alix: what a rally. u.s. stocks closing at their second hide. joe: the question is why did you miss? scarlet: they are winding down the global macro fund. joe: terrorism's threat to the market. how terrorism is hurting to arisen and what it could mean for the ruble. alix: and the rise of the robots. how will we find work? we begin with the markets. you said it perfectly. what a rally. six stocks higher for everyone that has fallen. that makes of the broadest rally since october 5. after those minutes came out it was off to the races.

banks and biotech shares taking the lead from energy as they wavered. andfter last thursday friday when i think there were a couple of down days, a lot of people would have guessed we would see more volatility. we have seen calmness. yesterday was flat. was climbingket higher, it just seems like it was a relief rally. everything is -- joe: there were no surprises. alix: what caught my eye was apple. it got an interesting up grade. they said the stop needs to be re-rated. it is going to be a service company and sell you stuff for your whole ecosystem. that is more dependable revenue. they made 11% of the return. it is significant when it comes to the overall market.

joe: huge day for the nasdaq. scarlet: something that caught my eye was oil prices. let's take a deep dive into the bloomberg terminal. when it went below 40 i thought it was over. i thought it would take stocks down. we bounced up above that. that --ot go above below that. numbers were dicey. the u.s. imported less. inventory should be drawn down more but they were not. demand in the u.s. was not that great. that was the takeaway from the numbers. oil was able to rally. nonetheless it went up with the stocks. joe: one of the famous is that stocks need oil to rise. oil is ugly, and can do too much.

i want to dive into the terminal and look at two-year yields which are sensitive to interest rates. this chart speaks to the extent that they are on the same page. , they didn't move at all. everything is in sync right now. i think the fed has to be good, the message they are sending is what the market is ready to hear. scarlet: in contrast to september. and the devise of the blackrock globalists and funds. it has been tough times for this part of the world. s&p 500 is the blue line up 40%. line tracks macro hedge funds globally.

some people say you can't s&p 500.acro to the 5% drop does not look like a great return any way you slice or die set. you can see all these charts and more on twitter. joe: we have -- alix: our guest is joining us, good to see you. david, let's start with the rally. is it one or did we learn anything more from the fed minutes? guest: i don't think we learned a lot new. they are holding their cards close to their chest but they have given us the green light in every speech we have seen from the most dovish members to the most hawkish. the employment report was a game changer and they have recognized it.

they recognize their mistake to draw this gloomy picture for the globe. joe: do you think janet yellen is feeling good? there was volatility and she had her critics. the fact that she didn't go for it. economic data has come in. she could say this is a much more comfortable time to land. guest: she is far more comfortable than august or september, or prior to the payroll report. it bell did the fed out. that is a great thing. the economy looks decent. that really put the icing on the cake. putting some wage data, that

played well. long dax want to go and long dollar. the dax is up 17%. at what point will that trade work its way out? up 12 or 13.x is >> 16 over one year. guest: so yes. it was about this time last year we pushed this move out of the u.s. and into you -- europe. one thing, the u.s. is done with qe. that is probably not going to work anymore. we know the qe is starting in europe. you solve the currency in europe

which has worked in the u.s.. know theyts, we complemented our previous no-hitter hats. positive on the u.s. alix: we want to go to salesforce.com. scarlet: earnings beating estimates. as for revenue, that is in line with what they had been looking for. that works out to a rate of 23% increase from the same time a year ago. salesforce has seen its growth early down quite a bit in 2015 in late 2014 to the high 20's and now this low 20%. to -- it isect up

raising guidance for the full year of revenue. the low end of the guidance is higher than the consensus estimated. $.74 forper-share of the full year of 2016. on those counts salesforce is topping estimates. alix: the guidance is 8-8 $.1 billion. you were getting more positive on the u.s.. guest: the main reason we stepped away after a long commitment for nearly five years was the miss commit -- miscommunication during transition from qe two the unwind of qe. we're going to reduce uncertainty and the fed has learned about communication. the market has learned lessons about how to read the fed. for me i am going to focus next year more on the u.s.

