matt: from bloomberg world headquarters in midtown manhattan, we're covering stories from washington and london to berlin, tokyo, and sydney in this hour. oncks lower, the pound down concerns britain might face hard brexit after the prime minister theresa may pledged to start pulling the u.k. out of the european union next year. outsourced sports equipment deal, agreeing to a , a victory to the activist investor who has been pushing the company to put itself up for sale. more in today'feels report with jeff. has donald trump lost the race in the past seven days, starting with a widely criticized debate performance and ending with

reports he may have avoided paying federal taxes for 18 years. many are wondering if he could recover from his worst week in the campaign. halfway into the trading day. >> good to see you. we are talking about company -- basicallythe pushing the market to the downside as you can see what majors with the industries now. pre-much similarly for the s&p 500 as well as the nasdaq. over the past four quarters, we saw gains for the s&p in the dow and we are starting the work order of the year on a negative note. let's look at some of the best performers including tesla, netflix, tesla coming out talking about how third-quarter sales or cars came in a little better than expected.

it is still sticking with a by the end forecast of december. netflix is up here. outage overpower the weekend if you are watching netflix. this is a serious by marvel called luke age, a lot of binge watching caused the outage. resorts also rising up 3% because of september, let's go and flip up the board and see what is happening in terms of energy. energy is on the downside. it cut its full-year earnings out look because of rising costs and transocean as well, both down by as much as six and one third percent. both getting a downgrade. transocean, getting a lowered guidance from rbc and growing companies to a whole there.

the real estate sector is continuing the down team for today. the run-up to the s&p 500 real estate sector command line earlier in september, investors run of the stocks so they may see people pulling out and taking some profits. all right. a lot of equity news to kick off this monday. mark:mark: mark crumpton is in the newsroom. republicans are wondering if donald trump can recover from one of the worst weeks ever from a presidential candidate. a report he may have avoided paying federal taxes for 18 years and was a criticized for his initial debate performance and going after a miss america pageant contestant.

leads mr.clinton trump by six points in a new national survey. in aon edges trump 42-36% survey of likely voters. gary johnson, third with 9% and stein gets 2%, 10% of likely voters remain undecided. turkish officials say a state of emergency is declared after a this summerary coup will be extended another three months. us-based muslim clerics accused of masterminding the coup. allowedrnment has been a massive crackdown. to a japanese biologist. honored for his work on how cells recycle their content. is involved in

several conditions, including cancer and neurological disease. global news 24 hours a day than 26 hundred journalists and analysts in more than 120 countries. this is bloomberg. matt: thank you. time now for the market deals reportedly zero in on the m&a business with insight and analysis big players behind the deals. we are talking about two big deals announced. pro shop buying its retail competitor, $5.5 billion. editor ofs executive global m&a is standing by with a special guest who is no stranger to closing date deals. >> some of the big deals he , anded last year's merger

dealillion merger, and the -- with that come i handed over. >> thank you. we're lucky today to have mike. matt was mentioning the big deals you have done in the past. we have been lacking a bit in the big deals. definitely a down year, 30% off of 2015 in terms of dollar value. how do you view the year and what has you concerned and optimistic? to be here.leasure 2016 was an outstanding year for filled with aand lot of large m&a transactions. 2016 has been slower by still one but it is

of the busiest years for m&a in terms of transactions and probably the last 10 or 12 years. still an exciting year. what we are not seeing are the megadeals. there were three or four very large fan that -- transactions. seeing a fivell print m&a market in 2016. >> what worries you and what m&a? sidetrack >> i think m&a is all about confidence. one thing feeling m&a is it is a real alternative for growth. it is more difficult for companies to grow and they look m&a. confidence that m&a alternative, anything

that impacts ceo's is in board members and investors will on the -- undermine the m&a market. that,er the catalyst for that is what would concerns me. something that would undermine the confidence the market participants had in m&a. donaldd the election of trump and hillary clinton, could that throw off the m&a market? undermines that stability and confidence and creates confusion and uncertainty will lead to a slower m&a market. you can see already some uncertainty in another month or week or two to go before the election. uncertainty around any election has probably created more corruption and uncertainty than we have seen in the pass and could impact the m&a market for sure. view hillaryy

can't -- hillary clinton versus trump? .> certainty is critical there is a premium around anything that leads to certainty. the certain candidate is more predictable. i think the market perceives lessd trump as being tested. we do not have any experience with him in the political arena price market will likely some of that in. we will see that coming out of .he debate there were a number of articles this weekend about the reaction to the debate. marketplace is an uncertainty and they will like the have -- value a candidate -- classy your not the first person to say that. i have heard from others. a company becomes cheaper and that makes m&a more likely? me, uncertainty for a

particular company will make boehner bowl make m&a more important but it is really acquires buyers that drive and today and ceo and board members need toe stockholders predict what will happen when you do a transaction. uncertainty, they will back off even if it means suffering the cost when one or more targets may be vulnerable. >> right. what about the financing markets? it seems a the fed will indicate they will raise rates this year and they will go up next year. does that worries you -- does that worry you? >> other reasons, political pressurety, that puts on the ability of financing, we interestust focused on

rates but also the availability of financing. we have seen a number of new market entrants providing this. the alternative for the big banks, if there is pressure on the cost of financing, that will put pressure on the m&a. we have enjoyed a robust financing market even at the beginning of the year when m&a was down. a robust m&a market. my colleagues would tie you as we get closer to the election, equity markets will likely slow down. we have to see what happens and what action the fed takes and what reaction the market has us to get closer through the election. the that will impact the m&a volumes. what keeps you optimistic and makes you think we will stay in the low interest rate environment, the family environment for m&a?

