london as we wrap up the trades the client. in the next hour. you can talk to them, you could try to mitigate that negative interest rate by increased mark, you are watching this activity. selloff as well. that was the ceo speaking mark: it is a new month for china, the oil price continues to hold the market at a. with bloomberg. the european close starts right you know what is coming up next. now. mark: brendan greeley is putting on his gloves as we talk about the battle of the charts. which central bank has the largest balance sheet. betty: we are going to take you from new york to london to berlin in the next hour, and comparing cointreau major central banks. that is up next. mark, show us what is going on. ♪- comparing cointreau mark: january was the worth months since august -- worst month since august. it could have been worst. at one point the european benchmark was down by over 8% but as you know, mario draghi, janet yellen, and mr. kuroda came to the rescue.

we have started february as we started january, with concerns about china, manufacturing the official gauge fell to a three-year low. we have had six months of declines and oil, need i say? i want to show you some of the big movers today. check out nokia share bright. the big decline are in finland, down 11.4%. sinceing the most september 2012. disputefrom a samsung that fell short of analyst estimates. ,t is not the technology unit it generated 20% of the company's operating profit. betty, really quickly i want to

show you the big recliner today. look at luxottica, down 5.8%. you know the company, it makes ray-ban sunglasses. i'm going to ask you a second if you have ever won a pair of ray-ban's. betty: oh yeah. resigned,chairman becoming the third luxottica chief executive to leave in 15 months. many might say that is very unlucky. down by 5.8%. they: i have to keep up cool factor and compete with you so i have one them. , is thatit revoked high pronounce it? i am a revo guy. betty: you are just so fashion forward. we have a lot of manufacturing data across the world and not betty: welcome back to bloomberg great data in china. markets, live from london and ours was less than spectacular. new york trade this is the how about the u.k.? european close. it is time enough for our global battle of the charts.

mark: it was good. we take a look at some of the most telling charts of the day, and what they mean for you manufacturing unexpectedly rose investors. kicking things off is brendan to a three-year high in january. greeley. what it suggests is british i'm here to talk about factories had an ok start to the downward nominal wage rigidity. year amidst this global trade forget what i just said, because that is a very fancy economics economic concern that has been dominating financial markets in way of saying nobody likes a pay the last month. cut. it is very difficult to make many factoring contributed absolutely nothing to the wages go down in any circumstance, much easier to fourth-quarter growth rate of negotiate them up. labor markets do not clear. drivenich was entirely by the fy the services industry. classical economics assumes that at least manufacturing seem to in the event of a recession, if have gone off on an ok footing only you will a recession go long enough, it will take at the beginning of 2016. adjustments to their wages, there will be no unemployment. let's see if it last. betty: mark, i am watching one this is not how it works. the lastxtra data from chart in particular, courtesy pointed out by our millennial age producer, talking about how year. this is 2001, this is 2009. they apparently like to spend money less on goods and more on notice that you have some pay increases during the recession, enjoyment.

as you can see, this s&p index but no pain decreases. which measures leisure versus just a short cliff. retail at the highest level labor markets do not clear because nobody likes a pay leisure outperforming retail cut. since 2011. essentially, millennials for the if a problem with economics that we have to get used to. big consumers driving more plane tickets -- it turns out that people like to take care of each other. and restaurants and dining and downward nominal wage not so much on things like sweaters and coats. we are 90 minutes into the trading session in the u.s., i rigidity. brendan: i'm going to name that want to head to the markets desk where ramy inocencio has the my garageband. latest. [applause] ' shareumber liquidators [laughter] mark: this is the balance sheet price is hitting session highs around 11%, after news out that of the big for going back to they reached a plea deal with regards to a criminal court case 2011. what is blowing me over today is the boj. the balance sheet is 23% from last year. right now, we are crossing the of gdp. headlines, they will pay $10 is 23%.n line million for timber sores crimes that they played guilty for.

