had that big of a weight on the 24 group basis. there you have the closing bell. we are looking at a recovery. two days of selloff, the first two days of there you have the closing bell. we have a recovery. people are starting to factor in the fed. cap underperforming, in the green, but underperforming. .> yields are lower

we did not get the turnaround in rates. >> it seems banks do lose. taylor, what are you watching? pmi.ese services , it chart, the white line continues to fall into contraction territory. manufacturing still looking .etter the equity market is turning around a little bit. real estate and white, utilities and yellow, 20% going back over

a year. there remains some skittishness in the market. taylor? ishareswatching the msci momentum etf. straight daysur of outflows, the worst week of the year. you have to take into account that much of this number comes from that large spike lower the came on tuesday, and outflow worth more than $300 million, the largest outflow of the year. if you don't include the rebalance, you might be tempted to say this goes to that rotation we sought last month, momentum and value, people leaving momentum. if you look at the holdings of fit into it does not

that category of momentum, those saying momentum had become utilities, real estate, staples. if you look at the largest 27% is technology, than financials on health care. another reminder to make sure you know what a fun holds beneath it. >> thanks. i'm looking at the copper/gold ratio. one ounce of gold can buy 592 pounds of copper. for its third straight weekly loss, while gold heads for again. it has been led by global manufacturing and growth slowdown. the u.s. gauge dropping to a tuesday's low, and report of slowing manufacturing added to expectations the fed will cut rates. lower rates make non-interest-bearing gold more interesting to investors.

investors may be seeking a safe haven for assets. >> thank you. still with us is private wealth advisor and portfolio manager at ubs, and our cross assets reporter. we were just talking about software, nasdaq up over 1.1%. even prior to the volatility, this area has looked frail, some of the red-hot growth names getting totally slammed. is this an area that has become attractive again? that 20 yeark at average forward-looking on the technology sector, it is below that average. you can build the narrative you would like to believe in in some cases, but in this case, the ash sector being up over 30% a component part of the s&p 500,

valuations are rich in given that chinese tariffs front and the companies in that sector that you have to be careful as an investor to really understand what it is you are owning. that as we to that are experiencing this daily frenetic agita -- agita is a good word -- but if we take a step back and give investors the benefit of perspective, i have been managing money since 1998, so let's go back 20 years, and the u.s. large-cap equities have only been down five out of 20 of amazing, is kind and that is arguably during one of the worst 20-year periods of investing you can look for. , if you were to look at the interviewer declines investors experienced every year

, mental immunity is key here, the data is key here, and embracing this idea that volatility is here to stay. that is the narrative, right, that we are and they late stage , and that is something investors can hang their hat on. >> we have to ask you about the vix, we saw an early spike to 21, but has come back down. i know you look at different measures, but what does this tell you about how things are going forward? >> what is interesting about how , andix has been acting this is something wells fargo flagged this morning, it might not have risen as much as you would have expected. it has a substantial premium built-in. there is trailing volatility of

seven or eight and a 16 handle were telling you that investors thought something was going to happen, monday and tuesday happened -- we have had an event. the normalized and bright sized so that iss, probably a reason why. things look placid there. yesterday was a big day for people monetizing and rolling strikes into out months to have that protection. >> we had an event at the beginning of the week. what was the number one question you were getting from clients during that event? what are you getting now? has it changed? >> it hasn't. the question is are we headed for recession. my answer is yes. we don't know when it will happen, but we know they always do happen. one of the most damaging effects of the fear of a recession is

the action you take before it actually occurs, so you had a lot of people -- not my clients -- leave this market at the end of december. it is amazing how fast the narrative has changed, but the fourth quarter last year was the fed will not cut fast enough. we are in for terror free litigation. so if you bought into that -- litigation -- re- litigation. fear-based thinking is not an investment strategy, number one. number two, understand this is the climate we are in but recessions are a healthy part of market ecosystems. this could be a soft landing in one that could present a great buying opportunities for investors who extend their time horizon at expectations -- and

expectations for returns. >> how long? but most three years, recessions are less than 18 months. , i would defer to luke, but in the last 20 years, we have had two of the worst recession since the great professions -- great recession. 2009, and out of that five years in 20 years, three years or 2001, 2002, 2003. advantagelook at that point, we should be embracing enter your declines, re-waiting, and look for income relative to the larger economic cycle we find ourselves in. does that make sense? >> yeah. luke, any other stats? >> this is a great week in the bond market for convergent-type debts.

