♪ francine: meeting in doubt. president trump says a summit this month with his chinese counterpart is unlikely. will we see a trade deal? theresa may leaves brussels with no real concessions. canned in yet -- can dinner with the irish prime minister hail a pleasant breakthrough -- brexit breakthrough? the amazon ceo accuses the national inquirer of trying to blackmail him. ♪ welcome to "bloomberg surveillance." i'm francine lacqua here in london. these are your markets. we are seeing a little bit of pressure moving sideways. stoxx 600 generally flat.

they are now worried about a trade deal between the u.s. and china. we are seeing downward moves when it comes to stocks and upward moves when it comes to bonds. as the prime minister of u.k., theresa may, heads to the irish capital to meet with --, you can see pound up. coming up, we speak to the chief executive of mediobanca, he is alberto nagel, if humans from now -- a few minutes from now. paula schulz is giving -- olaf schulz is giving a speech. >> a secret brexit workers group has a plan called project after. the group is putting together a strategy to revive the u.k. economy in case of no deal. prime minister theresa may leaving brussels without an

agreement and has to dublin as she races to get changes to her brexit do before time runs out -- brexit deal before time runs out. the feud between italy and france continues to grow this morning. premierlows deputy luigi demaio meeting earlier this week with a senior figure of the italian -- of the yellow vest movement. that decision was criticized. >> many mistakes were made in , but thist of course -- to france is incredible. i totally disagree with this choice. we are against -- >> one of the highest profile members of thailand's royal family announced her intentions to run for the office of prime minister.

it is a significant shakeup before the march 24 election. she is the sister of the current monarch on the eldest child of the former king. she relinquished her royal title in 1972 when she married an american. special counsel robert mueller is looking into a meeting paul manafort had in august of 2016. according to court transcripts unsealed yesterday, paul manafort met with a translator fbi believes had a relationship with russian spies. he was charged last year with witness tampering but is a broad and has not entered the indictment. amazon boss jeff bezos is accusing the national enquirer of extortion and blackmail. the publication -- he hired investigators to find out if a story published about him and a news anchor was politically motivated. the publication now threatens to publish obscene photos if the probe is not ended.

this is bloomberg -- global news 24 hours a day and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. back to you. francine: there is new concerned that president trump and china's president, xi jinping, before a 90 day truce inspires -- expires. the trump administration has said it would more than double on $200 billion of chinese products if there was no new trade deal. currng us now is edna an. what do the latest comments by trump mean for the trading? -- trade deal? >> i think it demonstrates that we still have a way to go. both sets of negotiations have a deal that can be signed up -- remember, trump himself ramped up expectations on this last

week when he said he would accept an invite from the chinese to meet with president xi jinping, and that sort of accelerated the idea that the u.s. and china were heading for a fully fledged trade deal. he is saying practically they bynot meet but march 1 -- march 1. it does not mean that the trade talks are going off the rails, but demonstrates that we are not quite at the point where president xi and trump can sign off on any deal. francine: what should we expect from the talks in beijing next week? >> i think, francine, we will be looking for signals that the talks are not just remaining on course, but are starting to make progress into some more poignant things, especially around concerns that american companies have about sharing their technology, or been forced to shed their technology with competitors in china. being forced to operate joint ventures with chinese companies,

and of course on protection for their know-how, their intellectual property that they say is being stolen by chinese rivals. these are some of the really complicated areas that we will need to hear that some progress is being made on to encourage the idea that the u.s. and china can somehow reached a trade deal by march 1 or shortly after, or at least extend the truce. francine: thank you so much. let's keep the conversation on trade and the markets. joining us now, kathleen hughes, global head of liquidity solutions at goldman sachs. good to have you on the program, as always. how do you see this u.s.-china double play? can it get resolved or will it get worse? kathleen: when i talked to our clients, it is certainly top of my. certainly clients -- top of

mind. certainly clients in europe and asia. i think things have moved on since then. it is looking more promising and fingers crossed, i think there has to be some of the there -- some movement there. clients are very focused on that. francine: how much are they focused on that compared to brexit? and if you tell them there is no real way of protecting you from an escalation in the trade war? drop] francine: -- kathleen: money going into u.s. dollars, which are reflections of uncertainty. francine: if you look at what

your colleagues worry about the most, is a globally u.s.-china, or is it asia? because china is slowing down and there is a trade war, they are focusing domestically and not able to help the rest of the neighbors as much as they used to? kathleen: if you are large, global multinationals, you are worried about china. that would be top of mind for them. corporate balance sheets when you look at them, they are putting off things until they get more certainty. francine: what is the risk of a recession in the next 18 months? kathleen: risk of recession? that's a great question. i think the markets have price in more risk of a recession than we have. we think global growth is slowing but still growing. my colleagues at goldman sachs did some research looking at the factors that caused the last recession.

there were five key factors that were looked at. some of them have actually structurally change, so things like u.s. dependence on oil, or inventory buildup, you know. with technology does have become less important. some of the more financial triggers like huge imbalances, we really do not see that playing out. we think the u.s. consumer has a healthy balance sheet these days. those recession risks that markets looked at and were pricing in and getting nervous about as you entered the fourth quarter last year we think were overblown. we do not see a risk of a recession this year. we see growth slowing. the risk probably goes up next year but not this year. howcine: the slow down, much bigger isn't if we do not have a compromise between the u.s. and china? ithow much big of a risk is if we do not have a compromise between the u.s. and china? kathleen: if it does been out of control or we do not get positive movement on trade,

that's a risk to the growth story. francine: kathleen hughes from goldman sachs asset management stays with us. coming up, we speak to the chief executive of mediobanca. that exclusive conversation is coming up next and this is bloomberg. ♪

♪ francine: economics, finance, politics, this is "bloomberg surveillance." i'm francine lacqua here in london. let's focus in on italian banks. this, first of all, let's have a look at at what the stocks are doing overall. i am looking at stocks, a little bit on the downside. some of the main concerns, it's basically this u.s.-china tr

ade war. a lot of the industrial metals also down. the yen nudging higher. hong kong stocks paring an early slide as trading finally resumes after a three-day holiday. let's get talking about the banks, especially the italian banks. mediobanca has reported a beat for the second quarter. exclusive now for an conversation is the investment banks chief executive officer. he is alberto nagel. thank you for joining us right here on "bloomberg surveillance." give me a picture. you did well with the results. what will the next 12 months bring? alberto: thank you very much. thank you for inviting me here. we have talked our record revenue with an increase of 9%. this is coupled with an increase

of recurrent profitability. by 15% up like 50% -- up off of the back of strong commercial efforts. they were linked by -- production, 8%, and net new money that brought the total financial assets up 11% in six months. this was coupled also with a very important capital generation. one, and5.9% quarter all the news that was coming from the regulation was positive, net positive for us. business that delivered, 2 digit return on allocated capital with consumer finance 32%. 20% in wealth management and cid in -- the outlook is still very

positive, because we are expected to grow in the coming quarters business model. -- thanks to our business model. francine: you have grown loans specifically. as the economy slows, what is the outlook for increasing that? alberto: it depends on the sector in which you operate. we are a specialized bank. we don't have the model of a universal bank, so we are not correlated with the macro, in the sense that our business is far more long-term growth trends. in wealth management, the kind of loan that we do is related to savings, and the italian savings market is one of the best in europe, in terms of potential had size -- and size. francine: so you believe the loan growth is sustainable? alberto: our loan growth is sustainable. of course we are selective.

when the margins are less, we grow less. because of this approach, it is really specialized. if you have a business that is more geared toward the italian economy, you may be exposed more to this kind of backdrop. francine: where do you see the business? you are talking about the differences in loans depending on sectors you serve. please doing well? who want -- who is doing well? who wants to grow? alberto: demand for loans in consumers is still really good. also, because italian families are less indebted compared to their peers in europe, because -- so there is still confidence in demand for personal loans at consumer finance in general, as well as the m&a dialogue between corporate's is still robust. acquisition finance is still driven by m&a. francine: what is your m&a advice to aiming european banks -- ailing european banks?

