daybreak.""bloomberg futures in the united states negative after a five-day losing streak, the longest since election. this,ries look like yields up three basis points, and a stronger dollar, the trump trade. how timely. >> donald trump will become the 45th president of the united states. coverage,ou live preview the next 100 days. soros unleashes harsh words about the future president of the united states. why he thinks donald trump will fail. yellen arguest the central bank has not been

behind the curve. we look at the fed under a trump white house. david: we turn to that big story, the inauguration of the 45th president of the united states of america. hill coveringtol all the festivities. a differentve president, but the same old ceremony. it follows a regular script every four years. and his wife-elect walk across pennsylvania avenue to the white house tortilla and coffee with the obamas, then get into limos, drive to capital. mike pence will be sworn in at 1145 p.m., then chief justice roberts swears in the president

of the united states, followed by the inaugural address, then everybody goes into the capital building. obamas fly to palm springs, the new president signs executive orders, then goes to lunch with the house and senate leadership. 3:00es into his parade at p.m., only lasting 90 minutes, then go to the white house around three :00 or four clock is president of the united states. >> presidents don't get a lot of detail in there and naugle address, but do we have a sense of the themes? presidents don't normally give a lot of details in their inaugural address, but do we have a sense of the themes? itthere may be a premium on

for mr. trump as he is being sworn in as the least popular president ever, so he has a tall task of had him -- task ahead of him. alex: tall task for the markets as well. george soros with harsh words for donald trump. uncertainty is at a peak, and uncertainty is the enemy of long-term investment, so i don't think the markets are going to do very well. right now, they are still celebrating, but when reality comes, it will prevail. alex: mike, when reality comes,

l prevail.prop when will we have some clarity of what can get done under a president trump? >> at this point, congress is starting to work on some initiatives and finding them very controversy over. they have started work on obamacare, but can not decide whether they're going to repeal and replace it at the same time. it may be weeks before that gets decided. what you may see action on is corporate tax reform. there is contention over the border tax adjustment, but lowering taxes for companies has wide support on capitol hill. on which theasis market has been going up, so if they want to hang their hats on something, it will probably be that. alex: thank you very much. the reality of according to

the wall street journal is it cost george soros $1 billion, the trump rally. we continue our coverage and davos -- in davos. he has optimism in the economy under president trump. that is a think simple question. you have to look at the short-term and long-term. we have a republican senate in congress, and as i tell my european friends, it is a different system than a parliamentary system. is good and bad of america that it is a huge battleship and you can only move it so quickly. everybody is in a wait and see attitude. there are a lot of business

people, including here in davos, who are optimistic about what might happen to the american economy under a donald trump presidency. do you share the optimism? >> we have a wait and see attitude. the government can only do so much for the economy. is beauty of private equity that we take a long-term so thative, 7-10 years, goes through multiple administrations. we have been doing this at bain capital for 30 years. democratic administrations, republican administrations. the great thing about the u.s. in terms of resources, it's a good place to do business long term. >> any of the current companies you own that you think are at

risk because of things trump has said he wants to do? >> we have done analysis of the portfolio, but we don't know exactly what he will do. atlth care is being looked for repeal or adjustment, but the companies we have in general are delivering services, and those services will be needed, and somebody has to pay for those services, so we think they will get right through. health care is the only part of your portfolio ucf risk? >> if you have a trade war, and export-oriented company could be an issue as well. the economy is adjusting, and we are talking long-term, not the next 3-6 months. talk abouto investing and reaping the rewards of those investments.

valuations are awfully high. dealsh, can you see getting done at these levels? hard, but there are always sectoral issues. regulation affects a media business, software business, health care business, they often you canbe redone, so see some sectors that have issue or are facing disruption. >> are you holding off until prices come down. we are disciplined because prices have been at the higher beenthe cycle, so we have very disciplined to say can we buy a business and transform it, take it global. we need a concrete plan to make it a better business in 3-7 years. it is hard to find those when

the price is high. we made some great investments over the last year. think and other people in private equity will have to get used to the idea of paying 10 times ebida? >> we have been through these cycles before. it is an equation. if you're paying 10 times, it means are buying businesses that grow. if you can't do the growth that multiple,hat it's expensive. schatzker with pain capital. we are hearing this from various people. particularly the uncertainty of trade and what will happen there. it reminds me of the christmas

dilemma, free trade, but we want fairness. as most people know with the current dilemma, the optimal outcome is cooperation. you know what usually happens, greed kicks in. it's an outcome that afflicts both actors in the negotiation. to fair trade get without going through a trade war? we will see soon enough. we want to go over to alix steel with some movers now. s&p futures slightly higher, but here is one down for you. the revenue fell short by $800 million. it was oil and gas with the miss. london stock exchange taking a wild ride, now up 1.5 percent, the eu saying they may have concerns over clearing the

london stock exchange and the deutsche borst merger. formalve yet to submit a succession plan. one overseas that had a terrible ata, down 50% on the week. now adding vehicles to a recall, 5.2 million. the big question is what will the right down be. issues are starting to circulate within the stock as well. american express, ibm after the closing bell yesterday. missing onpress the bottom line, and ibm down 2%. nevertheless, that revenue fall of 1%. >> thanks. it is inauguration day, but will energy regulation be one of the first items on his agenda.

energy the outlook for under a trump administration. that is next. this is bloomberg. ♪

aides havep prepared a short list, getting rid of guidelines, deciding what areas are open for drilling, rescinding epa clean power plans, resending the social cost of carbon, what will take priority?

joining us now is continental resources chairman and ceo, , and advises donald trump on energy policy. thank you for joining us today. i outlined a list of to essential actions trump could take today. what do you want to see? >> there are a great deal of executive orders put in place that congress had no input on. ,ertainly rolling those back that is one of the first things. going ahead with some of these pipeline construction jobs that are 95% complete or more and get those done. all those things need to be paid attention to, and the first thing because on. there are hundreds of these some 131 have been

passed this last week. alex: when you look at the regulations that have then pass, what is the number one that would help you do your job better over the next four years. rules thatmethane this administration imposed or are in tempting to impose pose, that is a huge one. that needs to be taking care of. we are in the business to sell every molecule of natural gas. job, so thisy good is certainly something that had no need, did not need to be done at all. alex: when does that get done? what is your timeline for that to be rolled back?

>> a lot of these can be done almost day one. take action through the congressional review act, but every agency has been under pressure by the current administration to pass everything in their power against this industry. and is what has come down certainly they will take immediate action as soon as it can be done certainly. i have a chart on my terminal here, this is u.s. oil production, the red line is when president obama took office. we have seen shale oil grow to 10 million barrels under obama. how much more can this grow in the next four years?

that we we have said have a lot of potential capacity , with the horizontal drilling, innovation that has , over time, it will not happen in 4-5 years, we say 2025, we can double production. by 2020, we could be energy independent, and we are making moves to get there. that could very well happen, but you have to turn it loose. ,e have had an administration just like fossil fuels, they set out to stop it. alex: if producers like yourself are able to run more freely over the next four years, what does that do to prices?

theory holds that if you have more production, prices get worse and it hurts your profit. >> this has been good for consumers. horizontal drilling and innovations that have come about have lowered price to the consumer from four dollars to two dollars, and it has been extremely good for america, natural gas prices and oil prices have come down. we've implemented and introduced efficiencies in this industry. we don't need $100 a barrel to show good profit, but we should get our share of new demand in the world, 2015, 1 .6 million barrels. this last year, 2016, 1 .3

million barrels. we expect about the same this year. certainly we should enjoy our share of that instead of the saudis, opec members, and russia gaining all that market share. certainly we have the production capacity to do it. they turn it loose and let america enjoy the trump rally that we are seeing in the market . yes, go ahead. alex: we have to leave it there. thank you for joining us. i know you have worked hard on this day for donald trump. we had back to the world economic forum in davos, where a deputy prime minister will reveal the progress of his economic reforms, next. this is bloomberg. ♪

david: i david westin. continuing our coverage in davos, switzerland, we are joined with a special guest. ,> i am here with anas al saleh deputy prime minister of kuwait. nice to see you here. needcountry has outlined a , a budget deficit, the product of lower oil prices, where did those plans stand? >> we started tapping the markets in kuwait, and now we ,re very soon going abroad targeting 2017 definitely will we will go toe the international markets. you have floated a figure of 10 billion dollars, the amount that needs to be raised. if there was demand, would you

consider a larger issue? >> i will leave it to our advisors on the best ways to finance our deficits. that depends as well on the markets condition. erik: i see. who have you hard to advise you. surely you need a bank as well? >> who is in the running? >> a number of them. erik: what is your outlook for oil prices? fromst year this time january to january, 100% up. think the $50 or $60 level would be something acceptable. erik: how long? >> 6-12 months. erik: do i interpret that to say

you are satisfied with the results of the opec production cuts? >> oh, yeah. i was there when the deal was made. today, i was on the phone with arrivinggue, and he is to head the committee which will be supervising the commitment to the cuts. this auditing is exceedingly important because there are a number of people that do not believe members will honor their commitments? >> i have never seen a commitment, and if you see the startups, kuwait has started doing it, saudi arabia, and some number countries out of opec, so i do feel that they will meet commitments. if oil stays at its current level, $55, will your

budget deficit widened or narrow? >> it will definitely narrow. erik: by how much. if you meet your target for expenditure? >> it will drop. deficit was 9.6, and when we close the accounts, it will be less for a simple reason. we budgeted it on 35, and the average is 43 now, so definitely our deficit is less. ,ow it depends on how we budget how do we price the barrel, $40 to $60 would be something worth looking into. erik: for arguments sake, if it stayed at $55?

