francine: the fight over who controls five g technology networks. president trump will curb access to the u.s. and american suppliers. china is holding best tennis holding of u.s. government debt falls -- china's holding of u.s. sovereign debt falls. and, we are live in paris where we will be speaking to the world's former chess champion, harry kasparov, and the fastest man in the world, usain bolt. ♪ welcome to bloomberg surveillance, everyone. i am francine lacqua in london.

that stocks in europe are down zero point 2% after the ratcheting up of tensions between president trump . in the communiqué, they did not mention huawei specifically, but they talk about chinese telecommunication companies they. 2.2, and similar moves for the u.s. and tenure german bonds. in terms of equities, let's look cook, shares plunging by quite a lot, 20% of its market value lost, down some 17%. will have more on the equity movers. gary johnson -- guy johnson also spoke to the chief executive. coming up on bloomberg surveillance, we have a good lineup. will speak to the former brought just champion garry kasparov about a.i., and the ericsson

chief executive, and then the world champion sprinter usain bolt. anglewas also a business with some of the scooters he is promoting in paris. now let's get straight to the first word news in london with olivia howe. >> theresa may will meet with colleagues who wants to asked her, rank-and-file members of her own party. . the question is when will she quit? she is trying to buy herself more time by bringing back her brexit deal in june. some are calling for her to step aside as soon as possible. berkshire hathaway has revealed its new amazon that which totaled $860 million, which gives clarity to the way the thinks ofe investor amazon. the company also ramped up that on j.p. morgan and cut its stake on southwest airlines and wells fargo.

facebook, twitter and alphabet have committed to develop rules. the promotion of violent extremism on social media, after the march 15 must shooting in new zealand. the terrorists had posted racist manifestoes on line and livestream his rampage. this company has agreed to a $300 million rescue loan as it rifles with mounting debt. the london-based company has received multiple bids for all or part of its airline business, in a bid to raise extra cash. higher fuel and hotel costs are expected to impact its results. an auction for a living artist, this painting sold for $91 million. the winning bid came from an art dealer, bob mnuchin, father of treasury secretary steven mnuchin, who says that he made the purchase for client. bloomberg has learned that this company is exploring a sale, receiving interest from two

buyers. we have been told that they are seeking $600 million. the ritz-carlton is one of the priciest hotels in manhattan. global news, 24 hours a day, on air and at tic-toc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i am olivia hows. this is bloomberg. francine: let's talk trade, and president trump's differing approaches to did up of his top concerns. the white house has moved to curb access of wally to the u.s. markets, and has put the tech giant on a blacklist. the e.u. and japan have been given six months to reach a deal that would limit or restrict auto imports into the u.s.. in return, washington will delay new tariffs. china has also cut its holdings of u.s. treasuries to the lowest levels is 2017, is slight reduction of about $10 billion, but enough to hit the two-year low. the world's second-largest

economy owns more foreign debt -- more u.s. debt than any other nation and that is considered the nuclear option. ,e start with christian keller managing director and head of economics research at barclays. can would be absolutely certain that the trimming of treasury holdings has nothing to do with the trade war, because if you look at what has happened in the last couple of years, it was almost a natural reduction? christian: i would think the chinese are not in the mood to make it look as if we are using debt as a tool to fight the trade war. i think it would not be in their interest and it is not their intention. they are also keeping. stable, so i would not misinterpreted in that way. francine: if you look at the economic forecast, the longer the trade war continues, how do concerns, istrade it skirmishes, does it get really bad? christian: i think we

increasingly have to work with the likelihood that this is now a permanent situation. to the fact that we will get additional tariffs on full 550 billion dollars in imports at 25%, and we are modeling based on that. if you do it over the longer-term term, it means u.s. down aboutl go 2%. but it depends on what the financial turmoil could imply. for china, the effect would probably be three times as large on growth. what does that mean for the asian economies? christie and: it's such a situation, in open economies, such as europe, they would be hit. we just got a pretty good gdp number from germany yesterday, but that would be a country that would not do well in this scenario. all the small open economies

particularly in asia, would be hit. it is difficult to do an ad hoc scenario on this, but growth would definitely be slower. francine: since you mentioned germany i have a chart that looks as -- at the 10-year yields. not every 10 bit minutes, but on an hourly basis. best a a sign that the sign of the diversification of the economy in germany and europe? christian: recently the behavior has become increasingly such that you see the german bund yields and 10 years being in a negative territory, the ecb pretty much out of options. of course, they could do something more radical than they have so far. we have to see who the new president of the ecb will be. but we have a situation where by there seems to be no inflation pressure in germany and very low interest rates, so the

equilibrium where you get low inflation and low interest rates, you don't get that, that looks like japan. francine: the trade concerns her to -- her to germany, but germany could get a break from tariffs from president trump if he focuses on fighting with china instead of focusing on cars, car makers in germany. is that an advantage? christian: i think there was a bit of relief in the market. may 18, the deadline for the cars, we thought maybe he might come up with something more aggressive this week. that has now been postponed for the next six months. it might mean he doesn't want to open two fronts, but also still seems to be on his mind. i don't think germany is off the hook. the issue around cars will remain. it may well come back within the six months or at the end of the six months. francine: if this is the new

normal what are the chances of a global recession in the next 18 months? christian: the chances have definitely gone up. there's always a question of what you call a recession in china. the risk for china has gone up, if you go below 5% growth in china, that is already recession-like. if you've been global growth going into negative territory, i think the chances are relatively low. what we have done now is increased the risk of china not having the kind of managed slowdown that they have, but worse.ng automatically, that means the risk for the rest of the world is much higher. francine: christian keller from workplace stays with us. we will talk more about the chinese economy -- from barclays stays with worse. automatically, that means us. coming up, an exclusive interview with nicola mendelson, facebook's vice president for emea. don't miss that interview from

our summit in london. this is bloomberg. ♪

♪ francine: economics, finance, politics. this is ""bloomberg surveillance." let's get to the bloomberg business flash. >> this company has entered talks to sell its skincare business. the potential buyer is a group that would be one of the biggest public equity deals this year. as the world's largest foot company is focusing on water best foot company, nestlé's exposure to close in the second half. forecast.ssed its net bookings rose for the 5% but failed to meet the estimate for

nearly 500 million euros. traditional video games have taken a hit from the popularity of video games like fortnite. ubisoft hopes to team up with chinese tech company tencent. this consensual would bring the alliance partners closer together. bloomberg has learned that this man could be nominated as director. a merger of the two automakers have so far been rebuffed by nissan. that is a bloomberg business flash. francine? francine: thank you very much, olivia. president trump is ratcheting up pressure on trade partners, moving to restrict huawei and zte from the american market. we are back with christian keller from barclays bank. abouto we not understand the chinese economy, what do the markets not understand about the chinese economy that economists do? christian: i am not a true economist, but it is the biggest

black box in a way, the most important one in the global economy. what is crucial, if we go to a scenario where the trade war persists and china slows, and people start looking at reserves , the and at the cny question is can we go back to 2015 where you see capital going out and the chinese trying to bring their capital out, that remains the biggest achilles heel. . it is not an emerging market, but it would have to be liquidity inside china wanting to leave. francine: but there have been some kind of capital controls. they haven't really left, they are trying to stay put. christian: that is exactly to the point. the biggest difference from 2050 is a have done capital controls. the reserves are one trillion less but they have capital controls that seem to be working quite well, and to give the pboc confidence to manage the cuny. francine: how much --

i think they would have to let the sea and why depreciate. thus they would have to let the cny depreciate. francine: we are talking about the possible tariffs coming from the u.s. hitting automakers.

we have the bundesbank president talking right now, he says that tariffs hit automakers hard, and he says the u.s.-china trade escalation risk to poison the gdp. it has gone unnoticed, but if you look at many markets, there is a 30% chance of an interest rate cut by the ecb. are they right comedy think they will meet the cut? christian: first of all, money markets price probability, there is a certainty, a 100% probability of a cut by the fed, therefore, you would think in other money, they would react. it is more likely that the ecb will have to do something. aboutb has been talking tiering. if you protect the banks that have a large liquidity surplus, you could put either negative interest rates longer, or try to

-50, and40 may be to the markets were try to price that. i am not surprised that the markets are starting to price list, given the current outlook. francine: coming up, a conversation you don't want to miss. we talked tech, leadership and racing with the world's fastest man, was involved. this is bloomberg.