should it make -- should they mate? alberto: haslinda: they should -- alberto: they should but they should be favored to mate. in the meantime, it is causing pressure on capital and eps. until this outlook, in terms of capital requirements, is not clear, and there are not any measures to favor a real merger between banks that are in different countries, we see more likely local consolidation, and this is going to happen in the next two years, rather than cross-border consolidation. francine: if there is a deutsche bank-,'s make consolidation -- deutsche bank-commerzbank consolidation, that would lead to more consolidation? alberto: yes, i see intro market

consolidation because synergies are more limited. when it comes to close border -- cross-border, with think -- we think we need another set of rules that are favoring these kind of megamergers. francine: rules we do not have at the moment? alberto: we do not have at the moment. we have rules in terms of buffers of capital if you get bigger, and also there are systems that in terms of liquidity capital, and synergies is not favoring cross-country m&a. francine: how do you want to grow your wealth business? are you looking for and a targets? -- m&a targets? alberto: first, we have an organic path. on a relative basis, what is happening to the other banks in terms of capital requirements

, i claim required by ssm think we have a better chance to grow on relative terms. our basic policy is organic growth. on top of this, we are investing in distribution in italy and the neighbor country, so if there are assets of quality to be sold in distribution of private banking, affluent banking, we will look, and we are always open to dialogue. alternative,ing in notably in liquid -- in illiquid. francine: are you buying anything? alberto: yes, we have bought a capital company in the alternative and a capital company also in the distribution, but we will do more. francine: how big? alberto: today that m&a dialogue is more centered on small to midsized. we are not at the time having

any discussion on a larger sized deals. francine: alberto nagel, thank you so much. the chief executive of mediobanca stays with us. up next, relations sink to a post war low between france and italy. what does that mean for the eu? we will discuss that next. this is bloomberg. ♪

♪ >> the most difficult political

question is the border between northern ireland. francine: the german finance minister delivering a keynote speech right here on bloomberg at queen victoria street at that landscape for -- future landscape for financial services. he says he believes we will have a brexit agreement by the exit date and says he is absolutely sure he will manage financial market issues. yesterday he said in his country germany that we need to be prepared for a no deal brexit. we will be keeping on -- an ion any headline from olaf scholz. the italian prime minister -- italian finance prime minister has shrugged off month of dire economic data, saying it's all just a temporary economic setback. in a surprise move, france has recalled its ambassador's to

italy, citing meddling in domestic affairs, following a meeting between the italian deputy premier and a senior figure of the yellow vest movement on tuesday. still with me is alberto nagel, the chief executive of mediobanca. does that make a difference to possible m&a acquisition, possible deals? alberto: it could have an impact, in particular in a larger do, when, you know, some national interests are concerned. as you think about banks, or the fed, or banks that are more strategic. i don't think it will have any impact on the normal m&a, on the midsized deal, on most regular type of m&a. get updated onu what is happening every day with italian politics? alberto: i don't think there is

a different italian discount compared to the past. i think italy has some structural problems of making its economy more competitive that are long dated. on top of that, we have to add that the overall backdrop of the economy is not affecting only of what happened in the first term, a part of the second part of last year, there was some sort of delay in terms of negotiating the budget law, and uncertainty. in the end, they have done a communitythe european -- union and i think this is a positive. francine: thank you so much in this is bloomberg. ♪ ♪

♪ comcast business built the nation's largest gig-speed network. then went beyond. beyond chasing down network problems. to knowing when and where there's an issue. beyond network complexity. to a zero-touch, one-box world. optimizing performance and budget. beyond having questions. to getting answers. "activecore, how's my network?"

"all sites are green." all of which helps you do more than your customers thought possible. comcast business. beyond fast. this is moving day with the best in-home wifi experience and millions of wifi hotspots to help you stay connected. and this is moving day with reliable service appointments in a two-hour window so you're up and running in no time. show me decorating shows. this is staying connected with xfinity to make moving... simple. easy. awesome. stay connected while you move with the best wifi experience and two-hour appointment windows. click, call or visit a store today. francine: this is bloomberg surveillance. between maternal if you

the richest person in the world and president trump. jeff bezos for the accusing allies of the president of trying to extort him. he said the national inquirer tried to blackmail him with embarrassing photos of him and a woman who was not his wife. they have an immunity agreement with prosecutors over the efforts of the trump campaign. we have more on the story. good morning. thank you for joining us. what is at issue in a fight between jeff bezos and the publisher of the national enquirer? >> a few different things are going on. is thetention initially are his own copyrighted material and no one can publish them. that is one separate issue. he would be a newsworthy figure. amazon is sometimes the most

bible company in the world. that makes him a newsworthy figure. if these photos were taken in public, they are fair game and anyone can use them. if they were taken in private, that's a different issue. he's not a politician. you would be hard-pressed to find they are newsworthy in and of themselves. the other part is his claim to the national inquirer has been engaging in what he calls blackmail or extortion or transactional things based on these emails see published. they said they would not publish the photos if he stopped an investigation. is notansactional nature the journalistic norm. it allegations of that kind of

forange have been alleged some time. ami acting like any other journalistic outlet? alan: not really. asserts privilege and an ability to publish these photos because he is a newsworthy figure, it's in line with every other media, whether it's bloomberg or the times. they would all make the same arguments. it's unclear. if these are photos in a private if they it's not clear are usable cannot. once very different is their willingness to stay in emails that he published that he will not publish in exchange if you stop an investigation of us and publicly not disparage us.

do they have the right to publish the photos? alan: it's a good question. a few years ago, the majority of people would have said yes. decision hulk hogan against a website called gawker that published sex tapes of hulk hogan, the court in florida said they did not have the right to publish those sac state's because they were taken in a private setting. it's not actually clear whether they have the right to publish those photos. it depends on how they were obtained and taken. thank you so much. let's get straight to the bloomberg. >> president trump says he won't

lead his chinese counterpart ahead of the march deadline for new u.s. tariffs. find.s. and china may not a deal. the white house is expected to ban chinese telecom equipment. he plans to release an executive order before the mobile world commerce -- congress. the u.s. warned its allies any country using chinese technology could face u.s. countermeasures. the president said he is open to theging the limit on deduction for state and local taxes. senator grassley threw cold water on that idea. it is ironic that democrats are now advocating for a tax change that would primarily benefit the wealthy. the feud between italy and france is growing this morning. the president recalled the ambassador to make a point.

this follows someone meeting earlier with the senior figure of the yellow vest protest movement. the european parliament criticizes that decision. this for the meeting is incredible. totally disagree with this choice. global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries, this is bloomberg. francine: thank you so much. theresa may is hoping to break the brexit deadlock when she meets her irish counterpart in dublin today. this follows tense talk in brussels.

they agreed to further negotiations and set new deadlines. they are due to meet before the end of february. ireland wants more time to get brexit right. >> island has no problem with an extension as long as it serves a purpose. if we mean more time to get assurances that the u.k. needs to ratify this withdrawal , that is essentially the document that outlines what the u.k. and the eu envision is the future relationship. if that takes more time, so be it. bloombergs bureau chief in dublin joins us. ofst of all, what kind reception can theresa may expect? >> it's a beautiful day in dublin. it's very mild. i think she will get a warm

reception. i think in terms of what she is coming to look for, she will get the cold shoulder. spoke to said these talks will be between the eu and the u.k.. they will look for a time extension. unilateral exit. they will be granted neither of those. to be anot expect us inch closer after the dinner tonight. anything theyhere can give theresa may? this pointsay at there is very little in terms of a withdrawal agreement and the backstop. they made it clear that we are the political declaration. if the u.k. moves the red line,

then they can look at the withdrawal agreement again perhaps. the u.k. needs to move its red line. the are also complicating dynamic. these people are not comfortable with them. they don't have a great relationship. i'm not sure if that makes things more difficult. it doesn't make life easier. francine: when you look at what happened in brussels, there is no breakthrough insight. is this what jeremy carmen put on the table as a possible option, theresa may is going back on her red line. maria: that's right. lookedverything prior rough for the prime minister. it was much more friendly. the eu has said we are not going to go back to the negotiating table.