>> we would definitely have a 50% -- erik: reduction in the budget deficit. what price does it take to balance the budget? towe calculate transferring the future generation fund, even though we are in deficit. erik: you are still investing in the future. same amount? >> it is 10% of whatever we do. erik: you were not fiddle with that 10%? >> we will stick to it. erik: even though it is causing short-term pain. >> we feel it is important to do so. erik: over the longer term, what's the right price for oil? >> right price would be a price where producers and consumers agreed. erik: exactly.

what do you think that should be? say long run, to but there is a consensus on $60, $60 to 65 dollars would be easy to digest from both sides. get oilwill it take to from $55 to $65, more cuts? >> commitments to the agreement. erik: that is the first thing. once they see the producers are committed, the oil price will automatically rise? >> that is my view. erik: and if it doesn't? >> it will affect the market. erik:i understand.

>> my colleagues have elaborated a number of days ago that services surrounding the downstream might, but we have not yet decided what exactly. you haven't decided? >> we have not identified the

company. erik: will you wait to see how the aramco ipo goes first? >> of course, aramco would be a good example of seeing how it works. erik: going back to oil price and production, there is talk that these cuts will roll off in a few months time, april, may, would you be in favor of rolling them over so they persist? we will >> we will have to see the market conditions. then they will decide. in the they would do best interest of both sides. minister,deputy prime thank you for taking time with us here at the world economic forum. anas al saleh is the deputy prime minister of kuwait. john: let's get straight to the markets, shall we?

two hours away from the cache open, marginally positive on the dow. the s&p up. treasuries on offer for much of the morning. 2.50 is year yield on the 10 year. the euro weaker. the cable rate at 1.22. inauguration day for donald trump. he will become the 45th president of the united states. kevin, great to have you with us. walk us through what to expect. just behind me on the podium, president of elected trump will become president trump. he will meet with outgoing president obama, where they will have coffee with their theirctive wives -- wives.

then he will give a short and not duration a dress, laying out his vision for the country. i am told that he will seek to unite the country and make america great again, but also put america first. look for that to be a key theme. john: i picked out a quote from one of our stories, president obama used a pen and phone to load the federal register with harmful regulations. donald trump has an eraser. how is he going to use it? kevin: three ways. they are focusing on the first one hundred hours, not just the first 100 days. beyond that, repealing key portions of the aca, the universal obama-legacy health care bill, then of course look for him to take key executive orders, getting the ball rolling on economic growth. his team is meeting on capitol

hill these past several weeks with republican leaders to craft a tax agenda to lower not only personal income taxes, but global taxes, that he argues makes u.s. businesses more competitive in the global economy. in the heart of the reaction. more from him later today. 100 hours apparently. that makes sense and this land of tweets. i'm not sure congress has gotten that message. alix: executive orders can. mike: we want to turn to banks. they have done well since the election of donald trump. bank ceos talk to us in davos about what they think should be done. >> some of the legislation stuff, dodd-frank and all that. , no one in the rational mind that everything

that has been done has been done right. for would not advocate throwing out dodd-frank. i would not do that at this point. >> there are things we had to fix in this industry after the crisis, so there will be debate about the right regulations and how it will be mitigated over time. >> we need to stop and absorb the regulation that has been done in the capital levels are at high. >> regulators can change a lot of things easily, certain rules about lending, liquidity, capital, i would like to see some of those looked at and modified. i think it would be good for the economy. the policies that trump has committed himself to. quiterket seems supportive. spending on and for structure, lower tax rate, and removing

some regulation and overlapping regulations, all quite stimulative. again, stimulative against the the statusquote -- quo, and far more than had the democrats won the election. mike: with us now from winston-salem, north carolina is the chairman and ceo of bbt bank . always good to have you on. >> good morning. mike: you heard what the ceos had to say. two thing struck me. they're not talking about taking things out root and branch, but modifying here and there. of d regulating brother than not going further than they have already gone? >> i think they ought to de-regulate. the large banks, the banks you are talking to, don't want to get rid of dodd-frank because

they have achieved regulatory capture, and it's keeping new banks from being created. i am more for radical reform here it i like the choice act. it gives banks an opt out. if they have strong capital positions, they can opt out. create a much more competitive environment than we have today. mike: is there a bifurcation between the money banks and the regional banks, smaller banks on the other? should there be a different regulatory system for those two groups? >> in theory, there should be, but what happens is regulators regulate to the highest standards. if i'm a regulator and something goes wrong in my small bank and i did not apply the tighter standards, it makes me as a regulator look bad. in theory, great. in practice, regulators regulate

to the tightest standards. i think we will get improvement in regulations by changing the people who run these agencies, the compliance side of the federal reserve, the occ, because regulators do make the law and can decide where they want to fit on that spectrum. congress approves broad context, and regulators move based on the political wind. one of the assets of dodd-frank was the volcker rule. mnuchin onom steven the hill yesterday to this is what he had to say. >> i do support the volcker rule. the concept of proprietary trading does not belong in banks with fdic insurance, but the federal reserve put out its own report that the vocal role has completely limited liquidity in , and the federal

reserve is concerned that the interpretation of the volcker rule does not allow banks to create enough liquidity for customers. mike: specifically on the volcker rule, we don't want to go away altogether. may be some adjustments around the edges. is that where you are? >> i don't have a lot of energy about the volcker rule. i think it's a great point that proprietary trading can be dangerous. i do think banks should be able to do that in aspects of their holding companies, but i don't think it has a big effect on the industry. it only affects a handful of large banks, but it is creating liquidity problems. if the regulators make it loose interpretation and good times, if something goes wrong, the bank gets crucified ellis of the

banks will have a tendency to over interpret some rule like that because they are afraid it will get reinterpreted in difficult times. big banks had achieved regulatory capture. one accusation of the trumpet ministration is that we will have regulatory capture because so many of these guys have worked at the likes of goldman sachs, etc., so why do you think it's going to get better if these big banks have achieved regulatory capture knowing about the people in charge? >> i think that is a practical challenge. practicaly i like regulatory reform through congress, something like the choice act. i think there will be a tendency on theless focus intensity of regulation. that is part of the theme of the trump administration, and part of his own theme. the obama administration has been an focused on regulation on every front, so i think it will

be of benefit, but it would take legislation to get the full benefit of the regulatory structure. john allison, great to have you with us. john: more than 30 million americans could lose their health insurance if obamacare is repealed. we look at the future of health care and a donald trump white house. that is next. this is bloomberg. ♪

>> this is bloomberg daybreak. chairman of the democratic caucus joins us, coming up. john: this is "bloomberg daybreak." except his pin today. mckee, how soon can they get this done? is a choice they have to decide. the republicans have set up the ability to repeal part of obamacare quickly. they have created a situation

where they can't block it. do they come up with a replacement at the same time. he wants to says repeal and replace simultaneously. the congressional budget office , 18 that if you repeal million people lose health insurance. if they want to repeal and replace, that would take longer to get done. what kind of policies to they in mind to replace it with? >> they want to repeal the whole thing. some tweaks would satisfy much of their complaints. they don't like the idea that young, healthy people have to buy insurance. if we get rid of that, the elderly and sick, their premiums go way up. that is a real problem for them in making this whole thing work. thing that don't like

are the insurance exchanges, because they say the names have risen too quickly. if you get rid of those, change those, then you have upended a lot of entrenched bureaucracy and spending, so the question is whether it is worth it. there is a lot of work for them to do. what they're talking about our changes to the tax code, changes to the way obamacare works in terms of how much you have to spend for what you get. you might get less, but pay less. john: great to have you with this. full coverage on this and not duration friday. market participants are thinking how distracting will this be, and how time-consuming will it be, because i'm looking at the stimulus plan. place were they started, being totally consumed with obamacare. rained,certainty has

especially hospital stocks. for more on the conversation, we go to the world economic forum in davos, and are joined by y erik schatzker in the trenches. ,rik: he is toby cosgrove cleveland clinic. the talk of the day is not just the not just the inauguration, but what president-elect, soon to be president come is going to do about the affordable care act. have you talked to him about what he replaces it with? >> i've talked with him about the method. erik: what have you advised him to do? >> it moves us from volume to value. bill.a 3000 page it is headed in the right direction, but things needed to be added to help us deliver the care we need. erik: what is at the top of the

list? >> we need to have more wellness , convince people they have to take care of themselves. erik: preventative medicine. and obesity, because we cannot control the costs if we have these cancers and problems from obesity. marketow does the free stop people from smoking and eating food that is fat. >> we don't hire smokers anymore at the cleveland clinic. we thought we should set the example. 25%smoking rate went from to 15%. erik: maybe congress should do the same? maybe the federal government should do the same? thought about that. as far as obesity, we took sugared drinks out of the cafeteria and changed the food we serve.

costs have come down and we are in a healthier erik: position. erik:the president can't quite act like an employer. >> it's going to make it such othersivate industry and can do these sorts of things. we will not get these changes from government. we get them from the private sector. erik: donald trump was to cover everybody. he said that. many and congress want to cover everybody. how do they do it and still pay for it? >> that is the issue. we have to costs out of the health care system. you need a more efficient delivery system, and pay for fewer things, keep people well. one of the ways is to allow hospitals to come together and not be a cottage industry, but have a system and work together. justice departmentis

had to ease up a little bit. they should think negotiate drug prices? >> i do. i don't know whether that will happen or not, but we support the drug development industry for the entire world. to you, howwere up would you redesign the drug pricing system? >> that is an incredibly difficult question. erik: i know it was a bit unfair asking it, but go ahead. >> there are some bad actors and's those bad actors have driven up prices. on the other hand, we have many others who are still increasing their prices on a regular basis. we will have to have the drug industry regulate itself. if it doesn't, it will be like killing the goose that lays the golden egg. there is a lot of anger amongst providers and patients about drug prices. lead themselves,

then they're going to have someone force them. sok: toby cosgrove thank you much. great to see you at the world economic forum. toby cosgrove ceo of the cleveland clinic, talking about donald trump's number one priority, repealing obamacare and replacing it with what? we will find out. stay on that subject and turn to the lawmakers who should decide what happens. our next guest has just taken over as head of the house caucus. he joins us from capitol hill in washington. thank you for joining us, congressman. i don't know if you could hear what the head of the cleveland clinic told our colleague and he has talked to the president-elect and does favor fundamental overhaul to the aca. where do you stand on that? need to be made.