♪

francine: this is ""bloomberg surveillance." i am francine lacqua in london. theresa may is meeting rank-and-file members of her own party. the big question, when will she quit? she is promising to bring her brexit deal back in june, but some are calling for her to step aside as soon as possible. what does this mean for the country's fintech sector and what do executives want? thomas,, here is janet chief executive officer at the risk, strategy and markets that intellect design arena. we have to talk about brexit, the impact on fintech, disruption in the payment system. but first, you are here for the bloomberg equality summit. why are we not doing better inequality? why are we still talking about it in may of 2019? because, i think particularly when i started in the banking sector, people thought, let's have a

conversation around equality and make changes. they didn't take into consideration is that you are looking at cultural and societal change. as we know now, that is where it is really difficult to make rapid changes, and that is why we are still talking about gender equality and all parts of equality, not just gender, it is also ethnicity diversity and other diversity issues. francine: has it changed in the last 10 years, or are we going backwards? garry: i think if you look at city? janet:, for me personally, when a look at the city today compared to when i started in 1998, it certainly has changed. it is much more conducive environment for women to work in. but in terms of gender equality, i think we have gone backwards francine: talk to me about fintech. executivess

and they say that it is going to be great. how much disruption will come? janet: it will be huge. francine: the people know what is coming? janet: i don't think so. what i am seeing is that individuals like myself, particularly women who have been positions inr banks for a very, very long time, having approached by the large tech firms like the googles the facebooks the amazons for senior leadership roles, and they are moving. they are ticking like 15-20 years of banking knowledge with them and they are doing and quicker, faster and better. francine: how will the model change? we all bank now on our little phones. how will that be disruptive in 10 years? janet: the great thing about those women, they have been in their positions in the banks for a long time, and they wanted to share better ways of doing business. so they are going with these great ideas to the tech firms,

and with a much more diverse community or manufacturing community in these tech firms, they have the resources to do things very differently. so it definitely the internet of things, a.i., machine learning, automation. we will see a blend of all those three areas coming together. in the technology, the fintech world, i think those women are looking at all the tech world, looking at doing things very differently. so it be disruptive, and things will be faster. francine: christian you are in charge of dust our economies are being disrupted. inflation is nowhere partly because of the sharing economy. how difficult is it to look at economic measures given the isnge in the tax base, which affecting everything we do? christian: i am a macro-economist, but the big

banks are not sleeping. -- it is a at it fascinating topic. we have done some work on how tech is affecting the macro economy. i love the reasons. -- a lot of the reasons we wonder why prices are low, and they are not driving up quicker even though there is supposedly low unemployment, is because tech has made a lot of processes cheaper, supposedly, the productivity we measure is quite low. but it feels as if there's actually a lot more going on than what the measure with traditional gdp because zation really captured or measured in a gdp statistics. when economists look at output and what is going in and then divided and said that it is productivity, maybe what we measure is too low. francine: just catching up with the french president on the way -- on huawei.

develop business innovation, and we've believe in corporation. at the same time, for 5g for instance and a lot of innovation come we are streaming careful about access to foreign technology that affects our national security and all the safety rules. francine: that was the french president talking about cooperation and multilateralism. thank you for joining us, jenna thomas, executive of risk, tragedy and market at intellect design arena, and rich in color from barclays stays with us -- and christian keller from barclays stays with us. coming up, we talked a former role chess champion about a.i.

trade tensions intensify over who controls five

g technology networks. president trump will curve access.-- hwuawei's sovereign debt. lowest level in 2017. sovereign debt falls to the lowest level since 2017. and we will speak to the warmer chess champion and the fastest man in the world, usain bolt. i'm francine lacqua in london. we have a lot going on. we will check your markets and around the world. here is bloomberg first word news with olivia. olivia: donald trump has ratcheted up his battle with china for dominance of 5g technology. the department of commerce also announced it put the tech giant awei on a blacklist. we spoke to emmanuel macron about this. i am -- >> i am trying to

be realistic. we believe in innovation and cooperation. allowssame time, 5g access to new technology to preserve national security and all the safety rules. the u.s. has ordered its nonemergency staff to leave iraq. this is what american officials are blaming on iran. emirates foreign affairs minister says they need to avoid escalating the situation. >> we need to address iran's behavior, but at the same time, not devolve into a crisis. that is very important. olivia: sony announced another buyback just months after completing its last.

of stock, equaling 5% of tokyo company shares. this underscores the commitment to revive ailing stock price. thomas cook has agreed to a 300 million pound rescue fund. the london-based company has received multiple bids for all or part of its airline business. fuels cook says higher costs are expected to impact results. a record for a living artist. from artng bid came dealer bob mnuchin, the father of treasury secretary steve mnuchin. howard -- global news 24 hours a day on-air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. francine: we all know tom keene wanted that rabbit but missed out. it gender inequality is not just an important ethical issue, it

is also good business. we dig into the numbers with annmarie. annmarie: it is not just an ethical issue, it means it is good for business. i have been looking at the gender equality index. a number of companies make up the index. in europe it is unilever, adidas, and santana. check out this chart. the numbers do not lie. outperforming the msci all country world index. about gender equality, one topic front and center the last few years has been the gender pay gap. this is the second year in a row that u.s. -- u.k. companies are required to disclose. are a handful of companies paying women more than men. still being paid a lot

more than women when it comes to a lot of these. at the senior level, there are more men than women. the ftse 100 companies and ceos, that number this year dropped to just five. i spoke to one of them, allison cooper, just last week. i asked about this shrinking number for female executives across the 5100. >> this is going to take time to bring people through businesses. i think we are seeing improvements as we look through -- work through the management players. we have a significant focus on diversity, inclusion, and really trying to improve. in particular, the lower level of the organization. we have some better performances. that we do need to move that up to the business.

>> coming up on bloomberg at the equality summit and on bloomberg tv, i will be talking to hosts and you, francine, will be talking to a lot of them. looking forward to all of these as we dive more into the diversity and gender equality topics. francine: such an important subject. now as cybersecurity takes center stage, tech suppliers are coming under increasing scrutiny. but will new technology also play a role in countering the threats? the grand master was one of the early victims of the ai revolution. he was the first world champion to lose to a computer. today, he's one of the most prominent voices in the debate. london, from in

catchys, always good to up with you. thank you for giving us a little bit of your time. you talk about human and machine collaboration. the u.s. and china are in a trade war, but is this really about texture primacy -- tech supremacy? the first one to learn that fighting the machines could become a dead end. usealize that the future for would be in cooperating with these machines. i don't think that we should be afraid of the future. are obviously, there consequences of any new disruptive technology. it creates problems, destroys some jobs, but creates new opportunity and creates the industry. it definitely is a certain

threat but it is not about evil ai. do you worry about how china is using artificial intelligence? >> regarding china, we're talking about bad actors. and in a totalitarian state, they are well known for using technology to subdue and to collect data. on them abroad. from what i know, china is sophisticated, undermining the very foundation. francine: do europe and western same? if i am a

western consumer, should i care about the chinese having act as to my data? -- access to my data? >> we generate our own data. someone will collect the data. i believe there is a huge difference between google data collection and kgb data collection. buy a aware that when we or download official recognition , that is the risk we are dealing with. or dealing with chinese russian technology, some sort of hacking, i believe it is quite different. and i think we should be extremely cautious, trying to put this between what is happening in the free world where there are still putlations and it could

them under some kind of scrutiny. and there are uncontrolled for otherivities cause or state organizations. if you look at data collection and china and russia, when you look at ai, you also look to see that the system works properly. is more data -- it is more data and the more exposed we are. we are paying with a new type of currency which is our privacy, our data. this data collection and the free world, we end up with unwanted advertising. some of this could be used by businesses beyond your knowledge. but china, russia, iran, turkey, it could be life or death.