a meeting,ing to be maybe a more technical one. that is good news for the u.k. we did hear from european lawmakers, this is a sign of goodwill. it is perhaps a way forward. the european union does think the way forward is not to turn to the party, but to seek a cross party deal. that means the labour party. that might mean a softer brexit. that is welcome here. francine: thank you both. now, goldman sachs asset management. we talk about some of the money markets, how should we view brexit? is a no deal scenario closer western mark >> that's a great question. it is top of mind for clients.

we see an agreement being reached, maybe not in the exact form it is now. that is still our base case. it is such an interesting global event that clients everywhere are focused on. if that plays out in a deal gets reached, it will have much less impact than other parts of the world. that could be volatile for finance. francine: volatility will play out in pounds? because investors and clients are so focused on it, when you go to the u.s. and talk to clients, they ask about brexit all the time, i think there could be a short volatile event. at the end of the day, it's an impact to economies right here as opposed to the u.s. or asia. a no dealif there is

brexit that happens, it is a systemic risk? kathleen: it would affect europe that you would see growth really slowing. growth is already slow and data dependent in europe. they are focused on where inflation comes from. it could certainly provide some problems for europe, certainly for this economy here in the u.k. francine: what are the biggest money market trends? kathleen: this place to some of last year ofe saw volatility in markets, cash rates going above 2%, there were big inflows into the u.s. dollar money market funds globally. i think there are a couple of

drivers for that. investors that are dollar investors, they are interesting again. they take notice. then you have other investors who are de-risking, getting out of markets or shorter in duration in their investments. it's a perfect storm a to have money flowing into the u.s. dollar. francine: thank you for joining us today. meantime, we will discuss financial services post-brexit. i think he is being interviewed. from the perspective of cyprus,r ireland or this means if we develop a

perspective, we think about the social democrats being to next president of the commission. >> if that is how you think of it, you may be the only country that thinks of it that way. >> this is a very serious question. we must be like this. the others should be. this is how i think about the situation without the british. i have already said that i am sad about the u.k. leaving the european union. , germany isor that increasing the british leaving the european union. we have to understand that we

are not a party in the european debate. we should be ready for supporting the european progress. we should be ready to discuss all the different countries and their ideas about the future of europe from the north, east, south. ♪

francine: a thai princess has been named as a prime minister ariel candidate. this marks a monumental shift for thailand, where they are treated as semi-divine and apolitical. our asian equities editor joins us. who is she?

how did she come to be nominated as a prime minister candidate? >> she is the oldest child of the late king. her brother, her younger brother, is now the king of thailand. character.lorful she relinquished her royal title many years ago. it she married a u.s. citizen. she lived abroad, came back. not royal.nically ais has enabled her to be candidate. how she came to be nominated remains to be told. we don't know. position toin the leave the country after many years of unrest between

supporters of the monarchy and supporters of the ousted prime minister who is in exile for many years. he backs this party. it would create a bridge between .he palace and the supporters it's a monumental shift in thailand politics. francine: what does this mean for the political landscape and the monarchy? seen howains to be this will unfold. they haven't had much the day to day lives of people other than appearing in certain films. she has a charity.

she engages in moral activities. how this will play out in a political sense remains to be seen. it's unlikely she will be challenged simply because she has such strong roots to the monarchy. francine: thank you so much for the update. coming up on bloomberg, we speak to the chief executive. that interview is that 11:30 a.m. this is bloomberg. ♪

francine: this is bloomberg surveillance. i am francine lacqua. there is a spat between two of europe's biggest economy. france recalled its ambassador in italy. that drag relations between two founding members. that follows months of verbal attacks.

let's get the latest from our team in paris and rome. they are on speaking terms. what triggered the escalation? ofthere have been months barbs back and forth between the two countries, recently more from the italian side. the deputy prime minister went to france to meet with members of the yellow vest movement. he was just there representing the party. he is looking for allies. the yellow vests could create a left for the election. he didn't warn the french he was coming. theykind of strange it chose the sky. he is one of the more controversial figures in the yellow vests.

you had a deputy prime minister of a neighboring country meeting semi-underground with france calling for insurrection against the state. it was too much for the french to take. francine: once behind this attack? electioneering, the ,ermanent collection campaign france gets thrown into the mix because the campaign for the european parliament in may is to brussels,e, germany, macron is a great target. francine: thank you both for the update. now let's take a look at some of the stock numbers. sebastian: i've got an all earnings extravaganza for you. the headline is solid.

there is a clear highlight, it's not often you get the region at such a bright spot. this is the biggest move since november 2015. walls, they are missing the lowest estimate. we are talking about transport costs. this is the biggest move since november 23. the trading volume is it 20 times its 20 day average. it is 12% lower on that stock today. this is the biggest consumer electronics provider. this black friday that came in for the country increase their market share. they've been on a wild ride. they lost three quarters of their value. they are clawing back.

francine: bloomberg surveillance continues in the next hour. tom keene joins me from new york. someone is joining me. interviews atthe 11:30 a.m. london time. mark greenberg joins us. 3:00conversation is after european time. we are looking at u.s. stock futures the climbing. there is a pessimistic wave gripping over the u.s. and china. this is bloomberg.

francine: meeting and doubt,

president trump said a summit with the chinese counterpart is unlikely. will we really see a trade deal? the irish trimester held a breakthrough. the nationalcuses enquirer of blackmailing him. good morning. this is bloomberg surveillance. what i also looking at is this incredible spat between france and italy and italy and germany. this has really intensified yesterday with france saying they will pull their ambassador to italy and recall them. tom: it's really front and center. deal, butike a small it's a huge deal going back to 1940 with mussolini. market, ite the bond is price up yield down

everywhere. francine: and stocks down. we will go through that in a second. we are getting to the bloomberg. >> a bizarre turn this morning in the feud between the richest person in the world and president trump. jeff bezos accuses allies of the president of trying to extort him. david packer tried to blackmail him. ofhad embarrassing photos bezos and a woman who is not his wife. communityer has a group -- deal. mr. trump says he won't meet with resident xi. the trump administration said it would double the tariffs on $200 billion if there is no new trade agreement. theresa may flies to ireland to

try to get the prime minister on her side. she races to gain support from european leaders with changes to the brexit plan. there are just seven weeks to go before the u.k. is scheduled to leave the eu. in thailand, a princess was named as a candidate for prime minister in the election next month. it's an unprecedented move where the royal family is treated as sam i divine. -- semi divine. global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries, this is bloomberg. this is bloomberg. tom: let's do a data check.

all the politics going on, particularly the dublin ballet this morning. as francine mentioned, there is a today deterioration. the curve doesn't shift. it has been remarkably stable. he euro comes in even weaker. over to the next screen, we have a weaker market. the 30 year bond was at 298 when i walked in the door. that is a big deal, under 3%. i agree,ferro and that's the most important statistic on the screen. the switzerland 20 year begins to grind down again. that is a 20 year yield in switzerland. that is stunning. francine: i'm glad you brought it up. we may show this in the next

couple of minutes or hours. bundi am looking at is yields losing. this is all about pessimism over trade. china's markets are shot. european markets pull this lower. trading resumed after a three-day holiday. the president said he won't speak with the chinese president, it is freaking out the market to eight point. thatld point to the fact the german minister is here. they are speaking about brexit. charthis is a yield curve . it really works right now. we have negative yields in germany, positive yields in germany. here are the yields in october if the yield peaks.