when a company does a deal, often times the inquirer shields go up. their shares one up and that is relatively recent phenomenon. probably onou hit the most important thing for m&a. works from the perspective of the board and company and stockholders. even in the case of qualcomm, market will be sending the message to the company that it is ok even if it is large and even if it means the company will have to take on debt to pay for the purchase price. the back to confidence that market ceo's is really dizzy m&a a slowdownnative to of economic growth and the slowdown of the ability to grow companies organically. the market recognize that and looked as an alternative to not

to m&a. we continue to see the market --ards ceo reward bores boards, i think that will continue to fuel m&a. >> seems they are trying to get on the boards and be friendlier. our activists driving as many deals? >> i would say the activity of shareholders has increased dramatically. it makes for a better story and we tend to focus on traditional activist hedge funds. they drive the ball of investing. they view, they took on toition of actors investor do something a lot of investors, maybe not as publicly come are becoming much more active. activist hedge funds. i think the activity will continue on we debate throughout

the year with whether or not the returns will be sufficient. withdrawalgh profile and a question of whether or not the active- i think nature of investor, the change of the market, will continue to drive externa reaction and m&a. >> versus the longer-term view you are supposed to have? hardestnk it is the thing for investors to do. focusing on the long-term value -- when theyhere speak with constituents, they that.o talk about i think directors do a good job of it and it puts a lot of pressure on companies to maybe take some returns.

think it will continue to be attention in the boards. >> thank you. back to you, matt miller. matt: now, coming up, our aboutors to optimistic the outcome of grexit negotiation? there are unknown risks lurking. we will explore. this is bloomberg. ♪

matt: time for a look at some of

the biggest stories in the news right now. the booming u.s. auto sales maybe isn't over yet. general motors and fiat chrysler posted sales that beat expectations. meanwhile, ford in line with estimates. those sales fell 8.1%. the probe's cover about 643,000 vehicles and involves door latches that can open while vehicles are moving. a sudden loss of power steering. and 2013 and 2010 ford fusion. 2.4 million vehicles for similar problems. retailers are dangling perks like higher pay too little or workers in a tighter labor market.

according to a job website, they are more determined to lock in early and would be willing to hire temporary workers with critical background than they would have two years ago. business flash update. still ahead, it was a terrible, no good horrible very bad week for donald trump on the campaign trail. can the candidate turn it around? insight.ave this is bloomberg. ♪

matt: the worst week of donald trump's presidential campaign began with a widely criticized

debate performance and end with a bombshell report that he could have avoided federal income taxes for 18 years. could the presidential candidate be running out of time? bloombergned from politics. steve, thank you for the time. that was the worst thing that happened to donald trump all week? was it the weak performance in the debate, the tax performance in the new york times? >> combined, it is all bad. thing thatittle, one is never -- that has never punctured his polling numbers, the combination of a lot of things that keep building and building, everyone is waiting for the tipping point. that is what people felt last week. to answer your question, probably his spouse, miss

universe pageant winner, who donald trump attacked over twitter. the reason i think that is the worst is because the other things, pushing the message on the trail, she objected thewors- injected this into the conversation. but trump carried it further and at 5:00 a.m.,out attacked the woman on twitter, and the importance of that, the reason that is important, is octobers is october and surprises happen every presidential year. both put out the most damaging stuff they will put out in the coming weeks. matt: it also seems to point to a problem we have known about for a long time, but more and more, we are hearing advisers saying he just does not listen to anyone. >> that is the thing. -- rollout the october

has been, donald trump able to withstand the attacks. his reporters are resilient to that. maybe not preparing for the debates as much as he should, then going out of his way to do things that distract from his core economic message. such as having spouse from a former miss america pageant winner or something like that. matt: the tax returns, part of what the clinton campaign is trying to push here. that thesuggesting lock -- the loss was not really a loss? or are they suggesting he should be paying more than he is

supposed to? questionnaire using as a two-pronged attack. one is, donald trump, as the billionaire, does not understand your lives the same life you do and 20 out the fact the majority of americans pay taxes and donald trump is not one of them. matt: he took an almost billion-dollar loss. the majority of americans would if they were entitled to it. >> totally. the second part is they are looking at the business practice want a man to run the country and in one year, he lost $1 million. fair or not, those are the two product tax they see as an opportunity in this story. obviously, he did not prepare for the debate. do you think that will be super damaging? not do wellama did in the first debate against mitt romney. him to bounce for

back? >> it is absolutely possible. is town hall and interactive. they tell their story and say my student debt, how will you fix that? the candidates have to speak directly to the situation. christie is good at that and we know he is advising trumped up air how seriously, whether he prepares more. matt: thank you. we appreciate your time. this is bloomberg. ♪

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we go to mark crumpton in the newsroom. vladimir putin system a russian deal on weapons grade plutonium. inability, both expose enough plutonium for 17,000 nuclear warheads. two fishermen have died in the haiti.aters of winds of 145 miles an hour. may hit the southwestern tip of haiti later today or early tomorrow. hillary clinton will be campaigning in ohio today and taking aim at wells fargo. planning to call for limits on forced arbitration and what makes it tough for workers and consumers to sue companies.