i still love the europe and japan trade. i am moving out of neutral and more positive. just on the concept that we will stronger rate rises, a dollar, and the lower rates than usual for a business cycle upswing will put multiples higher. joe: you've heard that it has been able brutal street for global macro funds. your own long dollar trades done have sat on that and fantastic. short oil. whatever it is. why can't they take advantage? hast: your hfr index suffered. some major ones have closed. macro trading is a hard game. it looks easy in retrospect but the deal with macro funds is people trade with tight stop

losses. people start tapping you on the shoulder and saying you have to do something about that. the volatility we have had, it was up 26%, it went to negative on the year in the summer, and it is back to 15%. you are trying to trade that theme with a bunch of guys telling you if you draw down by 4% you need to start pulling away. the way the macro fund world has aructured itself is for different volatility than we have. scarlet: a different kind may be. they have to trade into them and out of them. it is a lot of things that have gotten us into trouble. why are they not focusing on two

years out, three years out. dort-termism makes people stupid things. alix: this shows the volatility across all asset classes, whether it is stocks, how do you see volatility playing out? we go through these , everybodyeuphoria gets resigned to low volatility, then the standard deviation event takes everybody out and it is a lot of heard mentality. is going to market evolve is you're going to see macros comeonal back to the market. guys willing to take bigger swings, 5-6% months will not be considered a bad thing in the context of trying to make that

return. that is going to be a slow thing to get people comfortable with. fund over the risk-free rate, it is hard work because of the way the macro their evils evolve. alix: coming up, will the ecb extend its program? ♪

alix: coming up, senator lindsey respect.th all due

we want to get mark crumpton with news. market: a deadly rate in a paris suburb has left two people dead. authorities are trying to determine the identity of two others taken into custody. eight suspects were taken alive following hours of violence. the paris prosecutor's office says 5000 rounds of ammunition were fired during the assault and there are conflicting reports about whether the raid killed the ringleader. the paris prosecutor says he cannot say for sure whether he is among the dead. the islamic state has killed in a region and chinese hostage after demanding ransom for their release. their deaths were announced in

the latest issue of their english language magazine. are the deadliest extremist group. that's attributed increased by 317% last year to 6644. compared to the 6073 blamed on the islamic state. both groups are responsible for half of terror deaths around the world. most americans want the united states to stop admitting syrian refugees as the result of our exclusive bloomberg news poll. said theose surveyed u.s. should stop plans that would allow 10,000 syrian refugees to resettle here. the nation is divided about sending troops to iraq and syria to fight.

russiana u.s. and coalition to fight islamic terrorism. more on these and other breaking stories at the bloomberg.com. alix: we're back with david at jefferies. economicof the big trends is that eurozone exports are looking good, rising over the last several years. your messing up the rest of the world? elsehey stealing everyone exports? they have these exports leaving everyone starving? guest: i don't think that is a fair characterization. we have to look at the big picture of what qe has done in developed markets. we weakened the dollar a lot. int was their qe starting

2013. europeans are weakening their euro a lot. those are competitive devaluations. that has hurt economies that do not have the ability to weaken their currency as easily without creating problems. i don't think they are eating japan's lunch. .hey are eating ian's lunch >> what will spur domestic demand in europe? it looks pretty good but we know it is because of exports. does qe address the domestic demand? >> it has been a mixed bag. whether you look at the u.s., u.k. or europe, it is not as though it has been a huge windfall for this to mastic demand.

it seems to have put a floor in it but it hasn't been a kind of gang busters story. a lot of that is because of the way qe operates. in the u.s. those that have access to credit got the most benefit. those that did not have wealth did not get much. the second be set in japan. they are loving dollar yen. they don't like the dollar yen. you have this big guy happy small guy not happy thing going on. small guy is the driver of consumption.

i think of that story line is consistent across all qe. i don't think you will get a great consumption hit story. what you're going to get is the same thing in the nikkei and smp. where you on japan? do you think there is room for the nikkei to run? guest: i do. they have a fiscal package coming that will address those transfer problems. it will get some help to small businesses may be at the expense of the larger businesses. at i think that is aerequisite for all they -- be. i'm still excited about the japan trade. i think they will going. the loser in all of this is emerging markets.