, would be very cautious allowing these countries to operate freely in our environment. because they do not abide by the rules and they use technology without any restrictions that we are trying to impose. the question that all our viewers and listeners want to know, is it a chess match between president trump and president xi of china? who would win, and why? >> i always hate these kind of questions because there is an assumption that dictators play by the rules. the game of chess is about rules. and we both follow the same rules and we cannot break them. you have to win abiding by the rules.

areators know that they bending rules at a time when they think it is convenient and it works in their favor. chess and democratic politics, it is a big stretch. good answer. it looks like you have been asked that before. we will have more from christian keller, head of economic research at barclays. what we werek to talking about before about the disruption. how does ai change the world that we are looking at? does ai disrupt that? >> potentially, yes. we measure physical output. and to some extent, you can adjust it. verynk he said something

interesting, there's a big debate about it. he said that we should embrace it and we should see it as just another innovation the same way we see the steam engine, electricity, the car, what have you. another view is that this is for the first time, artificial intelligence, not something that mechanically helps us but something that can replace thought of a human being, something that is intelligent. this could be a very different revolution. as saying thatr we live in a world where we reap the benefits of machines doing that for us. it becomes a game of redistribution. i don't want to become too sci-fi, but if ai develops in a way that some project, this could not be so far away anymore. francine: head of economic research at barclays. are flying taxi set to become

standard in cities? the new all electric five seater aircraft. don't miss the six was of interview. this is bloomberg. -- this exclusive interview. this is bloomberg. ♪

this is bloomberg surveillance. i'm francine lacqua in london. flying taxis have been a mainstay of sci-fi movies for decades. a german startup is hoping to turn that into reality. the company says the aircraft will begin the bull of traveling 300 kilometers and 60 -- will be capable of traveling 300 kilometers in 60 minutes. we are delighted to be joined by the company's cofounder and chief executive.

this is crazy. a flying taxi for real. five years, 10 years, 50 years? in 20 plan is to book it in 2025. until then, we need to certify the aircraft. we need to set up production. and we will be ready. francine: we are not even able to do all electric cars right now. how much money do you need to make this dream a reality? >> we have one of the biggest teams in the world. we need another $100 million to go on the market. francine: is it being on a rooftop or being slow? not lobbying

government. we have conversations around the globe with cities and regions to be the first benefiting from this kind of service. that is because of the performance of the performance of aircraft that allows us to fly 300 kilometers with one battery charged. will thathow much cost me to get from here to buckingham palace? you can book it at the price of a taxi. francine: is it different to a helicopter? i have so many questions and people can't quite believe it is true. probability that it will be in 2025? >> 100%. it is an electric jet aircraft. it is a lot safer than helicopters because you have redundancies on the engines and it is much less noisy. it allows us to land on top of the studio and you wouldn't hear it. francine: it would make my

commute a lot shorter in the morning. there are cities like paris where you cannot fly an aircraft over the city for security reasons. >> you can fly over the cities but you need the right permissions. because these planes are redundant and they are safe like passenger jets, you can fly with today's regulations. francine: have you got to speak to countries or cities where they are more eager than others? where has been the more welcome reception. >> around the globe. every city would benefit. we are getting emails from everywhere in the world. i can't tell you where you will be in the first place to launch. francine: bloomberg headquarters would be great because a lot of us get here at 2:00 in the morning. let's talk about the battle over the control of 5g networks.

donald trump wants to restrict huawei's access to tech markets. he spoke to french president emmanuel macron about europe's approach to the issue -- we spoke to french president emmanuel macron about europe's approach to the issue. >> we want to be about jobs, business, innovation. at the same time, for 5g, it will be access to core technology to preserve national security and all the safety rules. the rising security concerns are set to benefit european competitors including ericsson. go to the conference in paris where we are standing by with the ericsson chief executive. >> francine, i'm happy to be

joined by the ceo of ericsson. who is better to talk about what happened last night? donald trump tweeting that it might curb huawei from the u.s. markets. will that benefit ericsson? >> it is great to be here. we have just read the executive order and we need to analyze with that is. but the strategy remains the same as before. we work with our customers to solve their problems. that is the only way to long-term develop our business anyways. let's look at the consequences as we have analyzed them. >> have you learned any lessons from when 3g rolled out in the u.s.? don't know if there are any similarities. we manage a lot of networks around the world.

we know how to do that in a better way now. but i think it is way too early to speculate. >> what about nokia for example? >> we need to win with the customer and resolve their needs. we need to provide technology that helps them moved to 5g. then we will be successful. >> what about europe? i was talking to the french president not too long ago. europe wants that huawei.allway -- is that the right decision?

>> we will work with whatever policy is decided. i have no views on that. it is back to what we can impact. we can impact our own strategies, our own market strategies. that is what we will work with. i will say that in a 5g world, security is more important. part of it is security solutions. the way that they operate the network. >> should it be dangerous to have different roles in in the u k,untries? they are reviewing the wally -- of who

huawei in 5g. >> i'm not sure that has any impact. i think france will try to be a global provider. u.s.,e customers in the europe, and asia. is the most important and that is what we're trying to work on. >> is the trade were having any impact on customers and your growth? >> i am a person that believes in free trade. almost no hallmark. we have less than 1% and we depend on exports. we have as open a trade environment as possible. >> one of your largest shareholders recently said that there is zero chance that you

will not achieve your 2020 target. have a margin of 10%. will it be time to revise those targets? toi think it is very good have shareholders supporting us. i think that is very good that they believe in our target. >> you became ceo in early 2017. those shares have gained around 65%. is that too conservative a target? >> we were building a strong company five years to 10 years out. andrive the product growth solutions to customers. that is what we focus on. that is the top priority. then to guide the market, we put some objectives out. we did that, but it is all from that perspective. >> are you going to grow to acquisitions?

>> we have set acquisitions are part of our strategy. we believe we can strengthen our product by making market acquisitions. have few months ago, we that trade. constraints on the radio and making offerings for the customers. >> it was a pleasure to speak with you in paris. this was the ceo of ericsson live from paris. francine: thank you for that great interview, the ericsson chief executive on everything from targets to the five g networks. continuessurveillance in the next hour. tom keene joints me out of new york. coming up, an exclusive interview with nikolai mendelson

. we will ask her about data privacy. and we also have a conversation with usain bolt, the fastest man in the world. leadership and putting scooters around paris. and trumps threat on the highway. we will look at that. we will look at treasuries and what the market is looking at. this is bloomberg. ♪

francine: trade tensions

intensify over who controls 5g technology networks. --sident trouble curb president trump will curb huawei 's access. debt also the lowest level since 2017 and yields hold steady after touching a three-month low. and surveillance on the road. we are live in paris where we speak to the fastest man in the world, usain bolt. and we speak to patricia arquette. lacqua in london. tom keene in new york. a bit of a different show today. we look at trade concerns and we look at a quality with the bloomberg equality summit today. in washington yesterday, there was a detailed article on the tensions between the white , congress, and the pentagon. we know it has been percolating for a number of days. we will talk about that as well. francine: let's get straight to

bloomberg first word news. >> the u.s. has fire the latest shot in the trade war and president trump wants to restrict china's wally technology access. 5g networks, of signed an order declaring a national emergency. they spent months branding huawei a security risk. there will be six months to agree to a limit on car sales. that is according to a draft executive order seen by bloomberg. the administration has determined that imports are a threat to national security. allowsls argue that it them to invest in new technologies. theresa may is meeting with members of her own conservative party. they tried to buy more time by promising to bring her brexit deal back to parliament at the start of june.