thatod yi y ended yesterday, something huge there, so this will be the first week since april of 2016 that the japanese 10 year bond yields rises three basis points, a week where the u.s. 10 year treasury yield falls at least 10 basis points. >> that convergence theme coming up now. >> you really delivered there. bund-treasuryting correlation. >> you set stay close to home. when we have the dollar weakening, generally resolutely going tos the u.s. lose its haven status? >> personally i don't think so. one of the things that is kind of amazing that is a saving grace in the united states is we

are 70% consumptive gdp, so we have to be careful about the language we use that influences any behavior, which is amazing, because we can use the data to communicate this, but it is really about how people feel about the lives they are living, if they can do certain things and continue to spend money, so that advantages the u.s. right now. ubs does not think we are headed into a recession in the next 2020 cycle, so when i say there is inevitability that always happens, we don't see that happening soon. >> thank you very much. >> thank you. >> our thanks to luke, our cross reported. that does it for the closing bell. we will have the latest on the impeachment inquiry facing president trump on "what'd you miss?".

this is bloomberg. ♪ ♪

♪ caroline: live from new live fry caroline hyde. here is a snapshot of the bounce back. we closed up. joe: "what'd you miss?" , asline: u.s. stocks rise feel speculation the fed will cut rates. president trump calls on china to investigate the bidens.

bloomberg learns the use cape prime minister has a plan b if the eu rejects his deal. he is not ruling out an irish backstop, but with one crucial condition. romaine: breaking news on wework , the company telling employees , telling layoffs employees they will have to undergo cost-cutting efforts. the efforts will be handled as humanely as possible, according to him. , september pmi in germany below estimates. on the u.s. side, ism hitting a three year low. here to take us through the data and what it could mean is the chairman of the jerome leavy forecasting center. i can't remember the last time

we paid this much attention to a pmi services number, 52.6, not awful, but low enough to cause adjutant -- agile top -- judah. is a lack of understanding what is happening in the rest of world and how it is affecting us. we hear about the trade deficits, the trade war, there is a problem with overbuilt balance sheets in the private sector. it is worse overseas. it is starting to bring the rest of the world down. that will affect us. joe: you put out this note that

looks at the phenomenon of overinflated asset evaluations -- valuations. we like to think financial markets are a function of the real economy, and you are saying the real economy is down the street from financial markets. >> i want to emphasize this piece is put out as a white paper for public consumption. whyle or nothing is about the economy has changed and why we are seeing more bubbles and expansions in periods of financial fallout, and it comes down to a structural change happening, private sector balance sheets have been growing thisr than income, and starts to make decisions necessarily riskier, and that

dynamic is making this process unsustainable. the inability to keep pushing interest rates down to support balance sheets and expanding, we are running out of room to do that so that is found risk hanging over international markets, and whatever happens in give you, and i will my professional opinions about that, but the balance sheets have become large, undermined returns and made people see capital gains, and that is the world we are living in. isoline: you said the u.s. not as dramatically overleveraged. is it china? >> australia. europe, unlike the u.s., which deleverage the private sector -- we still have enormous leverage, especially the corporate sector, but reduced -- europe did not deleverage and they have a

similar debt situation and kept things rolling along, so we have at least begun a correction process. romaine: if we don't get to that correction process in time, are the right tools there to address another crisis considering it is a different balance? >> that is a great question because people are thinking does the fed have enough bullets? if i can think of what christine lagarde said, i am not a fairy there there is a limit to what central banks can do. not a fairy. there is a limit to what central banks can do. asset values have become high ,hroughout the economy supported by very high interest rates, and people have stopped depending on interest rates and operating returns because they are depending on more capital gains.

you have come to the end of the game. joe: let's connect this to recent data and how people are thinking about the economy. in the old days, maybe there was an inventory cycle, factories made too much stuff and they can't sell it, so they have to slow down and bell people -- lay people off and there is a slowdown. the last two recessions, arguably the last three, did not look like that. they were asset bubbles that popped, real estate, dot com stocks. this is the future of our recessions? what's going on with the manufacturing sector? is this problematic? the real risk is not some inventory cycle or anything happening in manufacturing, but something on the financial asset side? >> that is a great statement. --ht now, the biggest bubble where is the housing bubble in

this cycle? it is in emerging markets and corporate debt around the world, with this hunger for yield that comes out of these overbuilt balance sheets that forces interest rates down has forced people to put money in key places where it is going to get killed, so the next also, the amount of wealth in stock markets and housing may make the wealth effect a much bigger factor. wealth effect was not a big issue in the 1960's and 1950's. it became one in the 1980's, especially the 1990's, and ever since. that is a real concern here. joe: great stuff. a fascinating report as we are focused on this data. we will have plenty more ahead. this is bloomberg. ♪