there is no question. been dealinge have with in washington over the last six years is that there have been 60 attempts to undo the law without replacing it, no thought from the republicans on how to replace, fix, or make it a better law. we democrats would have been open to that, but it was simply about repealing the aca. now the shoe is on the other foot. they own this entirely. what ever changes they make, it will be on them. we hopeamerican people, the changes are positive ones to make it more affordable and better quality health care insurance is provided for the american people. there any question that they will have their way, what ever that is, fundamentally redoing obamacare? to behink it remains

seen. the president and the republicans are talking about the good things, keeping a child on your plan until 26 years of on lifetime expenditure is lifted, the fact that people with pre-existing conditions cannot be discriminated against, wellness, keeping people healthy or earlier and life, so later and life they are not dealing with those diseases. toget there, you need feature vegetables, and that's where the republicans have a problem. they don't like to pay for it. how can we do this in a holistic way that everyone has it. that is something the aca provided to the american people. they want to change it come if they break it, they own it. price, one of mr. your colleagues, likely to be the new head of hhs. he has a new cause of delegating

a lot of this to the states, is that going to happen? >> we have not seen any proposal. they have not included us in anything. i appreciate you sharing that with me this morning. i am on the same committee with mr. price and we have not had any conversation on this. of medicaidration will fall to the states, and that means they will reduce coverage or increase taxes and and way, property taxes others. my republican colleagues are coming to understand that now. i think this block grant notion is ludicrous. block granting medicare is privatization ultimately and ultimately the elimination of medicare, and that is the wrong way to go. there will be a number of these major issues in your jurisdiction, tax reform, infrastructure spending.

have the democrats come together and formed a strategy about how to deal with the new congress and new president? are you going to work with republicans or try to obstruct? >> that is interesting. many of my colleagues not here what happened to president obama, i think the american people are turning onto what happened. the republicans were absent these last 6-8 years in terms of cooperating to get things done for the american people. i think we are developing a strategy. president-elect trump is an unknown entity. his suppose it part of it does not know where he will head down the road, so we are meeting all the time and developing that strategy. i will be here to remind mr. trump that it is not a one-man show. he does not control the country

entirely. there is some progress, and we have a role to play in steering this country in the right direction. mike: is there a choice between going hatfield-mccoy's as opposed to finding places where they can work with you? >> many people in america expect us what we would do, but what democrats have been about as doing the right thing for the american people. where we can find common ground, we will meet our colleagues there, but when we disagree, we will oversee officially -- vociferously disagree. face, and i their will be in president-elect trump's faces well, letting him know when i agree or disagree. mike: thank you very much. congressman joe crowley. great to have you.

john: so aggressive. fighting words. coming up, donald trump's impact on growth and the economy. , former secretary of commerce from new york in the markets, let's get a check. futures positive. s&p futures up 4-5 points. , treasury yields up to basis points. markets, president-elect trump becomes the 45th president of the united states, the stronger dollar story, the cable rate weaker. this is bloomberg. ♪

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viewers: for our worldwide, a warm welcome, and

good morning. i am jonathan ferro, alongside david westin and alix steel. on this inauguration day friday, the trump rally -- will it continue? about .10%.up the bond market -- deals are a little bit higher. .50 is the yield on the 10-year. alix: here is what you need to know at this hour -- inauguration day. donald trump will become the 45th president of the united states. we will bring you live coverage of the ceremony, preview the next hundred days, and what investors can expect from the unexpected. and george soros -- why he thinks donald trump will fail and think the market yet an exclusive bloomberg -- in an exclusive lubricant interview. -- bloomberg interview.

janet argues the central bank has not been behind the curve. fed under a trump white house. david: covering the inauguration are bloomberg's kevin cirilli, and michael mckee. kevin, i want to go to you first. take us through the day -- what do we have to look forward to. how traditional is the ceremony? kevin: so far, so good, in terms of tradition. later this morning, president-elect trump will meet with president obama at the white house, where they, along with their respective wives, will have coffee. they will be joined by several leaders of congress, including house speaker paul ryan, senator mitch mcconnell, as well as vice president-elect pence. those people will break apart from the white house and head over here, and behind me on that podium, they will begin to make their way in, all leading up, of

course, to when president-elect will take his oath of office, his swearing-in, and address the nation and the world. david: i see some slickers there. what is the weather like? is it raining? it is cold, and it is beginning to rain, but that is not stopped the thousands of people from around the country from being careful what they say is 18 or 19 months in the making. everyone is trying to keep warm. what, if anything, can you tell us about the inauguration address? kevin: it will be something shorter than normal. it is something he will try to unite the country with -- a common theme with the address will be america first, a slight twist on the famous campaign slogan, make america great again. he is going to try to reassert america's power and position in

the world. david: thanks so much, kevin. i hope you stay warm and dry. jonathan: i had to google what a slicker was. alix: you're kidding. jonathan: never heard of it. david: sorry. alix: lots of questions for the public and investors. george soros weighing in earlier in davos. george: right now, uncertainty a peak, and uncertainty is the enemy of long-term investment. i do not think the markets are going to do very well. right now, they are still celebrating, but when reality it will prevail. alix: mike mckee joining us. george soros putting his money

where his mouth is. according to "the wall street journal" he lost $1 billion since inauguration day. it goes to show the uncertainty investors feel going into the presidency. michael: donald trump has put forward policy positions and then contradicted himself and now he is finally republicans pushing back on some of them. it is difficult to say what you will get out of the administration. most of the postelection trade was on corporate tax helps. corporate tax is the most likely because there is bipartisan support for lowering the tax rate on companies, but how long that will take in what form -- nobody has any idea. i was talking to one investor who said the trade for now is to trade volatility. jonathan: i am looking how this is playing down, reflecting at this back on the -- reflecting back on the news conference from last week. we talked about what they might

do with health care. the question i want to ask is how distracting will that become for the party at a time when many of our audience wants to see a fiscal plan not just out late, but implemented as soon as possible? michael: it is going to be very difficult because obamacare is such a big piece. you have to deal with so much of it. there are four committees that have to do with parts of obama, including some committees that would also deal with -- parts of obama care, including some committees that also deal with taxes. none of this is certain. a lot of economists at this point, and analysts, are saying don't look for anything to really affect the economy in 2017. we might get legislation that would affect this in 2018. that trade might have to wait a wild. -- waited while. updates on what

is making headlines outside of the business world. taylor riggs. taylor riggs: el chapo has been educated to the u.s.. el chapo and embarrassed the mexican government by escaping from a maximum security prison. he was captured a year ago after a six-month manhunt. in central italy, there is a report that eight survivors have been found in the rubble of a hotel flattened by an avalanche. rescue crews have been hampered by heavy snowfall. the area was rocked by earthquakes earlier this week. and a group of lawmakers in london says traffic delays cost the british capital $6.8 billion a year. they recommended changes to the congestion charging program. investors say they should scrap the flat fee drivers pay to enter into london and should pay

more for using the most congested roads when traffic is the heaviest. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i am taylor riggs. this is bloomberg. alix: thank you so much, taylor. s&p futures inching their way higher, but i wanted to highlight some movers -- procter & gamble up over 2%. earnings were two cents better than estimated. all five operating segments showed sales means. organic revenue group to present. -- grew 2%. ge, a different story. the oil and gas business remaining challenge. american express and ibm after the closing now yesterday. americanamerican express doing , but cost cutting measures fell short. the stock off by 2%. ibm off by 1%. earnings beat, but revenue fell by 1%. systems revenue fell over 12%. in the health care sector --

merck and bristol-myers. bristol-myers off by over 8%. the company has sought approval as a first-line lung cancer treatment, but it is pulling the accelerated approval process, and it makes room for mark. -- mark. watch these stocks as we head into the open. david: thanks so much. coming up, back to capitol hill. republican senator john thune will be joining us. he led the confirmation hearing for wilbur ross and we want to ask him about the future of donald trump's cabinet. plus, donald trump says he wants to make america great again, starting with the economy, so it is a good time to look at the economic track record of his predecessors. who did the best, who did the worst, and what does it tell us about what president-elect trump has left to? that is next. this is bloomberg. ♪

david: this is bloomberg. i am david westin. back to- we will head capitol hill where senator john thune joins us live. welcome on this big day. senator, i want to start with where we are in the confirmation process. you have jurisdiction over some of them, but not all of them. how long will it take before the new president has the cabinet in place? sen. thune: i hope we get as many of them confirmed as quickly as we can. my concern is you have a lot of important positions, and the longer they are vacant, the harder it is for the new team to get up to speed, get on the ground, and go to work.