everyone wants to say it is the bottom. we have been steadfast in this for years. we believe what developed markets are doing is going to feedback negatively on a continuous basis. alix: good stuff. thank you very great to have you we have breaking news. shares soaring in after-hours trading after the company reported fourth-quarter adjusted earnings and raised dividends by 13%. shares up by as much as 19% right now in after-hours trading. ♪

scarlet: the u.s. has waged war on terror for 14 years. france has entered its own battle. the death toll has doubled and will likely have ripple effects around the world. our next guest says the islamic state can be viewed as the most disruptive startup ever devised. welcome back to what did you miss? explain about your comment about islamic state being a startup. guest: the islamic state evolve from al qaeda. decree to this caliphate concept.

the spread is unbelievable compared to al qaeda. longer-termre the implications? the attacks obviously didn't just happen in paris. russia will not let planes fly to egypt. what are the economic impacts? guest: they try to get a semantic terror. they get big responses. they tried to drag down the economy is. and egyptk at africa those are the companies that are worried. the egyptian pound is pricing 33% devaluation between now and next year. the tourismg at industry and it is completely wiped out. half a million muslim recruits for isis.

rom killedko haram more than any and they are still there. these are countries we should be worried about in terms of places which the fall into the type of instability that isis has. alix: how do you disrupt the disruptor? what lessons can we apply to the business world? guest: i don't think we can just continue dropping bombs on them. we spent $2 trillion. we have killed may a million people. to combat them on messaging and create new reliable sources of information, use tools in a better way than they do to re-defeat the ideology. qau can drop a bomb on raq

and it will still be around. joe: is it all action that you think will make the problem worse? guest: the knee-jerk response is to drop more promise. there have been thousands of airstrikes. what do they have left a bomb? if i look across the counter extremism world there is intelligent programs coming to the foreground to address ideology. when you see isis say this is a first storm in the coming winter there will be more. we will have to stand up against them. you are sticking with us. coming up next week discuss how oil and the russian ruble will be affected by the recent terrorism. be right back.

i just had a horrible nightmare. my company's entire network went down, and i was home in bed, unaware. but that would never happen. comcast business monitors my company's network 24 hours a day and calls and e-mails me if something, like this scary storm, takes it offline. so i can rest easy. what. you don't have a desk bed? don't be left in the dark. get proactive alerts 24/7. comcast business. built for business. tand that's what we're doings to chat xfinity.rself, we are challenging ourselves to improve every aspect of your experience. and this includes our commitment to being on time. every time. that's why if we're ever late for an appointment,

we'll credit your account $20. it's our promise to you. we're doing everything we can to give you the best experience possible. because we should fit into your life. not the other way around. scarlet: what did you miss? let's get to mark crumpton with more news. mark: prosecutors say an early morning raid in a suburb of the french capital was so violent they are not sure how many militants died. police fired 5000 rounds of ammunition, two people were killed. officials can say -- cannot say for certain whether the ringleader was among them. france while mullins says the terrorists captured were planning another attack. the arrests are the latest in a police dragnet that has seen

nightly raids by security forces . inserted language into the october statement to stress it may well he come a appropriate to raise the benchmark lending rate in december. agreed that largely the pace of increases would be gradual. majority of fed officials have signaled they expect to raise interest rates this year for the first time since 2006. that message was underscored one policymakers inserted a reference to the next meeting on december 15 and december 16. back ons iran has nuclear programs. the move is in line with the deal reached between iran and six world powers. implementation day for the nuclear deal was october 18. a new poll shows donald trump widening his lead in new hampshire.

the survey shows tropical leading the field of republican hopefuls with 22%. ben carson and marco rubio our next. carson had pulled within three percentage points of trump in new hampshire. the felony case against rick perry has now moved to the hands of the court's highest -- the highest court. he did not attend a pivotal hearing today at the texas court of criminal appeals. a ruling could determine if he stands trial on charges of abusing his powers as governor. more on these and other breaking stories 24 hours a day. from the bloomberg first ward desk, i'm mark crumpton. let's get a quick recap on how markets close. a big rally you can see.

almost 250 points across the new york stock exchange. that makes it the broadest advance since october 5 that.ing joe: it's been a remarkable week after those ugly few days. really remarkable. alix: this is the best day the markets have had in four weeks. havef the main sectors health care financials and materials led the rally. 17, creating 17 right there. take a trip inside my bloomberg terminal. it is déjà vu for the u.s. stock market. the s&p 500 looks like the correction. what happened is the short-term

trendline, the green line fell below the trendline in a death cross. it broke above the 200 day moving average for a golden cross six months later. then it was off to the races. take a look. let's zoom in. we had a death cross in late august. that is the pink line. if history repeats itself there may be a golden cross early next year. joe: love the symmetry. history rhyming. scarlet: that is what the technicians are looking at now. alix: we are back with a mod -- amad. oil. have to turn to you were mentioning the significance of egypt and nigeria. production has finally been getting on track.