they will also get five years is fed from the orange line, probation. in october 2015, 24.5%. lumber liquidators pled guilty $4.5 trillion. to violations of the lacey act, that is the size of japan's economy. the first time a major bank of japan corporation was found guilty of a felony. let's take a look at the markets right now, they are down, not as began his bond buying far down as earlier. the s&p 500 down about a half program, the boj's balance sheet percent, the dow also. was roughly 35% of gdp, below points,in more than 100 half of where it is now. now we know he has joined the 160 points off. negative interest rate club to the nasdaq is down about a spur inflation, which of course remains elusive, despite his third. let's look at the intraday. we can see how we have paired venture into quite those losses. unconventional central banking. up, climbingck they delayed the timing of inflation target to back up slowly, down by about 75 point. the six months starting in april i want to show you the of 2017. that is the third postponement seasonality function with the s&p. in less than a year.

basically this is the we had inflation in the u.k., performance month-to-month on and the u.s. also remaining elusive. what has been happening with the s&p. but the big question is, when with regards to what has our central banks going to start shrinking their balance sheets? happened in january, we fell 5% in january. we are on track to be in the and you know the boj and the ecb red. are nowhere near that. look at all this green. over the past six years, interestingly, in the fed, alan february has been in positive territory. seem to view the only before that in the financial crisis do we have vast holdings of debt as a vast back-to-back losses in 2008 in tool rather than the residual 2009. potentially we could see a rise from the crisis. if past is precedent. ony say they are not bulging let's look at crude, we did see the price at session lows and we their balance sheet until they start to raise interest rates. it is a brilliant chart. downward nominal wage rigidity. still are at session lows, down 4.7%. we are breaking a four-day winning streak we saw last week. see you later. [laughter] betty: energy stocks as you are the fed goes,r as pointing out, oil prices are they have been ok cap the rest of the central banks on when they are going to shrink that meeting some of the losses. balance sheet, particularly ramy: especially on the dow. recently.

exxon is leading the dow lower both solicited an implicit have said we are talking about it on a 20 point loss or so. right now, we will get there. we have a lot to think about before we get there. i love this charge. it is a general rule to never the energy sector being the biggest loser on the dow, down 2%. have more than for life will betty: ramy inocencio at the markets desk. unless one line takes off -- let's check in with courtney donohoe from our news desk. more than four lines on one chart, unless one line takes off than 2000 pages . of information about the deadly amtrak crash last may be and you can really see the story released today but still might there. explain -- might not explain why if you just to public debt as a percentage of gdp, it would look like the same chart. quick question, windows they train was going more than double the speed limit. the fed really start to think the engineer says he does not about reducing its balance recall what happened. sheet? ar.e me a clear ye voting finally takes place tonight in the race for the brendan: not until 2018. white house. newns will start using the president when they turn out at 1700 caucus sites. they have already said they will start to think about the next rate hike. ss, was the word they said. democrats are leaning toward when they shrink the balance hillary clinton and republicans toward donald trump. been reminded iowa it has sheet is an assessment they are going to take after they assess the next rate hike.

we are two assessments away. betty: i'm feeling the love, and a wild since they have had a respect for everybody's chart winner. >> you have not had a winner in iowa in in years. review both win. [applause] brendan: everybody is a parties you were going to have a winner this time. nation metal -- a participation we are going to change that. medal. betty: for more on the fed and 16, that is a lot of years. bloomberg will preview central banks, stanley fischer the caucuses live from des from the council on foreign moines in a special edition of "with all due respect" starting relations will be sitting down at 5:00. and monetary policy. the justice department will investigate the san francisco police after the shooting death of a young black man. lamborghini and the shooting led to protests last month. ferrari are ready for the demonstrators want the police chief to be fired. ultimate test of endurance. the world health organization is the fast lane, after the break. ♪ holding a crisis meeting to decide if the zika virus should [laughter] be declared a global health emergency. who last declared an emergency over the 2014 ebola vax -- outbreak. they estimate americans could