i think probably today we will confirm some of the national security team -- most likely, defense, homeland security. there is a discussion going on about something of the other top-level national security positions. getuld like to see us elaine chao, wilbur ross -- i think they are noncontroversial, but it is up to the democrats. is of wilbur ross interest to our audience is of trade. of when he any sense will be confirmed if he is confirmed? sen. thune: we will do everything we can to get him to the floor. if it's unanimous consent. i would expect early next week. because he enjoys bipartisan support, he is someone we should get through the process quickly. he did a terrific job. a half hourfour and hearing, and he gave substantive

answers to issues you are concerned about. trade was paramount among those. i feel confident in his prospects for confirmation, and i think he will be good in the job. he has tremendous expense to bring to it, and he answered the questions with competence and knowledge when we had them in front of the committee. alix:. in from wilbur ross -- pivoting from wilbur ross to steven mnuchin, he spoke about the dollar, and said longer-term he favors the long dollar, in contrast to a donald has said about the dollar being too strong. you believe in the progrowth agenda. how do you factor that into conflicting statements about the dollar? sen. thune: miller thing i was encouraged about and i talked about in the opportunity i had to question steven mnuchin yesterday is he is very pro-growth. there are different points of view about the value of the dollar and how that impacts the overall economy. the key is you want to strike a balance.

part of the proposal that has been advanced by the house ways and means committee has a border adjustability provision, which includes adjustment of the dollar to offset a so-called import tax. there will be discussion in terms of the policy framework going forward, tax reform, trade, and everything else, about how the dollar plays into that. alix: right. sen. thune: as someone that represents an agricultural state, we would like to export and not having the strongest dollar is good for our exports. alix: that gets to the heart of the conversation -- competing agendas, in some ways. if you are manufacturing to be brought back to the u.s., you need a lower dollar. what you the reality will wind up being? sen. thune: probably, again, it is trying to find, strike the balance. obviously we were manufacturing jobs to stay in the united states.

that is where we are certain tax reform. we think we are shipping to many jobs outside of the u.s., and too much income is being housed outside of the u.s. because tax codes are not competitive and the rate is the highest in the world. in tax reform, if we could go to a territorial system and create a tax system that is civil and encourages businesses to stay in this country, do business and create jobs here, that will be a good outcome. of course, depending on what happens with the border adjustability debate, we'll see how the value of the dollar plays into that. i think a strong economy, a growing economy, getting up to 2% or 3% growth is good. that probably means the dollar will be stronger. that means these things have the tendency to even out. if you have policies in place, and a growth trajectory, and you're creating good, pain jobs, it will balance out in a way -- paying jobs in our economy it will balance out in a way that is good for the consumer and our standard of living.

david: you said growth is at the top of your agenda. when you had willed or ross, he said exports are important, but one of the ways to get exports up would be to use tariffs to extract fair trade agreements. that would have to come through your committee in all likelihood. where are you on the use of tariffs? sen. thune: i'm not a big fan of tariffs. i think, again, we want to create a more free trading environment. we want other countries to lower their tariffs to our guts. i speak from a next -- goods. i speak from in a cultural state. that is probably the generally held view amongst ulcer of probably some democrats as well. i was fairly, with how he answer those questions. i think he was suggesting we have to enforce our laws, and make sure the countries with him we trade our being fair and complying with trade agreements. oftentimes, businesses in this

country are victims of countries who game the rules, don't play by the rules. we play by the rules, and as a consequence, businesses here are hurt. he was clear we want to send a strong message. he is someone who in his business life has been a victim of unfair trading practices. he has personal experience with that. i think he will bring a perspective that exports are important. if we want to grow the economy, we have to trade, but we also have to make sure we have agreements that are good and that we enforce them. i don't disagree with that. topic muslims of congress on either side would. jonathan: i hear this again -- i don't think democrats -- members of congress on either side would. jonathan: we hear this again, but why are free trade agreements coming under so much criticism? i understand the china point -- they have massive tariffs on luxury cars, etc., but why mexico? sen. thune: you are right.

the point on china is fairly clear because of the way which way discriminate against american-made products, but mexico, canada, the whole nafta deal, when they indicated, and what wilbur ross indicated, is on a periodic basis, it is important to re-examine the trade agreements to see what is working and what is not. i do not think you will find much argument from people that mexico and canada -- our two biggest trading partners, that we need to have a robust a relationship with them. whatever steps they take in terms of re-examining nafta and other trade agreements, that is fine, but in the end, we need to end up in a place that continues to promote a low post, open trading environment with our two biggest trading partners. alix: thank you so much for joining us. we appreciate it. senator john thune. sticking with trade and tariffs

under a trump administration -- former u.s. secretary of commerce carlos gutierrez discusses negotiation tactics with nafta and playing hardball with china. this is bloomberg. ♪

jonathan: from new york city, with the eyes of the world on washington, d.c. on this inauguration friday as president-elect trump he comes the 45th president of the united states. the markets -- a five-day losing streak on the dow, the longest before the election. the dow futures up about nine point. .&p 500 futures of about .2% ugly retail sales out of the united kingdom, exacerbating the downward trend on cable.

treasuries, on offer, with yields up about two basis points. 10-yearthe yield on the today. -- we are waiting -- 2.49% is the other the 10-year today. matt winkler takes a look back at the last six presidents and scores how the economy did under each of them. very pleased to say matt is with us now. ", the 17thcke century english philosopher, it is one thing to show a man he is in error, another to show he is in possession of the truth. put us in possession of the truth. had six have presidents, and the most successful economy came under bill clinton, the second-most successful economy came under barack obama, our most recent president.

jonathan: focus on the data points where you compared president to president, and reconciled some of the political rhetoric you hear against the obama economy. matt: we looked at what turned out to be 14 economic data variables that are most commonly cited to measure performance, and we decided if we gave them an equal weight, that way, all the disadvantages and advantages that every president inherits would be offset, so it would be fair to all. for example, barack obama got the worst recession since the great depression. that is a horrible hand. jimmy carter appointed paul volcker, who subsequently raised interest rates, breaking the back of inflation. that was good for ronald reagan, bad for jimmy carter. you have contrasting benefits

and advantages for all of these presidents, but when you look at all of them together, you get a sense of ok, which economy did best? david: it brings up the question of why people did not give him the credit you think he deserves -- he rates at the top on deleveraging and strength of the dollar, but toward the bottom if not at the bottom on productivity and disposable income. i wonder if that affected the perception across the country. matt: what has affected him more than anything else is low gdp. that is really the worst part of obama's presidency, that gdp has been any mix. having said that, he is the longest streak in nonfarm payrolls going up -- jobs, going all the way back to 1939, and he did, with slow and steady growth, bring us out of the recession. there is no question about that. there is a benefit. --id: sorry to interrupt you

mike pence getting out of the limousine in front of st. john's church, which is just across lafayette square. alix: he will be joining shortly. , issue isissue you you have a looser monetary policy, which forces the fed to raise rates later in the cycle, which happens right as a republican takes office. is the correlation truly just about the fed? matt: actually, it isn't. bill clinton really had a hard time of it. the fed, famously, or infamously in 1994 raised interest rates, and alan greenspan said that was a mistake. that was a huge obstacle for bill clinton's economy in 1994. the economy took off afterwards, but he was not a beneficiary. if you recall, he lost congress in the period. he really was, you know, under

siege as a president at that point, two years into it period jonathan: fantastic story with the data the matter where you are on the political spectrum. matt winkler. coming up on the program, trump's take for treasury secretary called for 2% to 4% growth in the u.s. is it feasible? we have a countdown to what could be a big 100 days for the markets. fiscal stimulus -- that is what it wants. we will discuss what is next. from new york city, this is bloomberg. ♪

jonathan: from new york city, this is bloomberg daybreak. i am jonathan ferro on this inauguration friday. futures positive, up about 15 points on the dow after a two

-day losing streak. the positive tone as we count you down to the cash open. treasuries on offer throughout much of today. yields of about two basis points. 9%, the yield on the 10-year, and a stronger dollar, the theme. the cable rate a lot weaker on the back of the obvious retail sales, i believe, since 2012 out of the u.k.. alix: take a look at that, crude, self rally. here is what you need to know -- inauguration day --donald trump will become the 45th president of the united states. coverage,u live preview the next 100 days and preview what investors can expect from an unexpected president. george soros unleashing harsh words about the future for the u.s. president. by the billionaire investor thinks donald trump will fail and sink the market. fed chairs janet yellen reinforces her strategy for gradually raising rates and

argues a central bank has not been behind the curve. we look at the fed under a trump white house. that is what you need to know at this hour. jonathan: covering the inauguration of president donald trump for us is bloomberg's kevin cirilli, right in the middle of the action in front of the u.s. capitol. this time last year, i spoke to davos,rs, economists, in switzerland, i would say president trump, and they would laugh in my face. you have been following the campaign --talk about how it has evolved to get to this point. you know, 18 months ago there was a bare-bones campaign, and now we are just hours away from president-elect trump who will take the oath of office on that podium on the capitol steps behind me. i spoke yesterday with corey lewandowski, the original trump campaign manager, about the evolution from a scrappy campaign to what we are saying today. let's listen to what he had to say. startup. are truly a

we wanted to make sure we were asnding mr. trumps money wisely as possible because that is what he wants to do for the u.s.. the crowds kept getting bigger until 60 to remind people came out on election day and supported donald trump, and made him -- 63 million people came out on election day to support donald trump and make him the next president of the united states. the lobbyingmaking and advocacy group on k street. for washingtone and the way it works for the world. jonathan: you talk about how what began as a scrappy campaign became an election-winning machine. expectations could not be higher 56, look at it as the highest since 2002.

this is a market with participants and economists expect big things to come and come very quickly. does this man, as he walks out the door, have the team set up around him to execute quickly. quicklye has to deliver to appease the people that voted for him, and you can anticipate swift action on repealing parts of the affordable care act, obamacare, if you will, as well as dealing with corporate tax rates, individual taxes, and of course, international trade agreements, on a variety of trade issues from internationale pour -- foreign policy, dealing with iran, and immigration. he is a lot to deliver very quickly. jonathan: kevin cirilli, thank you very much. david: what we are watching here , as you refer to already, jonathan, the president-elect coming out of the steps of blair house, next to the white house.