how is the risk that we face right now priced into the oil market? >> geopolitical [inaudible] deliveryok at oil or two or three years out, it doesn't reflect that at all. it doesn't reflect lower investments, or stable demand. alix: we do have the chart. i want to walk through it. three yearsine is out. that is 5% below. you see that red line. that is where it was in 2009. you are saying we did not have a crisis like that. "spectre." they all think it egypt will get the money from the gulf.

then who knows what will happen. oil production comes down but then a risk of flareup becomes huge. nowiously high prices, lower ones could cause problems. joe: russia, there is a view that there is a thaw in relations between pugin and the west because they have a common enemy. we have seen outperformance in the ruble against oil. we have seen the prussian etf. do you buy this theory that this could bring russia and the west closer together and be good for russian financial assets? ultimately you need boots on the ground. you're going to have russian and iranian boots on the ground to do this. as though sanctions, off russia starts to benefit to

reinvigorate its economy. they have turned positive for the first time. the base fundamentals are looking rosy. scarlet: the chart that also came up was showing the ruble has decoupled. they tracked each other. brent moves slower and the ruble finds support. do you expect that to continue? guest: you are getting positive things emerging the other way. this is why russia is the best oil play if you believe prices will go up. it is so coupled now and it will re-couple of shortly. alix: something that is percolating is, opec spare capacity, their oil piggy bank, where is that right now? what is the potential risk for

that to shrink even more as this continues? >> it is down near one million barrels. there is no capacity in the market. one geopolitical shock and it could cascade. scarlet: what is going to be the biggest risk in 2016? risk. iraq is the biggest if you look at the political infighting it is huge. evening kurdistan. it is being underappreciated by the markets. what do you think the reaction will be for the west or something that is the biggest risk? >> it is the case of oil. we are having a final blowout on the downside. next are you have to read his side can investment be re-sustained?

david, your previous guest that there is more downside to come. we will see a bottoming process. alix: thank you so much. good to get your perspective. scarlet: we have some breaking news. delta airlines is looking to an in aero stake mexico. acquired an option to an additional 8.1%. the pension trust will require 4.6% of the airline. delta will look to buy an additional 32% stake. we have more coming up. what will jobs look like 20 years from today? ♪

alix: coming up, linkedin chairman and founder reid hoffman will be joining bloomberg west. you don't want to miss that conversation. what did you miss? it is time for the business flash. salesorce.com forecasting that topped estimates as new services bolster products for growth. salesforce says sales rose in

line with estimates. of green mountain beating estimates, raising dividend by 13%. the company raising its full-year adjusted earnings forecast. >> according to private documents obtained by bloomberg $27 million.st it is the number two right healing service after it were. >> that is your bloomberg business flash. alix: our robots the biggest risk to the job market? the u.s. and u.k. are seeing stronger job markets.

will these gains be lost? the bank of england did the math. in the u.s. the figure would be 80 million jobs. guest,: joining us, our the robots.se of congratulations. what you make of those projections? what i take away is that this is going to be significant. i think this is going to be a big impact over the next 10-20 years. alix: one of the first things people here, people have always said technology was going to take away jobs. why is it going to be different with robots or ai? guest: machines and out rhythms

are now taking on cognitive tasks and beginning in a minute -- limited way to think. it is so ubiquitous, it is not a specific industry. this is everywhere. scarlet: can robots help create jobs? bankamerica had a report that said electrical electronics added one and a half million as of 2011. is that the upside to it? >> there is definitely an upside. the problem is that as you look at these trends, it is hard to imagine more jobs will be created then lost. especially for people doing more routine things, this is going to have a huge impact. lastsomething else in the

lecture, i can believe that a thinking machine might over time out beat me but is less likely it will be giving this lecture to students a decade from now. what does this say about the that theyots can do, might be good at forecasting the economy but telling students at a university, they do not -- it is not going to be than getting good at that. when it comes to creativity, creating a story, writing a story, those are in the far future but the reality is not too many jobs are really focused largely on creativity. relatively simple things. scarlet: can you do a cause-and-effect with the robots in the u.s. with the number of jobs or the unemployment rate?