they will step down before june 15. if she refuses, it could lead to another no-confidence vote. the united arab emirates will not jump the gun. the minister of foreign affairs says they are committed to de-escalation. >> we need to address iran's behavior and clearly, at the same time, not to be baited into a crisis is very important. >> global news 24 hours a day on-air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. equities, bonds, currencies, commodities. today.y odd data check no new movement in yields or movement and currency markets. we are still at the point of

tension we were at yesterday. the euro advances. on to the next screen. we are shown the better equity markets. 2.16%. it is absolutely remarkable with the germany 10 year yield. . .wo basis points lower in yield extraordinary. i have a similar data check. european stocks are down. treasuries are higher. day.is my chart of the tom: this is what we're talking about. you can see it is a one, a2, a3,

ur -- a two, three, fo standard deviation move. francine? francine: i have a very simple chart. it is just looking at the german 10 year yield. bloomberg surveillance in general has been very focused on this move. the lower it goes, the more people say it looks like the japanification is complete. will talk about the lessons that europe could learn from japan. has movedhouse and the u.s. has awei on a blacklist. in return, washington will delay new tariffs. ahead of blackrock euro fixed

income and the global equities economist are both with us. peter, let me start with you. is this the new normal? or will we see trade tensions stay put? >> what is normal in these circumstances? when we look back over history, we get periods where protectionism creates out of the woodwork and becomes the new normal. thes very difficult to see genie is out of the bottle. the u.s. has effectively weaponize trade -- weaponized trade. that's how it certainly appears. i find it difficult to see what is going to change things. unless we get a change in the white house. francine: but a lot of people

have been gathering momentum. it is hard to say that you shouldn't go after china. u.s., it is not clear that the majority is against it. side, withr elections not that far away, i think there is a thin line that he has to walk between aggressive rhetoric and being seen as a strong leader. and at the other side, not risking too much impact on the economy as we approach the election. so we will see where that leads. tom: good to have the both of you with us today. what is the difference between the lower yields in 2019 and 2016? francine just showed the chart of the 10 year. the german ten-year roles right over again. what is different now?

to one degree, it is quite surprising. if you look at the labor market and you look at gdp statistics, it is not really the crisis that you would expect. it is more cost by the fact that we are learning about negative rates in europe. back after year, we were assuming that we would discuss the timing of a rate hike. back to been pushed 2020. i would personally be surprised don't see any hike in 2020. it is not driven by crisis, but the recognition -- tom: i was guessing that's where

you're going. peter dixon, if it is not driven , thensis but the new new how will markets adjust in the next 48 hours? basically, i think the central banks are on hold as michael just said because they are not sure how to react. i think there is a general recognition that given the confluence of what has happened in the economy and what has been happening in the market, the interest rates are low. equally, the concern about what -- i believe the federal reserve is nearer a rate cut than a rate hike. puturope, we will stay where the ecb is concerned. is aine: on the ecb, there 30% probability when you look at the money market for a rate cut in the first quarter of 2020. is that right? peter: i can see

where they're coming from. it would not be our call either. i suspect they would wait a bit longer to see how things pan out. the economy is still going ok. there is no need to panic at the moment. i think a sensible strategy is to wait and see. a lot can change between now and then. francine: thank you both for joining us. .ichael and peter, stay with us we have important voices joining us today around this conversation. we'll talk a lot more about what we're seeing in treasuries. which includes the private cofounder. vp.facebook's all that on bloomberg and equality. ♪

>> this is bloomberg surveillance. let's get the bloomberg business flash. shares of a british tour operator are plunging today, operating a $355 million rescue loan. thomas cook has been hurt by debt and growing losses. they are forecasting another tough summer. one of the biggest private equity deals of the year, negotiating selling a skincare business for more than $10 billion. a potential buyer headed by eq partners. the investment authority as part of the consortium. berkshire hathaway has disclosed the size of its bet on amazon, almost $861 million. -- he has generally

steered clear of tech giants. that is the bloomberg business flash. francine: once again, theresa may faces colleagues seeking to oust her. she meets with rank-and-file members of her own party in the big question is, when will she quit? we are joined by gina miller. one of the key operators in the saga that has been brexit. and michael and peter are still with us. thank you for sticking around. welcome to surveillance. in thisthe next twist ongoing brexit saga? gina: i call it the farce rather than the saga. but if you look at what will happen this week, there will be another meeting between the main part of the conservative party that will try to seek a change of rules so that they can get rid of misses may and require

them to name and date for the departure. i can't see that they will get far because you can't change the rules. think the more stable people in the conservative party are saying that you can change the rules. an awful lot will change this week and she will bring back her withdrawal agreements. francine: it was you're doing that parliament has such a big say. is what it isetic no matter who is prime minister. is it time for her to go or does it make a difference? gina: it doesn't make a difference because there is a feeling that there will be some sort of compromise between labor and the conservative government. i can't see that they will get away with any of those reports. the change in leader does not resolve the problem of brexit. the problem of brexit will still remain and the arithmetic in parliament is that there is no agreement on anything.

i can't see that this will suddenly resolve itself in the next three or four weeks. tom: good morning from new york. you are steeped in the minutia and the tactical exercise of brexit. as a liberal democrat, what does the middle ground need to do in the next 20 days? the new is a middle, party, everything else as well. what is the to do list for those stuck in the middle? i am not a liberal democrat, just to make that clear. i'm not aligned to any political party. at the most important thing is eu elections on the 23rd of measured -- of may. nigel farage is marching away with these elections. think about voting tactically because of the number of parties, smaller parties on the remain side. .e will return a huge majority

it is not a good look for us as these do notause believe in the eu and if they take dennis eads, they will try to destroy it from within. so you need to vote tactically. i've watched -- launched something called remain united. tom: based on my amateur reading from a distance, good luck with that. what will prime minister may do on may 24? gina: she will do what she always does, keep her head down, not listen to anyone around her, and be confident that she can somehow magically get her deal through parliament. tom: that is the to do list for prime minister may. i want to go back on the liberal democrat item. .his is fascinating in america, there is no middle ground. where is the middle ground on this debate? gina: unfortunately, it is very

split. we have many smaller remain parties arguing amongst them selves. there is a lack of leadership in the lack of strategic understanding that have a very simple message. and we have not learned from the 2016 referendum, the messaging, the marketing, and how we go out there and engage with people. francine: we kind of had the same options as we did five months ago and 12 months ago. we fine-tuned it, but the market probabilities are still the same. peter: the markets look at this and say that it might not happen at all. might be complacent, but that is the market thinking. to have something to react to because it is the same old story, time after time.

unfortunately, they will react when i have to. francine: is it time for gilt? michael: we have seen a huge , and i would say it is only marginally from brexit. it looks as complex as it looked six months ago. francine: thank you all. gina, michael, and peter, all stay with us. coming up, jeremy wright and the u.k. secretary at 10 a.m. in new york, 3 p.m. in london. talk equality. a bloomberg equality summit here in london. this is bloomberg. ♪

>> look at what the divisiveness of brexit has done to the united kingdom. it looks like game of thrones on steroids. >> people feel that europe is my europe. >> the countries you name, are they tax havens? >> a tax haven is where everybody pays their taxes. >> we could keep asking is amazon will pay taxes.

>> a much more confident europe might be slightly more hard-nosed. tom: i wonder what charles de gaulle would think about an eu debate in english. that was the most interesting set of videos as we go towards in theentary elections united kingdom. with us is peter dixon of commerzbank, michael krol the final episode of game of thrones is the fault of june a miller where she spoke on a channel that is unifying a kings landing and wester us. westeros. this idea of game of thrones and all of that, we see it within europe.

years?s europe in five if they have the economic model they have? how does europe get to the next five years? i think the next five years will be interesting when it comes to the results of these elections that we are about to have next week. of m.v.p.'sa block that have returned to sit in eu parliament, they basically are against the eu and they will be sitting and trying to dismantle it within. they will block the budget, try to block climate change. they will try to block any sort of legislation around rights. they will basically try to dismantle it. i am told they are expecting as many as 190 what we would call fairly hard right in the piece -- mep's sitting.

brexit has been a heart attack for the eu. it is creating a divide between the french german axis. dismantlewanting to the eu and the problem of china coming in to try to dismantle and buyout debt and business in europe. europe is being attacked from several different angles. this will mean in the next five years, we could see either a dismantling of existing eu interests into a two tier membership organization where you have the bigger countries edd a block and tier membership. or you could see a complete realignment of fiscal contributions from member states. isncine: the other thing that suddenly european parliament elections matter. how does that change policy? michael: good point.

you could almost call it a positive for the amount of attention that the european election gets. maybe it gets it for the wrong reasons. analysisgree with the from gina that probably at the moment, we have some of the strongest headwinds we have had for a while. but also globally if you look at the interest from global players. i would probably be a bit more positive on some of the progress we have made on a country level. francine: thank you all. it gina miller, michael krautzberger, stay with us. we'll talk to the u.k. committee chair to talk about women equality and brexit. this is bloomberg. ♪