2 million fake accounts. secretary clinton will receive an m.v.p. endorsement today. lebron james says secretary clinton is a champion for children and their futures. clinton is running on the message of hope and unity -- needed to address violence in black communities. opinion pieces from business insider and the journal. dayal news 24 hours a powered by more than 2600 journalists and analysts in over 126 countries. matt: you can see the major indexes are down. because of theresa may talking about a brexit by the end of next year. you see equities down across the

board and the nasdaq is down. wherever you know doolittle is standing by. abigail: we are at the lows of the session with the nasdaq down 1%. volatility.on of two big updates and down days. this is shaping out to a down day. for what is dragging on the day, really large cap names. these are the top point drag. -- shares down as facebook announced their opening a market place feature for the facebook users and interestingly, saying they do not think is will be a near-term threat to ebay or amazon. you have to wonder over the medium term or long term,

considering facebook has a large user base. trying to help the nasdaq, tesla shares are on pace for their best day in about four months after the company they had better than expected deliveries for the third quarter and deliver 24,500 vehicles for the third quarter, as much as 19.5%. a presumption considering they did miss the second quarter units and also bullish, they twofirmed the second deliver 50,000 vehicles then. some say this has something to do with discounting, kevin saying they're pulling a trick in terms of discounting that this will -- most likely raise much-needed capital by the end of the year. att: abigail talking tesla

the nasdaq. let's turn to european banks, set to go20,000 jobs as tougher rules and negative interest-rate way on profits, what are the broader implications of deutsche bank's fall from grace and can the system whether the headwinds? the global financial industry today, bob, a senior lecturer at m.i.t. school of management that he has held a number of prominent positions in the financial community where he was a former vice-chairman at the fcc'snd chair of advisory committee on financial reporting and has written a number of books on the pairing the u.s. financial system. thank you for your time. to start with deutsche bank because it has been an incredible story. do you think this is a bank currently looking at extensional problems?

>> no, i think deutsche bank is not doing well, but it is not on the verge of anchorage see, if that is what you mean by existential problems. 220 billion int liquidity, and it is in a much better position than lehman brothers was because the liquidity is based on retail and it has got a strong line with the european central bank. has also got about 11% in , so regulators in the u.s. and other places may impose a fine of 14 billion, the ,iggest number put on the table but deutsche bank reserves about 5 billion, which would cut the billion, butout $9 they can handle it. not a good situation but i do not see them going out of his this.

matt: the justice department settlement is not it -- is very important. deutsche bank has turned the settlement down. would that leave capital in a even withus provision the lower number? could get a settlement of $5.4 billion, that is what they have decided to reserve so the capital would not go down. i assume they will have to pay more. let's assume the middle number like $10 billion. would go down from roughly $48 billion to $43 billion. break it upave to over a euro to two meet the capital standards. it would not be good for them. they would not run out of capital. raise morehave to capital at a time when the prices are low. matt: it is a concern and they may face other find the on the

one justice department. they are expected to save billions of dollars in fines. thinkfluential do you u.s. german relations are here? do they play any part? does on bloomberg: call a president obama and say you're killing one of our most important banks? not think she calls a president obama the people in washington are aware it would not been anyone's best interest if a large bank went bankrupt. them but be tough with careful not to put them out of business. think this is the sort of thing that has to be explicitly said and angela merkel would come out of -- if she explicitly said it. they have to mend real discipline in the financial markets. the way we have seen the justice department deal with other

european banks, they are tough to -- tough and strict and they do not want to put them out of business. matt: what about mario draghi, who has affected the bank's's -- profitability with his negative interest-rate. german banks do not charge in almostr accounts any way. if you went to deutsche bank and opened up an account with $100,000, it would cost them town and that was a big with their business model. >> yes. i think negative interest rates are problematic for the german banks. mario draghi feels this is what is necessary to get the european economy going again. even he last week suggested he cannot do much more and he has got to have some fiscal stimulus from the legislative side. i think he is a smart guy and he understands there are real limits to negative interest

rates and he will hopefully move toward more normal rates if you can get some help from the european parliament. matt: is it a problem for commerzbank as well, looking at easy for- it is not as german contra needs to have the jobs as american companies. doesn't something have to change with german bank business models? limit tok there is a what they can do given negative interest rates and they have a lot of what we would call mutual savings banks operating in a cooperative form. the realist -- the real risk outside of deutsche bank is in the italian banks. ande are really in trouble they have to get some sort of help from the government here and under the new european rules, the government is not supposed to recapitalize those banks, unless stockholders and

bondholders in those banks take a haircut and that would be politically a difficult thing for the italian prime minister to do. matt: speaking of risk, you have pointed out a couple of back home that are maybe more important to u.s. investors with interest rates not negative but still low. aroundere to have a hair -- a turnaround in rates, it would be a more serious problem for retail investors than they may know. think you are right. we have had a huge amount of retail and institutional money pour into junk bond funds and market on funds within the last two or three months. these people are yield hungry and frustrated with 1.6% yield on the u.s. treasury. junk bonds were named so for

good reason. we see a predominance of the money going into triple c, the junkie is to, the of the junk. investment and similarly in emerging market ares, a lot of those currency bonds. the u.s. dollar would go up and it would hurt currencies in the market. i do nothing a lot of u.s. investors piled into junk bonds and into emerging market bonds, fully understanding the risk that they have taken and they really may be unhappy if the risks materialize. matt: is this one of the major things holding back the fed? janet yellen still seems fairly cautious about raising rates. about thoseing

things more than u.s. employment and inflation? she is thinking more about u.s. employment in u.s. inflation. but i cannot get into her head. economy, sheoving has been going slowly. there is a high likelihood of a high. matt: he has worked for a number of big finance companies as well as president george bush and president mitt romney. the uk prime minister theresa may said the process can leave the eu by the end of march or the first glimpse of a timetable for the divorce between britain and its largest trading partner. have investors been too optimistic about negotiations? the global economist for unicredit says there are far too

many unknown risks from brexit. some of those vulnerabilities. >> a very specific thing about that fine. going forward, that would be resolved, i'm completely sure one day or another. the thing that people are not focused enough on in my opinion, brexit does not look good. >> what does it mean for you and what is the potential? classic basically means they cannot square the circle between the insistence on controlling immigration and keeping access on a single market and specifically having passporting for banks. if that equation does not hold and it increasingly looks like it does not because they care more about the immigration

the u.k. would go into it , you get the big trading partner -- why don't we see this in a the volatility, it go intodata, inf seems the risk is not yet .actored into the market you come track -- come back a bit, and then you have the numbers and life goes on and you do your thing. cheaper for tourists to come into her my point is the fixed investment will be heard and we saw it last week, the head of nissan said we now, britain,it about 7000 employees. we do not know what the system would be.