they get into the motorcade. they will now drive all of two blocks around the corner up to 16th street and join the vice president-elect michael pence at st. john's church for a ceremony. they have not quite departed. we have this ritual every four years. it kicks and a half-hour to go a block and a half. alix: we will keep our ion that. the big focus -- our i on that -- eye on that. the big focus at davos. mr. ross: we have been growing at 2%. we are a 3% plus grower. donald trump thinks we are a 4% plus grower. i hope we are. points of u.s. gdp is $200 billion. that is a lot of inequality that will go away.

the positive -- >> a positive attributes, that we definitely need, growth in the nicest is good for everybody. it helps to drive global growth. >> what we see is a new administration that is talking about growth, if a structure spending, tax reform, and, you know, repatriation -- things that are pro-growth. >> growth is good for all of us participating in the economy, so i think this administration, as all administrations try to do, it will be focused on growth, and to the degree that people working in administration can think in practical ways about how we can accelerate growth, which provides opportunity and jobs for people across the economy, that is a good thing, and in that environment goldman sachs will benefit period >> --will benefit. >> we should be able to get to 3%, 4% sustained gdp.

that is important. the most important issue we have is economic growth. alix: we are joined by deutsche jim's chief economist, and o'sullivan, then a bit to rent economist for the us economy in the fourth quarter of 2016. the beginning of the segment we heard 2%. mnuchin same 4% is a possibility. >> i think it is likely we will cnx collation in growth -- escalation in growth. we have seen congress that has been progrowth and pro-business. all of that should be lifting gdp growth. becomes, of course, what will the inflation picture look like when we get there. we are already close to full employment. it is a delicate balance we are following, but there are potentials. alix: it could happen -- what do

you think? lot they bounce around a quarter to quarter. in the short run, if there is big studios, you can get a big lift to growth quickly, but it does not look like there will be quick policy action from a macro perspective anyway. it is not until the second half of the you -- year where we get tax changes. ultimately, the biggest question is a sustained pickup in growth, and that is with the treasury secretary nominee emphasized. to get sustained pickup unit is stronger labor force growth and stronger productivity growth. could we boost economy with tax cuts -- sure, but in that case, the fed would tighten more aggressively. can we get labor force growth of -- the only way to do that significantly is to allow more immigrants in, or do we boost more productivity growth? that is more open-ended, encouraging business investment, infra structure.

there is some room there, but realistically, 3%, 4%, it is a bit of a stretch. forthan: we are waiting policy initiatives, but the sentiment cannot get higher than this -- the highest since 2002. can it become real -- expectations are high, therefore people are confident, go out and do more? absolutely -- there is high correlation to consumer sentiment and actual consumer spending. if this stays at these elevated levels, you should expect a boost in consumption, and what has been unique, as you can see and your terminal, is the increasing consumer confidence has been for people at the bottom of income distribution and the middle. yet -- you have not seen much by the high-end consumer. the average consumer is feeling better. it has sustained for november and december. we have to watch the numbers in general can we could get a boost from unleashing animal spirits. david: you see the motorcade is

pulling away from blair house on its way to st. john's church with the president-elect will depart, and have a ceremony. coming back to this question, how much of it is baked into the economy -- fundamentals, before we even had donald trump, how much is this extra elixir of donald trump getting elected? jim: i would say the transfer positive before the election, and there has been a little since the election. with the labor market, we keep getting 180,000 a month. jobless claims, no sign of weakness there. personally, i think there is a limit to how much confidence can boost spending on its own. over time, it is an indicator of spending. if you sustain these levels of confidence, absolutely, it is stuck about a mime offices -- metamorphosis of spending. realistically, without policy change in the next six months -- we're not when you get a tax cut

in the next six months, realistically there will not be cited ray auditory relief. suddene will not be regulatory relief. torsten: will we see followthrough -- the same thing for consumers, if we do believe this is going to be sustained, there are reasons to suspect consumption will be moving. likewise, if you do not think it is sustained, stock market should not be training as high as they are the moment. sales lookment store terrible, but amazon is doing great. in total, real consumer growing -- has been going close to 3%. it has not been that. david: torsten slok, and jim o'sullivan, thank you very much -- thank you both for joining us today. president-elect donald trump and his commerce secretary designate will bore ross says trade with -- wilbur wass will betray -- ross say-- wilbur

trade will be one of the things they address. we will be joined by george w. bush's surf air commerce, as the president-elect is shaking hands with st. john's church vicar, about to go in for the traditional service. this is bloomberg. ♪

taylor: this is bloomberg daybreak: asia i am taylor riggs . coming up -- daybreak. i am taylor riggs. coming up, --

alix: as donald trump is inaugurated as the 45th president of the united states, the question is what is in store for the next 100 days, especially with its policies on trade. over the last week, those in davos raid in -- weighed in on the topic. >> what is maybe blown out of proportion is trade. they are looking to tweets and one-liners, and statements like that, and the president said he negotiates that way -- he puts it out there. >> i think any sort of a trade war would be mutually assured destruction with china or other countries. >> they have gone through many u.s. administrations with many chinese administrations, and he was anticipating being able to work things out, as our the u.s., -- as is the u.s. despite the kind of language from time to time he has employed. so, multiplying things that get

sad to create enormous anxiety is, i think, little overdone. >> obviously, a trade war with china will be bad news indeed for everybody that is in a global-trade related business. >> we are definitely for free trade, definitely for open markets. it is clear that globalization is a force for good. i do not know anybody that challenges that. it does have some negative aspects. maybe we have all been too quick in dismissing those. >> if he is anti-trade, i am at odds with him, but at the same time, what his rhetoric and what his spokesmen are around him, and again, he is not a careful politician, and it is hard to get all the nuance in 140 characters, but what he seems to be saying also is consistent with i want to renegotiate these trade-offs. i want them to be more symmetric. -- trade deals.

i want them to be more symmetric. i wanted to be more fairer. and if not fair, beneficial to the u.s. address. i do not see fault with that. alix: we heard this from the confirmation hearings and surrogates -- that it is not anti-trade, but it is free trade and better deals. what will be the reality over the next 100 days? matt: that is a good 1 -- michael: that is a good word because donald trump will start to find his rhetoric clashes with the pot -- policies he has an the consequence is of his actions. he will probably immediately withdraw from the transportation dextran specific partnership. -- transpacific partnership. there are no consequences in the short term. and he wants to renegotiate nafta, but he does not have the power to put a 35% tax on companies importing from mexico. he can only import -- impose a

tax on a sector -- maybe all autos, but not one company. then he would have to ask congress to pass specific legislation. he is probably also unlikely to name china a currency and if you later -- a currency manipulator. he will come up against limits of what he can do, and that leaves a question of how does he govern? does he continue the rhetoric, or does he look for practical, cover my solutions? david: that is michael mckee, reporting from washington, thank you. with us now, carlos gutierrez, former secretary of commerce. thank you for being with us mr. secretary. welcome. sec. gutierrez: a pleasure. good to see you. david: let's start with nafta. the last time you are with us, you said whatever is to be done is to begin quickly. we spoke with senator thune from south dakota and this is what he had to say.

senator king: whatever steps they take -- senator john thune: whatever steps they take in re-examining nafta, that is fine, but in the end we need to end up in a place that promotes a robust open trading environment with our two biggest trading partners. david: i would say, secretary, you have one senator on your side -- it is time to take a look at it, but let's move on quickly, and you think that is where this is going? if so, while he making such a big deal of this? sec. gutierrez: in many ways it is symbolic. yes that is one of the trade agreement we have a trade deficit. we have a surplus if you add up all the others, but we do have a trade deficit in nafta. this could be a matter of opening up the environmental chapter, the labor chapter, looking at maximum -- mexican wages, minimum wage, making sure there is not an unfair advantage. the key thing with negotiating

naphtha, renegotiating nafta is a foreign-policy question more than a trade question. what do we do to the internal politics of mexico? there is a presidential election in mexico in 2018. if there is a sense that there is some bullying going on, that the deal is getting lopsided in favor of the u.s. -- if in the meantime mexico goes into a slump, or into a recession, then i think that could have some very serious and tax on the 2018 impact onn mexico, -- the 2018 election in mexico, and we might end up with someone that is not good for the security interest of the u.s.. how we deal with this is critical. david: and president pending until has said he is open to some talk about nafta. in the meantime, can you sustain

the balance of trade deficit without doing the damage politically that you suggest? sec. gutierrez: that is also the trick. hearing,, in mnuchin's he said something that i thought was very important and it is the first time i have heard it coming out of this administration. i think it is something we need to keep in mind. he said the goal of anything we do in trade is to increase exports, not to decrease imports. that, for me, is everything. and that should be the strategy. if we try to decrease imports, than the rest of the world will try to decrease exports from the u.s.. and we're going to get into the same trap that we did with the tariff decades and the kids ago. -- decades ago. it is important to keep that in mind, that we are trying to increase exports from our companies, and that the goal of all of this trade work is not to stop imports or decrease them.

david: to that very point, you have said before the big issue, and a much more difficult issue is china. we do not have a free trade agreement with china of any sort. we are starting from scratch. 'tis a much bigger player. he heard wilbur ross talk about tariffs. can we get fair trade with china without going through some kind of tariff system? china is more: complicated you have state-owned enterprises. we do a big business with state-owned enterprises. how to regulate or know how -- that they are not getting subsidies -- you know, it is a lot less ok -- opaque. how policy is developed, how labor flows inside the market. china will be a lot more complicated to negotiate.