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with any other country is not appropriate. second it is not the best way androw your own ecosystem have a world of cooperation and decreased tensions. >> extremely important conversation there. an extraordinary conversation on 5g and the backdrop as president trump goes after foreign adversaries in technology and the ramifications for apple and beijing. here is sebastian . >> tough talk from china and escalating trade war with the u.s.. the country is accusing the u.s. of banded logic in trade talk. president trump has ramped up

the battle with china. he signed an order to restrict huawei technologies from the u.s. market. a 10 billion dollar reduction and china holds more u.s. government debt than any other nation. more than $1.1 trillion. the nuclear option in the trade war. congress is demanding the trump administration plans for tensions with iran. a large briefing for all council members next week. chuck schumer said there is an alarming lack of clarity about the strategies in iran. in new york last night auction record for an artist. a stainless steel rabbit sold for $91 million at christie's. to thening bid it went

father of treasury secretary steven mnuchin. news 24 hours a day on air and on tictoc on twitter powered by more than 2700 analysts in more than 120 countrie. thrilled to have michael a blackrock and peter of commerce bank. the markets are extraordinary over the last 72 hours. i go right to the two-year yield on the bloomberg terminal. 101 isixon, textbook currencies will compensate for in rate tradeion and international economics. should i have optimism that currencies will adjust to a better solution? >> i think that would be stretching it too far.

the currency market is likely to remain relatively volatile. you see a rise in volatility but you are not seeing massive volatility. --n equity markets >> may be, michael, it is how we are has said what we are hedged against instability. your experience at black rock, what does the left tail look like? are people in control of their risks or hedges or are they not? >> good question. on a generalt level is probably too difficult. we alwayserspective try to build very diversified and robust portfolios. we are using some currency options that up until three or four weeks ago, despite the

headlines on potential risk, currency volatilities were very cheap. i agree with you. over the next three months looking at the left tail even if that is not your main scenario it is as important as optimizing the portfolio for your main scenario. >> what is the chance of a recession, global recession or recession in the u.s.? >> we haven't relatively low. obviously you can construct a scenario around an escalation of the trade war. does notonald trump have incentive to totally escalated -- escalate it in the near term. if you look at europe and the labor market and wages and the domestic economy, things are looking relatively robust. we saw a bounce in q1. the export sector is confident. we still have recession probability relatively low. >> -- 20%.

>> a little bit perhaps. , whatct of the matter is figures a recession is unanticipated policy actions. to raise. more likely we don't have the same degree of balances in the economy as we did in 2008. we may see major market turn up. if we do get a recession it will be mild compared to what we have seen recently. >> if we cut interest rates in europe, in japan, in the u.s., what happens in the 10 minutes after we cut interest rates? >> there were two answers to that. one is, markets fail, great. banks are reacting therefore it is time to put on a

bit on the market. the other one which will probably kick in soon after that is, central banks much be quite concerned about the direction of the economy if they are cutting interest rates. i don't think it would give the market a huge amount of support. function. the wirp one of the reasons to buy a bloomberg terminal. get the rate cut idea for september. here is the moonshot over the last couple of days. up to 55% likelihood. i look at this idea of a rate cut, what dynamic in fixed income would be expressed through a rate cut that soon? perspective, if you look -- i don't necessarily

think a rate cut is warranted including the river market. -- labor market. speculation ist coming from this discussion of a revision of central-bank strategies. a lot of discussion about makeup strategies. you want to say, if you on average want to achieve 2% at least you know that in a downturn you will stay to the downside. maybe you have to run a slightly higher rate in good times. i think that logic will contribute. at the moment that is not our main scenario but i think the market will react more friendly to a u.s. rate cut then it would be to a european or japanese rate cut where it would look desperate. >> the time variance is important. bellodixon, george sarah

says a small german bank just published a euro below 110. does peter dixon and commerzbank have a euro call and have you adjusted it in the festivities of the week? >> no we haven't. we still think the euro goes higher from here. primarily because, if the u.s. is cutting interest rates why should the dollar gain ground? >> thank you both. michael krause berg are a blackrock and peter dixon of commerzbank. nine time olympic gold medalist and investor cofounder talking about scooters and why he wants to take on paris by scooter. that is 6:30 a.m. in new york. this is bloomberg. ♪

>> this is bloomberg surveillance. i am sebastian salek. elon musk's spacex has made a business of launching satellites. tonight he will launch his own satellite. thecompanies will take first steps towards a space-based consolation to serve broadband to underserved areas around the world. he is doing this along with fellow billionaire jeff bezos. losses narrowed in the first quarter. the shared workspace operator reduce losses by 2-iron $64 million. -- 264 million. we work is expected to go public this year. thecisco is out with a bullish cell. businesses are still spending on contributor network this by concerns of a global globe. cisco says the americas region

contributed the most to growth. asia declined. that is the boom -- bloomberg business flash. >> let's turn to the shakeup in corporate germany. deutsche and others undergoing changes. this comes at the same time that europe is transitioning from chancellor angela merkel to her successor. chad thomas is our western europe managing editor. michael kraus berg are a blackrock and peter dixon of commerzbank are still with us. when we look at germany we often think about the stability of europe. we have a huge generational shift with angela merkel possibly stepping down and her successor coming in place. do you worry more about the political vacuum or the fact that the companies we are mentioning are trying to spin or become much more comprehensible for investors?

>> as someone who has lived in germany for a long time what is interesting is that these transitions are happening at the same time. you have this transition playing out very slowly but away from chancellor merkel. no one knows how that is going to end. you have the political stagnation that is happening. you have all these companies that seem to be in turmoil. that is something fairly new for corporate germany. have activist you investors stepping in and saying we want change. look at what happened with -- it was unheard of at the ceo would lose a boat like that. all this change is happening at one time and no one since the know where this is going. >> we need to fix the banks? so much speculation about what will happen with deutsche bank and whether they will merge with deutsche bank -- commerzbank. >> the banking sector is what the finance ministry seems to be most concerned with. we had the push before the merger between deutsche bank and

coins bank out of the finance ministry. we hear there are still discussions going on in the not just around deutsche bank and commerzbank which is off the table at the moment but what other banks might step in. if you listen closely to the finance minister he talks about needing a european banking champion based in germany. which means you have the opportunity for someone to step in as a potential merger partner with commerzbank in particular. >> i want to go to industrial germany. it has been a humbling time off of the ge merger and the disaster that has been. engagedublic of germany in thebayer -- the bayer monsanto disaster? >> the average person in germany does not understand why bayer bought monsanto. bayer will give you the reasons

they thought it was a good idea. monsanto did not have a good name in germany because of these genetically modified seeds they are producing and roundup. average people don't understand why bayer would do this. >> i don't know whether this goes back to your calls on equities and sectors in germany or if it goes back to the strength of the german economy. or both. economywe see now is an which has been painted into a corner. whether it is sustainable we will wait and see. i think it will be a fairly slow all from here. by market has been battered what is happening externally. is what is happening in china, it is all the impacts on the german exports sector. that is temporary. there are a lot of interesting dynamics going on.

all these tectonic plates are grinding against each other at the same time. in fromve breaking news all of global wall street. this is a timeless and ageless thing. s, it about individual trader compliance departments trying to watch individual traders or is it about the banks? what we have here is major banks having caught up in a years ago cartel is the language that is used by the eu with a billion euro fine. i did some quick math. the fine for barclays is 12 days of operating income. that is quick math. it is an extraordinary story and what is fascinating is there is not much about the banks in compliance and a lot about rogue or individual traders talking between banks.

jeffis is something that -- just came out of the european union. there are five banks that were fined a total of one billion euros. this is a big number but because it is five banks i don't know if it will have a huge impact on the bottom line of these banks. it is a good reminder of the risks out there. a lot of chief executives that he spoke to them now would say this is legacy. this is linked to the foreign exchange market for foreign currencies. are trying to figure out whether that has changed. is legacy back to 2007 and 2013. gentlemen, thank you for unimportant market conversation. michael krol's burger and peter dixon. we continue. stay with us. this is bloomberg. ♪

>> jpmorgan barclays and he grew are among banks find a total of

..7 -- 1.7 billion euros you have been pouring over this. you have been looking into it. how much is this legacy? this is something that is a reminder that bankers and banks are at risk of being fined but it should not be a problem going forward. quite an old cartel and behavior that goes back about five years. authorities in the u.s. fined banks in 2015. the banks knew what was coming and they agreed to this. they got lower fines because they settled with european authorities. there is one bank that we are still waiting for, credit suisse that has not titled the case. we are in a position where this is finally behind those banks. i was going to ask about other penalties. how many more fines are we expecting on other things?