these guys produce 40,000 cars or something a year. they will face something like 10 to 15% on this big story. >> is it possible the markets are sophisticated enough to say theresa may is taking a position and if she were to come out and say the most important thing in the world is that she gives of negotiating power against those countries, and we have to wait and see how those play out -- >> that is a fair possibility. i think it is a wrong one. she is probably trying to do exact he this. immigration in britain is not the same issue and britain is all about workers being there. it is a non-issue, where immigration is all about the middle east. make thatee how you compromise.

matt: coming up on television and radio, catherine hayes will be live at the federal reserve bank cleveland and will have an exclusive interview with the fed president at three: 15 p.m. eastern time this afternoon. this is bloomberg. ♪

matt: thrown it stores opened it -- to the public. it is one of the biggest displays in the world. paul allen went to take a look. paul: this warehouse was once a budget highway store, to one

man's expensive and extensive car collection. >> $7 million. >> that is probably being conservative. alone, this is worth $5 million, never the vintage rolls-royce collection. >> this is very rare. list.ather extensive 15 to get it going. it is not easy to drive. >> it is not easy to drive. obviously never drive them. >> also nearly impossible to drive is a new arrival. aue to the era, it does have bar to stash your whiskey. the collection is owned by one

man who for the past 30 years owned a aaa auto one of the biggest car places. he came home to indulge his hobby. >> raking even? >> it is like a passion. >> i understand some >> cars that will never be sold. >> ferrari, for example, i cannot imagine driving it on the road. >> it is a car to appreciate. >> at the other end of the spectrum, the area is devoted to -- , perhapstroke engine qualifying it as the world's most powerful lawnmower. quite also making its way to

australia from the former soviet -- if upholstery could talk. , the insurancet for the best collection is a closely guarded secret. matt: thank you to paul allen or maybe he should be thanking us for the assignment. can read more about luxury for bloomberg pursuit, the finest things in life including travel, watches, and dining. this is bloomberg. ♪

matt: earlier today on bloomberg surveillance, head of currency strategy mark chandler, and chicago school perfect -- professor asked as -- how fragile the year in banking

system is right now. >> the shock of the fine short overall, and how little it takes to create tension in the european banking market. remember, a substantial amount of capital as well. how little it say takes? it is 10 billion more than analysts were expecting. given that if you offer $14 billion, it will put the bank -- >> i do not know why the market expected so little from the bank. we know bank of america paid $16 billion. $12 billion.paid and it was the last one to settle. we know the first one to settle

gets a discount for the corporation. told therket was number was so low, it is because they made a mistake in telling them the number. you indo not want to get trouble with the general counsel but you have seen this ballet before. everybody jawbones until they must do something. >> part of the problem is pre-existing conditions. all thanks got recapitalized whether they needed it or not. nonperforming loan problem, this has been ongoing. caught repeatedly. we are not talking one-off but repeatedly. these are pre-existing conditions. >> how do you fix it?

they have a business model but let's not forget the u.s. went for huge amounts of pain and had an extended risk. >> we have to avoid that now. a new directive that limits the ability of government to bail out without unsecured shareholders and debt holders getting a biga new cut. matt: that was mark chandler head of currency strategy along with the chicago school professor. still ahead, september auto sales numbers continue to roll out throughout the day. and 8% plunge last month while nissan is topping analyst estimates. this bloomberg. ♪

in new york,:00 6:00 in london, and 1:00 in hong kong. good afternoon, i'm matt miller. welcome to "bloomberg markets."

from bloomberg world headquarters in new york city, we are covering stories from two choice and mexico city to london and amsterdam as well as tokyo. investment managers henderson capitald janus announced at all sure merger and then widening their reach. to do would create a $320 billion shop. henderson shares in europe up the most in seven years. does the u.s. auto industry growth spurt still have room to run? so far it's been a positive for general motors and ford as demand for granted pickup trucks remain strong. we also get an update from tesla who said they shipped about 24,500 vehicles in the third god -- quarter. bonds hasalue of

jumped to more than $12 billion. those bonds are guaranteed to lose money and held to maturity. so where does all the demand come from? america's david woo breaks it down for us. ramy inocencio has the latest of what is happening in equity markets. ramy: we ended the third quarter on a positive note, markets up by 1%, but here we are taking a bit of a u-turn coming up about positivity. major markets were down about half a percent. the s&p real estate sector, utilities and consumer staples being the big white today. take a look at where we have come ever since the start of the trading session. down by .46%, off of session lows. this morning, we were talking about the ism factory data

number that came out better than expected. 51.5 versus 49.4 last month. that sparked speculation the fed could raise interest rates sooner, and that is why we have seen this downtrend through the day. let's take a look at what is happening with debbie ti crude. we saw a pop, and then a drop. we are basically up again, .8% higher. earlier this morning, we got data that said supplies for the u.s. unexpectedly fell by about 1.9 billion barrels. an expected rise of three million barrels. lower after the 10:00 mark after libya said its production would rise by about 500,000 barrels a day.

oil is now at its highest in about one and a half months. take a look at the bloomberg dollar index. this is very much a dollar-pound story. we have seen the pound we can to its lowest since 1985 since the , a fearas been rising of a hard brexit coming out of london. prime minister theresa may says that she will trigger article 50 in march. cabela's beings, the target of bass pro. they will pay $65.60 a share. capital of being the target of henderson capital. new market cap of $620 billion. matt: thank you. let's check in on the first word news with mark crumpton. rk: hillary clinton leads

donald trump in the swing state of virginia things to an increase in support from millennials and independence following last week's debate. , clinton isy favored by 42% of likely voters. 35% favor trump. gary johnson is backed by 12%. jill stein gets 1%. donald trump says the nation's cyber security efforts are under constant attack from foreign powers. speaking at a forum in virginia, he said he would order a thorough review of the nation's computer defenses and warned against potential hackers from china, russia, and north korea. >> as a deterrent against our attacks, the u.s. must possess, and has to, the unquestioned capacity to launch crippling cyber counterattacks, and i mean crippling, crippling. this is the warfare of the future.