as we said before, we don't have a framework from which to negotiate. today, we have not only anti-dumping cases against china, we also have anti-subsidy cases, which is very rare to have both of them on a single country. so, how do you get at whether loans that state owned enterprises are getting are subsidized, whether they are being pardoned by the states -- those types of things that i think are going to be very, very difficult to get at. we also have some issues in terms of intellectual property. cyber security. the new regulations on technology firms going into china is very restrictive. so, there is a huge agenda with china. david: so, finally, mr. secretary, you served, as i said, as u.s. secretary of commerce, the prominent ceo with kellogg's. you had a lot of success come about were also one of the most

well-known, highly respected hispanic voters of the cabinet under george w. bush. does it trouble you at all as we look at his new cabinet that there are no hispanics for the first time, i think, since the first term of ronald reagan? sec. gutierrez: with something that really popped out and it was clear after he chose sonny perdue for agriculture. look, the only thing i can say is i hope it is the only -- it is the way things turned up, and he was looking for people he knew, who had the skill put in the right job, who subscribe to his point of view. done, youe it wasn't know, and vertically -- and vertically. that it was done on purpose. that would be a problem. we need to move forward. ps other jobs to fill. invariably there will be turnover in this administration. i do hope hispanics play a lot

bigger role in his administration. that is all part of the healing and the unity the president-elect would like to create. david: i would notdavid: -- i was not suggesting it was adverted, but there is fence mending enbridge -- bridge building the president might want to do with the hispanic community given the campaign rhetoric. what advice would you have for how he would start the bridge building? sec. gutierrez: i think he should start meeting with people who represent the hispanic community -- people who have their pulse on what really the head ofanics, associations. there are a lot of big groups. i have not seen anyone -- you see the films come out of the trunk tower. you have had some prominent minorities, but i have not seen one member of the hispanic-american community i

think there should be. you should be listening to those folks. he should have this people in his administration and his trusted circle. if not, it becomes a bit too obvious, and people start wondering people start -- wondering whether it was done and vertically. alix: excellent point -- i want to wrap this together and end on trade. 20 think the biggest reaction could be if we see retaliation to a dental trump presidency? think the biggest reaction could be if we see retaliation from a donald trump presidency? sec. gutierrez: the biggest reaction would be from china. china will not be pushed around, and i think we know that. that is something we need to keep in mind. mexico, because of the 2018 presidential elections, they also have to show a tough stance. so, it will not be easy.

but the big one -- the big one will be china. jonathan: carlos gutierrez, we appreciate your time. coming up on the program, we are following all of the action out of washington, d.c., as donald trump prepares to become the 44th president of the united states -- 45th president of the united states. st.as just arrived at john's church. later, jim polson will join us to talk markets under the future u.s. president, donald trump. from new york city, this is bloomberg. ♪

jonathan: for our viewers worldwide, good morning -- a

warm welcome to you all from new york city. this is bloomberg daybreak. i am jonathan ferro alongside alix steel and david westin. futures are a little bit positive, of about 19 points on the doubt. positive five points on the s&p 500. yields of a single basis point now at 2.48%. in the fx market, a stronger dollar story in the g 10 space. david: here's what you need to know at this hour -- inauguration day. donald trump will become the 45th president of the united states of america. we will bring you live coverage of the next 100 days and talk about what investors can expect from an unexpected president. george soros unleashes a slew of harsh words about the future president of the united states. 20 billion or investor thinks donald trump will fail and sink the market in an exclusive -- theionaire investor -- why

billionaire investor thinks donald trump will fail and sink the market in an exclusive bloomberg interview. we look at the fed under a trump white house. jonathan: 30 minutes away from the open. features marginally higher. let's get you some movers quickly. alix: on the upside, skyworks solutions up by over 7%. earnings were better. cf industries also up by 4%, getting the double upgrade at bank of america merrill lynch. merck getting a nice boost. the bristol mile cancers -- bristol meyer cancer drug is being withdrawn for fast truck -- fast track improvement. bristol-myers getting hit, down over 7%. this particular drug they will withdraw from the fast-track generate 20% of bristol-myers

revenue as a secondary drug. this is a big black mark on bristol-myers. herbalife -- every day traders favorite stock -- sees fourth quarter sales being lower than expected. a man express off by 2%. prophet also felt -- american express off by 2%. -- profits also fell. david: covering the inauguration is kevin cirilli on capitol hill in the cold and the rain. we know the president and the president-elect are at st. john's church having this service. what comes next -- would you expect? kevin: they are going to head over to the white house later this morning where they will meet with other top members of congress, including house speaker paul ryan, and senator mitch mcconnell, along with president obama. at one point, president-elect trump and president-elect trump will have -- and president obama

will have coffee with their respective wives. we are several hours away from when president-elect trump becomes president trump. i have to tell you, they are testing out the audio. the crowd is filling up. people have come from all over the country --as far as california. the crowd here feeling pretty good and excited to hear what president-elect trump has to say. david: is it too soon to get a sense of how big the crowd is? right now, i would say there are at least more than several thousand, but we have not heard an official crowd count, and it will be interesting to see whether or not the weather here did t-rex anyone from coming, but the people around us are having a good time. david: and what can you tell us about what they were here once the ceremony begins? kevin: this will be a shorter inauguration address that we have heard from previous administrations.

he will focus on being a president for all of america, and the key central theme we will hear from him is he wants to put america first. this, of course, is coming as he is going to try to hit the ground running, if you will, in his administration, repealing key parts of obama, looking to renegotiate -- key parts of obamacare, and to renegotiate trade agreements, and get the ball rolling on tax reform. when you look at market reaction or expectations in terms of gauging from that front, he has a lot riding on this address in terms of what to project from the world, and economic leaders as well. david: kevin cirilli -- and if we had doubts on the weather, you can see the digital breakout, it is wreaking havoc. jonathan: kevin is counting the crowd members and will come back with an official tally. george soros, weighs in on trump's impact. the wall street journal reported george soros lost $1 billion on

the election result in the truck rally that came afterward. surprisingly, or maybe unsurprised like him he has a grim outlook on what comes next for markets. george: right now uncertainty is at a peak, and uncertainty is the enemy of long-term investment. i do not think the markets are going to do very well. right now, they are still celebrating, but when reality comes, it will prevail. jonathan: joining us now is jim paulsen. great to have you with us on the program. a grim outlook. expectations are very high how quickly does this administration need to deliver a policy response to validate what we have seen in the market? jonathan, i think

that the policy response of the trumpet administration is just one factor among many that is providing a very positive foundation here for the stock market. i think it is much less important than what is happening in the global economic momentum here. we have had a significant impact and growth in the night fades from growing sub 2%, prior to the third quarter were we jumped up to 2.5%, growing close to 3% in the fourth, but at the same time there was a global pick up across the globe. , thish recoveries recovery has finally brought it down to include the middle class, main street. wages are going up, real meeting incomes are rising for the four -- median incomes are rising for the first time. are touching more economies that are doing better than ever before in this economy. the westpac global surprise index has risen to some of the ties levels of the recovery. has52-week moving average

risen to a list a six-year high. that says this recovery is maybe broader than ever. we restarted the earnings cycle after a stall. we are moving interest rates away from zero. the fed is normalizing policy, and we are electing a pro-business president that is promising less regulations and lower taxes, but my point is i don't think we need that to continue to do fairly well. jonathan: well, some of these sectors will need that. if you look at the financials and the rather we have seen, the correlation is clear. yes, the rally began earlier in the year, but it was fueled and aggressively fueled by trump with the expectation something big would come out of the administration. with the expectation something big would come out of the administration. how do you draw a distraction between what is a global -- distinction between what is a global phenomenon and the trump

administration? jim: financials have responded a lot to the rising yields. they are benefiting from the federal reserve raising short race and giving them a revenue flow on deposit liabilities. they are benefiting in the stooping of the curve. it benefits all the profit margins in all their businesses. they are also benefiting from a 7% to 8% rise in growth out of the banking industry, which is a new phenomena over the last couple of years. it was nonexistent earlier. and the effects of the markets are closed to new highs, and there is a fair amount of deal activity, and increasing public interest in the stock market, which increases transaction activity. this is not just about trump alone, although certainly less regulations will continue to help them if they do in fact come through. alix: i feel the elephant in the room has to be the dollar. here is what steven mnuchin in his confirmation hearing set about the dollar. mr. mnuchin: i think the u.s.

currency is the most attractive to be in were very long periods of time. i think it is important, and you see that now more than ever. the currency is very strong, and what you see is people from all over the world wanted to invest in the u.s. currency. alix: so, really, kind of, favoring the long dollar longer-term. what does that mean for u.s. companies, and at what point do we see an issue on exports, profit margins getting bit into? the dollarnly, if goes up, that will start to bite into earnings momentum here in the united states. there is no doubt about that. my feeling is the vast majority of people think the dollar is going to keep going up. i think the dollar has been in a peaking mode the last 18 to 24 months. the dxy, the broad dollar against developed currencies, is

not very different right now, close to 100, then it was a year ago or two years ago. two has been at the high-end of the range and has been in for two years. the fed is raising rates, we are raising rates in the united states, but the reason we are doing that is because inflation is going up. inflation is petitions are rising from 1.2% last february to about 2.05% this morning. ultimately, a rising inflation is one of the most instructive things for the value of the u.s. dollar. rates are going up, but i think inflation is also going up, and i think the dollar is going to surprisingly come down and juice earnings momentum even more. jonathan: there is a contrarian call. jim paulsen, wells fargo, they given much. coming up, president-elect snald trump has vowed to lash regulations -- that is

coming up. this is bloomberg. ♪

jonathan: from new york city, this is bloomberg daybreak -- breaking news out of the united kingdom, according to a person familiar with the matter, hsbc has begun cutting about 100 senior investment banking jobs, at the managing director and director level according to that person. that person asking not to be identified because the matter is private. just bc said to begin cutting about 100 investment banking jobs. david: thank you. thank you regulation is at the top of the agenda for investors. as we prepare for donald trump

to take the oath of office, we asked bank ceos what they expected out of the new administration. >> some of the legislation stuff --people ask about dodd-frank, and all that, what i would be for is no one in their rational mind. say everything we have done and how it was done was done right. >> there is a lot of clean up the news to be done, but i would not advocate, as some people are, for throwing out dodd-frank. i would not do that at this point. >> i think it will be implementation. there will be every go through a debate about whether regulation is and how it will be mitigated over time. >> 20 to stop and absorb the regulation that has been done and recognize for the u.s. banks the capital levels are sorted narrowly high. >> regulation -- it is harder to do than just changing regulation. regulars can change a lot of things easily -- compliance, cost, certain rules about lending, how you use your

capital. i would like to see some of that looked at and modified a bit. it would be good for the economy. >> you look at the policies trump has committed himself to, they are stimulative and market supportive. you look at spending on infrastructure, lower tax rates, removing some of the regulations and some of the hilltop and overlapping -- buildup and overlapping regulations, those are all quite stimulated. again, stimulative against the status quo anti- , but far left dish for more stimulated than what they were expecting. david: we are joined by the chief equity strategist for kbw. we had john allison, who used to run bb&t bank on her lip, and we posed him the question that a lot of big bank ceos -- bank on earlier, and we posted the question a lot of these banks do not need these reforms.

