>> impeachment inquiry. president trump could become the fourth president in history to face anti-semitic proceedings. trump calls it a witch hunt. impeachment proceedings. trump calls it a witch hunt. we will speak to regina miller. christine lagarde contraction is not her base case, giving her the biggest risk for the economy. it is mediocre growth. it is at risk because of, essentially, one major threat, which is, you know, the trade

war that we see. nejra: welcome to "surveillance ." london.ra cehic in european equities firmly in the red following what we saw in the u.s. session yesterday with the s&p 500 dropping the most in august. the u.s. stopped -- the impeachment headlines. president trump in the u.n. with some harsh words for china. the 10-year yield dropped from almost nine basis points in yesterday's session, continuing its slide today. coming up on "surveillance," we speak to gina miller, sbm private founder come on all things u.k. politics a day after the supreme court ruled the

suspension of parliament was unlawful. let's get to viviana hurtado. chinese companies are prepared to buy more u.s. pork after trade talks restart in washington. this comes a day after president donald trump used his u.n. speech to slam china. said it needs to make the nation for your and more market friendly. president emmanuel macron stepped up to ease tensions with fireeye and -- with iran. it would be a lost opportunity of president rouhani new york without meeting his american counterpart. president trump used his u.n. speech to criticize iran. pres. trump: no responsible country should subsidize iran's bloodlust. iran's menacing behavior continues, sanctions will not be lifted.

they will be tightened. viviana: the global economy is likely to dodge a recession. that is the view of incoming european central bank president christine lagarde. trade tensions remain a top threat to the global outlook. ms. lagarde: it is at risk because of essentially one major theat, which is, you know, trade war that we see either brewing, and the uncertainty that it generates for investors and anyone making economic decisions. viviana: global news 24 hours a day on air and @tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i am viviana hurtado. this is bloomberg. nejra? nejra: thank you so much. speaker nancy pelosi announcing the house would kick off a

formal impeachment inquiry of president trump. that is after he urged ukraine's leader to probe joe biden. the president's betrayal of his oath of office, betrayal of our national security, and betrayal of our national elections. therefore today come i am announcing the house of representatives is moving forward with official impeachment inquiries. nejra: these actions raise the possibility that trump could be come the fourth impeachment face proceedings. joining us now is senior writer stephanie baker & men french -- and simon french. stephanie, what is different this time? are twoe: i think there

reasons for her finally acting now. one is, i think him trump has admitted to much of this story. he said yes, he did ask the ukrainian president to look into these allegations about joe biden. that it is clear that military aid was withheld. for nancy pelosi, this is a much simpler narrative for voters to understand than the ins and outs of the mueller report. office abuse of by president, potential abuse of office by president to go after his political rival. that is an easier narrative for people to understand. secondly, i think more moderate house democrats, those who won in districts where trump had won 2016, they have finally come out in support of in and teach men inquiry. those two things combined made her finally press ahead, despite

the political risks of doing so. nejra: so we have got the inquiry so far. in terms of this actually leading to charges against the president have a how likely is that, given the role of the senate? stephanie: i think what will likely happen now, the house judiciary committee, as well as other committees, will continue with their inquiry if they find enough evidence to proceed, then articles of impeachment's will be drafted, and then that would be put to the full house. because the democrats controlled the full house, it does look likely, given the light of right now, but that would pass and go to the senate with a trial, where it will be blocked because it is a republican-controlled senate. even if the house votes to impeach trump, it is unlikely to go anywhere, because republicans in the senate will block is treated as a potentially disk -- risky move for the democrats,

it will bringay out his base, saying he is being unfairly attacked. nejra: simon, given what blocking said about it them, does the space the downside? the s&p 500 dropped significantly yesterday? the momentum in equity markets as a result of this, partly because of the live lack of a is emma the real pathway to impeachment, but also, and i think this is key, we are starting to move into a cycle where investors are going to have to a democrat presidency as early as the backend of 2020, and this is just layers on top tothat calculation you have make on what kind of economy, what kind of economic governance you are going to get it going

forward. is the logic that at the very least it is distracted from the u.s.-china trade talks? does that mean that all of this could be dollar negative? simon: quite possibly third went possibly tells you in the short term is that the china strategy, which appears to be to sit this one out and see if there is a change of tone in the white house in 2020, probably is slightly strengthened. you are likely to see less concessions from the chinese in order to get a deal. but i think in terms of being dollar negative, we remain dollar positive, because there are much more fundamental drivers pushing the dollar higher, in our opinion. nejra: we will talk about those later in the show. thank you to bloomberg senior writer stephanie baker. simon french of panmure gordon stays with us. saudi arabia is ahead of oildule and restoring

capacity. that is the headline on the bloomberg right now. in terms of oil prices, we were earlier in the session. we do stay lower their. brent crude trading at 1.6% on a $62 handle. the biggest names in business and government will be heading to the annual bloomberg global business forum in new york. we will hear from india's zealand'sodi, new jacinda ardern, and spain's pedro sanchez live here on bloomberg. ♪

nejra: economics, finance, politics, this is "bloomberg surveillance." i am nejra cehic in london. pushing its way in the front of the queue today, boris johnson has restated his bow to complete brexit next month. defying calls to resign, he says he profoundly disagrees with the supreme court but will comply with this ruling. in a moment, we will speak with gina miller, but first, let's get the latest from westminster and bloomberg's anna edwards. what can we expect as parliament returns? anna: what we expect in the very short term from today's proceedings, 11:30 is when we see parliament returning. we know we will hear from jacob rees-mogg's, the leader of the house, and the government will lay out the leadership today. very short terms.

the extent to which the rebel mp ken reinstate together. she has called on them to be bold. action around brexit. how can they stay together when they are such a dissident group is the key question. remember, what brought them together is the idea of a no brexit. party here in westminster. what else can they put together to try and push their agenda? government says it still wants to leave the eu on the 31st of october. anna edwardserg's it was, thank you so much. let's speak to gina miller, founder of scm direct. time she hasond beaten the government in court to regina, welcome to the show. thank you for being with us.

gina: good morning. i did not really think i would need to bring this case, because all over the summer, i had been writing to boris johnson and his team, saying if you go ahead with this, it would be illegal, but they still decided to push ahead. i think you what you will find is they have very little time now to try and deliver something come up with i and many people think is undeliverable, so theer we do not leave on 31st of october, forget what mr. johnson is saying, or they try to do something which may well be a legal. my -- be illegal. my legal team and i will be keeping a watchful eye over these over the next few weeks. nejra: gina, to that point, are to returning to have to court on the point that lawmakers have already passed legislation requiring boris johnson to seek an extension until the end of january?

are you expecting to have to challenge boris johnson on that front at all? gina: i think yesterday's win is that i unequivocal win hope that is a real shock to mr. johnson and the government and they do not attempt to break the law or give unlawful o advice to the queen again. if they do, we may have to take action, but i really hope they do not go to those lengths. nejra: from where you are sitting now, and in terms of taking that action, how far along that process might you be? is it just something you are thinking about and waiting to get definitive next steps from boris johnson? gina: the course would never theytain anything that feel like is academic. there is always a very fine line between taking the courts and then listening to the case and the actions being taken. we literally had a day, but we had been preparing a case for some time before that. at the moment, we are not

repairing anything. i really hope the government does not attempt to break the law, and i am not preparing anything at the moment, just keeping a watch on what they are doing. nejra: you are keeping a watch on parliament as well. what would you like to see from mp's as they returned today? gina: oh, it has got to be much, much plainer speaking, much tougher questioning from the government. we hear that there will be an updated yellow hammer report they have got to start debating in a select committees all the reports. what isquestions about really happening with the negotiations going on with the eu. much moregot to be bold, as i said before, and decisive in the decisions they make in the time that we have got left. nejra: should boris johnson step down? if you and i broke the law, there would be a penalty to pay. he is the only prime minister in modern times two has actually

attempted to do and then found out yesterday's ruling. in an ideal world, yes, he should go, but i have to say with the clock ticking to the 31st of october, there is not time for a leadership election. the only way out would be for the conservatives to agree on a unity candidate, and there is so much infighting in the conservatives, house of labor, i do not see that happening. i think he will end up staying and post, but there have to be serious questions place to him in parliament, but i think there individuals and the government who have to be answerable and consider their positions, such as jacob rees-mogg, the attorney general, the chancellor. it was not just boris johnson who delivered this unlawful advice to the queen. boris johnson's negotiating start with the eu been weakened given the development of the last 48 hours? the article 50se

legislation is very plain -- and a member state has to act along the lines of his constitutional requirements. so they will be happy to know that our constitution is working, the separation of powers is working, and that he has been brought back into line. because if he had gotten away with this, there would be a question mark over the question of if he had acted constitutionally. matt: gina miller -- nejra: gina miller, founding partner of scm direct, thank you so much for joining us. boris johnson cutting short history to new york to visit parliament he tried to suspend. we will bring you more on brexit and what it means for investors. this is bloomberg. ♪