america's dominance in this , and must be unquestioned today, it is totally questioned. mark: he also said secretary clinton's only experience in cyber security is her "criminal attempt to keep her e-mails hidden." the supreme court has rejected president obama's last ditch bid to keep immigrants from being deported. june, a vote left intact a lower court order halting the administration's program. today is the first day of the court's new term. in iraq, militants unleashed a series of attacks in shiite majority neighborhoods in baghdad. 16 people were killed, 25 were hurt. the deadliest attack happened at an outdoor market leaving seven people dead. islamic state has claimed responsibility.

global news 24 hours a day powered by more than 2600 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg. matt: thank you. u.s. sales figures for september trickling out all day, auto sales. by early accounts, it's been a solid month, relative to analyst estimates. of the u.s. automakers, gm and ford posted declines for the month but basically came in line with estimates. nissan saw u.s. sales rise 5% for the month. that clobbered analyst estimates for a drop of 1.5%. teslare on sales, production, and the future of autonomous vehicles. we have rebecca lindland, and insider with kelley blue book. rebecca, it's a pleasure to see you today. thanks so much for coming on the

program with me. everybody seems to be upbeat, and ford shares are up marginally. even though their sales fell 1.8%, what is there so happy to be about? >> this is a month about quality of sales over quantity. one thing i was encouraged to see was the improvement over after transaction prices. so consumers are paying more for their vehicles than last year. they are spending more, getting higher trim levels, better equipped to vehicles. we looka positive when at gm and ford stocks in particular. it speaks to the profitability of the balance sheet. they are getting more pricing power essentially, although they did give more incentives because of labor day. industrywide, $430. but the pricing power is still

there. at gm, the average that people paid was up over $4000 over last year. in my mind, that speaks to the consumer being interested in well-equipped to vehicles, higher trim levels. we saw improvements in cadillac and buick. i think we are seeing some good news when it comes to what people are buying. even though some of the sales were down a little bit compared to last september, which was on fire, we are seeing a good quality of sales going on. was a greateptember month. last year's september was a pretty high bar to be. i know that truck sales were a little bit weaker. 33% gain in yukon sales, so the suvs are doing great.

f-150ado sales were down, sales were down. pickup trucks are not selling quite as well as last year. >> not quite as well, but what are our the transit connect to vehicles, the smaller commercial vans. even from ram we saw improvements there. i see potential strength in the business purchases of vehicles. while they may not be buying pickup trucks, they are still buying commercial vehicles. the other day i had a guy at my house doing some repairs, and he had a new nissan van. he said he bought that instead of the pickup truck. so we are seeing some exchanges go on. but it speaks to some good business strength happening, particularly in the small business world. matt: they have a whole new segment with the ford transit, prints comings

here. they had not been updated in the long time and now we have these newer versions. >> the one thing that the guy pointed out at my house was that he could stand up in his van. even though it had a higher roofline, he felt it held his agreement better. overall for him it was a better use of space. it was a very competitive price. when a look at the numbers today, i thought, what we are seeing is maybe people are swapping out a little bit for the traditional pickup truck. what this means for the profitability of these companies is still up for debate. what i looked at some of the numbers, i still saw some good strength. when we think about last year being a record year, anything up year-over-year is a huge win for the industry. matt: a lot of people have been

indicating that we may have peaked here, not that they love all that much, but we have hit the apex. , orking of profitability lack thereof, what about tesla? paceare delivering cars on with promises, they continue to hold forecasts. how are they doing? it depends on what your metrics are. for a fledgling car company, ,hey are fulfilling their sales they track sales when it is delivered to the customer, all the paperwork is complete. they have several thousand sales yet to be declared. it is a tough thing. i like tesla in the products they are coming out with. wall street really likes tesla a lot. people have bought into the vision of elon musk, bought into the why. i think people are excited about the product, excited about being what hef his vision for

says is a real change in mobility. --t: i know tesla owners although i'm not sure if they are allowed to -- but they use the self drive and functioning all the time. are they at the forefront of self driving cars? >> i think they are right now at least. it does not mean that they will win the war, but they are right now at the forefront. there are projects going on like the uber project in pittsburgh with the ford fusion. beta now in terms of testing autonomous vehicles, right now they are in the lead. kbb just did an independent ,tudy that we commissioned showing a lot of consumers are really interested in autonomous ,eatures, autonomous vehicles not totally self driving, but

they are interested in that technology. matt: we will have to have you back when it is not sales date because it is fascinating and everyone is aiming for that. coming up, we reported on donald trump's rhetoric affecting the mexican peso. that is affecting immigrants who work here and send money back. how he is handing a windfall to immigrant families. this is bloomberg. ♪

matt: you are watching "bloomberg markets." i'm matt miller. we have reported on the so-called impact of the trump campaigns trail rhetoric on the mexican peso. when he rises in popularity, the peso weakens.