guest: right now you can't draw a parallel. we are not seeing that impact now. there are other trends you can look like -- look at. the fact that the economy is getting less effective at generating jobs, every decade oneproduce less than the before. we are not at the point of true unemployment. alix: what jobs are you most focused on? >> across the board. the key inside, is it a job that is routine and addictive ball. something?lers or not a nurse or a nanny. guest: jobs working in homes, they require an extraordinary amount of dexterity.

joe: what is the piece of advice you want someone to robot prove their career? tost: you want to learn how learn. everyone, even people that don't buy into this would agree things are going to move faster. alix: much more coming up. how should we address robots replacing human labor? ♪

alix: we're back with martin ford, author of rise of the robots. we asked the house of lords member how to address this negative impact of robots replacing labor. guest: it is an income not tied to the job market, it seems to be the logical way forward. alix: it is similar to a solution you posed in the book. a basic income could effectively become a brute force algorithm. why is this the solution? scarlet: we are going to -- guest: we're going to need a solution. things are not going to work the way they worked in the past. we are entering a new era. the economy is going to be less labor-intensive. or a is not enough work

network that pays well enough for most people we have to come up with a different solution, not just so people can survive but so they can be active consumers driving the demand required for the economy. joe: in your work have you done ballpark estimates of what kind of check he will get from the government every month for being alive that would make the economy work? guest: one of the keys, it will start out minimum link -- minimally. hopefully if you do this relatively seeing you could phase it in gradually and increase the amount overtime so eventually it would be a livable income. joe: something that toby -- he wrote a blog post saying the folks who own the robots will own the means of production. labor power will be kaput.

there would be a big demand problem. it does seem like in this scenario where robots take so many jobs, in theory that is great for the owners of the robots but if there is no demand coming it wouldn't -- guest: that is one of the key things i focus on. you do not have consumers out -- it is not it is create consumer demand. right now the mechanism that gets purchasing power into the hands of consumers is jobs. if they go way we need to create a a mechanism. silicon valley is leading the way when it comes to the development and production in the technology of robots. have they come up with any solution to keep the robots from taking jobs? i don't think there is a

way to prevent robots from taking our jobs. we can retrain people but there is no way to stop this technology and we wouldn't want to. technology has made us better off than previous generations. the last thing we want to do is change that. people to adapt to it so -- so technology can progress and everyone benefits at least to some extent. joe: there is a movement afoot to raise the minimum wage for everyone. a $15 minimum wage. opponents will say you are just going to speed up the pace of automation and the fast food places will hire robots. is that debate kind of silly? it's going to happen no matter what. guest: right. i would agree on that. there is some scaremongering out there of people against the minimum wage. they will say all these places

are going to automate. i think it is inevitable. personally i support raising the minimum wage because in the short-term it will make people better off. the longer run automation is going to be a problem anyway. we will need to come up with a solution. berlet: there has to something positive about the rise of robots. guest: if we adapt appropriately and end up with a guaranteed optimistic it is an almost utopian scenario where no one has to do a job they hate. no one has to a dangerous job. people have more time for their families. everyone is better off. that is optimistic. can we get to that? alix: i'm sold. thank you for joining us. scarlet: author of the rise of be rights, we will back with what you need to know for tomorrow. ♪

scarlet: in the last few minutes we got breaking news treasury will issue guidance on anti-tax inversion. that will come out sometime this week. itsbank of japan will hold meeting and make an announcement , speaking at 1:30 a.m. eastern time. alix: a possible qe and in december. joe: watch tomorrow, tentative signs the manufacturing industry is starting to come back.

maybe we will see signs of that tomorrow. pay attention to that. alix: thank you for watching. scarlet: see back here tomorrow. joe: have a great evening. ♪

mark: i'm mark halperin. john: and i'm john heilemann. "with all due respect" to lindsey graham, whose polling numbers are -- well, let's just say there is nowhere to go but up. was i supposed to say something? ♪ john: stick around for more of that later in the show. but first we have a new bloomberg politics national poll, with findings about how americans feel about the only thing that's been in news from past six days, and that is isis