ms. lagarde: i am at a loss as to what is going to happen, but clearly brexit uncertainty is questioning many economic decisions on both sides of the channel. nejra: christine lagarde has preparing to take the helm of the european central bank as the first woman in history to leave the institution. more highlights throughout the morning. breaking news the bloomberg in the last few minutes, estonia ex-desk as found the ceo in estonia found dead, so police are confirming that the

anske ceo has been found dead. president trump is cutting short his trip to the yuan -- boris johnson is cutting ship his trip to the u.n after the supreme court ruled. a suspension of premiership was unlawful. still with us is panmure gordon's simon french. carsten, welcome to the show. guest: i do not think anything has changed. we need to take a step back and realize what is going on here, and miss changes in societal partyure around britain, political realignment, that is the real story going on. this is not about another instance here, another twist in the story. that is not change the elemental fact that we are missing any

agreements here. nejra: do you agree with that, simon? simon: i agree that our best chance is that he will resign on the ninth of october, a window for national unity's to come together, a very disparate group of parties in parliament, they agree on blocking no deal, but will that be enough for formal executives with the extension and move it to the 31st of january? if they cannot do it, then i do not think a no deal risk is minimized. nejra: carsten, has boris johnson's negotiating stance been weakened, in your view? carsten: no, you have to view that the whole of threaten of a no deal is going to change. party ins believed no parliament forcing three no deal, and now we have the surprise ruling from the record us as, actually, we cannot just

breakup parliament just like that. we are functioning with a system here, and that is not new to the european side. we have to see if the run-up to otherwise, there is no way out. nejra: is an election likely in the u.k.? election talk basically goes back to the idea that we are trying to apply the old traditional logical british policies, the idea that we can go back to force every individual voter to make up their mind between labour vs. the, and you and once i or other commodities are think that works any longer. you need to get brexit out of the way, and the truth is after, we will realize brexit is just a proximate for a much deeper division. it is the new normal. nejra: is the pound -- simon: certainly on the

long-term view, but if you are trading in the next 3, 4 weeks, we expect it to go lower before the return starts to kick in. right, simon french, chief economist at panmure gordon, and carsten nickel of teneo stick with us. we have more with christine lagarde. we will bring you more of our interview. stick with us. ♪ stick with us. ♪ eñ

inquiry.peachment president trump could become the fourth president in history to proceedings,ent

and house democrats say they have opened a formal investigation. trump calls of a witchhunt. slides into a crisis after the supreme court rules that suspension of parliament was unlawful. her baseaction is not case, christine lagarde giving us her view on the economy. ms. lagarde: it is a mediocre growth. it is at risk because of, essentially, one major threat, which is, you know, the trade war that we see. nejra: this is "bloomberg surveillance." i am nejra change in london. let's check in on your biggest stock movers with annmarie hordern. anne-marie: good morning. one of the biggest gainers on the stoxx 600 climbing 2.5%, today, comingank in mind, even though it remains

a very competitive market, consumer uncertainty remains. down more than 4.5% on the tui. reiterating underperforming for the stocks. the rally they have seen in tui and other operators is now priced in, and operators face a lot of headwinds. edf also to the down, plunging down 6.5%. it estimated the cost is going to have to rise, the nuclear reactors yielding in the u.k., and this is rising by as much as 2.9 billion pounds, and they have a higher risk of a delay. shares of eda just tumbled today. nejra: annmarie hordern, thank you. speaker massive pelosi announced impeachment proceedings against president trump, as he puts on pressure on the government of ukraine to put pressure on joe biden. speaker below see: discernible

-- losi: discernible betrayal of our constitution, our security, and our constitution. therefore, i am asking the house of representatives to move forward with an official impeachment inquiry. thea: these actions raise possibility that trump could become the fourth president in american history to face impeachment proceedings. trump denies wrongdoing and says he will release transcripts of his phone call with ukrainian leader today. us as kathleen hunter. great to have you with us. what should we look for in the transcript of the july 25 call, when it is released? there has been a back and forth between issues with joe biden and pressuring the ukrainian president into launching an investigation into a business deal that his son, hunter biden, conducted in the ukraine.

i think when the transcript comes out, whether or not that did occur, and the extent to trump either implicitly or explicitly did exert pressure on the leader of ukraine. i think that with trump in particular, given that we know how he operates, even if he does not explicitly say i need you to do this or else, i think what folks will be looking for is some kind of an explicit, you know, attempt to exert leverage on ukraine. we did find out yesterday the trumpet said he was going to withhold some aid from ukraine, and that had a potentially occurred a week before this phone call, so i think we will be parsing the language closely and what was said and what was not said. what can be said about the democrats in the seats that trump won in 2016? kathleen: we can see what the risks are for a party that attempts to impeach a sitting

president feared republicans, by all accounts, suffered some political losses in 1998 after the impeachment proceedings. there is a concern that there could be a backlash particularly among independent and swing voters to any kind of attempts to pursue impeachment. is the balance democrats have to strike now, looking like they are not going to hard after trump. trump is calling it a political witchhunt. they will have to threat that needle, look like they are doing their oversight, following oversight requirements, but not going to bar in pursuing president trump. nejra: kathleen hunter, thank you so much. let's get to bloomberg's first word news with viviana hurtado. u.k., primethe minister boris johnson says the supreme court made the wrong decision. this after yesterday's storage ruling he broke the law in suspending parliament for five weeks. he says " obviously" he respects the verdict.

they want him to resign, but his office says no, he won't go. hiking thes -- tariffs pain for the eu. the u.s. can retaliate. anhington is considering approach meaning they rotate the products subject to tariffs. over to australia, that is where the reserve bank is reiterating it is ready to cut interest rates if needed, but stops short at an imminent move next week. governor philip lowe says the country is that a internal point in both june and july. reaffirming a period of low rates is in the cards. police confirming the former chief executive of danske bank's estonia unit was found dead. he was head of a breast now at the center of a billion dollar

multiline -- money laundering scandal. global news 24 hours a day on air and @tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i am viviana hurtado. this is bloomberg. nejra? nejra: viviana, thank you. christine lagarde has preparing helm of the european central francine lacqua sat down with her and asked about the global economy, trade risks, and protectionism. ms. lagarde: i think europe and the eurozone a particular has to and a hasle further, been a continuum, and there has been high momentum, slow momentum, but it has to be a continuum, and more needs to be done to complete -- you heard that many times -- complete the banking, make sure there is a european security market that is and havingbroader enough of a fiscal space that is in common, however you call it, but that can be used eventually

to start the line. i think all those three, which are not particularly glamorous and sexy for the european citizens, but constitute the foundation and the infrastructure upon which there can be development and there can be security. francine: when you look at factors, we have done more in good times to prepare for the downside? ms. lagarde: yeah, yeah. most policies, most of the unfortunately, when you have good times, good growth, you spend. , political natural reaction, and it is hard to resist. in bad times, you start consolidating, which is exactly the opposite of what should happen. i am very pleased to see that finance ministers in europe or at the growth to make it more efficient and simple.

there is such a complex marriott ad offferent -- myri different packs, as if anyone understood what the packs were. francine: do they need to have a conversation with citizens? ms. lagarde: i am very strongly convinced of that. francine: what happens if we do not have that dialogue? ms. lagarde: i think if people are wanting to talk to themselves in narrow circles, but i think you tend to isolate yourself with very jargonic that to, and i think have constantly present in the back of your mind, it on your -- en, eventually

creation of visionary men who wanted to avoid war yet again, and that requires multiple wayrs, foundations all the through to defense, common energy policy, but that is not in my homework list, because it is for the european council to move forward with, but i am convinced about that impulse, and i very much trust that the influence of the european commission will move in that direction. nejra: that was christine lagarde speaking to francine lacqua. more from that interview throughout the day. from hear the conversation europe. still with us is carsten nickel from tyndale intelligence --

teneo intelligence and simon friend from panmure gordon. carsten: what you need to see a fromger pressure coming the economic front, and the last time we saw significant movement on the german side was in the face of the financial crisis, about a decade ago. i think you need to go back, at the very least, we need to see mid-november, official confirmation that we are in recession in germany to lend additional urgency to that conversation in germany, but i do not think we will see a fundamental deviation from the sound public finances clause we have seen for a very long time. nejra: simon, do you agree that the data needs to get even worse to see germany act on the fiscal front? simon: i think that is right. if you look at the pmi's, you have got a real dichotomy between the services pmi and the manufacturing pmi. manufacturing is in a recession in germany, but the services sector is not. nejra: the latest data showing