.ou can see this in the chart when he took a commanding lead in a commanding lead in the primary race, the peso surged against the dollar. recently, when polls showed he was gaining in several key states, you saw the surge again. after the first debate, where ,linton seem to take the win and trump stumbled on policy details, the valley of the peso against the dollar fell. all of this volatility is affecting immigrants. for details, let's bring in isabella cota. great story that euro here. let me ask, when you talk to people in the markets, do they believe this relationship between trump and the peso, is it a theory that people are buying into? that is a very good question. the reality is up until early september people were still skeptical that this was an actual correlation.

there are a lot of factors that have been hitting the mexican peso but as of september it's been clear, it is trump driving the day so the most. in your story, you talk to an immigrant worker who is here in texas and he was sending money back to his family, horrified for obvious reasons about a trump victory in the election, but you point out, he is able to now send all of more money back to his family that he previously had been. here this isht perhaps one of the biggest ironies in this u.s. election campaign. not really seem to understand the relationship between trump and the exchange rate in mexico. when i spoke to them and their families here in mexico, it is clear they are benefiting from their money being multiplied. a lot of it has to do with the fact that pass through inflation has not really hit cpi here in

mexico, so prices are more or less the same. but the benefit is there. matt: let's bring up that chart again. what is a little bit confusing mexicane is when the peso goes up, it is actually getting weaker. previously, you could only by 15 the dollar dollar, was weaker, the peso was stronger. now you can buy 20 pesos. is it expected that if trump won, we could see 20, 25 pesos to the dollar? >> by some forecast that's the case. goldman sachs released a forecast last week and they see depreciating a further 20% if trump wins, so that would be about 24 pesos for dollar. of course, if hillary clinton

wins, they would see an appreciation of 10%. you can understand why mexicans are keeping a close eye on the elections. great story, thank you for coming on the program. you can check out her story on bloomberg.com. still ahead, how rapidly evolving technology is creating new markets. we are talking artificial algorithms, augmented reality, and semiconductors. this is bloomberg. ♪

matt: this is "bloomberg markets." i'm matt miller. things are changing rapidly in technology. our next guest says augmented reality and artificial intelligence algorithms are the cost of creating the markets. carol massar is standing by with brad slingerlend. and do have with us brad

slingerlend, with janus capital management. good to have you here with us. talk about the environment right now, the investment themes you are following in the tech sector. >> there is a lot happening in the tech sector right now. the biggest things are the shift to the cloud, away from the legacy i.t. systems we have been using for the last 30 years come into the new platforms. we are seeing a three horse race development between amazon web services, microsoft cloud platforms, and google's cloud platform. a year ago, amazon was dominating, and they still have the market share, but amazon and google are doing well in that market. carol: does that mean you are moving into those names as a result? investors,ong-term those earnings we are positioned

in. we think they are poised to win quite a bit of market share. two chilean dollars spent a year on i.t. globally. quite a bit of that is on infrastructure and software. we think that these three companies are poised to gain market sharetwo chilean dollarsr on i.t.. we are seeing that shift accelerate right now across the world. carol: what do you think about drones? we just spoke to the ceo of gopro talking about their new lineup of cameras, progressing their product lineup. what do you think about what gopro is doing, drones over all, is that an opportunity you have been investing in? >> there are not a lot of great ways to invest in drowned as a public market. it's a very exciting technology. havenitial applications been a consumer hobby market but we are excited about the industrial marketplace for drones, agriculture, logistics, delivery, data collection,

sensor information. there are some semiconductor companies with good intellectual property such as low powered chips that go into drones. companies like nxp semiconductor, companies that make specialized connectors. it is early days but we are excited about it. julie: you have been outperforming your peers so far .n 2016 your top holdings, alphabet, apple, arm holdings. where have you been adding to these positions? be long-term investors, we don't make a lot of changes. are excited about long-term prospects for. , that hass position been building over the past year. we are excited about that as they gain market share with enterprises. of m&aalso seeing a lot

activity for the cloud software names, semiconductor names. we're seeing a lot of companies that we think are great but could also be acquired. some rumors last week aroundn nxp. we are seeing a lot of opportunities. as rates stay low, we think we will see more m&a in the tech sector over the year. you mentioned cloud, machine learning, artificial intelligence. what about some opportunities with ai, where do you want to be as an investor? >> we are moving to a mobile includes ai.at instead of interacting with technology, we would just be served answers in a chat format, more of a natural human format.

the current incumbent, microsoft, google, facebook, are making big strides in ai. we think we are moving to an ai-first world from a mobile first world. that will be impacting every sector throughout the globe. carol: we believe in on that note. you.slingerlend, thank -- we will leave it on that note. matt: you can catch more radio interviews on sirius xm, bloomberg.com, and on your bloomberg. coming up, the henderson group could with janus capital be the precursor for a wave of consolidation. this is bloomberg. ♪

matt: live from bloomberg world headquarters in new york, i'm matt miller. this is "bloomberg markets."

let's get the first word news with mark crumpton. mark: the vice presidential nominees go head-to-head in their one and only debate. tim kaine has the edge so far when it comes to fundraising. mike pence has raised about $10 million for republicans, but tim kaine has brought in at least $27 million. you can watch the debate here on bloomberg tv starting at 8:30 new york time with 30-minute pre-and postdebate analysis. twitter will live stream the bloomberg broadcast. trump's new luxury hotel in downtown washington has been vandalized. someone spray-painted the phrases black lives matter" and "no justice, no peace" on the hotel saturday. police have not identified any of the suspects. a washington post reporter held for 18 months is suing iran.