it is bigger for the regional guys. are they right? >> it is difficult. there is certainly some truth to that. if you get regulations that affect community banks, a lot of that is not a table. the bank secrecy act is a real plague. we do not see things like that changing. while he makes some good points, i think it is very difficult. implementation will be more difficult than some people in the market think. david: explained that, why that is where the rubber means the road. it sounds like why wouldn't we want to protect against that. fred: exactly. it is the challenge -- it is complicated for smaller banks, the rules and regulations been imposed as a result of that. jonathan: what kind of rules do we need to see? fred: fundamentally, what we will see going forward is a bit of relaxation. with the ceos are saying is not

much different than what janet yellen is saying. less -- a bit of a less of a footprint from regulars on the banks could probably help out here. alix: there was a report from consultancy yesterday that big banks could save as much as $27 billion if they pare back the spending they used to comply with regulation. do you believe that kind of number? fred: i do not think they could say that, but what we are talking about now is not having to increase. if we look at compliance costs, it has been the biggest growth area of the last five years. if that slows down, you will see what we call operating leverage happened --higher rates, higher revenue, less cost. tc the markets expand, and growth in earnings estimates for the big banks. david: is that what is necessary to get more lending done? i talked to brian moynihan, and he said if you reserve -- increase reserve, you could

freedom up to lend. fred: it is a question of how much lending capacity we want to expand -- do we want to thousand six and 2007 again? again? and 2007 the last two years, it is not bad -- lending has not been a major impediment to growth, unless you want really rapid re-leveraging. alix: looking at the space, which bank's best poised to take advantage of this kind of opportunity? fred: the number, number one, this is a global trade going on. it is a reflation trade. the banks in europe and japan have gone up as much as the u.s. banks. a lot of these things, if you want to play value in banks, you should look at europe and possibilities there. that said, our topic is bank of america. you don't have the overhang of wells fargo. q should get benefit from -- you should get benefit from higher interest rates and benefits from less regulatory touch. jonathan: you don't get to leave

after mentioning european banks and not taking one. start with the country. would you go? fred: well, we're not quite going to germany, so we can go to deutsche bank, but we like bnp. tweeting some of these eggs can do relatively well in the -- we think some of these banks can do relatively well. fred: based on these trades. jonathan: bnp specifically -- facing a tough election year in france -- who knows the regulations we will have. why bnp paribas? fred: interest rate pressure has been the most. if you like and up globally on both of those, you probably want to look at the leverage they have for minor changes in europe. jonathan: fred cannon, great to have you with us. coming up on this program, let's see what is at stake for u.s.

equities as donald trump takes office. look more for -- no further than the stock market? --the stockpanies market's most taxed companies. this is bloomberg. ♪

isathan: from new york, this bloomberg. i am jonathan ferro -- companies perceived as benefiting most from the corporate tax reduction we may get -- an index of high-text stocks has been in the s&p 500 -- gone up by the most in four years in the s&p 500. we are joined by -- who crunched the numbers. walk me through this. >> there is a basket goldman sachs is identified. these are the ones with the highest tax rates as they range from 35% to 40%, which would fit in nicely with donald trump's

proposal to reduce it all the way to 50%. that might be a aggressive, but a reduction to 20% or 25% might not be the worst thing in the world for these stocks. what we have seen is there are banks in here, auto companies, a lot of high-tech companies that have really taken fire since the election, up 25%, 30% each. that represents is a lot of expectation that these stocks are going to benefit from this. there has not been much follow-through on trump's part yet. jonathan: you have the official tax rate at 35%, then the effective tax rate at somewhere in between. these companies, when do they sit amongst all of that? the 10-year tax rate, they are ranging from 35% to 40% over that period. they have been taxed at the high end of the spectrum for quite some time. it would clearly benefit them greatly. it is very into see that people on wall street have not really

been adjusting the ups forecast quite yet just because of the uncertainty about this. they are not really taking this and running with it, and a lot of that having to do with the border tax that has been proposed dragging on retailers. there are a lot of counterbalancing factors that don't make this quite an easy trade on a day, broader, s&p basis. alix: analysts more conservative, investors not so much. that is alicia with the normalized increase of the s&p -- that is what we cap showing with the normalized increase. we see people buying volatility, hedges -- what is the downside? joe: the downside is great here we have been leveling off. the s&p and the dow creating a range. people have not been inspired lately. we can see a reversion to pre-election levels if it does not come to a -- fruition that could lead to a decline in the stocks. david: what other realistic

chances there will not be fundamental reform -- democrats and republicans agree we have the highest corporate tax rate in the world, something has to be done about that, but the question is how do you pay for it? joe: i think the skepticism you see is based in. people have been buying volatility, but that has been slowing down. the market is moving sideways. it was sort of a reactionary trade. he saw most of the gains in a lot of these copies in the first week after the election. there is optimism, but not an overwhelming degree of confidence. that is why you have seen a leveling off. big consensus, little conviction. consensus for that conviction --that is what it feels like right now. policyou have uncertainty, as we have been talking about all show, but in the vix it is low, so not reflected in the market. the s&p going nowhere the same time. david: which brings us back to today, the inauguration, and the

cabinet. 20 the cabinet officers to put together the policy so them -- we need the cabinet officers to put together the policy. getthan: there is the open the good stuff, and the belief we won't get the trade wars. you have to discount that somehow in this market. the opening bell next on bloomberg daybreak. futures, sally positive on the dow after a five-day losing streak. the s&p 500 up .10%. bonds on offer. deals of a basis point at 6.48%. york, ♪ -- from new york, this is bloomberg. ♪

government. ♪ jon: this is "bloomberg daybreak." this anthan ferro on observation friday. 20 seconds away from the open. point after a 21

five-day losing streak. the longest since the election. as you hear the opening bell ring, switch up that boredom look at treasuries. 118. years your yield on the 10 now. 131.80. was we had aggressive repricing on the back of the trump election. a stronger dollar story. the euro flat against the dollar. this open market to alix steel. x: the dow is coming off of a five-year losing streak. looking at major averages heading for a second down week.

if you dig deeper into the individual names, we are looking at apple and its suppliers. they are coming out saying it should calm fears about any potential iphone sales dropped. apple moving higher by 2/10 of 1%. other suppliers are up in the market as well. in terms of earnings, we are looking at general electric and procter & gamble. general electric down by over one first and and beat everywhere except in the oil and gas unit. revenue fell light. procter & gamble up by over 2/10 of 1% adding premium products as well as cost cuts. the big question going into president trump's first 100 days is what happens to the market? s&p are the sectors in the

and how they performed. financials are up 15%. thank you. look out the outperformance. on the financial side of ames, the yield curve is fine. higher growth and higher in the nation. the other side of the policy initiative. we're are either going to get softer regulation, or an administration that says enough is enough. david: those that were not the up the those that were most could come down. is a view of

president-elect trump coming out of the motorcade. if we could get a chart of the u.s. 10 year yield. the start of last year, there was deflation fear that peaked in 2016. it was hard to find anyone optimistic about absolutely anything. -- theimists and optimism growth kind of kick 10. -- the optimism growth kind of kit in. that is remarkable repricing. is what wasuestion baked in? what was trump himself? jon: a lot of people would say it began in the summer and was injected with steroids and 20 late. in 2008.teroids

-- wherein the u.s. are we? they open pretty flat up for tens of 1% -- up 4/10 of 1%. great to have you with us on the program. if we get your correction, where is the pain going to be found? financials? >> yeah, you had it right. all those areas that went up so much, like the depression in january of february. the enthusiasm trade -- that is why we downgraded our market view in mid-december. alix: you will be looking to find opportunities, or is that a longer-term question? >> this correction could get nasty. i have been more cautious about it since mid-december only

because when you think about where we are from a sentiment standpoint, and from a market rally standpoint, we are in the opposite day from the election. there were nine days in a row when the s&p was down. only 30% of newsletter writers were bullish. now, it is the opposite. everything is extremely overbought. it is more a tactical correction than a major fundamental change because the backdrop of credit remains positive. jon: i cannot wait to buy. i am going to ask you something on technical. technical. who is going to buy? >> corrections -- we all call for correction from the are

going up. corrections are only considered healthy until you get them. when you get them, everybody sells. if you don't have a plan of , that it is on the correction versus a more major fundamental trade, you are not going to buy them. if you are offensively positioned, by definition, you have to reduce risk. what we did in mid-december is tried to cut back. we advised that the more aggressive traders, the hedge funds, should lower their net exposure. that is been a good call because of market has not done anything since then. from a mutual fund standpoint, we said if you have significant overweight in the offenses sectors, just lower it back to a market neutral standpoint. i don't think you want to get defensive because it is hard to get bullish on a decline if you are really defensive because it feels like an offensive trade.

david: we are looking at this limousine. that is where donald trump and melania. what was the last time the markets were dependent on the political? this? there are a lot of good things being said by the president-elect and people surrounding him, but we don't know if he could manage government yet. he has not done that yet and it is harder than it looks sometimes. see with we wait to the reaction is to get this done? >> certainly. earlier, i saw an interview with ted cruz. they were talking about what the plan is in the senate. the first is to do an appropriations bill to repeal obamacare. that pushes out any tax legislation until the second half of the year. i think the expectation is it

will happen in the next 15 minutes is an appropriate. what is important to point out , when we upgraded the market before the election, i wish i was smart enough to know that donald trump was going to win. i did not. i was asleep at 8:30. it was based on better global activity. now that you look at the citigroup economics index, it is at a secure high. everybody is on board that you have this improved global backdrop. some of the improvement clearly on anticipation is baked in, not just to the political anticipation, but the economic anticipation. alix: there is a fundamental growth aspect, but we still have a lot of if, ands, and buts. this is the chart on economic uncertainty. hearing strategist after strategists think volatility is going to pick up and it will be big. do you agree and when will we see it?