it is spilling into the employment sector a little bit, though. simon: a little bit, but it is still comfortably in an expansion, and what it tells you is at the moment, 77 percent of the economy, which is the services sector, has not been affected by the weakness in manufacturing. the german industrial conversation talking about the idea of balanced budgets in germany, that is what carsten is talking about, but you probably need the economic data to buttress those, too pressure side.to change the nejra: do you see pressure to act on climate change? yeah there again, keep in mind, the concerns are in , i do not mean in a legal way, it is really about political norms and values and fundamental convictions on that

front. even if you see the effect on the labor market, i agree this is what we have to see to take the political conversation seriously. even if we see that, then the question is -- what is the right? if you go back to the early 2000's, we had elevated levels of unemployment. what was the reaction of the german government? we went for reforms that were plainly focused on the supply side. that is the legacy that we are having there, so i do not think we are at the turning point, nejra: definitely not cured so is the ecb going to carry the weight of the -- turning point, definitely not. nejra: so is the ecb going to carry the weight of it? simon: no. they have have the dialogue. it problem is the dialogue, is federalism, and for citizens, it is mainly to talk about communities, which really gets the pulses going. nejra: thank you for joining us today, carsten nickel, deputy director of research at teneo intelligence, and simon french

of panmure gordon stays with us. leaders will gather this week for the bloomberg annual business form in new york, top bank executives, policymakers, and world leaders, including india's narendra modi, new zealand's jacinda ardern, greece's kyriakos mitsotakis, and spain's pedro sánchez. this is bloomberg. ♪ this is bloomberg. ♪

nejra: this is "bloomberg surveillance." i am nejra cehic in london. let's get to the bloomberg business flash. here is viviana hurtado in new york. viviana: the dramatic turnaround is widening. authorities are probing current and former executives for alleged attacks avoidance -- a

legend tax avoidance. axe luxury brand -- alleged t avoidance to the luxury brand gucci from 2017. totander taking a hit operations, challenging the regulatory environment. the eurozone's biggest bank says it will not affect the lender's ratio. the uk's santander's fourth-largest unit. it has struggled a mixed competition -- amidst competition and geopolitical uncertainty. and that is your bloomberg business flash. nejra? nejra: thank you, viviana. following the attack on a processing plant 11 days ago, we have more from [indiscernible] -- from bloomberg's annmarie hordern. annmarie: we are ahead of schedule about a week. they had a scheduled deadline of

getting to 11,000 barrels a day by the end of september. we're hearing they are at 11 ,300. per production right now, the two oil fields that were just a few weekends ago, they are actually ahead of what they were producing ahead of the attacks. so they are ahead of schedule. nejra: that schedule brought forward by a week. we were hearing this could take months. annmarie: exactly. it originally, they were very worried. use of owl of the -- use of el-din,-- yousef gamal anchor, paid a visit here stocks continue to rally in pictures now you see prices lower on this news, down 1.5% on both contracts. this is basically saying that

they will be able to restore much quicker than we were expecting. s annmarieomberg' hordern, thank you so much. still with us a simon french of panmure gordon feared does this change your base case at all? -- panmure gordon. does this change your base case at all? simon: no. i think it is a danger that we ever focus what is going on in saudi rather than what is potentially going on and iran. we spoke earlier on radio about the fact that what comes out of a is potentially some material developments regarding tensions in the u.s. and iran on the nuclear deal, what that means for a rainy and output in terms of the markets, and i think that is the biggest story here for the long term -- for a ianny and output in -- iran output in terms of the markets, and i think that is the biggest

story here for the long term. starting to focus back on where they should be. nejra: on the u.s.-iran issue as well, if someone said to make him a look, if we did move to all-out war, yes you will see the spike of $100 a barrel, but if we stay away from that, do we stay range-bound, just been a higher range? range-bound.stay as we heard thereof this last hour, the fairly tepid economic growth on the demand side, there will not be the demand that can push prices up to $70, $80 a barrel on an upswing global activity. relatively stable given the attack has been fairly curtailed in terms of the impact long-term, impact on supplies. i think that is right, that we can have a little bit of confidence over the stability. nejra: all right, simon french of panmure gordon stays with us. biggest names in business and government will be heading to the annual business global forum

in new york. do not miss those voices live here on bloomberg. this is bloomberg. ♪ this is bloomberg. ♪

ms. lagarde: it is not in the baseline to have a recession. a mediocreit is growth, it is at risk because of, essentially, one major threat, which is, you know, the trade war that we see either

developing or brewing, and the uncertainty that then generates for investors or anybody making economic decisions, you know, not to mention -- i think mark carney called the tragic deal of the horizon, which is the climate change impact on our economy, that requires action now, but will produce effects later on. nejra: that was incoming ecb president trade christine lagarde saying trade continues to be the number one risk. panmure gordon's simon french stays with us. -- is still with us. difficult in the near term third i do not see a deal as we had closer to the u.s. electoral cycle, but i think christine lagarde is right to say this is a big deal for investors.

term perhaps to what she is saying is recession is not the base case, it is never a base case. you can kind of dismissed that as a comment. -- calling recessions is not a great one of theirs. i do not think we can read too much into that, but it is very much a binary outcome. will there be a deal here? that we will see will be pared back in the first half, or is it going to go the other way? i am hoping for a deal, but not for the october talks. nejra: is this for china or the u.s.? simon: i think it is greater for china. the reason being just the materiality of the export. has gotthat the u.s. further to go in terms of retaliation. china is somewhat topped out. that tells you quite a lot around the materiality on the economic side, but equally, the , probablytones

greater in china, so it is quite a balanced relationship, and this is what concerns me a little bit with the early wins that the president had with canada and mexico on the nafta arrangement. this is much more a spat of equals, and therefore much harder to see a quick win. nejra: simon french, panmure gordon chief economist, thank you so much for joining me today. u.s. futures have turned negative throughout the european session, contending with political risk in the u.s. as well as the trade war. this is bloomberg. ♪ as the trade war. this is bloomberg. ♪

impeachment inquiries.

president trump could become the to faceresident impeachment proceedings. truck calls it a witch hunt. that parliament, boris johnson slides into a political crisis after the supreme court rules his suspension of parliament was unlawful. members of parliament consider their options. and christine lagarde says contraction is not her base case, giving us her view on the biggest risk for the economy. good morning, everyone. good afternoon if you are watching from asia. this is "bloomberg surveillance ," live from new york. today is also the global business forum, francine and tom giving you the latest news, world leaders all gathered here. tom: extraordinary. prime minister johnson now back in london, do we know that? francine: we understand he could be landing in the next couple of hours. we also know that other world leaders, including the italian once, should land in the next couple of hours. tom: history made yesterday in

london, and history made yesterday afternoon in washington, just absolutely extraordinary 24 hours. francine: we have to go through press reports from these impeachment proceedings. a lot of people in the markets worldwide want to know exactly what is going on with that. let's get straight to the bloomberg first word news with viviana hurtado. viviana: president donald trump ramping up is rhetoric between the growing tensions on the u.s. and iran. he used his speech yesterday to criticize iran. responsible no government should subsidize iran's bloodlust. iran's menacing behavior continues, sanctions will not be lifted, they will be tightened. viviana: francine: next up today, iranian president -- viviana: next up today, iranian addresst rouhani will

the heightened tensions. at the u.k. parliament, back in session after the u.k. supreme ruled prime minister boris johnson suspending of parliament was unlawful. powerng him of staging a grab your prime minister johnson says he will respect the court's verdict. his office says he will not go. s chief adam neumann out. the company is replacing the chief withal two people could we have been told it is unlikely to take place next month, as planned. global news 24 hours a day on air and @tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i am viviana hurtado. this is bloomberg. francine, tom? tom: viviana, thank you so much. equities, bonds, currencies, commodities right now. interesting markets off of the news yesterday, lower yields is really the headline, although

the curve did not come down. a steeper curve near the zero level, three basis once on the 210 spread. on to the next screen, please. equity markets, the vix 13 to 17, almost 18 over the next couple of days. lower yields, 1.61%. dollar resilient is what i would suggest, francine. francine: i am looking at investors trying to figure out exactly what the steepening political gridlock in washington and we also have a the same time the prospects for reducing trade tensions within america and china. oil down. you see vix a little bit elevated. breaking news minutes ago on the bloomberg terminal, saudi aramco is said to formally announce a listing plan next month. so we know that they intend to float or they aim to announce that they intend to float

around october 20, according to people familiar with the situation. will have more on saudi aramco and the facility facilities that they say are back online. tom: very good. we want to bring you the historic coverage of the house of representatives of the united states. everyone working off of a terrific effort. of thethis as my book summer a few years ago, a small monograph called "impeachment," and nowhere in it does he mention the president of the united states. there is a compendium of the beginning of the book, and i thought the speaker pelosi in her statement yesterday really leaned on professors on scene of harvard come on madison, way, richard, "we are in a situation. are people trying to impeach nixon because they hate him and his policies, or because he actually did something wrong?" goes on with perspective to say "it is really