once important is the shift in the yield curve from october where the negative yield has gone from a five years out to nine years. this is the expanding negative yield that. charthe bank has a great of the expanded it negative yield debt. we are not yet to reckitt -- record negative yield yet, but we are getting there quickly. francine: this is talking about the same thing. the question of the day is when will the 10 year bund advance the 10 year yield. german yields are show or after the growth downgrade. rallies the debt to be

expected. it's a valid question. tom: we are going to monitor europe, there is a lot going on right now. let's try to focus on the markets and all of the swirling around what we saw yesterday as president trump made clear he is having trouble getting to march first with china. daniel joins us from bmp. have a great chinese history. issueu say that the trade was another impetus for caution in the market? daniel: absolutely. it was inevitable with the reaction you had in the market. positivea lot of things happening. the key part work signals on the chinese side and the american

side. so much had already really been priced in. we knew there was potential for disappointment when the announcement was made. we want to bring out another chart. this is deutsche bank. we are going to look at this later. all you need to know, i am going to expand in over the lower left corner. i am sorry. is a catalystope for the little concern. daniel: you think about the connection between what the banking sector does and how it pushes credit into the broader economy. if you are worried about the slowdown in europe, how will that be turned around? you need credit going into the economy. if that's not happening, it's another reason to be concerned. francine: let me take you over

to my chart of the day. yields, whent bund will they drop below japan? daniel: we are not that pessimistic. they are not going to be going anywhere anytime soon. the market got to negative on the eurozone. we are under weight. the growth is now. yields frothyd now. francine: this is also a china u.s. question. it's almost because it's a three-way relationship on trade. daniel: if you look at what happened from 17 to 18. we thought it would continue to go at that rate. it killed growth in 2018 for your.

gets us to china and the u.s.. that's why we have more concerned about the outlook. tom: thank you so much. francine: in the meantime, we are listening to a great .onversation at bloomberg lp he is the german finance minister. he said we need to make sure we are prepared for a no deal brexit. we will continue listening into that fireside chat between stephanie and the german finance minister. this is bloomberg. ♪

get to the business flash. sony is planning its biggest share buyback ever. $910will buy as much as million of its own stock. shares are rising more than 4%. they reported weaker profits and the playstation is this. it cut the forecast. world's largest videogame makers, activision blizzard will announce cuts next week. they could number in the hundreds. key gameowledged some set flat or declining numbers. they are boosting their bet against starbucks. it -- howards had schultz made an announcement. stock inmost shorted the restaurant group.

that is the bloomberg business flash. theresa may is hoping to break a deadlock when she meets her irish counterpart in dublin today. after tense talks in brussels, she has until next week to secure changes to the backstop that would satisfy her party. join us are the dublin bureau chief. thank you for joining us. she didn't really achieve anything at all. for the prime minister, she walked out very angling. they were not happy about the comments made on the day prior. they were determined to make sure this wasn't a real failure. it really wasn't. we are not going to go back. in reality, she will meet him at the end of the month. that is good news for the u.k.. she got none of it.

tom: how do we get to monday? do we get tohow monday in brussels? what do we do monday morning? morning, theday mood has changed. there was an idea the prime minister was almost walking into a trap. that was not the case. commentealized that really did not help. this is a woman under so much pressure. they have relaxed on that. tom: what has changed in the republic of ireland over the last 48 hours? nothing has changed. korea might be right in terms of tone, in terms of substance, nothing has changed.

the only thing they will offer her at this point is nice words at a little decoration. on the news by labor. may will be given nothing apart from a nice dinner when she comes this evening. francine: i'm not going to ask you once on the menu. if you look at the options left brexit, we have this plan presented yesterday about staying in the customs union. that would be against her red line. with the irish go for that? been theyition has will move the red line if it u.k. moves its red line.

one of them has been exiting the customs union. if she moves on that, we will look again. it won't stop everything. some of the rules are around being in the single market. i would imagine a commitment to the customs union would be a significant move forward from the irish point of view. is she ready to do that? many people think she won't go to those lengths. we are still in a deadlock decision, i think. tom: thank you so much. we really appreciate it. let's pick up with daniel morris. politics in what to do in european investment. areel: more broadly, we asking at market equities

opposed to a particular call on europe right now. it's a factor in the big rebound we had. if we step back and look at what the outlook should be, it really comes down to whether or not growth is frothy now, which we believe it is. that will give it some support into the rest of the year. term,ne: on the shorter we have no idea exactly what parliament will vote for. we have no idea what will happen march 29. do you assume the worse? daniel: not necessarily. our view is the probability of hard brexit is low. there is the possibility. if you look at what the macroeconomic possibilities are, they are not diverse. brexit, that soft

is somewhat similar. that's why you haven't seen sterling move much. of all of those, we think they are more. the uncertainty around which one it is as to opposed to what the actual outcome is, that is uncertain. we don't know if it's two weeks or six years. francine: does that just happen on the pound? could it move certain sectors? daniel: it's going to be primarily through sterling. we think that's going to be around what that look is for the u.k. economy and the relationship with brexit. it is all about sterling. francine: thank you so much. coming up on bloomberg markets, -- this isfellow for bloomberg. ♪

francine: this is bloomberg surveillance. amazon boss jeff bezos is accusing the national enquirer of extortion and blackmail. he said they tried to blackmail them with embarrassing photos of -- him and a woman who is not his wife. let's get straight to our reporter who is been following jeff bezos for quite some time. what is the issue in the fight

between him and american media? basically, it's the world's richest man who is up against america's most prolific publishers of exposes. postwe are seeing from his is the inside of these back-and-forth between american media and some of its subjects. the bigger picture is this is a proxy fight between the world's richest man and donald trump. media -- american orit's not like bloomberg the new york times. what they are saying is it's a quid pro quo. it's an unusual exchange. it's not like normal journalism. tom: there is a difference in law here. on suing and journalism in the united kingdom and the united

states, does he have legal ground in the united states to take actions against the national inquirer? >> if anyone does, it would be him. he's got the resources to employ an army of lawyers. it's a bit more open. k, this would be hard stuff to publish. moree u.s., it's a bit fair game. to see a lotgoing of cross analysis on this between the u.k. and america in the coming days. he is an exceptionally private person. would you suggest the fact that he has displayed his privacy over the years would be germane? >> i would think so. that's been a running theme through his career. even as amazon has become massive, he is avoided the

press. his personal is affairs are not really that relevant. american me would say the public uses his services. he has suggested that this is not fair game. he is going to fight tooth and nail. francine: thank you so much. let's get back to asset management. ison't know whether there the fight for the taxes and governments around the world were asking amazon to be broken up. what does it mean for the way you view retail? contextto put it in the , it really is when we think about the reaction to technology they arethe portfolio,

rebounding inevitably in january. demand ass this opposed to a rethink about the business model for a lot of these companies. that's quite hard to measure. a lot of what we have seen in the share price move is a realization that is more significant. francine: thank you so much. coming up, more with the chief executive. we asked him about italy and the link between banks and his country. this is bloomberg. ♪

tom: good wall street friday. francine lacqua in london, i'm tom keene in new york. you need a briefing. here is viviana hurtado. the trump

administration warns the european union the trade truce agreed to last summer is in danger of unraveling. gordon someone telling bloomberg there has not been good faith and understanding that once existed very present -- once existed. imposed duties in the e.u. retaliated. italy's industrial production falling in december for a fourth straight month. recession that started in italy last year may continue. italy's populist coalition government is being swamped by negative data. president trump will step up a .rackdown on huawei the president is expected to sign an executive order banning the use of chinese equipment from u.s. wireless network. the move will happen before the onile worldwide congress

february 25. the longest-serving member of congress in u.s. history has died. dingell represented michigan. he was a democrat and a big supporter of the auto industry and oversight of government agencies. he was succeeded by his wife. he was 92. global news 24 hours a day and at tic toc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm viviana hurtado. this is "bloomberg." tom: thanks so much. in india yesterday, the hugely political rate move in india wrapped around elections. russia is more stable. i want to -- there are other headlines out of russia. 1.7%reiterate a 1.2% to gdp this year. the other thing on the bloomberg