see over 4000 get cases in the next year. will allow a permanent space for non-orthodox prayer at the western wall. men and women will be able to pray together without a partition. american jews and liberal jewish denominations have often -- have long been unhappy with orthodox control of the site. news 24 hours a day powered by our 2400 journalists at 150 sites around the world. doty: a program reminder, not miss a conversation with fed chairman stanley fischer. tom keene will be sitting down with him to discuss the economy, said, monetary policy, and a whole lot more at 1:00 p.m. in new york and 6:00 p.m. in london. ♪

betty: in today's pursuit, the

true test of man and machine, the first real american supercar that can hold his own against anything across the pond. they made their official racing debut at the rolex 24 at daytona. one of the biggest endurance races in the world. we are back in new york with all of the high-speed twists and turns. describe this. this is the u.s. version of le mans. it is a 24 hour endurance race. there are teams that have three drivers that race the car for 24 hours straight around the track. betty: it is a test of endurance. tell us about the sports gt. racing debut. this is a car that we saw in detroit that will be sold as a street car as well. you can buy it for about $400,000. the famous gt that the ferrari at the famous le mans race.

mark: welcome back to bloomberg i hope to capitalize on that heritage and do well in modern-day racing. betty: one of the unique markets live from london and new york, this is "the european characteristics versus lamborghini or for our -- or close." i am mark barton. ferrari? engine, it isford betty: i am betty liu. out of china, the government's all-american, handcrafted. betty: there you are. official measure of activity looking hot on the track. >> i did a hot lap with the dropped to a six-month low. grand marshal of the race, who the shanghai composite slumped along with it, but the impact is the most winning racecar was not just felt in china. mark: oil recent rally coming to driver ever. he has one the le mans nine times. comparing the gt to the a halt. opec pumping a record amount of crude last month. other cars? >> this is ford's new halo car. stephen isaacs as chairman of helpingst in committee, this is the car that they are going to be teaching their brand manage 10 billion euros. image on for the next few years. betty: you can buy this for a dominated january. when are wee aside, pricey some. what does this mean for the cars going forward? >> they didn't win the race. going to shake off our china oil fixation?

they finished in the middle of who is more likely to rebound, china or oil? the pack. stephen: they go together but they finished seventh and ninth in their category in the race. most concerning late is the politics. that was ok. if you cast your line back to the bookseller arrested in hong they had some gearbox problems, stalling along the race. kong and do more delving, you there is a 24 hour sebring race hear the issue of arbitrary coming up in june, and in the arrest even in hong kong is labonte later this year. .retty much widespread -- and in the le mans race later this year. we can move forward from here. for car fanportant i think the concern is how are the political elite, how is the new president -- he has only been in for two years, how will manufacturers. car manufacturers to have cars like this? he handle this new situation? you had a 30 year bull market in >> it is very important for two china interrupted and now you reasons. have some very serious problems. number one is the one you , it creates a dream my concern is the policies not be able to cope. mark: politics is your big threat. i'm talking global here. scenario, it gets everyone emotions involved. geopolitics, which you wrote in that is one thing. december, what has happened if a racing team does well, it since? is great for the brand. look at harare, ferrari has done

fantastic in formula one and geopolitics has the greatest mercedes. potential to disrupt markets. what is the top of the geopolitics concern? number two, the technology used stephen: that is a really big in racing actually trickles down to production cars later on. one. we are looking at the future, we have seen already the basically. some of the technology that we nationalistic politicians have see in this gt will make their one in democracies in hungary way down to production cars later on. betty: thank you. and poland, as an example, and you can read more about luxury supercars on bloomberg.com. have shown themselves to be quite aggressive. there has been more than a change, more than a slightly nuanced change from what we are mark? used to. mark: today on bloomberg one can say the same thing about television, a complete in-depth donald trump. he is not a minor change, he is an earthquake. review of the caucuses, live i really want to hear betty's from des moines, iowa. it is a special two-hour edition of with all due respect take. i have -- had american guests beginning this afternoon at 5:00 p.m. eastern time. last week and they think he is europe is fascinated with trunks going to win. these are the kind of risks that hold in the race for republican. make one think we may have passed the high water mark for liberal consensus politics, and in america glued to the results? is so international fascinatig therefore open market, free