joe: president trump under fire, addressing impeachment probe in florida, claiming democrats are focusing your efforts on the probe because "they cannot beat republicans fairly." this comes as kurt volker testified today. for the latest on the impeachment inquiry, let's welcome our congressional editor. thank you for joining us. i am having trouble keeping track of how fast the developments are coming in this story. what is the latest thing you are watching? >> it is moving quickly. we are getting more details of the testimony of kurt volker, the former envoy to ukraine, who

testified behind closed doors. the main focus was about the delay of aid to ukraine and whether or not that was in exchange for president trump's pressure on the ukrainian president to investigate joe biden. if democrats can establish a connection between those two, that makes a stronger case for wrongdoing on the president trump side. that is the focus now. tomorrow they will hear from the inspector general the intelligence community, and the first person to handle the whistleblower complaint that sparked this impeachment inquiry. romaine: we heard from the president, addressing the question of what he may or may not have asked that ukraine, and in the process, told us what he may ask of china. take a listen. >> china should start an investigation into the bidens, because what happened in china is just about as bad as what happened with ukraine. romaine: i know we live in a world where a lot of things get

said by trump and we dismiss them. is this as serious as some people on the democratic side are taking it? >> it is hard to tell with this president, whether this is a threat or a request that was made at some point, or whether he is speaking off-the-cuff. the biting campaign did respond and said this is like his infamous event in 2016 when he said, russia, if you are look for hillary clinton's emails, saying the quiet part out loud, which he often does. we are trying to figure out if this is something that he has pushed china to do. loud andays it out there is nothing left investigate. caroline: what the markets have biden's losson is is elizabeth warren's game. i'm interested in the knock on

effects for the 2020 campaign. who is losing out here? >> that is an interesting point. when you look at joe biden, he is the centrist candidate, and there is no solid centrist to take his place if he ends up faltering or is contaminated by the scandal. bidens best pitch to voters is he is the most electable candidate, the one best position to be donald trump. if the involvement of him or his son ends up hurting that argument, that is a hard thing to sell the voters. elizabeth warren does have something to gain. she was surging in the polls, already overtaking the first place spot. getline: always great to your insight. keep us up to speed. coming up, goldman sachs biggest winners from the bet on companies that boosted second-quarter results that are

now costing the millions. this is bloomberg. ♪ everyone uses their phone differently.

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>> i am mark crumpton with first word news. no pentagon officials were listening in on president trump's call with ukraine's president in july. the defense department said pentagon attorneys are asking the department for any reference connected to military aid to ukraine that was delayed. the cannot confirm conversations between the department in the white house as part of this review. i think you guys understand that will be part of the conversation taking place, and generally, conversations with the white house fall into a different category of things.

in this case, i will not be able to comment. denies thet trump assertion that the military assistance was delayed to pressure the ukrainian president to seek dirt on joe biden. russian president vladimir putin says his country is helping china develop an antimissile early warning system. he made the announcement at the conference of policy experts today. he criticized the united states for abandoning a key nuclear treaty. he says that decision has weakened international strategic stability. french officials say a survey entered police headquarters, stabbing four colleagues to death before he was shot and killed. the men who worked for the city police forces since 2003 had never caused any trouble. the paris police headquarters is located across the street from notre dame.

the irish prime ministers says ireland in his words may have to live with the no deal brexit for some time if no solution for a british exit from the eu is found. he said he would not predict any outcome of the talks, but would prefer to see a deal where the u.k. leaves in an orderly fashion. during a joint news conference in stockholm, the prime minister called boris johnson's brexit plans "something we can engage on." >> they do fall short in a number of aspects. any mechanism that were to exist would have to be reflective of the views of the whole of population of northern ireland and not give any one party of any denomination a veto. >> european union council president donald tusk says he is still unconvinced about the new

brexit proposals to unblock the stalled talks, even after a phone call to discuss them. global news 24 hours a day on air and at tictoc on twitter powered by more than 2700 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. caroline: constellation brands, saul shares fall after mixed results. here to break down what is going on with the consumer is our consumer reporter. feeling so good about the

feeling so good about the economy i want to buy my pepsi and my christmas. -- crisps. >> that's right. hep c has not seen any pushback. has not seenepsi any pushback. they are benefiting from higher prices. >> it is a complicated story. i think people lie to pollsters or present their best selves. a powerhouse been for pepsi for a long time. there have been people who have argued to split it off, frito-lay is one of the best packaged food companies that exist. soeda is a different story, but they made up for it, so pepsi chugging along today with higher prices. romaine: constellation brands

part a little bit. theirf this is related to investment in marijuana and cannabis, right? >> it is. the marijuana stocks have been hit hard. canopy, in particular, not profitable like everyone else in canada, and some slowing sales. the pressure is on constellation to prove they made a good bet. romaine: the responses hard seltzer? claw, hardwhite seltzer is a real thing, extremely popular with a demographic younger than us. romaine: thanks. >> me too. corona will push into her seltzer next spring. they are a victim of their own success. the beer numbers have been strong. there is concern when they miss the estimates on modelo. in the background is this