, they talk about rate hikes to come down the road. a little bit of movement there. ranking, front-end center -- banking, front and center right now. let's listen. banking, a $500 in order tongs plan take into account this environment. >> our expectation is to meet our targets. reductionelerate the to be in advance of our business plan. >> we started a cost reduction. from a recurring cost savings in 2020 to 3.3 billion. >> the outlook is positive because we are expected to grow

in the coming quarters thanks to our business model. tom: managing the messages, a set of european executives. let me show a chart. lisa knows this chart better than anyone. of u.s.one proxy banking, jpmorgan, and i'll performer in the united -- an outperformer in the united states. with no return are deutsche bank, unicredit. do you have any sense we are going to rationalize banking? lisa: the conditions are there. when you are executives talking about obstacles and hurdles that make for cross-border consolidation, it is unlikely

for the foreseeable future. tom: it is 5:33 in the united states. anyone watching from america knows the regulatory differences between the e.u. and the u.s. give us the regulatory angst of these equity patterns. tank regulators upset about the path of unicredit? yes, they areors, urging consolidation. on the other hand, the national regulators are making it difficult. still requiring, requesting locally even funds if they are eurozone banks regulated by the ecb and that is thatf the stumbling blocks make cross-border -- cross-border dealmaking next to impossible. francine: congratulation on your

columns. which is today the strongest bank in europe? becausefficult to say they each have attributes or is there one stand out? elisa: if you look at stock market valuations, that is a good metric. ubs with a diversified model, , driven by wealth management which tends to be more stable than deutsche bank at the moment which is in the midst of trying to find its ideal business mix while the top line get squeezed and costs stay put. does the commerzbank merger happen? is that the catalyst for the rest of the sector? elisa: a merger could happen pointingerman papers

to the decision coming before the elections in may. it does not change the landscape on eight european scale. landscape ine germany because it creates a more dominant german consumer bank. the rest of the bank -- market is still fragmented and even deutsche bank would not be sufficiently large. tom: this is important. bring up the chart. logarithms, work in i am sorry, there are these lows in deutsche bank. you say they're trying to get to may. if the stock price of deutsche bank breaches the december lows, do they have the luxury of getting to may? elisa: yes, i would think so. there is no reason to force a merger overnight, there are no concerns about liquidity. it is more a question of how long germany wants to ride this

out and parliamentary elections could make things more difficult. francine: overall, when you look what is happening to the french bank? they were the best in class 18 months ago? tooa: both of them relied heavily on the investment banking business which has proved to be difficult in terms of maintaining that market share in the case of bmp, has led to losses. bnp, has led to losses. ot has left them to exposed, but is not growing. francine: coming up, john kenneth, carlisle executive. that interview at 7:30 a.m. new york.

this is "bloomberg." ♪

tom: bloomberg surveillance, thank you for joining us. duty in lacqua on flu london. i have had emails, is francine ok? francine: they have asked me to get a new voice. out.a trooper, toughing it on euro-dollar, it is good to have daniel morris with paribas.

you have a unique window into brussels now. are the actions separate from euro movement or do they move euro-dollar? the coming weeks, i would be focused on the other side of the atlantic. forfebruary is the deadline the department of commerce to issue its report on autos. it is something that a few people have been paying attention to but it is a risk when it comes to the euro-dollar. i think we will get a break to the downside. tom: you are looking for euro weakness. give me a target. penciled in got 110 which would be a new low. i have had that view since last year. it is not a recent development. the european data has been helping.

it is really just a little lower than where we are here. francine: it is not a catalyst? elsa: there are a number of things contributing. it has been a good environment for young trades. people are defaulting to using the dollar for funding for those. we should be thinking about how we fund those trades. are we too pessimistic about the euro? lot ofhere have been a one-off factors and we are hoping in the second half of the year, a lot of those will dissipate. that does not mean i am in the bullish camp. how do you see this playing out, what kind of your level do european exporters need? -- euro level do european exporters need? whatl: it is a question of

is happening with terrorists and emerging market demand. we have seen the drag on exports , what has happened over the last couple of years. it has been more about the dynamic in terms of the emerging markets as opposed to currency. within the euro, and i guess we go to sterling, which is most informative? euro-sterling is an easier way to traded if you have to trade sterling. euro-sterling and if you want to pick the range, selling the highs, playing the lows, that is where i would look. cable is tougher. tom: this is good on a friday because tougher is range bound. every chart, the dollar m big

unity we talked about earlier, every chart gives me a range bound feel. do people like you take a holiday or is this an opportunity to go directional? elsa: there are interesting trades. one of the best calls has been short brazil-mexico. we are much more in a bearish camp. there are interesting trades in emerging markets. 210 is tougher. we have got a longer-term bias dollar-yen. this is whattom: we love to do. on and she dazzles us and i could go right to the bloomberg. i will make this up. here is a long-term trend on strong mexico, week brazil. language on brazil.

she is looking for this kind of path. was that even close? elsa: it is a beautiful chart. .rancine: you get a b- tom: i want a blue star as well. francine: we have gold stars here. that share price is falling significantly. 4.5% after we heard norms -- news from firefighters and inhabitants of a brazilian city have been evacuated. as we understand, the dam is at risk. we do not have much more news in terms of what type of risk the dam pose. this was in the same state in january, 142 people died and 200 collapsed.er a dam

it is the same state in brazil. tom: with some real hardship there. the leadership of brazil in the hospital with pneumonia off the stabbings he had a few weeks ago. we have more to come. we will come back with elsa lignos. you have got to look at the new competitors in the beauty business, not that i know anything about glossier. in the 6:00ceo hour. this is "bloomberg." ♪

viviana: this is bloomberg surveillance, i'm viviana hurtado. frederico day a has no idea what he is doing except to run the french bank into the ground. socgen,about the ceo of

the shares falling to a five-year low yesterday. its plan is to shrink its trading business. from the brink. a bankruptcy judge approving eddie lampert's bid to keep the retailer open. lampert's plan would keep or hundred 25 stores open and save 45,000 jobs. the judge rejected arguments lampert plundered assets. uber is laying out a plan for long-term self-destruction. making the pitch it is to investors as it prepares for an ipo is that it is more than just a ride-hailing app. it is betting big on electric hikes and scooters. those options are displacing ride-hailing. that is the business flash. francine: thank you. upneed to bring our viewers to date with what is happening

in france and italy. the french and italian leaders at each other's throats for weeks. it escalated yesterday. relations at -- between the nations at the lowest since world war ii in this has implications for businesses. we are just hearing from mr. dimaio, this is one half of the five star movement, saying italy wants cooperation and we're also hearing from the other half, saying he wants to summon the french interior minister to talk about italian tariffs in france. we have to talk about what this means for europe. let's change gear in talk about the yen. we were showing earlier that investors could still flock to

negative yield japan bonds because of the return of dovish central banks around the world. still with us is daniel morris and elsa lignos. thank you both. this is look at japan, in the context of the end of monetary tightening, what happens to the yen? elsa: it is interesting, is if this is -- if this is the start of the fed easing cycle, the yen could strengthen. there are lower than they were a few years ago. if the fed were to start cutting rates aggressively, the yen could strengthen. that is not my base case. as long as you have a view that the fed is on hold, i think that is a constructive environment for dollar-yen. francine: this goes back to a chart, we pit dollar-yen against the 10 year treasury yield. that negative

yielding government bonds could be an opportunity? daniel: if you think about what returns are likely to be this year, you would expect them to outperform this year. the other thing that is interesting, if we look at the yen now, equities have made back youlosses from december, have not seen the yen pullback to the same degree. you see signs of nervousness in gold and yen. i think we should be asking ourselves which market's giving us the right signal. tom: what is your call on yen? give me a number. are you anywhere near 94? elsa: in an environment where the fed is cutting rates, we covered see dollar-yen sub 90. -- we could see dollar-yen sub