borders, all of which would be positive for business and markets over generations. betty: stephen, i am so glad internationally. there is a sense that the he's -- i'm so glad you americans are playing a joke on mentioned this. the world, and they realize that trump is a serious contender for the white house. he has been like a hurricane coming through politics, but we will see what happens in the also a lot of people in business iowa caucus. that is it for the european puzzled how they would deal with a donald trump presidency. close. ♪ i am curious if you have gained out whether donald trump in the white house could actually be good for the market. stephen: i do not think so. if you look particularly at financial services, one of the first things he has promised is to tax carried interest as income. it is really protectionism. the waving of the sword, we do not quite know will he when he gets into the white house find it much more complicated? we will not know for quite some time, but that is one of his big issues.

we are going to stop immigration, we are going to be much tougher on china, other supposedly exporters who are dumping goods. he said to apple, you have to make your devices in the u.s., rip out your supply chain. i hardly see that is positive for markets. he is not a consensus george bush, ronald reagan republican under any circumstance. betty: i think what you said right at the beginning is key, what his he going to be like if he got into office and he has to deal not just with himself but with congress and with the supreme court. we could see a different side, a much tempered side. it seems like a lot of investors are very cautious, particularly given what has gone on in china, the uncertainty around the fed. we have a chart that shows investors are piling up on companies that have a lot of

earnings, essentially a sturdiness with their earnings. earnings are resilient to global headwinds. does that tell you, is that a bearish signal that people are cautious and want to go into more solid companies with good earning momentum, maybe not the high-growth stocks? stephen: defensive strategies are certainly what we have been what you areand mentioning, that will secure the market. i happen to believe we are in a proper bear market. it is a national phenom -- a natural phenomenon, and we should not always be surprised. historically, there markets in the u.s., if you look at the average, have been around 37%. on that basis, we have a long way to go. mark: your calls are looking fairly pressing it that you made in december -- precedent that

you made in december. interest you call 115. 2%.ear u.s. treasury, the market saying later to. #-dollar 150. dollar: the call on the >> it is noon in new york, 5:00 is that the u.s. economy will weaken off quite a lot, and investors are positioned very lightly on the euro so there p.m. in london, and 1:00 a.m. and hong kong. >> welcome to bloomberg markets. would be a tendency to rebalance that trade. toy the s&p, i would like ♪ step back and look at some of the information that came out last week. we had earnings of two great american companies, two companies that lead their industries. >> from bloomberg world there is no question their balance sheets are completely robust. headquarters in new york, good monday afternoon. >> here's what we're watching at they will sell a lot of products and make a lot of money, but in this hour. both of those cases, the earnings were very disappointing. investors want

apple, there was a big? lincoln, as factory business. whether they can continue their its lowest since 2012. speculation swirling that magic and secondly, boeing, whether the cycle has turned down. twitter has a takeover target. marc andreessen has considered a deal to buy the company. >> federal reserve vice chairman they simply cannot sell as many stanley fischer will it is his planes going forward. i think those are two very interesting symbols, and i would take on the economy and the likelihood of a fed raising rates four times this year. draw investors to look at those companies. mark: central-bank coming to the rescue? stephen: they camp, but they first, we go to the bloomberg markets desk where we have been tracking the men's in -- the have to ratchet things up. we saw a big shock on friday. movements i. a move to negative interest rates. the ecb is talking about further easing but what i'm concerned about is the politics in europe. it is simply the politics. will the germans continue to acquiesce? there was an interesting article in the financial times last week where they are positive, what

could a deal look like on the refugee crisis between germany and greece? he put the money on the table and said, if there is a debt write-off perhaps greece will take control and. any more refugees going forward into northern europe. it is an interesting viewpoint and i'm afraid i do share his point, that the politics do affect the monetary side. mark: will the eu acquiesce to david cameron? try and hammer some kind of compromise out? stephen: i think they will have to. the question is, will it be enough for the british voter and will they see through the migration crisis and run scared. that is a substantial risk. say? the fedfed said absolutely nothing and more or less repeated the december statement. some people felt, we need the fed put. the fed will allude to or make