jason resign and his family filed suit in court today. it says he was psychologically tortured in captivity as part of a move by tehran to leverage negotiations for the luke laird deal. he and his wife say they were theired repeatedly about "value" as bargaining chips. syrian activists say warplanes have begun targeting again one of the largest emergency hospitals in aleppo. the medical societies as a bunker busting bomb punched a 10-meter deep crater at the front of the entrance. three workers were reportedly killed. officials say the hospital has been targeted twice in the last week. in hungary, the prime minister has suffered a setback in his attempt to reject the european unions migration policy. in aew voters turned out week and referendum to make the proposal binding. the government needed half the electorate to pass the ballot

but only about 40% voted. global news 24 hours a day powered by more than 2600 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg. janus capital and henderson group have announced a merger today. the new combined group will be henderson global investors with $320 billion in asset management. we spoke to the henderson ceo andrew formica earlier this morning. starting point that we had when we started discussing the transaction was, we share a .ery similar strategic ambition when we look at the industry and the challenges we face, we are aligned on those challenges. are alignedntly, we on solutions for the firms. that is the fundamental bedrock. the second point is the culture of both firms are so similar. active fund managers coming from

the point of teams building allowed corroborative approaches. we share values and behaviors. the focus of both firms is making sure we do everything we can on behalf of our clients. chanceves you the best in this merger of equals. >> you said a new breed of asset manager needs to be created. what does that actually mean? recognition that the industry post the financial crisis is changing. we know there is far more significant regulatory intrusion in our industry. that is requiring greater scale. the global clients that we deal with, global distributors, have moved to a global basis. they are looking for partners that can service them globally. making sure that the service they receive is across the board. again, trust is such an important area in financial services.

they are looking for a brand and partner that they can trust through time. that is what i mean by a new breed of asset managers. serving clients through a clients.f >> do star manager still have a role to play within this combined company? have namesrm will and individuals who are regarded for what they do. even today, everyone is managers has a team behind them supporting them. whether you are looking at a sporting event and you look at the top 10, and it is not just what they do but the team supporting them. lone is no such thing as a wolf working on their own. part of ideas by people in the firm. being able to collectively grab is the future of active

asset management, and the future of henderson and janus. ,> when people think of janus they think of bill gross. s he ofportive i what you're doing? he is supportive, he has a phenomenal track record. you can see, he is the strategic driver of what we are doing. he is supportive of what we're doing. earlier on, you called brexit a drop in the ocean compared to the 15-year view you have for the company. why is that? >> people look at brexit as a situation that is so defining that you should change everything you are doing. what i was trying to point out was, at the end of the day, whatever form brexit takes for the u.k., the financial services industry, the client base will persevere and persist. they are anurope,

important client to us. the u.k. and europe will be important markets for us, as well the u.s., japan, and australia. we cannot just be looking at brexit as the defining moment. it is one of a number of geopolitical risks that will happen over 20 years. >> analysts getting together putting out research on who is next to come together in this industry. my question to you is, is bigger better, do you expect more consolidation? was it a big call for you to be the first mover to come together before others followed suit? it is interesting, if you look back through m&a in our industry, there is not much experience are examples of transatlantic. the reason is it is hard. you also have to do it where you have this shared vision and culture. and henderson coming

together has made that easy. others will look at this and say they wish they would've done it. they will have to make sure they have an aligned strategy to do it. we think this is best for our employees and shareholders, which is why it was such an easy decision. matt: that was andrew formica, the henderson group ceo. coming up, we will get more on this merger from the janus capital ceo dick weil. hillary clinton is currently speaking in toledo ohio, outlining economic proposals. she said she is still to get the endorsement of basketball superstar lebron james. you can watch her speaking on your bloomberg terminal.

matt: this is "bloomberg markets." i'm matt miller. the canadian government is trying to slow hot housing markets in vancouver and toronto without creating knock on effects for the rest of the country. an announcement from their finance minister this morning introduces three new measures. pamela ritchie joins us now with more. what are we talking about here, what are the measures we are looking at? pamela: first of all, the goal is something to state. the government came into power promising affordable housing for .anadians for the middle class

it has been a very hot housing market. also one of the other stated goals is to make sure that if there is a bubble forming, if there is a concern that a bubble could pop, there would not be systemic financial issues rippling across the country. those goals in mind, the government came out saying that borrowers who already put a reasonably large down payment down of 20% or so might end up also facing some higher premiums, to make sure the mortgage is insured. that is one piece of it. whether thethink 20% down payment they are putting down is also something they can afford to service over the course of the mortgage. that comes into effect october 17, so days away. it does not apply to existing mortgages. one of the other stipulations is

they are closing a tax loophole that has been there for some time that allows nonresidents to buy homes and then later claim tax exemptions on the sale. the third is an ongoing peace. the government having consultations with the banks, to talk about whether they should increase the amount of risk that they are taking on for government insured mortgages. that will be something hotly debated. thanks very much. something that we will continue to follow. pamela ritchie. coming up, we hear from bank of america's david woo on the market risk of a trump presidency. it is an interview you don't want to miss. this is bloomberg. ♪

matt: this is "bloomberg markets." i'm matt miller.

republicans wonder if gop presidential nominee donald trump can recover from a pretty tough week in the campaign. we spoke withe, david woo, bank of america head of global rates and fx strategy earlier today about the market risks of a dog trump presidency. look at the biggest concerns in the market right now, we will end up with an easy victory for clinton and likely end up with a split congress in washington. as a result, the markets are pricing in not only the gridlock again but a high probability of gridlock. , status quo,s nothing will change, the fed will be on hold because there will be no fiscal stimulus. the markets conclude that this means low interest rates. this is why everyone is piling into the risk clarity traits which does well in low rate environments. all we know about u.s. elections in the last 20 years is that

when we get into the final stretch, the race usually gets tighter. if for nothing else, i have to believe uncertainty premiums are underpriced. to see repricing, you will see higher volume and higher data assets for arming. >> thus far in the election we have seen volatility very low. the matter what was going on in the spread between clinton and trump. why doesn't that contradict your thesis? >> if you look at the polls, they have been volatile, but if you look at the electronic work -- markets,s clinton never went below 67%. before the first debate, when trump was surging in the polls, the market never gave her less than 70%. from that point of view, the market never thought it was possible that trump would represent a slight challenge for her. higheree higher vol,