designed for we the people, not the keyes at all," and theme of the entire monograph on our history, clinton, nixon, "loathing a president is not sufficient grounds." we begin with stephanie baker and we are thrilled to have our chief washington correspondent, kevin cirilli. kevin, i found yesterday's events absolutely extraordinary and original in the way houses approaching this and an inquiry versus a vote. will we have a house vote on impeachment? wein: well, that is where are headed, but right now, we do not know. we get the transcript of the call between president trump and president zielinski -- ukraine president volodymyr zelensky today. president trump reportedly citing a senior administration official said he is going to release the whistleblower complaints, so to 48 hours, 24

the call will be released, and the whistleblower complaints will be released. president trump is of the un's general assembly today. he was already pre-schedule to meet with ukraine president zelensky. we already know that the senate -- and the key to all of this is the senate, because republicans control the senate -- that the senate have invited some of the senate intelligence committee has invited the whistleblower to meet with them on friday. so the story is moving quickly. there do not appear to be the votes in the senate to convict ,he president of an impeachment but there appears to be a growing consensus in the house to move toward an impeachment vote. tom: it is very interesting, to say the least. the expertise of stephanie baker, she is in london right all and was really leading of the western world coverage of

paul manafort and the original relationship with the ukraine. stephanie, i am absolutely fascinated, how this all began a kiev. describe to us why mr. giuliani going to kiev to mop up after the manafort disaster. stephanie: well, rudy giuliani does have ties to the ukraine. he has worked for various ukrainian oligarchs, and he has been the one really pushing this narrative, trying to get ukrainian politicians, in particular volodymyr zelensky, president, to pursue an investigation that looks at this company where joe biden's son, hunter biden, sat on the board, a ukrainian natural gas company. it had been the focus of several probes, and the allegation that trump and rudy giuliani have made is that when joe biden was vice president, he demanded the dismissal of ukraine's

prosecutor general, who, many people had accused of turning a blind eye to corruption. giuliani is saying that this is because he wanted to protect his son's company from that prosecutor. there is nothing that has come to like that that is true at all, and prosecutors have dropped that case, and it had been put on ice when biden had made that demand. stephanie, for our international audience, is there one thing that prompted nancy pelosi to finally embrace the impeachment inquiry? if there are piece of evidence, something that made a trigger? stephanie: there is nothing that has come out of ukraine that has, you know, prompted her to act. what has prompted her to act as ump fact that tr owned up to having have a foreign leader to investigate his political opponent and that

he has also said that he held up military aid to ukraine. now he is giving conflicting accounts as to why. one is saying because of corruption. second is because he thought europeans should be stepping up their own a, that ukraine should not be -- own aid, that ukraine should not be relying on the u.s. i think it is a simple narrative for voters to follow compared to the mueller investigation. this is a president asking a foreign leader to intervene and to help attack his main political opponent in the 2020 election. francine: the 2020 election is around the corner. how does this change the polling, if it does at all? mean, candidly, everyone i have talked to in the past 24 hours says that the biggest political winner in the short term is elizabeth warren. there is a monmouth university poll out yesterday that has her beating joe biden in iowa, beating joe biden in new hampshire, and, look, these are

two separate stories third you have the ukraine phone call, as stephanie baker just laid out, but you also have this issue of hunter biden. there was no legal wrongdoing of hunter biden, but that does not mean if you are a progressive voter, and elizabeth warren's message is running on anti-cronyism, that this does not bode well for the biden campaign at all. tom: i have got a million questions. let me begin with the committees of speaker pelosi. how odd, kevin, versus clinton or next and, is this structured -- or nixon, is this structured? do you think this will devolve down to mr. nadler and their judiciary committee? kevin: jerry nadler is ticked off that, at the turf war of the committees. tom: exactly. kevin: the new wants to all of this is chairman adler has said for months that the investigation that his committee is overseeing is an impeachment

inquiry. the last 11 in hours, 12 hours, is that speaker pelosi has moved to seeing precisely what these investigations are ultimately headed toward, that they are ultimately headed toward an impeachment. look, i think over the next 24 hours, there will be much more clarity in the sense of what is going on. but stephanie hit it on the head, and this is the bottom ise, the ukraine development an easily digestible information to the american public, to voters, that the mueller investigation was unable to do. tom: ms. baker, in london, stephanie, i go to you, the tension with kiev seems to be rudy giuliani versus sort of business as usual with john bolton. how in god's name did the former of new york city doing in and around national security

director john bolton? stephanie: well, as we understand, bolton was not happy sort ofdy giuliani's freelancing in ukraine, as it were, but, you know, i think the danger here is that, you know, what trump has succeeded in doing is elevating this story, and in cable news, the two words that are being repeated are " biden corruption," "biden theretion," even though is absolutely no evidence that joe biden did anything, is responsible for any kind of wrongdoing or acted in a corrupt way in any shape or form. and i think that is the danger that democrats face, is that this allegation will be repeated, will be front-page news, and if people are not paying attention, all they will do is associate biden with corruption, even if it is an unsubstantiated allegation. francine: stephanie, thank you

so much good we are i think expecting documents and transcripts to be announced today. chief washington correspondent and senior writer stephanie baker. aristine lagarde says contraction is not her baseline view pure we will bring you our interview with the next ecb president. this is bloomberg. ♪ ident. this is bloomberg. ♪

ms. lagarde: it is not in the baseline to have a recession. that said, it is a mediocre growth, it is at risk because of, essentially, one major threat, which is, you know, the trade war that we see. that with some of our interview with christine lagarde, the incoming european , on thebank president outgoing managing director. we talked about global trade. portfolion lege manager. a question for you both --

christine lagarde says she is not worried about it recession, but mediocre growth will continue because of the trade war. where do we go from here? the incentive would be to get a deal, rationally, but we also know that president keyp is losing in some states, and if you are china, why would you make a strong deal with someone who may not be the president next year? u.s., you, in the have an incentive to make a deal because the economy is slowing, but i am not sure china's incentive is slowing, so at best, we think we will get a medium deal in the middle of october, but it will not be a long-lasting truce, and we remain a bit negative on growth, and we remain long on treasuries in general. francine: john, do you have any idea, if it is a democratic president, will that give china a better deal? john: let's start with the

fundamental economics. i think parts are very close. germany's numbers were all full on the manufacturing side this week, in the sense that they are being caught in the crossfire, but in another sense, this is deeply a european problem, and that is german massive fiscal contraction, and the ecb and mario draghi basically tried to say hey, it is over, we are supporting the monetary space, dealonetary policy cannot either in the u.s. or in europe with the trade issues. tom: spending the rest of our time in the next session as well on one topic, speaking to the smartest guy on the block, alberto gallo, is there any evidence that germany might be using its so-called fiscal space?

alberto: there is a lot of discussion -- tom: is there evidence? used if it seems to be there is a recession, and as john said, we are very close to that. definitely we are in the manufacturing, but we are very close. tom: john, you have been a great student of the history. the european model has been flawed from day one. where is the evidence we are going to get a united fiscal response? john: well, and germany made it worse, because they brought in their own fiscal rules that were tied to the eu fiscal rules, and they are running a fiscal surplus. if the only evidence, i suppose, is a discussion of using some kind of all balance sheet entities to fund infrastructure -- sheetoff balance entities." john: we can call them ob's.

that thise thrilled week, the bloomberg global business forum will start strong. galliaiting and alberto -- john ryding and alberto gallo. this is bloomberg. ♪

tom: there are eight conversations of the day. you're in, if

economics, finance, investment, this is exactly one, ubs. look for that with our matthew miller here in moments. francine lagarde yesterday on her fiscal challenges will be front and center. francine: it is, and she would not say, and rightly so, she did not give any hints on whether she would push fiscal, she said judge, also the politicians and bring them together. what will it take? we know it does not work. even mario draghi said fiscal policy needs to do something, and unfortunately, the consensus in europe, unless there is more bad data, they are not going to particularly in germany. they are preparing a hedge to be worse, case things get and k's brexit is not the baseline scenario.