some nuanced, that the game has changed in the sense that the economy has slowed down. they did not do that, and that makes me concerned. has the fed backed themselves into a corner? they raise rates and have to justify that now and say, we are right, the economy is strong enough, and maybe they got that wrong. mark: stephen isaacs, chairman of the investment -- more after the break. ♪

betty: live from bloomberg world headquarters in midtown manhattan and london, it is the first day of february. you are watching the european close. i am betty liu. mark: i am mark barton. favorite cameron has stepped up his campaign to win concessions from the video.

he met yesterday with the eu president and tusk says there is have agreed they to postpone by 24 hours the template for a compromise land. hans nichols has been following this story and joins us from berlin. where does this thing stand? hans: the british are saying one thing. they are saying they made a today,reakthrough and there is no confirmation from brussels. there is the official press briefing from brussels and no one seemed to be bolstering britain's claim that they made progress. talks continue in brussels, not london. it continued at a lower level in brussels. what mr. cameron one is a 24 hour reprieve.

yesterday evening we kind of got the sense not everything might be going in the same direction, in part because mr. task took to twitter and poured cold water on the fact that a deal was imminent. he said "no deal yet, intensive work in the next 24 hours overal." that is almost and they want to have a deal by the february 18 to 19th summit in brussels. that, if you have a brussels meeting and get some sort of agreement, you can have the referendum june 23 in the u.k.. that is when i come to london, so i'm trading you brussels for london. we both get good assignments and we mix things up. that is if they actually have a deal. betty: i feel left out of this quickly, whatly

if they fail to strike a deal, what happens then? hans: mr. cameron can always delay this. he said he is going to call a referendum, it is just a question of when they do it at the eu -- eu level. .ark: hans, good to see you i will see you in brussels. onty: i am buying my ticket the euro star also. mark: betty, get over here. betty: europe's biggest bank is getting serious about cost-cutting. does that mean it will take drastic steps on moving its headquarters out of london? ♪

>> welcome back to bloomberg market. ts. let's get a check in on our first word news. >> good morning.

after reading target i more than 150 million dollars worth of political advertising, iowans will have their say tonight. voters there will show up at sites to pushucus for nominees. hillary clinton is leaving the democrats, but i bernie sanders is not far behind, still pushing this populist message. we will create an economy that works for all of us, not just the 1%. [applause] >> bloomberg will preview the caucasus, live from des moines, iowa, on a special edition of all due respect. the five year-long civil has now begun talks

after a bombing. castro's first trip in 20 years, a critical step in rebuilding the islands ties with the west. air southwest france rescuers are telling a ship that had threatened to run aground. highways made the rescue attempt impossible. effectuated -- evacuated last tuesday. is 4:30 p.m. in london, so the session has closed. how does it look?

mark: same old china. manufacturing fell to a three-year loan. six months of decline. that is a record losing run. the ftse fell, the stoxx 600 fell. down by about a quarter of 1% today. as you know, it is not just about china, it is about the falling oil price. after a four-day gain, crude oil declined after the best winning run for over a month. it was not just about declining stocks today, check out ireland today. it doubled its third-quarter earnings, passenger numbers surged. profits should come at the higher end of the forecast. this is the cherry on the cake, it will return 800 million euros to investors via a share buyback program. when that is complete, it will

have returned more than 4 billion euros to investors over the last eight years. gainers in europe today up by 6%. betty: we had today's euro area facts that matched estimates, but there was one estimate that would have worried mario draghi? slashed prices by the most in a year in january, highlighting the regions deflationary risk. countries and market economic survey reported a decline. that is the first time that has happened in 11 months. crisis,aghi has falling a slowdown in business activity, food for thought as i said, as he addresses the european parliament. that marchtored meeting of the ecb, deflation and the euro.