90. the u.s. is about to hit recession. you have seen a disconnect between the optimism surrounding equities in the emerging markets and people holding onto long yen positions underlying that nervousness and uncertainty. the yen mightan not act the same way as it did in the past. a chart's go back to you know so well. you made headlines on yen. here is the announcement of 2016, better japan exports. it goes the other way and we get .his ambiguity how do we break that? is it news flow? is it flow-flow or is it rate-flow? elsa: you make an interesting point. we sought in the overnight capital flows from japan.

there has been shifting out of european bonds into u.s. that is not enough. it has got to be the unhedged flow we have got to pay attention to and that is why we focus on the front end of the yield curve rather than the back in. francine: do you like in the asset classes in japan? equities was one i kept on hearing. challenging, if you look at earnings revisions for japan, it is weak and a lot of that is a's exposer -- asia exposure. the good news is, with the dovish fed and more dovish ecb, it allows the bank of japan to keep up the qe and yield curve control that much longer. that is the support for the market. i do not know if you want that to be the only reason that equities go up. i will try to get out on

pairer the brazil-mexico which is interesting. this morning is extraordinary, out of europe, the prime minister in ireland, this historic moment for france and italy and you come to the united states and the thing with mr. bezos. the headline is trump-xi. please stay with us from london. this is "bloomberg." ♪

morning, italy vestsrates the yellow

tofrance, macron silent salvini. 2016, bonds are bid to near perfection. consider the u.s. a 30 year bond, consider the growing negative debt in europe. president trump will not be president xi. it is 21 days away. good morning, live from new york, i'm tom keene with francine lacqua in london. i got through the opening without mentioning prime minister may which was a faux p as. how was the trip? francine: they are not going gray. we heard from the german finance minister right here at bloomberg headquarters in london where he says the need is standing by

ireland in this impasse -- the e.u. is standing by ireland in this impasse. to givenot want anything unless theresa may goes back on her red line, staying in the customs union. tom: we will do a data check. we data check the first word news. viviana: a bizarre turn this morning in the long-standing feud between the richest person in the world and president trump. jeff bezos accuses allies of the president of trying to extort him. the national enquirer publisher tried to blackmail him with embarrassing photos of bezos and a woman who is not his wife. pecker has an immunity agreement with prosecutors over the enquirer's efforts on behalf of the trump campaign. president trump and president xi may not reach a trade deal before a truce expires. mr. trump says he will not meet with xi before the march 1

deadline to avert higher tariffs on chinese goods. the trump administration said it will more than double the tariffs on $200 billion worth of chinese products if there is no new trade agreement. theresa may flies to ireland to try to get leo varadkar on her side as the prime minister races to gain support from european leaders resisting changes to their plan. e.u. officials rejected may's request for a time limit on the controversial irish backstop. there are seven weeks to go before the u.k. scheduled exit from the e.u. call her the princess who will be prime minister. in thailand, princess ubolratana was named for a candidate as prime minister in next month's election, an unprecedented move where the royal family is treated as semi divine and apolitical. the election will be the first in thailand since a former army chief seized power in 2014. he is also running for prime minister. global news 24 hours a day and at tic toc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm viviana hurtado.

this is "bloomberg." tom: thank you. the markets move, let's do a data check. nine, two daysve in a row, off the mark. a little bit of steepening yesterday. screen, the vix higher off the news. 30 year bond says it all, under 3%. year, is what me and jonathan ferro are looking at. i am sorry, the benchmark for me is the switzerland 20 year yield, it would be unimaginable. those are lower this morning. francine: do not be sorry, it is good to look at that. i am looking at u.s. equity futures and asian shares fell

over concern about economic growth and trade disputes that is giving investors angst. european shares are steadier than they were. shut forarkets remain lunar new year and just for good measure, i am always looking at pound. in case there is a breakthrough in brexit. tom: i grew up in an academic house, science, engineering, , and my mother bought the national enquirer. she would bring it home and my father would cry. joining us now, our national enquirer expert, martin schenker. i cannot believe we are having this conversation. you know the general counsel. he would sit me down and he would say london is not new york where it -- new york.

is mr. bezos doing this action against the national enquirer thinking he is in london where he can get something done versus a free-for-all in journalism in america? marty: he has decided to take on donald trump at his own game in terms of pushing against what he considered her to be a politically motivated attack on his person -- against what he considered to be a politically motivated attack on his person. tom: what does the word extortion mean? marty: it means trying to for somebody to do something he does not want to do with a criminal intent. tom: we have got all of the emails. in the pantheon of public officials, he was the most private of all. was but he is the owner of "the washington post."

i cannot imagine what it is like to be a journalist with a high-profile owner like that. tom: it is an original idea. marty: it really is. to his credit, jeff reseau's gave a full throated -- jeff bezos gave full throated support to what he is doing and to keep doing his critical journalism against trump. francine: if you take a step back, what is at issue between the spite? -- between this fight? this has been joined by the president and his continual attacks on the journalism at the washington post which he has described as fake news. the connection between the national enquirer and donald trump has been documented. to try to is going make donald trump back down from

his attacks on the newspaper. francine: ok. is american media acting like any other journalistic outfit? all kind of argue the merits of the original reporting on jeff bezos. there was commentary at the time that he was not that prominent a figure for the national enquirer to put those personal texts as their lead story. that was unusual. you said two hockey goals from attorney shapiro. where does this go next? we have 14 pages in the national enquirer on someone my mother would never care about. what is the next? marty: it is interesting we have not had any comment from the national enquirer or the white house. we should get something

today and to me, that will set the path for the next move. tom: can you come back and talk about justin bieber in the national enquirer? marty: that is next. s accessthi surveillance? we got through that. schenker, with decades of experience on american journalism. coming up, a different conversation, thrilled to have sebastian mallaby join us. you know him from his authorship and the hedge fund business as well. this is "bloomberg." ♪

viviana: i'm viviana hurtado. sony is planning its biggest share buyback ever. the electronics maker will buy as much as $910 million of its own stock. shares rising more than 4% in tokyo. last week, sony reported weaker profits in playstation and cut its annual forecast. this triggered the steepest share drop in almost three and a years. half cuts are on the way at one of the world's largest video game makers. activision blizzard plans to announce cuts next week. they could number in the hundreds. in november, activision said some key games were flat. investors are boosting their bets against starbucks. its former chairman is considering a run for the white house. short-sellers borrowing 2.5 million shares over the past week after howard schultz made his announcement. it is the most shorted stock in

the restaurant group. that is the business flash. tom: thank you. appreciate it. after bezos and the national enquirer, let's get back on theme and it is good to do that with marty schenker and the perfect guests, david balin writing often on asia as well. their ine cacophony on the news, the economic slowdown everywhere. , is the back to the tension out there right now, is it about a broken multilateral trade system? being the trade system is reset and it is no longer going to be multilateral for the u.s. that is a substantive distinction. what we have to do is we have the wrong expectations for what we should be looking for on