however, we are very close to that recession and. -- edge. tom: john, none of this was in your studies at cambridge, negative interest rates that alberto gallo deals with everyday. how can you deal with the negative statistics? john: you can hurt the economy, because you can damage the profitability and capital of the bank through negative rates of they are not passed alone. --you look at the u.s. pace this case, you have got chair powell saying it is not capital spending, it is other areas, uncertainty related to trade and tariffs, so lower rates, i do not see how. we have gotten to a world where everything has been put on the central banks for over a decade now, and we really need, especially in europe, a reworking of the fiscal system. isncine: mario draghi

longing for that. since he became president of the european central bank. so what has changed now? john: well, chairman powell is very close to going into recession. like my friend here says, yes, it is a production, and we will exercise it. recessions are -- the damage caused by a recession is greater than if you can avoid the and you have to end up using the policy levers much more. there is an unwinding of economic activity. francine: all right, we will get back to john and alberto. what then we are talking about is climate change adaptation. more on that next. this is bloomberg. ♪ ♪ devices are like doorways

that could allow hackers into your home. and like all doors, they're safer when locked. that's why you need xfinity xfi. with the xfi gateway, devices connected to your homes wifi are protected. which helps keep people outside from accessing your passwords, credit cards and cameras. and people inside from accidentally visiting sites that aren't secure. and if someone trys we'll let you know.

xfi advanced security. if it's connected, it's protected. call, click, or visit a store today. ♪ "surveillance," tom keene and francine lacqua, an extraordinary 24 hours as we look at the turmoil in

washington and london. the bloomberg business forum is front and center. francine: you try to figure out with trade worries and talk about impeachment and what parliament does next in a u.k., and you have many world leaders on the stage to figure out what that means for your part folio. -- portfolio. tom: let's advance the discussion to nigeria. jacob, thank you for joining us. i go back to your work at chatham house on u.s. foreign policy. it is a hallmark moment for the house of representatives but also a hallmark moment for mr. zelinski in ukraine. how urgent is it that ukraine attach normal relations with the

white house and washington? jacob: it is pretty urgent. several hundred million dollars of security assistance which has been released because of the public scrutiny and political pressure on the white house from congress and the wider public. that is in things like antitank missiles which ukraine has been asking for, for years. while the level of violence is not as high as it has been at various points, the ukrainians are eager to have as normal relations as possible, given the recent transition of power, to make sure they have good relationships with the united states. they are walking and almost impossible tight rope. tom: what is the domestic military realities of ukraine? what is theof kiev,

defense urgency for the leadership? jacob: the urgency is that you have several provinces of the country that since early 2014 are not under the government's control. that reality has not changed in five years, but one of the contingencies that has been front of mind is what if the separatists up the offense? there is a cease-fire in place that is violated on a daily basis, but the battle line has largely been stable for a few years. the ukraine wants to build up its ability as much as possible to prevent violence from spiking and prevent separatists from making further gains and moving further west. francine: we understand president trump will meet with

the president of ukraine. this was arranged before any of this came out. what will they tell each other? jacob: i would not want to speculate, given the intense scrutiny and impeachment announced last night. i think trump will probably be more careful in this conversation then he has admitted to being in previous conversations, though there is the fundamental question of whether he thinks he did anything wrong. it is entirely possible in order to demonstrate he did nothing wrong, and in front of the president of the ukraine, he continues his campaign. i wouldn't really want to make a guess as to which one of those options it is, but it will be one or the other. francine: let me make you speculate on how vladimir putin

would be looking at this. jacob: that is a tricky question. putin probably does not want anything to do with this back-and-forth. he would prefer a more pro-russian government in ukraine and has hopes donald trump would follow up on his stated desire to normalize relations with the u.s. and russia. sense, in a broader things that distract the u.s. and make it more difficult for the u.s. to carry out a coherent foreign policy play to his advantage, because it gives him breathing space to capitalize on syria, to buy him space to make his own moves. tom: thank you so much. he was outside the supreme court yesterday in london. here is sebastian salek.

sebastian: let's kick things off in new york, the near -- the u.n. general assembly kicking off its third day. donald trump will meet with leaders from venezuela and japan. with the will meet leader of the ukraine as nancy pelosi launches a impeachment inquiry. beenond parent has sentenced in the college administration -- admissions scandal. the government filed additional charges of international money laundering and fraud against a chinese national who allegedly paid $400,000 to get her son into ucla as a soccer recruit. saudi aramco is ahead of -- production is

over 11 million barrels a day. they are producing at or above the levels prior to the attack. global news 24 hours a day, on air and @tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am sebastian salek. this is bloomberg. francine: let's turn to more on westminster. boris johnson cutting short his trip to the u.n., flying back into his biggest crisis of his premiership. the supreme court ruled his suspension was unlawful. joining us now is anna edwards. anna has been following the johnson and industry should from the beginning. johnsonwe know -- administration from the beginning. what do we know? we are hearing both

fighting and concession from boris johnson and his team. they accept the verdict but do not like it or agree with that. that is the messaging coming from the team at the top we have boris johnson flying back and the leader of the house called what happened at the supreme court a constitutional coup. we know the house will start to sit at 11:30 u.k. time. this prorogation had never happened, trying to get back to business as usual. unmoved as pretty they reflect on the fact that parliament has not changed. i caught up with tobias ellwood. he has an innovative suggestion. >> i suggest we would take a leap after the vatican can -- vatican.

lock us into parliament until we decide a resolution. anna: that is certainly one option, locking everybody up until they find a solution. the key question is whether that rebel alliance manages to stay together to cross an alternative to boris johnson's administration in some form. francine: let's get back to john ryding and alberto gallo. seeing pictures of the prime minister arrived back in the u.k. youust be furious, if believe reports about what happened yesterday. does he need to apologize? john: i called an important political consultant in the u.k., my 90-year-old mother. she said simply, boris johnson is in a pickle.

he has no majority in the house of commons. tohas been defeated 11 votes zero by the supreme court. imagine a unanimous supreme court decision by the u.s. you can disagree with it all you like, but it is the law of the land. the problem is, if his only agenda is to get the u.k. out of on october 31, is that still a p.m.,t, halloween, 11:00 the u.k. leaves? parliament says if you do not have a deal by mid-october you have to ask for an extension. francine: in the past, every time he was in a pickle, he was fighting. i will ignore and suspend. we will go through with this. is the blow yesterday so big that he will be more restrained? john: very hard to know.

yourselfry and realign to the new realities or you can keep on fighting. think, is more inclined to keep on fighting. tom: i want to come back to your 90-year-old mother, but we have to go to alberto gallo. this leads to a dampening of interest rates. does this roll over to business confidence and business planning? becomee three year plan the no year plan? alberto: interest rates going down should favor capex and business investment. it is not happening. includingew research an m.i.t. paper talking about lack of connection between lowering interest rates and additional capex. even when you talk to

entrepreneurs, they do not invest because interest rates are lower. laws,ant to see stable have a stable business environment, and they look at the projects, not just the discount rate. it boosts financial markets but not the real economy. alberto: you can go back to 1937 theory. you know what matters? animal spirits. there are times when this calculus, people don't make those investments. john ryding, i love that you bring your sainted mother into this. if i look at brexit as a foreigner and they vote to leave , how does your mother perceive the rural or the cities away from london versus the fancy people like you living in london? john: i worked in london.

i did live in the south. is an intergenerational issue. the younger are much more in favor of remaining in the old. there is a north-south issue. just like the u.s. where manufacturing has not had a big pickup, there has been no improvement in the economies. public, they just want done with this and want to know what the future is about. francine: talking about animal spirits, if pound is cheaper, investments for foreigners are more attractive. on novemberll know 1 what the legal environment is. wto rules cannot even sell its products. what about the disruption in supply chains?

i don't see 10, 20 basis points matching up. tom: let's cancel everybody else today. did your mother survive preston man city? john: we are focused on the league, third place in the league. girl --y good, alberto alberto gallo with us. coming up, axel weber with our matt miller. this is bloomberg. ♪

♪ bloombergthis is "surveillance." that is a picture of westminster. atot of action will happen 11:30 u.k. time.

they will open after the supreme court said what the government did in proroguing parliament was unlawful. inis johnson arrived back the u.k. about 20 minutes ago. we understand he will address parliament today, according to labour whips. the government will not only talk about brexit and the crushing defeat yesterday. he will also talk john thomas cook and iran. agenda and what they do from there. tom: we are thrilled to bring john ryding and alberto gallo with us. i want to go to david folkerts -landau at negative interest rates.