>> one of the things that causes us to change our view is the vix. when it becomes -- when it goes over 20, you want to be less aggressive. let's look at 2013, you had a 30% up here for the s&p 500. so many stocks did so well. you still have to fix get over 120 between december 2012 to january 2014. you do get by opportunities. to me, as a market is going up, that is the easy call. the real challenge to investors is what you do with it? are you positioned to take advantage of it? ? happens, are you highly convicted that it is a temporary one? ,istory shows that you never ever, ever, ever, ever sell minimal weakness unless you are in a recession or a well-defined bear market. david: what we are watching is

the vice president, joe biden, reading vice president-elect mike pence with their wise at the white house -- with their wives at the white house. they will be going in for coffee with the president and first lady. the north portico. this is the trump motorcade, sorry. the trump motorcade is coming up for the white house just a half block away. they will be joining the president -- the vice president-elect and the vice president as well as president obama. you could walk that in two minutes. alix: wrapping it all up, what is on your shopping list? >> it is on weakness. neutral marketing week of -- neutral marketing and neutral sector. we want to buy industrials, group as a market pulls that, they could have

significant outperformance going forward. david: tony, thank you so much for joining us. chief market strategist. we are watching the trump motorcade now coming up pennsylvania avenue. the parade will happen later this afternoon. the new president pulling into the white house square. the president-elect donald trump and his wife melania will have coffee with president obama and of course michelle obama. you can see president obama and michelle waiting for them as a motorcade starts to pull up. marine guard saluted. -- marine guard saluting. one of the last time people see the president-elect. he will be the president and a matter of 2.5 hours from now. alix: everyone is waiting for his speech to outline any policy. and if you will issue an executive order later on today. it is not just about the next 100 days, but the next 72 hours. david: it is quite an stored in

everything. they will be moving with moving vans. they will have all of the obam'' things out of there and all of the trump things in their. -- in there. he will go back and after the inauguration and all of his things will be in there. there is the more -- there's a motorcade pulling up to the north dakota cake -- there is the motorcade pulling up to north portico. it is fairly majestic, this turnover of power that happens in such an orderly fashion. two people sogine different than a barack obama and a donald trump in the way they conduct themselves. but then there is a gracious to it on both sides.

jon: one of our stores is that president obama had a pin when he walked into the office -- one of our stories is that president obama had a pin when he walked into the office and trump had a razor. here is melania trump, and we know that cover -- we know that color. alix: that looks like a picture frame to me. david: greeting one another. [laughter] themselvesve to post for the traditional photograph. their, see across from -- you can see across from there, an array of photographers. there they are. the first couple and the first couple-elect.

and so it begins, a fundamental transformation. long from now, we will know what it all means because right now, it is hard to know. alix: that is the question. david: that is president-elect donald trump with melania going in to the white house for coffee with president obama and michelle. and we will be right back. this is bloomberg. ♪

♪ alix: this is "bloomberg daybreak." i am taylor riggs in the green room. coming up, special coverage of donald trump's inauguration. ♪ david: this is bloomberg. i'm david westin. tunnel trump will sit at his new death later today and the oval office. he will -- donald trump will sit at his new desk later today in the oval office. repealing obamacare is one of trump's top priorities. hear from washington is mike mckee. pick up that question -- how much can the new president do to dialback obamacare isaac in order? how much -- thou back obamacare -- -- due toorder

dialback obamacare by executive order? >> requiring the department of health and human services to pay for things like abortion-inducing drugs or contraception or transgender counseling. but the real parts of obamacare that republicans want to replace and repeal will have to go through congress. joed: earlier, we had crowley, democratic senator. he said the republicans passed bill to repeal obama care when they were not going to them through because of veto. crowley, democratic senator. henow they have to do something that will stick in may are having a harder time because it is easy to repeal it, but not easy to replace it. >> this is an issue where you pull on a thread and another part of the government unravels. now have started talking

about access for every body instead of insurance for everybody. if you got the money, you can get insurance. but the question is what do they do with the people who don't have money? donald trump says he will have his own plan that will not be until february. this could drag out a lot longer before we get any idea. david: a question jonathan has been asking -- is there a chance that this new administration kid get distracted with health care much in the way some people thought president obama's date administration got distracted in the early days? > >> no question about it. one of the difficulties is the soon-to-be president has made so many promises and so many areas that he would act on immediately. the legislative capacity to do things quickly -- there really

isn't a lot of legislative capacity to do things quickly. a lot of things go through overlapping committees. if they are going to do obamacare first, it could take them well into the spring and push things that like tax reform or infrastructure programs. it will be hard for him to deliver a lot of the things he delivers through twitter. david: that is bloomberg's the mike mckee reporting. what you are watching is former president george w. bush with his wife laura arriving on the east side, the opposite side for the new president will be sworn in. we will also have president clinton, president george w. bush in this transition of power that is really symbolic that everyone gets together and whatever differences they have, he put them to the side. that is the helicopter that president obama will get on when he is former president obama.

he is going to palm springs, california. alix: vacation? david: he's earned it. [laughter] alix: we want to stay on the issue of repealing obamacare in the future for health care. i want to bring in david windley who joins us from tennessee for today passed a morning meeting. we heard the setup. what will be the best play for health care stocks if we repeal obamacare and something new was put in place? >> it is important to set the stage that health care was the worst performing sector in the s&p 500 last year. but is the third best over the last five years. why is that? funding.ama injected they want to take some of that out. recover a group of stocks. i would highlight them as a helper in this effort to reduce the cost. alix: we did see united health

halt sales of health insurance through the affordable care act exchanges. do they buy into that there are exchanges? mind thate to keep in the changes themselves are relatively small percentages of the overall picture. night health care is a very dominant provider of health insurance, so across many carerent -- united health is a very dominant provider of health insurance. alix: what kind of uncertainty can we expect in volatility? >> absolutely. and that couple of quarters, at least are going to be a period where we get repeal, and more than anything, but in terms of what that replacement looks like be very uncertain. there will be a period where investors will not know what will be getting.

alix: we saw president-elect trump take a meta-boeing and lockheed martin. -- take aim at boeing and lockheed martin. a period ofbe in shots across twitter with headlines and profiles of high drug pricing. when you get down to brass would a couple of things be to distinguish between companies that are truly in abating, and pricing products that are lifesaving as opposed to price increases on things like generic drugs. the other piece of this will be how we decide as a republican-driven washington, how they decide they want to protect the investment and innovation of the pharmaceutical industry. those are opposing goals for sure. jon: david windley, thank you so much for joining the program.

a defining moment, and two surprises. one, president trump will be president trump. and two, the outcome in the markets. how this played out hours after the results came through. one person who got burned was george soros. take a listen. uncertainty has peaked. actually, uncertainty is the enemy of long-term investment. i do not think the market is going to do very well. right now, they're still celebrating. comes, it willy prevail. jon: there is a man reportedly burned big-time by the trump rally. at this point -- it does point

to something -- a big consensus hoping we will get the good stuff and not the bad stuff like a trade worker in -- the bad stuff like a trade war. alix: the big wildcard are trade wars and china retaliation. we had a former commerce secretary weigh in on that earlier. >> retaliation would probably come from china. of course, if we put on a 45% tariff, they will do the same. china will not be pushed around. and i think we know that. alix: so, not just about the action u.s. takes, but what will china do. jon: david, how many times have we heard from the transit administration that they -- heard from the trump administration how fair they can

make it? david: there could be a reason why we have not gotten that balance of free and fair. we just saw the trump family arriving. i would not be surprised if that is president clinton, but we will see in the next hour. coming up, special coverage of donald trump's inauguration. for "bloomberg daybreak." here askeep watching they arrive on the east side of the capital. that is a shot down the mall to where president trump will be sworn in. that you very much. this is bloomberg. ♪

♪ guraom new york, i'm david

and this is special coverage of the inauguration of donald trump. mr. trump is set to take the oath of office and less than two hours time. we will bring you live coverage. we will look at how mr. trump's policies will impact the business world. you are looking at footage of the national mall in washington d.c. people have been securing seats. it got underway in earnest at 8:00. at blairump stayed house. he will stay in the white house tonight. we are seeing members of congress -- mark sanford of south carolina at the capital making their way to those seats on the west front of the capital overlooking the mall and the washington monument and the lincoln memorial as well. market.ok at the u.s. trading