>> we are looking at some new cartels. we are looking at bond cartels, there is one for ssa's and eurozone. the banks have only recently been charged. we saw one in december and one a couple months ago. we saw one in options trading. there are new scenes out there. the shockwave we saw with the , those big fines do seem to the past. >> october 26 of the last year these regulators were crushed by a federal jury in new york. they were found to not guilty. is this extortion? are the banks paying the fines to the regulators go away/ >> these are settlements so the banks have agreed to pay the fine. the traders have not been -- were acquitted. >> the traders were acquitted,

right? >> yes. by a new york jury. >> wait a minute. if the traders were acquitted what did the banks do wrong? the accusation here is a little different because it is about collusion. it is a case where the banks have admitted liability for colluding together. collusion and they exchanged information they should not have changed. -- what theye of are looking for in different cases. this is an antitrust collusion about this exchange of information that should not have happened. you're not supposed to tell your rivals what you are doing. rooms betweenchat this bank and that bank and one that is what we are

talking about in terms of cartels. >> this came from a bloomberg news report in 20 13 that these kind of chat rooms were swapping information on trades and trading strategie. >> with the change of commission we do -- how much the know about how the new commission will be to upper or softer on banks? do we have any insight on whether this is political or they will be the same? that is the role they have to do and they have to abide by their mandates. these cases seem to be fairly evergreen. this one started under the previous commissioner. when they feel they have the proof to do these cases they keep going. motivation inme other cases about why you might pick particular targets. in this case the banks came forward and admitted to it which makes it easy for the european commissioner to take a case. i don't think these will go away.

we see two or three other things pending that will come from the next commission. >> thank you so much. banksagreed to buy involving one billion euros. the barclays fine at about 12 days of operating income. i'm unsure on that exact number but that gives you a sense of it. the debate of technology and china is a global debate. it is really nuanced and front and center. a technology event that has become more. just to recap everything we know for our listeners on the radio and our tv viewers, the white house on wednesday and a two-pronged assault on china. --t it is stopping come companies that it sees as a threat from selling to the u.s. and it is blocking huawei from selling essential components. is actually a

nuclear option to halt the chinese rise. one question we have been asking is whether this is an exchange to see who has more tech supremacy between the u.s. and china. delicate on his comments on 5g and chinese technology. after thecoming up extraordinary volatility of the last three days. a nice rally yesterday off of a selected headline including a delayed european auto threat. julianna man u well will pick up the pieces off the floor next. mmanuel will pick up the pieces off the floor next. this is bloomberg. ♪

yields andw low

increased likelihood of rate cuts markets await more information on a trade war and the decline of global exports. andington awaits beijing perhaps beijing awaits washington. it is all the pentagon's men, the assembled generals and admirals. selected white house officials disagree and the president recalls iraq. halfway between the hidden city and the moldova story of beijing , will tim cook be able to sell iphones? this is bloomberg surveillance i am tom keene in new york. emmanuel macron is in paris. he is really k.g. here about chinese technology versus how washington is reacting to foreign adversaries. is very clear that the

president went on the offensive with the two-pronged assault on china. it is worth remembering that when we speak to a lot of experts in europe they say it is much more difficult for europe because in the u.s. you don't actually need huawei to build the 5g technology. in europe it would be a significant delay to 5g if you were to cut off china and huawei. the base of the conversation is different which is why you have much more of a -- >> for our global audience i would -- limitation of apple products in china. up at techcron fired in paris and a quick guest from paris in a moment. first word news in london he is sebastian salek. sebastian: the european union of fined five banks a total

1.2 billion dollars for taking part in foreign-exchange cartels. the banks include barclays. says it will engage with the u.s. on concerns of product security. the president had a resected of order that would restrict the chinese telecom supplier from the u.s. market. the u.s. is worried about beijing and how it could use huawei gear for spying. president trump will give the eu and japan six months to agree to a limit on cartels in the u.s. -- on car sales in the u.s.. vitamin a stricken has determined that imports of cars in the u.s. are a threat to national -- the administration has determined that the import of cars in the u.s. are a threat to national sick ready. to -- national security. 's party wants her to

quit. promising to bring her brexit deal back to parliament. conservative lawmakers will ask her to step down before june 15. if she refuses that could lead to another no-confidence vote. the uae want jump the gun to accuse iran of sabotaging its ships. their foreign minister says they are committed to the escalation. -- de-escalation. -- addressto i dress iran's behavior clearly but not to lead into a crisis is very important. onglobal news 24 hours a day air and on twitter powered by more than 2700 journalists in more than 120 countries. this is bloomberg. glad you showed the interview with the official from the united arab emirates. interesting how tensions have built. we will touch on that in a bit.

currencies and commodities have a nice lift. a little bit of euro recovery. we are where we were yesterday. on a yield basis i really want to go to the extraordinary germany 10 year yield. -0.11. one basis point lower in beal -- year -- yield on the german ten-year. crude oil gaining. i was going to mention sterling. there is an important meeting underway. the pound dropped for the ninth day versus the euro. that is the longest losing streak since 2000. theresa may is facing a threat to ouster. tom: i want to get back to economics. this is nothing more than customs coming into america.

these are the standard deviations of the trend. we are out for standard deviations. and take anoms tariffs intake in the u.s.. there is a debate over who pays increased custom duties to the united states. francine? is a simplenor chart. it is about german bond deals and the fact that they are coming -- becoming a lot more like japan and the german ten-year bund yield is approaching all-time lows. tom: we need to frame where we are and we can do that with the equity markets. also original capabilities in derivatives. rare blendnuel is a of equity and derivative strategists. he joins us this morning from btig. have you changed your bullish thrust over the last four days? julian: it is tempered.

the fact that dialogue between the u.s. and china has escalated and that we are in wait and see mode for the next several weeks for us tells us that the upside that we thought was possible, we have a year end price target of 1000. if everything goes right china negotiations, brexit, and the fed plays along and remains accommodating you could move to 3400. tom: i want to show julian emmanuel's world. good morning to all of our quantitative researchers. this is one of the coolest things in the terminal. this is a guesstimate of volatility of the market into the future. in this thread tip, that is flat out the idea that we will see a weakening yuan. when you look at your assessment of equities can you believe in

the certitude of some of these trade vectors that we are seeing? julian: i think the week yuan theory will be disproven this time. the chinese reaction funk and should be different. the015 when you have strange you weaken the currency to help exporters. the chinese calculus is different here. you want to backstop the consumers. what you don't want to do is let the currency weaken too much, the chinese calculus is different here. importing inflation for the chinese domestic consumer. that is part of the story in this slight decrease in treasury holders. the chinese government is incentivized to allow the currency to depreciate very slowly if at all. francine: is there a concern about capital outflows? julian: there is. when you take into consideration their ability to massage those rules at the margins, along with

and the reserves potential to sell u.s. treasury the expectation is that the government will find a way to cause capital outflows not to be a headline grabbing event that we saw going back to 2016. francine: what should we worry about in china? increasing debt, a possible recession despite consumer demand holding up? julian: a possible recession. , growth closer to 6% in a lot of ways is recessionary. if you look at how china has year it hase last been a western-style recession regression. stimulative measures have come in, stocks have bottomed. yearthe question is --tom: i he two questions.

good observation on inflation fears from the leadership in china. this is the inflation of pork prices in china and it is hugely colored by serious illness among -- this is deflation. gears into aft sasegue. , isidea of huawei apple that enough to snuff the confidence out of the benchmark of everyone's portfolios? julian: no. tom: you look at it as tangential? julian: perhaps more than that. this is all unfolding drama. it is going to take months and years to unfold and the beauty of the american capitalist system is there is constant , westment to situation

expect that however the negotiation was moved we are going to have forward movement as well. francine: julian, thank you so much. we have some important voices joining us today. the conversation on women and equality. we have on equality summit in london on diversity. we will speak with the u.k. treasury committee chair. this is bloomberg. ♪