the big one is march the 10th. prices is the last thing he needs as we approach that crucial meeting. rise. he wants them to he is doing every thing he can to get that going. thank you. we arere in the u.s. watching how stocks are trading. we are coming off of our lows of the session, particularly on the nasdaq. it is now down about 3/10 of 1%. we have more live from the nasdaq. you're watching netflix? >> a little bit of a recovery. one of the top performers is netflix, on speculation that apple could buy leads to get into tv content. you have to wonder whether this is a one-day wonder rally, seeing as they were in a brutal downtrend as last year's literal top nasdaq stock is often a rough start here in the new

year. another stock that is having a rough year, one oftocks are after the biggest balls out there caught his price target -- bulls out there caught his price target. seems a bit more realistic, which is causing some investors to take a 30% short position, and alter their views. betty: thank you. following credits we said deutsche bank, europe's largest financial firm is making some big adjustments to cut down those costs. hsbc says it will impose a global hiring at patriots. what is the magic number they are trying to reach? mark: $5 million.

seeking that much in savings by 2017. hsbc is to report earnings at the end of this month. stephen covers the banking industry for bloomberg and he joins us now. where are all of these specifics going to fall? >> it really is going to be a global cut, as well as a hiring phrase that has been imposed. they will be hiring people on a net basis in china where they are doing a big expansion, but we are going to see these job cuts, everywhere in the world from turkey, from the u.k., across europe. mark: and it is not just hsbc that is either cutting jobs or freezing salaries, it is a trend across some of the big players in europe. >> there are some numbers they have to get to by 2017, which is $5 billion, which is not a small amount of cost cuts have to get through. but just last september barclays of president harry freeze after

working out a net reduction of employees. after two years it was not sufficient. you have deutsche bank saying it is going to reduce pay. the fact that they have decided to freeze hiring is not really a surprising thing in terms of what is happening in european banks. betty: what about radical ideas, including moving their headquarters? >> that the decision is the 22nd of february, when they will be releasing that full-year results. en out for be givin hong kong, but there is no indication which way they are leaving yet. lost this review last april, but it will be the biggest thing to look out for in your give banks this month. we were speaking with mike mayo, a big banking analysts, earlier this morning on bloomberg . he had a couple of things to say about hsbc. hsbc, like all of the global

banks, they faced pressure from the three r's, rates, revenues, and regulation. they have not seen revenue growth of the past year or for new year's. you need a plan b. if you are hsbc, and you do not have a plan b, a restructuring plan, you're going to hit a wall. betty: it looks like they are foul lines setting -- they are outlining some of their plan land. how do shareholders feel? >> hsbc has been performing some some of the european banks this year. but that is only 9% compared to an average of about 15% u.k. banks. a flight to to be quality safety, one of the largest institutions that investors are showing. but it is undeniable that the negative side of it -- sentiment and emerging markets hit the banking sector this year. mark: thank you for joining us. betty: from one bank to another,

reporting margins are shrinking at the firm despite involving assets under management. bloombergt down with talking about the difference between dividend and capital at the bank. >> we believe that the markets will continue too consolidated. we will be making opportunities, so we are getting some reserve for that. at the same time, we are seeing that investors are continuing to like dividends. so the second time, we are increasing a dividend. we come out with a new target, the payout ratio guidance, which i think is something that the markets wanted to hear. that is taking into account the opportunities that may surface in the m&a space. >> let's talk about the opportunities you have already had on the table.

here domestically. give me a sense of what kind of deal you would like to do. what kind of institution are you looking at? look at the portfolio that was diversified, it perfect world. we look at different areas that , asia, middle east, europe, switzerland, ideally. of the large sizes that would move the needle for us. of $5 billion, or $10 billion, because we have a rounding error of something that will change the size of the firm. ideally something that has come through regularization has left other agencies behind. >> let's talk about the negative interest rate world. joined thee have

negative world. how destructive is that to the client? >> it is a new concept for clients to think that keeping money with their financial institution, they need to pay you for that. what we've seen over the last 12 swiss franc for the holders, and that you can engage