you are in the bond market every single day trying to figure opportunity and how to not lose money. does the chronic nature of negative rates, is that an advantage or disadvantage? alberto: during the transition between positive and negative, bonds can make a lot of capital gains, which happened in the last decade. trap, we are stuck in a qe where interest rates are persistently low and do not help the real economy, because they hurt banks and lending, and if you have an aging population like in germany and you know that your returns on savings are lower, you start saving more. that is if interest rates are persistently low. corporates do not necessarily invest more if the political situation is unstable. and become self-defeating

can become deflationary. a lot of academics today are arguing for this. essentially, to get out of the trap, you need fiscal leadership, but this ain't happening yet. tom: the general statement of amateurs like me is germany to the rescue. fiscallyy big enough to rescue europe? alberto: it is not big enough to rescue italy or spain. it is strong and growing. tom: it is not that big. alberto: china is slowing to below 5% growth and germany is dependent on china, but they have room to react they are not easing. we need better monetary and fiscal coordination, but we are not there yet. because of all the inequality qe has caused, we could see a shift

to the hard left in some countries like the u.k. or in the u.s. people are tired of the inequality that qe has enhanced. it has made the rich richer. they may stop -- start voting for a different kind of populace -- populist. francine: alberto is talking about some kind of coordination. is there enough commonality to find a solution, or is it a race to the bottom? john: i don't think there's enough commonality, and to the size on germany, germany should be the leader of the euro zone economically. it is an anchor. as long as the country dependent on trade runs trade surpluses and fiscal surpluses, then the in ate sector has -- not

position to rescue the countries too much. anglosizee trying to germany? john: i am just saying germany will be stuck in the poor growth situation with the fiscal problems compounding trade problems. francine: we will come back with that the biggest names -- with that. the biggest names in business are gathering for the bloomberg global forum. this is bloomberg. ♪

♪ this is bloomberg "surveillance." we are covering the global business form and united nations general assembly. we are back with john ryding and alberto gallo. we have a viewer question. continue sending your questions,

because they are usually spot on. john, despite the low interest rate environment, why is there a lack of investment? are we fully invested? john: there is one view which by,advanced as the years go of secular stagnation. case't find that to be the in looking at where the equity market is. we are looking at high capital returns in existing investments. there is not uncertain -- certainty about the political environment, and then they deploy capital. there is not that certainty to get people to want to invest in new business. all of this, brexit, trade wars with china, everything muddies the water for capital spending. tom: i need to make some money

fast. where is the opportunity in the bond markets? alberto: interest rates continue to go lower, but if you think about where we are in terms of treasury yields, there are very low yields already. andhave private asset, debt equity, where the market has essentially doubled. there are a lot of investors. we see two overvalued extremes in the liquid space and the private space. we think there is value in the middle, if you look at financials sub that, high yield corporate's. the american market and local debt. you can still get high single digit yield but you have to be careful about what you buy, because the zombies are gradually falling down. says,ohn from coventry

what should i do with my wework bonds? we will do that in another hour. there is a lot going on today. the flow is extraordinary. francine: prime minister boris johnson has arrived back in the u.k. , but wefocus on brexit have an interesting conversation on negative rates and banking. tom: right now in zurich, matthew miller. withew: i am sitting here axel weber. they have a summit every year for their offices and it is a great ways to get a hold of him and find out what the highest net worth individuals in the world are doing with their money. i want to first ask you about one of francine's interview subjects, christine lagarde,

incoming president of the ecb. what do you think about her ability to get money out of the governments, like germany, that the market is saying needs to put forward fiscal stimulus? axel: we are still very much driven by monetary policy, only game in town scenario. central banks step in time and time again to save the economy from a hit. europe is in a downturn. we are not yet in a recession. germany is bordering on the second double-dip technical recession, so things are not going well. this is not the environment where fiscal policy in germany should be out a big surplus, like 3%. fiscal policy needs to react, so the call from central banks for fiscal and structural policy to take more of a responsible

approach is still warranted, but i do not see action on the horizon. the only thing that needs to be done is drive forward fiscal policy and structural policy. in germany, there should be long-term investment oriented infrastructure expenditure. the easiest thing is a tax reform. if you don't want to do an income tax reform, you can do a corporate tax reform. eliminatedasically the differential benefit that european tax regime has with lower rates. for corporate's, the u.s. is tax competitive and we are seeing the impact on the economy. europe has not responded. matt: peter alt meyer saying he wants to talk about corporate tax reform with all of schulz,

-- olaf scholz, but criticism people -- there has been so much talk about helicopter money, a fiscal monetary collaboration. what do you think about for central banks? axel: new tools have been used because rates have been negative bound. there is a limit to how low negative interest rates can go because ultimately it will drive out cash from the economy. they are flooding the market with liquidity. that does not lead to investments because whilst liquidity is there, you need investable and bankable projects. the government can play a facilitative role by having expansive investment policies. germany has a backlog on infrastructure.

many areas where you could to long-term, impactful investments that you could fund. germany needs to move into that space. tax reform is an obvious tool, and if you need to have those eyes on the consumer and corporate, you should have a combination of income tax reform and corporate tax reform. the last thing we heard out of germany is it will not happen anytime soon, but it should because the u.s. has changed the name of the game with corporate taxes being competitive. it is better to short profits in the u.s. for tax reasons, then european countries. matt: what do you think about mario draghi's negative rates injured -- experiment? it it saved the day and is time to move on? axel: i don't think it saved the day. the side effects are pronounced.

you can see in the banking system, every year with negative interest rates, interest income of banks goes down. productr project of -- of european markets is the 10 year fixed. rates start in negative territory in safe haven countries like germany, they remain there for 10, 20 years out. banks in safe countries like germany are doing less well than peripheral countries that are less responsible like italy. a different interest rate environment, so it has different impact on countries that the core like germany and italy. that is what central banks cannot take into account, but nevertheless they produce these

side effects. matt: what kind of effect has it had on a bank like yours, ubs, when you are trying to pass on negative rates to depositors? have you seen outflows in your wealth is this? axel: we are doing higher levels of deposit, at the level of one million or 2 million. it is an ongoing debate throughout every bank because we have the most negative interest rate environment of most european countries. the longer we stay in this environment, the interest rate environment all be passed on. -- will be passed on. we have absorbed it into our profit margins. that is not something banks can do forever, so in the short term you can expect profitability to be lower but long-term, you need

to price out negative rates. sooner or later, banks will be forced in that direction to bring the numbers further down, at which they start charging banks. brought inave someone to run your wealth management who is embroiled in a fight with tidjane thiam that led to him being followed under suspicion of poaching. do you still feel confident in that decision? axel: he is not with us, so that is an issue with him and his former -- former employer. we are watching but not commenting. matt: part of your job is managing big, powerful people to run this big institution. it looks like there was a clash of egos at the top of credit suisse. are you worried about putting him -- letting them together?

axel: no, i am not. we have made our due diligence as a bank and making sure there will be no regret moves. we have done our due diligence as late as today, and this is an issue that we do not want to comment on. we are not part of this discussion. matt: what about generally the practice of falling bankers who leave poaching clients, and talent is something that happens on a regular basis. is this something ubs would do? axel: there is a practice in the market and if it is good practice that follows, there is freedom of movement between jobs between financial institutions. andeeds to be orderly

between contractual arrangements. this is what we focus on. everything needs to be by the book and that is my sole focus. i think that is part of competition and if things don't happen by the book, i am not in favor of doing it. matt: let's talk about this family office event. of a net worth investors are worried about a recession and a lot are moving to cash. more interesting is that a lot of them, especially the younger generation, is investing in long-term sustainable esgs assets. is that a trend? >> it is one of them fastest-growing categories, over 70% in four years.

they are looking at the portfolio of their parents and family, and reengineering it towards their investment leaves. investing,t impact environmental friendliness, and are restructuring the portfolio as soon as they inherit that. that has kicked off a demand for sustainable assets. there are not enough in the world to please that demand, so we need to generate assets rather than trade existing assets. that is where the capabilities of ubs come in handy. we need to make the transition from a less carbon producing economy and ubs sees itself as a facilitator. matt: a lot of your clients would be hit by -- and this is a big what if -- bernie sanders onposed an 8% wealth tax

multimillionaires and billionaires in the u.s. how mobile is this wealth? that,ssible or likely is a tax that would cut their wealth in half, to lead to money leaving the u.s.? not overlyare invested anyway and have subsidiaries around the globe. many show profits at the subsidiary level. i think global wealth management is what we are good at and global family offices is the major counterparty with which we work. it is a millionaire and billionaire families with which we work, and they are globally diversified. many of them are very mobile. you have seen major family offices move from the u.k. to dubai.re to do by, --

and global wealth is flexible. the ability to tax and this category -- in this category is less. go where there is an interesting tax deal for them, complying with all regulations and tax regulations. i would not overestimate the for local taxes without taking re-optimizing decisions afterwards. if you are under a u.s. tax regime as an individual, you are under u.s. tax code globally, but it is institutional investors, there is a lot more flexibility. matt: axel weber, chairman of event their annual family

in zurich. francine: that was matt miller with axel weber, really trying to get an answer on what happened in the spy case. there is a spy probe that will decide the fate of top executives. these investigators are reporting directly to the chairman of credit suisse. they will move swiftly to exonerate or say they will take punitive action against top executives, according to a person familiar. there is quite a lot going on, questions about the political system, threats about impeachment and the boris johnson supreme court reading. up, 2.8% higher. moves on the european stocks, down 1.2% as there could be a

rapprochement in china and the u.s. nancy pelosi announcing the house will kick off a formal impeachment inquiry against president trump after allegations he put pressure on the government of ukraine to investigate joe biden. >> the actions of the trump presidency revealed the dishonorable fact of his betrayal of his oath of office, national security, and betrayal of our elections. i am announcing the house of representatives is moving forward with an official impeachment inquiry. francine: these actions raise the possibility president trump could be the fourth president to face impeachment proceedings. he denies wrongdoing and says he will release a transcript of his phone call. joining us is marty schenker.