>> i don't think it is in our to see war with iran. inhink it is definitely not

our interest because this is the region in which we live. it is our interest to look after this region. and exceptionally important conversation with the minister of foreign affairs for the united arab emirates. an admiral from the u.s. navy in bloomberg opinion. i can't say enough importance of all -- i will get this out on twitter as well. not on anshould focus overt iranian attack but a miscalculation that spirals into war. investors in saudi arabia, the retired general, this is what he said. few people know better the way an escalation and cost are difficult to control in the middle east. but general is calling for a gathering of facts not a military attack.

the best approach for the u.s. is to return to a greater focus on allies, partners and wrens. viviana is in washington. topic one with the article in the washington post, how will the white house react to what we saw in the washington post yesterday? this battle between bolton and the pentagon? >> the president himself taking to twitter. about 15 hours ago so expect an update we will be monitoring. president things the will be doing is making clear that it is not a division in his white house but he is pointing to what he identifies as differences in opinion. what will be interesting of course to this op-ed that you were mentioning is how it is that the retired admiral talks about the role of european allies. that is he says to force

iranians back to the negotiating table. we know what the complaints have been from u.s. allies about the way they have been treated by the president. what will be interesting is the role of congress and particularly gop members. in the last few hours lindsey staunch donald trump, has expressed frustration that congress, specifically geo b, have been kept in the dark. to that end later today there is a scheduled briefing from white house officials with both houses and parties and chambers of commerce. thank you so much. today is going to be absolutely fascinating. cannot say enough about the washington post article last night. it changed the debate. that was late afternoon in washington. it immediately changed the

dialogue on this growing issue in the u.s.. francine: i urge all of our viewers especially those in europe that are less familiar to go and read that. it is interesting -- underground in paris with the european reaction. the answer to trumps a new threat is that europe will not block huawei. tom: their interesting the response from mr. macron. julian emmanuel with us from btig. we have a lot going on particularly with markets. this is bloomberg. ♪

let's get the bloomberg business flash. a british tour operator has negotiated a $385 million rescue loan. it will only get the money if it makes progress in selling it . they are forecasting another soft summer. negotiating to sell its skincare business for more than $10 billion. the potential buyer is a group headed by the abu dhabi investment authority. 's berkshirett hathaway has disclosed the size of the batted main on amazon, all $861 million.

has said hett generally steers clear of tech giants. that is the bloomberg business flash. once again theresa may faces colleagues seeking to ouster. seeks to minister reconcile with members of her own party. the question is when will she quit if she quits? we ask this every day but today there is something significant happening which is the 1922 committee which could change the rules from the conservative party to force her to step down. >> the executive of that group is going to downing street. that is starting a meeting in the next few minutes. this could prove pivotal. they're going there to press the prime minister to name the date. she said she will step down when brexit is done but that is not looking like any time soon. she has to set a date so the

conservative party and the country can move on. we are hanging onto news from that meeting. she has been the martyr of clinging on to power. we talked about her being near the end so many times over the last few years. growing sense in westminster that she is reaching the end of her premiership. >> yesterday we had a story that was saying that she wants a fourth chance to put her deal, the same deal through parliament. that could be early june and she could announce if it doesn't work then she steps down? >> it is not going to be the same boat as last time. this time she will present the legislation and the actual bill. it is a fourth stab at getting parliament to get behind her brexit deal. that will have been the same week donald trump will be here for his big state visit. that could be quite a week of politics. still no sign that any people

that have held out are going to change their mind. a rumbling that labor could abstain but that is been shot down. what is she aiming for? a final roll of the dice is what it is being billed as. downing street is hoping that the results of the european election are so bad that that frightens and the torilla and labor say everyone is going to vote for the brexit deal and you're going to lose your jobs in less you get this done. tom: which flavor of tory is david merritt watching right now? using a different shades of conservatives, what should i be watching? david: assuming we go to a tory leadership contest in the next couple of weeks or months we have the whole range there buying for the top job. but they get the people who will make that decision, the tory party and parliament, you have to expect it is going to be one

of those people in the hard brexit side. that is mr. johnson or mr. dominic raab. the one who has by far the biggest name recognition outside of britain. he is still the front runner at this point. tom: one thing i read in the literature and the new urgency of the leave people in the rural areas and suburbs outside of london. there seems to be renewed confidence among the leave. can you say if there was a cameron like referendum that remain would win? or has that been adjusted. david: it is impossible to tell. london voted very much to stay in the european union. if you go outside of london they

have not change their mind either. those other places where nigel ferret is holding his rallies. if anything they are more determined to leave not just with a deal but on the nuclear option to leave with no deal at all. that is what mr. berridge is campaigning for. it seems undeniable that he is going to come out with the most votes at that election. julian emmanuel with us as well looking at equity markets. how is business confidence? businessama as well, confidence has to be pretty fragile given all these news stories? >> it has come off over the last several months. the fourth quarter of 2018 the u.s. government shutdown -- >> given the geopolitical risks

we don't think so quite yet. you have to reconcile some of these issues. the message is the german ten-year yield right now, the equity markets may be underestimating the geopolitical risk, the risks to growth and the fact that the fed in our view is not accommodative enough. francine: we will talk more about that. tom: you are talking like tom keene. francine: julian emmanuel staying with us. bloomberg an exclusive interview with the vice president for -- this is bloomberg. ♪

tom: bloomberg surveillance. francine in london and i am tom keene in new york. we are sort of where the bond

market was yesterday. i don't want to overplay the data. it looks a little calm out there. our first word news in london here is sebastian salek. >> breaking news once again. the european union has fined five banks $1.7 billion for taking part in foreign-exchange cartels. swiss bank ubs escaped a fine even though it was the first bank to tell the eu about the cartel. is on ahuawei conciliatory note after president trump moved to restrict it from the american market. they want to engage the u.s. government about concerns over products. they warn that restrictions will put the u.s. behind when it comes to five g networks. the french president was asked about huawei. arerance and europe pragmatic and realistic. we want jobs, business and

innovation and we believe in cooperation. at the same time for 5g and a -- access totions cornish college to preserve our national security. -- core technology to preserve our national security. >> only a $10 billion reduction. china still holds more than u.s. government debt in any nation, more than 1.10 join dollars. slashing those holdings will be seen as a nuclear option in the trade war. members of congress are demanding the trump administration tell them about u.s. plans to respond to tensions with iran. leaders from both parties will be briefed today. senate democratic leader chuck schumer said there is an alarming lack of clarity about strategies in iran. news 24 hours a day on air and on tictoc on twitter powered by the than 2700 journalists and analysts in more than 120 countries. this is bloomberg. right now the single best

chart, we are here with julian emmanuel from btig. we are going to go to inflation. this is the 10 year yield adjusted for the trimmed cleveland cpi. things are getting better. there is reflation. not back to where we were with the glory list -- chlorine is of the last decade. we rolled over. ferro's program on fridays at 1:00 p.m.. to catch up with him i need to do the real dividend. dividend growth is of after rating. >> of his lady other part of dividends is for the most part corporate america has decided to engage in buybacks.

there is no question about the and thet this dynamic way the fed is thinking is that inflation is something that needs to be propped up, even though that chart says what it says. there is a potential for the mindset of slower inflation that could be damaging. >> that is to chairman powell's point on the trimmed cpi. feeling,hat they are if i take a combined to dividend and share buyback, do i begin january 1 with a cash on cash 5% return or higher? that dazzling math we just did? francine: i like that. back of the bowtie real yield.

let's go more technical. what do you see in earnings? could aad -- francine: recession in the u.s. start by the simple fact that chief executives are not investing because they don't know what the future holds? >> there is that element to it and there is an expectation that particularly in this part of the cycle you might see increased investment. we have seen a little bit of it but certainly not enough to engender the kind of confidence that we would want to see from chief executives. ongoing,ou have this and this regulatory environment scrutiny about the use of capital buybacks in particular. it is quite a quandary. what is the state of the u.s. jobs market? we know it is increasing but is

it doing quality jobs, creating jobs people want to have? >> that is part of the last number of years. it is a measurement issue. we don't know what the composition in regard to salaried benefit jobs versus changes in the gig economy. it is difficult to measure. highpenings remain near a and measures of -- it is a good environment. the problem the fed continues to see is that given the employment dynamics why are not average hourly earnings higher? >> i rarely ask this question. i have cash burning a hole in my pocket and i have to buy shares today. i want to go higher beta sexy thing to get on board like december 26 of last year or do i

want to be more cautious and measured? julian: we think you want to be prudent. we think prices will go higher but in the near term over the next two to three months we think there is a lot of political risk out there. >> i look at the prudent idea versus everyone who is telling i have not done this in a while. the dow is up 10%, s&p up 13.4% this year alone. it is a double-digit market even with lisa and -- of ways this type of .etback policy consolidation tom: uber or lyft.