march 1. ist we should be looking for are there continuing dialogues between the china and the u.s. that would be the best possible outcome. is, i just came back from a trip to asia, what is going on in china, one is the trade within -- with the u.s., many companies have other plans in thailand, indonesia. is that those manufacturers are going to move their operations outside of china. there are two forces aligning against china. tom: within your travels to asia, we have seen this time and is notthe elasticity understood within america, is it? marty: americans think of china as this monolithic insular

economy. when, in fact, they have expanded outside their borders to create a manufacturing powerhouse, which is under threat by tariffs. francine: two-putted simplistically, does it point -- to put it simplistically, does a boil down to whether it is good to have a deal with china or do we think he wants to change the way trade is? it is a smoke and mirror, the markets would be happy. would the president? marty: it is fascinating to watch whether or not donald trump is willing to upset the world order by insisting on a systematic change in china, which china has said they will not do. where is backdrop

favorability ratings in the u.s. are at his presidency's low. , takee taken offramp something less and declare victory? francine: what is priced in the market right now? no deal between the u.s. and china or are they pricing in some deal? david: the market has tended to be optimistic on the outcomes. they are anticipating some kind of deal. we have measured what we think the impact of china on the negative side has been ended his -- andtween 5% and 10% it has been between 5% and 10%. tom: can you state this debate on china trade has dampened global gdp? david: there is no question it

has. take a look at trade between china and germany which has got an economic impact and between china and japan where you can see the trade volume is down of critical elements. tom: this is in the data right now? david: that is right. you can see the impact. it is a substantive issue and what trump is dealing with our issues that have been out there for 20 years, just an address, which has to do with opening up markets and we will see that in the next quarter. salese look back on phone , was tim cook being honest, was at the china slowdown -- was it the china slowdown? the answer is no. tom: i want to go to where we are going on monday. we will have marty schenker out

here on monday, leaving our theme which is the new socialism debate in america -- leaving our theme which is the new socialism debate in america. our theme which is the new socialism debate in america. francine: and whether it changes the democratic candidates to the left. balinschenker and david stay with us. this is bloomberg. ♪

viviana: this is bloomberg surveillance. i'm viviana hurtado. sears is back from the brink for now. a bankruptcy judge approving eddie lampert's bid to keep the retailer open. lampert's plan would keep 425 stores open and save 45,000 jobs. the judge rejected arguments lampert plundered assets. frederic oudea has no idea what he is doing except to run the french bank into the ground. these are harsh words from jeffrey gundlach. this is about the ceo of socgen, the shares falling to a five-year low. it has announced plans to shrink

its trading business. that is the business flash. francine: thank you. we are hearing from the heads of certain parts in italy. news hearing from the agency that italy and france will delay talks of senior foreign officials. we heard the bilateral matter or spat is between france and italy. yesterday, france decided they were going to recall the ambassador and the french ambassador to italy because of strong words from certain factions in the government. ouring us now for more bloomberg's reporters from france and italy. given the countries are further park, we need to wonder what happens next -- are further

park, we need to wonder what happened sex. what do we know -- what happens next. what do we know about emmanuel macron? he cannot help himself having serious,ut it is not he called them lepers several months ago. he seems to be leaving it to the foreign ministry, this big step up calling in the ambassador. annce is not called in ambassador since before the second world war. this is going to clarify minds in italy and get dimaio to realize he did overstep what is normal relations. taking thising that step is going to concentrate matters in italy and bring an in

to thisthis -- an end sniping. they are getting sick of it. give me a sense of what the deputy premier wants. it seems he wants cooperation with the french government. when macron, mentions factions in the and telling government, these are two factions. dimaio and salvini are competing ahead of the elections in may and they are the dominant force in the coalition. there is an establishment faction which is made up of the , of the prime minister, the foreign minister and they're working to patch up relations with france. the expectation is that until

the elections and beyond, salvini and dimaio will keep taking potshots at france, at merkel, even at brussels. tom: both are you are so qualified. polarity of de gaulle and mussolini. ri left is france and how ght is italy now? >> i would not put it on the left-right scale. the only similarity i see between the countries is that they are run by people who do pick and choose. i will make one point. if there are countries in europe that are geared to misunderstand each other, they are france and italy. you have got france the most

government, italy the most diffuse. many different factions in this government, many ministries are held by people that are not members of parties. i think the french cannot understand that. and they thinkce it must be from the top because that is how it works in france. tom: we are out of time. we will do this again. stay with us. this is "bloomberg." ♪ i'm a veteran

and the army taught me a lot about commitment. which i apply to my life and my work. at comcast we're commited to delivering the best experience possible, by being on time everytime. and if we are ever late, we'll give you a automatic twenty dollar credit.

my name is antonio and i'm a technician at comcast. we're working to make things simple, easy and awesome. francine: this is bloomberg surveillance. we have breaking news from jaguar land rover. tom: serious news.

this has been a train wreck. it bears close watching. francine: we had a great conversation with the l'oreal chief executive. >> there is a strong appetite of consumers for beauty products, for luxury products and so far we have seen no slow down at all . >> what trends are you seeing in china? jean-paul: we see a strong demand. aere is something called ballistic affect which says when people do not want to buy ext are happyms, they

lipstick. we think growth could continue. >> i know you said your not seeing any impact from the trade war. when are you expecting somewhat of a slowdown? jean-paul: we will see. there is no reason for the moment to be worried. if there is a slowdown, we will adapt. >> you do not see it in 2019? jean-paul: for the moment, nothing. we keep investing. one of the reasons we are not seeing a slowdown is we have been investing for many months and many years. brand in the number one in china. number one in men scare, in skincare. care, inmen's

skincare. >> when will it be number one? jean-paul: 10 or 15 years. tom: l'oreal on earnings. let us move on right now to an important issue in the march, in the united states, he is a congressman in chattanooga, the republican from tennessee. thank you for being with us. the last time i spoke to you, we spoke of washington. i want to focus on the border wall. , are they going to deliver a border wall plan that will force the president to come to a compromise? >> i think all of us in the room, whether in the executive branch or on the committee are working toward a compromise, a deal that is palatable to the

committee. this is not going to be a deal that everybody gets what they want. we are going to see wall funding and other things that are important to keep the people safe. i think we are going to see a deal made a deal struck and the government kept open. i am pleased. i am pleased right now. tom: you have got to come up with a plan or we are to have a second shutdown. what is your probability? nil.fleischmann: next to there is no appetite in the room on either side and that is a good thing. tom: you live this directly. officialsee, federal did not get paid? sir. fleischmann: no, we had five bills that were

passed. the energy and water subcommittee was funded. that was the danger. it would been 100%, have been several in less than a week. of thet it was 24% government, that is where the danger in that situation was. it took a while for affects to ffect. all the people got paid. francine: what will the deal look like? we understand there are border security experts advising both sides. you have president trump insisting on the wall and you have the democrats saying you need more generation -- more scanners, more manpower. rep. fleischmann: i think all of the above. i traveled to the border this week. new border wall funding being constructed.

the american people know that the wall is being built in new areas based on past appropriations. i think you are going to see a continuation of new wall, repair of existing structure and different barriers in different places. some places it will be a wall, some places it will be a fence. we are going to rely on experts at the border every day. francine: could we see a deal this week? today? rep. fleischmann: i hope so. today maybe early. roomsn and women in those , not only republicans and democrats, but staff members. the staff members are working hard and the information coming back is positive. are we there yet? no. are we getting close? i think so. tom: i'm guessing the national

enquirer has never seen the interior. i need you to comment on jeff bezos and the president? is this going to distract washington? rep. fleischmann: i am unaware of that rhetoric. the flashman house is interesting. somebody like me, it is a baseball house, adorned with baseball paraphernalia. tom: do we need a 22nd clock so you and i start watching again? rep. fleischmann: i love the game and i am a traditionalist. i like folks taking their time and pitching. i am waiting for the new york mets to recruit me. i played at the nationals park. maybe someday i will get that call and i will start. boswellderful, tom writing it up in baltimore.