when you look at this impeachment inquiry, how likely will it play out? marty: obviously, nancy pelosi decided to escalate this into a formal impeachment umbrella, but could have elevated it more. there was talk about a select committee on impeachment which would have raised the stakes. she did not do that, but she faced a revolt if she did not use the word "impeachment" to give texture to this inquiry. what are we likely -- francine: what are we likely to hear today? who will we hear from? marty: we will hear from donald trump at 4:00. he is meeting with the current leader of ukraine. we will get the transcript, and there is reporting that trump talks in a freewheeling stream of consciousness style, so it is

unclear whether there will be "a smoking gun" in that transcript. francine: the timing is quite awkward because you have 2020 around the corner. does it mean the republicans have to find another candidate? marty: this will be extraordinarily messy and the democrats will have to manage it. they have not shown an ability to do it so far. this will extend right in the middle of the political season. donald trump will surely be the nominee of the republican party and he has described this as an extension of the witchhunt. it will force the democrats to be on their back foot during this campaign, while they decide their nominee. francine: what is the likelihood of a public blowback? the president says this is a witchhunt. marty: this is really

interesting, because nancy pelosi has resisted the impeachment word for political reasons more than anything else, because she knows the public does not -- and the polling shows -- does not support impeachment. certainty,et public you have very few republicans interested. it will be interested for the democrats to get public support for doing this versus things on infrastructure and drug prices and other things. schenker, chief content officer at bloomberg. we will hear from world leaders, policymakers, and top ranking jamie dimonncluding and tidjane thiam on the bloomberg business forum. that is coming up all day. this is bloomberg. ♪

♪ it is not in the baseline to have a recession. that said, it is mediocre growth. risk because of essentially one major threat, which is the trade war that we see. francine: that was some of our interview with christine lagarde , incoming european central bank resident. -- president. posen, us now is adam president of the peterson institute. she was quite guarded when asked

about the ecb and we did not talk about negative rates. when we talk about the world or amy, she says recession significant slowdown is not her base case, but she worries about trade. will china and the u.s. do everything to avoid -- adam: i don't, but the economy will keep going despite themselves. oris not enough for china the u.s. to throw them off a steady recovery -- expansion. europe has a more difficult time because they are weaker and more trade exposed. francine: if you are donald trump and you are facing pelosi and the things she said, you have to make sure the consumer is confident. marty: donald trump is keenly aware of the economy being part

of his reelection campaign, but he said he does not need a trade deal to win reelection, and i think he is right. a lot of democrats are not criticizing his stance on china, so he has a pretty free hand in deciding when this trade war ends. adam: if trump makes any deal, i expect democrats to attack him for being soft on china. francine: we saw pictures of boris johnson coming back after being at the u.n. he was here to renegotiate brexit with e.u. leaders on the ofeline, and it was a wooing president trump to give him a better trade deal. failure ins a big that he can run as an extreme brexiteer.

his campaign, he has run out of international negotiating options. francine: who should the u.k. start getting cozy with in the u.n.? a big win for elizabeth warren? they: it could be, but if ukraine issue becomes front and center, joe biden's name becomes intertwined with that perhaps unjustifiably, that could create fourrt from joe biden -- joe biden from the democrats she is ahead -- democrats. and if joed in iowa biden cannot when i was, he is in big trouble. adam: whether you are looking from the outside in, the person you want to reach out to warren and possibly substitutes for joe biden.

there is not much point in talking with president trump. francine: we have the quinnipiac national poll saying elizabeth warren has 27% and joe biden has 25%. will there be a switch of allegiance? this is a shift to the left. marty: i'm sure that is within the margin of error and mirrors the momentum she showed in iowa. the progressive leftist policies of elizabeth warren, i don't know whether the electorate is focused on that. you cannot tell what the election will look like until you have a nominee, and we are at least six months away from clarity. donald trump and his people have said they relish the idea of running against elizabeth warren. they may regret that wish, but they have a stark narrative

about socialism and donald trump went there at the u.n. that is the campaign he will wage. francine: we will figure out if there is a tilt to the left in the u.k. we will have plenty more on brexit, boris johnson just arriving back to the u.k. and will speak to the house of commons in a little while. this is bloomberg. ♪

♪

this is bloomberg "surveillance." we are back with adam posen. we were talking about possible elections in the u.k. and possible impeachment for president trump. leftere is a tilt to the in the elections, what does that mean for the world economy? adam: it means a lot for governance and who pays which taxes, but for the world outlook , it means less than people think because you will still get a fiscal push and it will be mostly green spending in the u.k. and the u.s. on monetary policy, it stays the , elizabethrade warren and jeremy corbyn are saying some of the same nasty things about trade trump does.

financial and environmental regulation, and some wealth tax. francine: what does it take to get to more centrist politics? adam: on trade, we need to have more of a crackup and the public has to wake up. arere seeing polls people waking up to the damage, but elizabeth warren wants to run on patriotism as opposed to nationalism, and for me, globalism is better. francine: the biggest names in business and government are here in new york. we will hear from mark carney and christine lagarde. this is bloomberg. ♪

here, it all starts with a simple... hello! -hi! how can i help? a data plan for everyone. everyone? everyone. let's send to everyone! [ camera clicking ] wifi up there? -ahhh. sure, why not? how'd he get out?! a camera might figure it out. that was easy! glad i could help. at xfinity, we're here to make life simple. easy. awesome. so come ask, shop, discover at your xfinity store today. ♪ this is bloomberg "surveillance." you are looking at washington, d.c. where christine lagarde is

ready to leave the imf and take over at european central bank. she is the first woman to lead the institution. i asked whether she had any doubts accepting the job. >> i talk to many people who had been central bank governors and who knew the job, and they all supported me and yes, under current circumstances and given the strength of the institution and the situation we are in, i had to say yes. francine: we are joined by james sweeney, adam posen still with us. ,hen you look at the conundrum what does the ecb need? mario draghi has asked for fiscal stimulus since he took job. what can lagarde do? adam: she can seize the moment. she is not from italy and does

not carry the baggage draghi unfairly carries. lagarde is seen as someone who help europe through the crisis, and she puts a fresh face on it. germany is heading to recession. the failures and limits of the policy we have had up until now are coming to roost, and we saw morningcome out this and say it is time for germany to do public investment. she needs to carefully ride the wave. francine: if you look at the world economy, europe seems to be in a tricky situation. his monetary policy effective? and credits helping, growth is not especially bad. europe is exposed to trade and global manufacturing, and it is core europe, germany and the

countries closest to germany that are suffering the most. you have an inversion of where the weakness is in europe. clearly, fiscal stimulus is what is possible and what could help. the greatest advocate will be weak data in germany that we are seeing. francine: weak data that will bring on a full recession or spare them to spend fiscally? --es: some people call them call negative gdp growth a recession. negative gdp is a lobar. risingu get unemployment meaningfully, you will mobilize support. the labor data in germany come out quarterly. if you look at sweden where unemployment is rising, the manufacturing indicators in germany, those look like you will see a -- if those look like

you will see an unemployment increase, -- francine: are we expecting too much from fiscal stimulus from germany? adam: i don't, because if they do it there are a lot of good things they can do. you don't need to worry about what the return is. they are going to create more bonds, which is necessary for the ecb to do what it will do. they create more cover and legitimacy for other european countries to be fiscally responsible. francine: it is the greens that are starting to change the tune in germany. how does climate change help in pushing through stimulus? adam: i think that is substantively sound and this is where the un-investment -- underinvestment is, in the grid.

that will be the story. part of the reason there will be fiscal stimulus and expansion around the world is because it is no longer just a green story, it is a reality story. francine: what do they do with negative rates? it is the million-dollar question. madame lagarde would not talk about it. itative rates, how much does squeeze banks and the real economy? squeezet does not banks. you need a new stimulus tool. francine: you possibly trade bubbles with investors looking to search for yield. adam: you will search for yield and a low growth environment anyway. that is why we see this piling into equity, because everyone is

desperate for yield. in public markets, you are not getting it. the central banks are reflecting the underlying reality. francine: james sweeney and adam posen stay with us. announcedncy pelosi the house where the kickoff a formal impeachment inquiry into president trump amid allegations he improperly put pressure on the government of the ukraine to investigate joe biden. president trump denies wrongdoing and says he will release the phone call -- the transcript of the phone call today. whatine: what are you -- are you expecting to get today? kevin: later today, president trump is set to release the transcript that he had on that phone call with president zelinski where he tried to

achieve political dirt on hunter with thehis dealings energy holding. sometime by the end of the week, the president is going to submit the whistleblower complaint that was filed off of that phone call, to congress, to the senate house intelligence committees. the acting director of national intelligence is set to testify tomorrow. on friday, the senate intelligence committee chaired the republican has invited whistleblower to meet with the committee. speaker pelosi yesterday wants tog that she move forward with an impeachment inquiry, and president trump, we will hear from him at 4:00 p.m.