beta acid performing. if trump is elected, what happens after that? his trade policy which undead gdp. let's talk about the trade war. everyone takes about republicans getting in, they will declare a trade war on china. the last time that was talked about in washington was the early 1990's when bill clinton came in. he was under pressure to do something terrible with japan because the yen was very undervalued. the difference between today and the 1990's, gm sells more cars in china than in the u.s. the politics of trade wars are very different today than back then. can you imagine if they are raising prices by 20% overnight because of a 25% tariff on chinese imported goods? that would be political suicide for trump. i think the fiscal basis of

easing is an important picture. where the cars are produced, they are incentivize to be manufactured in china. isn't it important where they are made? >> a lot of them are made in china, no question about that in the case of gm. but the profits they make in china are brought home. basicallyere is dealing with lobbyists. who will be lobbying for a trade war against china? it is difficult to see any part of corporate america doing that. this is why trump is talking about reforming corporate tax law, to prevent more companies from taking their business offshore. in donald trump were to get elected, it would be based on a platform of really taking it to the chinese. to do that, nobody in congress will stand up to him. there is no sentiment in congress to say, let's stand up and defined the chinese. don't you need to worry about

trade wars? >> you would need to worry about a more subtle form of trade wars, currency wars. if trump would become president, you would see massive stimulus stimulus -- fiscal stimulus. the fed would be forced to normalize quickly. question, under a trump presidency, the dollar would do better, but the last thing he wants to see is a strong dollar, especially vis-a-vis the rmb. then you would have to believe that that is where trump will have a direct say, labeling chinese as currency manipulators. the general market environment will be much more volatile. >> your number one best hedge over the next three months? >> i am talking about the next six weeks. as the race tightens, volatility will go up. willnk particularly em

outperform. people want to get up, the door is very small. i like being underweight or emerging markets. one way to position for a correction is to be short on the australian dollar, which is a very good proxy. matt: that was david woo, bank of america merrill lynch. they also got his thoughts on another topic that he has been watching, that is bonds yielding less than zero. the unprecedented worldwide surge in negative yielding bonds regained strength last month. now the total face value of such corporate and sovereign debt jump to close to $12 trillion from a month earlier. here is david woo again on all of that negative yielding paper. >> last week, i did a tour of europe. i was in switzerland.

i have never seen investors there quite as depressed as they were last week. switzerland has had negative interest rates longer than anybody else, negative interest rates more negative than anywhere else. i'm telling you that they are now living to the backlash, talking about how pension funds are struggling. retail investors in the newspaper about how the government will be cutting pension benefits. all of a sudden people are bundling up. we have not saved enough money. as a result, the savings rate is going up. this is where monetary policy easing becomes counterproductive. >> what are the numbers showing us, pmi index? forf you look at u.s. data august, it has been a long time since we have seen such poor series of data out of the u.s. just pmi, but retail and home starts were week.

i think this is the reason why september numbers will be really key. lookingh is nobody is at data anymore, only listening to what the fed has to say. you and i know that that is more noise than anything else. >> you are looking at the negative rates in europe and also recession signals, but also the possibility for companies in europe to borrow at 0% yield. what happens if we see a recession, what does that shakeout in high-yield look like? >> we talked about this last time. i think the markets are becoming less and less efficient. actively managed funds are losing money. hedge funds are you losing money. as a result of the market's to live forward, it is crippling. in a low interest rate environment, people are chasing out the kerry. essentially, capitalism got a kick in the teeth after the crisis.

the one wins out, fundamentals or the central banks? >> i think we are close to an inflection point. i think global central banks are now facing increasing constraint in terms of their in the of the two is policy further. rates are likely to go lower further. if growth momentum turns the combined withnd, the fact that rates cannot go lower and rates have been rolling over, that combination could undo the market. that was david woo on bloomberg this morning. great to get his insight on those issues. -- it's time for the big bloomberg business flash, a look at some of the biggest business stories in the news right now. we started with u.s. safety regulators. they have open two investigations into problems with ford vehicles.

the pronk over 643,000 vehicles involving door latches that can open while moving as well as sudden loss of power assisted steering. those vehicles included in the probe are ford edge suv's may from 2011 until 2013, as well as 2010 ford fusions. the company has already recall 2.4 million vehicles for similar .roblems ericsson plans to announce job cuts in sweden tomorrow. somewhere in the vicinity of 3000 and 4000 job cuts. ericsson has reportedly informed the swedish government of its plan. it includes closure of all or ints of its production sites two locations, a move that effectively ends 140 years of production in sweden. facebook wants a rematch with craigslist.

the social media site will begin allowing users to post items for sale. facebook started a similar service in 2007 which was called marketplace but it sold the business to another company two years ago. two years later, i should say. companies are dangling perks like higher pay to lure temporary holiday workers in the labor market. companies are also more determined to lock in their workers at an earlier time period. more companies said they would be willing to hire temporary workers even with criminal backgrounds, than they were two years ago. that is your business flash update. it may be the six-year boom in u.s. auto sales, but it may not be over. nissan, theater, and chrysler posted sales in september that beat analyst estimates. meanwhile, for sales were almost in line with estimates, but that from the same8.1%

period year ago. fields is among those saying the industry's growth cycle has ended. if you look at the bloomberg terminal, you can see general motors stock, i have a year-to-date chart here, down about 6%. ford, unfortunately, is down almost 15%, more with today's gains. possibly because he has been so vocal that the industry has been peeking. of course, mark fields has been famous for his honesty and fort wright -- forthright attitude in business. coming up today, kathleen hays will be live at the federal reserve.

>> its 2 p.m. in, 11:00 p.m. and set -- lemon am in san francisco. vonnie: welcome to "bloomberg markets."

♪ vonnie: we are from bloomberg world headquarters in new york. over the next few hours, stories london, india,, and hong kong. stocks had a better-than-expected expansion the fedacturing with raising interest rates before the year is out. former ceo of twitter will be offering an exclusive interview. at the bottom of the hour, the ceo of janus capital, creating a $320 billion asset manager. ramy inocencio