>> i like ride-hailing whatever it is. it is a good thing. coming up next on the bloomberg equality summit, this is important. mathematiciannd behind mastercard. this is bloomberg.

gender equality is not just an important ethical issue,

it is also good business. the bloomberg equality summit had a frank discussion on creating the right corporate culture, progress being made towards gender equality and the challenges that remain. anne-marie joins us with an overview. >> i have been thinking through the numbers. the first thing i want to talk about is global index. it is the bloomberg gender equality index. what is so interesting, it is outperforming the all country world index. it is made up of a number of global companies in europe. you can see it is outperforming. it is not just an ethical issue. it is also good business. in the u.k. we had a second year where we had to report -- firms had to report the gender pay gap. that is interesting.

look at that sea of red. not much has changed. only a handful of companies are paying women more. most are still falling behind. the worst seems to be hsbc and anglo american. so much of this is women lacking these senior executive positions. that is when the salaries are much higher. big discussion about women climbing the corporate ladder. greatly appreciative to annmarie hordern this morning. and women in business it is important to talk about somebody who sees it through pure she took a -- masters in statistics and is more qualified than anyone in the united kingdom with the possible exception of and richards at fidelity to talk about what is going to take to straighten this true gender

disaster out. we are honored to have you. i have about 47 questions on digital banking and the future cars. let's go to women in education. you live stem. how do we get more people into ?tem >> thank you for the lovely introduction. i think we have to be really proactive. at mastercard we are bringing girls together age 12 to 14 to bring them into the company and show them how great stem careers are so we get them before they start dropping math and choosing exam subjects. we have done that with over 4000 girls around the world.

>> it is so important to get them into a stem environment that is less than threatening. what do the people at home have to do? everyone in america is getting 900 on their sat. what do we do in every single home to get parents to understand girls can take pyramid the mathematics and statistics? .> i am a parent myself i know what you are talking about here. i think parents have to be supportive of the kids whatever their kids want to do. my daughter went to university with an arts degree. after doing that she went to business school and now she works for a digital bank. the point about this is you can choose to go into a tech kind of environment at any point in your life and it is really telling

your kids that there is a variety of roles out there and to follow their hearts on it and actually expose themselves to as many subjects as possible. has the environment for women and girls changed in the last 10 years? we see headlines that are changing but if you dig deeper is it true or just headlines? >> i think the environment has changed. i think girls get a lot of encouragement now about the subjects. if your something like international baccalaureate you tend to take six subjects up until you get university. -- get to university. chemistryo maths and or english and geography but i could not mix them. francine: at what point do women drop off of the latter? is it because companies don't pay them enough or is it the education level? >> i think more women need to go

into stem at the education level. if you are talking about the corporate world we know there is a bit of depth that starts to occur in the 30's and early 40's. some of that is related to people having kids and making choices. has chosen so i think we have to look at that and say what is happening at that level. way behind on our attitudes about the first baby or the second baby, the third baby you don't care. you don't know the kid's name. corporategot to be a what toetal change on do with a grown adult multi-degreed woman or a blue-collar laborer that has whend up to $25 an hour they are 28 or 33.

what is the legislation you would suggest is the best outcome? i think that if you read a 100 year life written by linda bratton from london business school she starts talking about we have to train and constantly retrained because we are going to live a long period of time. as far as men and women are changes aredcareer to be encouraged. in my 30's i changed from an engineer to a banker. i would not recommend it the other way around. tom: that is a surveillance exclusive. we have to keep this going. this conversation is too important. i have a really serious question. pi to ad you explain sixth grade math student?

i am sitting with my daughter trying to explain 3.1428 or whatever the number is. how do you explain irrational numbers to a sixth grader? >> that is a tough question because i cannot remember not knowing what pi was. i think the easiest thing is to explain it in the context of a circle. looks like a circle to me. whether you understand numbers that way or you don't in today's world it is much more about understanding how do things work on the internet and why do we need to protect data, what is artificial intelligence and what does that mean in terms of helping me with my career? what do i need to know to be in that field? the advent of artificial intelligence you can have so much more creativity. francine: to a child born today,

what should they study to get into the jobs of tomorrow? >> you have to keep yourself extremely broad. and ableto be creative to read and understand things that are happening in the world. the old profession is at the forefront of that. you will be getting more and more artificial tools in journalism. it would be freeing up these brilliant journalists to think and ask the right questions. francine: tom is blushing. tom: is the headline there journalists are dumb? i'm going to go to julian emmanuel who has eight children. and i are battling on this every single day about a broader education for our kids.

or our parents. with the fundamental stem foundation. >> the more important stem becomes in terms of training for the 21st century the more important reading, writing and a sense of historical perspective becomes because you cannot integrated and communicated. i was way wrong. stem foreignto languages. to me learning two or three foreign languages is just as important for the organization of the brain as anything we would do with trigonometry, am i right? a veryink it is important skill and i wish i had done more languages myself. i specialized in latin.

your point being that training the brain in a certain way is really important. being able to open your brain to some of the classics, fantastically important. one of the things that is important later in life, i did not study history but i can read history books. i read historical novels quite a lot. if you don't study a certain level of mathematics it is virtually impossible to read some of the books that are out there. hawking has made the whole idea of relativity and black holes accessible to everyone. , askingis latest book lots of important questions. what does the future hold? francine: that is our next segment. tom: thank you so much. r --ow 2 pi

thank you so much for the quiz in math. she is the vice chair of mastercard. stay with us worldwide. this is bloomberg.

>> when alibaba started -- >> not one to mince words usually. we are following that speech in the paris very closely. caroline caught up with the french president emmanuel macron , the first leader to talk about huawei. we are joined by carolyn conan. we saw overnight that president was going really hard on huawei. the french won't do that. >> president macron was in paris a couple hours ago. i asked him what do you think europe and france should do after trump's announcement

overnight? should europe also been huawei -- ban huawei from being involved in the five g network? andpe really needs huawei they have already had a lot of involvement. clearly the french president would not bewei banned and the would work on security and making sure sovereignty -- how integrated are there systems into the telecom operators? >> they are in a lot of places. 50% of all the antennas in germany are made by huawei. if you estimate they have 90,000, replacing half of those would be a big task. in the u.s. i do not have a presence at all and they would need to be stripped out. is that when we are

seeing a softer stance or touch from europe? >> there is also a pricing thing from the companies and operators. if there are three players in the space they can get cheaper prices than if there were two. tom: carolyn, thank you so much in paris. that is more than an average seminar. it is the most interesting day with terrific -- an american benchmark. we are awaiting walmart earnings. andrevenues and earnings amazon competition. this is bloomberg.

at comcast, we didn't build the nation's largest gig-speed network just to make businesses run faster. we built it to help them go beyond. because beyond risk... welcome to the neighborhood, guys. there is reward. ♪ ♪ beyond work and life... who else could he be? there is the moment. beyond technology... there is human ingenuity. ♪ ♪ every day, comcast business is helping businesses go beyond the expected, to do the extraordinary. take your business beyond. trump's nuclear option.

president trump is ready to block list -- block list huawei. it has the power to -- who is telling the truth? bond yields or u.s. economy. bunds will rise. oil's big on ability. tensions threaten to erupt into bigger conflicts. 2020 candidates ask president trump to back down. >> i am david westin. trade is very much in the spotlight. we are waiting for walmart. myt part about what a fight -- what effect might shares have. alix: that is going to cut into margins irrespective of global supply chains and tariffs. david: with -- we will see how they do.