new york time. more details will emerge. nowcine: so far or up until , nancy pelosi was wary of impeachment because of public blowback. what changed? kevin: ukraine. ever since the end of last week and over the weekend, there has been a steady drumbeat of criticism from moderate democrats from about seven districts that switched from republican to democrat, that suggest should a president try to obtain political dirt from a foreign company and try to withhold military aid as democrats are suggesting, that would be an impeachable offense. the politics of this are readily at play. i want to point out that senator elizabeth warren has made the

crux of her campaign and anti-cronyism and anti-corruption message. there is a new pullout from quinnipiac that has her beating joe biden in a head2head match up. nowtor elizabeth warren leading with 27% of democrats and democratic leaning voters, and joe biden is at 25%. a university poll yesterday has her beating joe biden in iowa and new hampshire. this will be a quickly moving dynamic, but senator elizabeth warren has shown she has gained the most of this. cirilli. thank, kevin -- thank you, kevin cirilli.

lastly, is elizabeth warren the clear winner in all of this? leslie: it is hard to say. we are at the beginning of something that is very public and unlikely to proceed quickly. the formal inquiry of impeachment is a game changer, and i don't think we can predict how it will play out in terms of the democratic candidate that will emerge. it could have a positive impact for joe biden if he is seen to be the victim of some attempt by the sitting president to undermine his credibility. francine: the timing could not be more awkward because we are going to the 2020 campaign. how does this change everything? on whata lot depends comes out from the whistleblower , much more than the transcript. the phone call that took waste

was not recorded -- took waste was not recorded -- took place was not recorded. people do not have a lot of confidence in this white house. the broader question is what comes out when the congress listens to the report and in the months leading up, there was a sense there was an effort by the president to short-circuit the national security process, to marginalize those who should have been central to managing the relationship with ukraine. the idea that congress appropriated money and the president threatened to -- withhold it unless the president of ukraine conducted an investigation against one of the leading democratic candidate, these are facts that play out in significantly, but

the most significant thing is whether or not the sitting president of the united states is approaching his role in a way that is unlawful -- lawful and respects national security and the integrity of the 2020 elections. francine: as his popularity going to change? leslie: absolutely. be a verying to extended, highly political, divisive process. i don't think we can expect that the popular support, the public opinion ratings we have seen will be steady throughout. we will see changes. if you go back to the support that there was initially for impeachment surrounding richard nixon, support was quite low and changed during the process.

from how therent support for the democratic candidates changes, but i don't think they will remain static. plentye: we will be back more on brexit as parliament returns, and the attorney general says he will not resign over the court ruling. boris johnson will speak to the house of commons a little bit later on. what does it mean for the brexit process? we will explain, coming up. >> confirmed the suspicion this was a plan to stop number 10 -- ♪

♪ francine: jeremy corbyn seconds

ago, and it seems to be getting pretty feisty. you can see theresa may in the background as we follow live pictures of what is happening in the house of commons. yesterday in art decision that was unanimous, parliament is reopening. we are expecting the prime minister to talk later today to parliamentarians. what is he expected to say? anna: he is going to set out the government's proposal to what michael gove says. we will hear from the prime minister this afternoon and there is a lot of guesswork involved. parliament was not supposed to meet today. really interesting to see they are back in business in the house of commons, the speaker

getting things kicked off with saying,pical statements welcome back to our place of work. he called on joanna cherry, one of the mps who brought the case to the government, talking about the government's position. he reiterated the government and theyhe judgment acted in good faith. francine: thank you so much, anna edwards in westminster. let's get to the single best chart. it is the spread between the three-month cable volatility and one month. it is the widest since the 2016 referendum. we are back with james sweeney and adam posen. if you look at this chart and wonder what the market is

pricing in, are they pricing in no deal or are they fed up? james: a steady stream of information on no deal probability, the expectations of a no deal brexit have gone down substantially in the markets in the recent weeks. the general idea of brexit uncertainty weighing on business activity is certainly still there. we have seen in the data in the past year one of the main problems for the euro area is exports. when you look at where the exports are weak, it is places like the u.k. in turkey that have a substantial drag some of that trade weakness is related to political uncertainty and while hard brexit to have gone down, there is seemingly no end in sight. francine: if you are bank of england, how do you set monetary

policy for this kind of political posturing? adam: i think as you and i before, ther, -- bank has to be on hold because there is a good chance of a good outcome in a significant chance of a bad outcome. havenor carney and the mpc done a good job of stating the facts. anything resembling a hard brexit is terrible and is creating uncertainty. go, sothat, they cannot they are sidelined. francine: what does this mean for pound? is this volatility or are we range bound? james: it is volatility. it has been a difficult trade because news swings have been sharp and fast. adam: it depends on your trading

window. ,f it is more than two months you have to believe pound is going down, because you either end up with no deal and johnson undercutting the regime, or a deal with corbin and all kinds of threats with monetary policy regime. you have to be looking at a weaker pound. pounde trading more like in the 1970's and 1980's. francine: jeremy corbyn prime minister for the u.k., what does that mean for the economy? he is not doing great in the polls, but what does that mean for investments abroad? adam: it is terrible. thewill get a coalition of scottish national party and liberal dems. themn and labour will give back in the e.u.

they will have extreme policies domestically and it is terrible. francine: is this a domestic problem or a regional concern, or a shock the economy does not need? james: the local trade data in demand we see that weak has been an issue. it is a regional trade issue. in the worst case scenario, it will become a global issue. francine: james sweeney, thank you so much for joining us. we will be back with adam posen. the biggest names in business and government gathered for the annual bloomberg business forum. we will be hearing from narendra modi. we will talk about the world economy and globalism. this is bloomberg. ♪

♪ this is bloomberg "surveillance." we are back with adam posen.

we need to talk about the repo market. we have an opinion piece that came out on the bloomberg terminal about why he is worried about the repo market. good the fed easily fixed the remo -- could the fed easily fixed the repo market or will it have long-lasting repercussions? adam: i don't think it will have long-lasting repercussions. there is a reason people refer to this as the plumbing, it is necessary but not a big deal. because there is more regulatory requirements on liquidity and other things, the fed needs to actively make market in repo. they should have seen that coming, but ok. if the shocks happened this week did not disrupt other markets, it is hard to see why it would continue to disrupt other markets. trouble saying, i don't

want to -- no is in trouble saying, i don't want to lend to other banks. he also blames regulation, saying disrupting some of the system's most basic functions. how do we adapt? adam: this is not that different. 1960's, world in the 1970's, and 1980's with more someation, and you give up of those things for more safety. you drive at a slower pace not to run off the road. i would not overstate this. francine: it kind of came out of the blue. the plumbing, as long as that works, people do not think about it. adam: it should not have come out of the blue.

this is a time people knew they would be short of resources in the repo market. there was a lot of demand. --colleague, simon part or simon potter, you should have him on talking about how this works. he may have a different view. the bottom line is that plumbing is important, you need skilled plumbers, but if you pay attention you do not need to worry about the system backing up. francine: we are all heading to the plaza for the bloomberg business forum where we will hear from top banking executives. this is bloomberg. ♪

beyond the routine checkups. beyond the not-so-routine cases. comcast business is helping doctors provide care in whole new ways. all working with a new generation of technologies powered by our gig-speed network. because 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. willy davis, who has alzheimer's. i decided to make shirts for the walk with custom ink. the shirts were so easy to design on the site. the custom ink team was super helpful and they just came out perfect. seeing my family wearing my shirts was such an amazing reminder of all the love and support that everyone has for my dad. - [narrator] check out our huge selection of custom t-shirts and more, for teams, businesses, and every occasion. you'll even get free shipping. get started today at customink.com. ♪ rep. pelosi: the president must

be held accountable. no one is above the law. david: speaker pelosi announces a formal inquiry into impeachment of the president. president trump responds that it is only present jewel harassment. into the lion's den. prime minister johnson returns to a parliament he try to shut down, insisting there will be a brexit just over a month from now no matter what. world leaders and ceos talk climate change at the bloomberg global business forum as the u.s.-china trade dispute casts its shadow over world trade. welcome to "bloomberg daybreak" on this wednesday, september 25. .'m david westin lisa abramowicz joins me in new york. alix steel is off today. lisa: it didn't focus on global warming there at the