congressman, thank you. we will get you back for opening day. david balin listening closely. let's cut to the important elements. are swinging back to the pc players. -- to appease the players. his is going to destroy baseball? david: it is going to take too long. tom: tell us about a border wall. what did you learn from a shutdown with your domestic context? david: the economic impact it can have and it is more psychological initially, when it happens and then you watch it ripple through the economy and that is why it ended, it was about air traffic. it had to be ended. we hope it does not occur again. it seems to be useless. francine: i'm trying to make a

linkage between baseball and the border wall but i am failing. what do theou, markets want, if they are in the second shutdown, how will that be taken? david: negatively. the greater risk is this might not be a partial shutdown, this would be bigger and one that is intolerable for the u.s. economy. hopefully, we will see a transaction and that will be what the market expects. the market is not pricing in a shutdown. tom: david balin thank you so much. this from the toy business, hasbro with a major have got much more in there on inventory dynamics. move, this gets

hasbro back to support. the games of 2016 and 2017. -- the gains of 2016 and 2017. hasbro with a major miss. here is viviana hurtado. the trump administration warns the european union the trade truce agreed to last summer is in danger of unraveling. gordon summer telling bloomberg there has not been good faith and understanding that once existed. before the agreement president , trump imposed duties and the e.u. retaliated. italy's industrial production falling in december for a fourth straight month. it is a sign the recession that started in italy last year may continue. a survey of economists forecast an increase. italy's populist coalition government is being swamped by negative data. to brazil.

activity a community of 200 people living near its dam after stress tests and safety evaluations. calling it a precautionary measure. ores located near the iron mine. last month, another mine collapsed. more than 150 people were killed. the longest-serving member of congress in u.s. history has died. john dingell representing michigan. he was a democrat and a big supporter of the auto industry , national health insurance, and oversight of government agencies. he was succeeded by his wife. john dingell was 92. global news 24 hours a day and at tic toc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm viviana hurtado. this is "bloomberg." tom: thank you. we are going to drive for the conversation, coming up a

physician, the fda commissioner in a trump administration. we will have that conversation in the 7:00 hour. futures at -10. this is "bloomberg." ♪

tom: bloomberg surveillance. terrific news this morning. we have talked baseball, the border wall, 47 other things to talk about. what really matters to the fixed income market, the single best chart with david balin. it is the yield curve in germany, that is where the disinflation is. now,is the yield curve

here is where it was in october. you have got negative yields, it has shifted out from a five-year duration to a nine year duration. the deutsche bank chart, an increase in negative yield debt. are we going back to 2016? david: we did a comparison and that is the conclusion we drew, you are looking at this market and asking whether we are back in 2016. on january 1, the answer was yes, a lot of fear in the marketplace, we are in a low growth. tom: this is what it was like in 2016? tellinges and we are clients we want them to put money back in the markets and equities. market,ways, the bond which is mark. tom: the mathematics is

important. emergency question mark david: -- emergency? david: we are not. it is the idea you can fund debt if you're not paying anything. in terms of its ability to support the economy, it has used its juice. it is not stimulating more growth in europe, we saw the projection decline in growth. this is indicative of a fear factor now but not one that is beneficial in the long run for the global economy. francine: let me ask you this, when will the 10 year bund yield trade below japan's 10 year yield? this has huge implications. now, they can look attractive. david: on a relative basis, you

are right. it is a good question. haveologically, it will importance. we are steering clients to look at where there are high yields available to build into their portfolio. what we are interested in is the yield differential and that has expanded between the emerging and to, the u.s. market europe and germany and japan. clients are getting this opportunity to put money to work in high gilt markets and that is something -- high-yield markets and we think it is an opportunity relative to equities. tom: we have got to rip up the script. vescuzi.th ce here is the headline out right now. bring it up if you can. bid force will not alitalia stake on political

spat. this is what this has come down to. francine: the concern that people have is that the spat between italy and germany, now italy and france is escalating. we saw france pull out the ambassador yesterday. it starts permeating and hurting some of the consolidation rumors or partnerships between the countries. it would be a big deal. it would be almost the first which is usually for a domestic public, hurts economic interest. tom: what is the border like in the northwest of italy? lot of ourgest a viewers do not get over to that trade tension in the northwest

of italy between france and italy. what is the trade they are? francine: the trade is open borders. you from that region and can see the trade, one of the frontiers, people go in and out. they hardly check identity cards. we are not talking about it escalating to a point where there is a border. we are still in the eurozone and there is free flow. you have the agreement between the new rail line which could be in jeopardy and things like that that we need to watch out for. high-speed train, interesting, how odd the flow is now. going to continue from london and new york, david balin with us. we are going to switch over to banking. of carlyle group,

look for that in the 7:00 hours. futures -15. this is "bloomberg." ♪

a solutionannounced

of 500 million saving plan after -- at the 2020 verizon in order to take into account the environment. >> our expectation is to meet our 2021 target in 2020 so we can accelerate reduction to be one year in advance in our business plan. 2.7 e go from billion. >> we are expected to grow thanks to our business model rrelated from the macro. tom: look at the charts and it is beyond ugly.

superb work on day compare and contrast of american-e.u. banking. the regulators are different. >> the progress is different in and has been different there may be difficulty in europe. if you think about the u.s., we have gone through the key regulations since the crisis. when trump came in, we became more positive and we did have a proposal that open the gateway for some of these. dlach goingis guns after socgen. paribas, cannd bnp deutsche bank and their regulators told the european regulators what to do? alison: they cannot directly.

there haverisis, been nuances about different regulations and regulations within the u.s. that govern foreign subsidiaries and what will happen abroad. our regulations competitive -- are regulations competitive? we're seeing some of that potentially roll back with some of the proposals. , if your difference is look at their revenue environment, the environment is better in the u.s., we have had better growth. in europe, especially this quarter, capping off the fact that the u.s. has continued to europeans have trailed, we saw disappointing announcements out of so cgen third deutsche bank has gone through one strategy after another, revenue growth has been

elusive and the fact that continues to trail is what has people talking and increases the focus to look at other options. what happens with deutsche bank? will they merge with commerzbank and does the catalyst have to be something internal? alison: for deutsche bank, with each quarter they cannot post revenue growth, the pressure does intensify. the environment has not been helpful. the fourth quarter was challenging, december was difficult. have had ae, we healthy market but not the gang buster -- in january, we have had a healthy market but not the gang buster you need. to the extent you cannot get confidence renew, it does increase pressure. a couple of options out there. there have been stories talking

about what the regulators are doing to increase the ease of doing a deal with commerzbank. you have social issues that will mitigate the outlook. tom: next week on the new american banking as well. alison williams, thank you. much more to drive forward a newsday. we will have good coverage of that. we will do that next. this is "bloomberg." ♪

comcast business built the nation's largest gig-speed network. then went beyond. beyond chasing down network problems. to knowing when and where there's an issue. beyond network complexity. to a zero-touch, one-box world. optimizing performance and budget. beyond having questions. to getting answers. "activecore, how's my network?"

"all sites are green." all of which helps you do more than your customers thought possible. comcast business. beyond fast. >> labonte-bull run.

outflows this week as investors -- the secret iced slowdown props of the bond bulls. president trump says he will not meet with chinese president xi jinping before the march deadline to avoid tariffs on chinese goodss. in jeff bezos charges the blackmailnquirer of and hits the bias behind the washington post could be behind it. i'm alix steel with carol massar . david westin is off today. he was pretty tired, i have to say. carroll: you and i came in this morning and said there was not a lot of things going on, but we started the week with the state of the union under continuing to watch u.s.-china trade, and the jeff basil's story on the terminal -- jeff bezos story is the most popular on the terminal. ali