high-profile marijuana bet that has not played out yet, that it is still early. romaine: let's turn to goldman sachs. four bets the company made were winners a quarter ago, but now they are inflicting to end at -- million in pain inflicting $260 million in pain. more is ouror finance reporter. aventura,t with chemical company, debuted at $14 a share, close at $14.01 a share today. run come up atd q3 a disaster. that position alone, goldman sachs had a loss of greater than $100 million. at on top of that the fact that uber lost a third of its value since it was public, there you

have two positions with losses of more than $100 million each for goldman sachs, and that will not help entering earnings season. joe: can i ask a stupid question? equity stakes directly taken by goldman, sachs & co.'s -- i thought the volcker rule meant you weren't supposed to take positions on your own balance sheet? is that the way it works? uniqueman sachs has been as a bank from making big directional bets and companies. >> conviction bets, whatever you want to call him. goldman sachs has equity investments of $22 billion, most in private investment, but when some of those bets went public, they started to realize gains, sizable ones in q2. once you saw some of these

marquee names underperforming in q3, those turned into what looked like big losses for goldman sachs. it makes you more expectant for what softbank will report. i'm interested in this long-term perspective. we said trade webb did not do well, but have there been some gainers? >> they have had canes. the $500 they touted million, trade web made up a large part of it, because it wasn't revalued since taking a position 10 years ago. there are rules around that. , goldman could in its quarterly

performance. that's why we see these positions with losses in excess of $100 million. razor -- raiser . caroline: we just want to mention that the parent company of bloomberg news competes in providing data and information on the financial industry and holds the majority of voting power. now, let's move on. was one of those losers. it is still innovating, particularly in the world of the sky, perhaps you can catch a ride with uber helicopter for a

mere $100 a ride. it has opened its elevate service to all users. the service will fly you between lower manhattan and jfk airport in eight minutes. you have to get to a helipad, take off, then to your flight. it would take you about 30 minutes. joe: what is the price? caroline: $200. take 50you could minutes on the subway. romaine: the subway? caroline: is that beyond you now? that ins of being getting from here to the distance of where the helipad would be. romaine: i don't know. or you could just take

the rival, blaze, and that is cheaper. joe: ok, i will do that. with the ceo speak on an eventful year in cryptocurrency next. this is bloomberg. ♪

our,ne: developing this wework leaders telling staff job cuts are coming. 12,005, that he had hundred employees last time we checked. we know they are consolidating comes to how many people will be affected? >> they were considering job cuts perhaps in the thousands last week. they told staff things would be

handled humanely and they would start on this this month, but did not give a figure. joe: how should we think about these job cuts? they need to cut expenses because they need to cut their cash burn? or is it we are bringing a level of seriousness to the country and putting the previous era behind us, so for any potential lender, this is a new wework where we make hard decisions? >> it is definitely both. they are out there looking for lending, financing, and they want to project we are running things tighter, getting things under control, will not be burning $2 billion a year. when they thought they were

getting $10 billion from the loans an ipo, they could be more aggressive and growth plans come and now you are seeing a scaled-back version. workers arework saying their options valuations is it clear these new ceos are remaining? softbanke talks about taking a closer look. >> they are projecting that. they are running it like they are in place. we have seen them considering sales of stakes and businesses, pulling out of some negotiations, so certainly they are running the ship as they are there for good. ,ou mentioned that employees wework was aggressively

growing a month or two ago. caroline: let's check the latest business flash headlines. facebook may have to censor online hate globally. the european court of justice defamatory post can be removed and the eu. vanguard change the way people buy stocks. now it wants to do the same thing for the currency market. for are testing a new way asset managers to trade currencies that would allow them to avoid big, massive banks. the platform is based on blockchain technology. that is your business flash update. it has been an eventful year in cryptocurrencies with more and more companies getting into the space, leading to what may be a bright future for blockchain technology.

ceoing us now is ledger pascal gauthier. what is ledger in your role in crypto? keysdger secures private for consumers through our we sold at 1.5 million units everywhere in the world, and for enterprises as well. way -- when you look at the way the industry has evolved over the past year, year-and-a-half, how are the services you are offering, how have they changed? >> we are working on the products and user experience. our mission is to make it easy-to-use. they share the same flow of the private key, you need to secure the private key, but they are

idea is to use, so that we make it secure and easy to use. many talk about the latest projects, this decentralized application that is more than an asset. for you, asset speculation is coinsbut out of all the and everything we think of, how many will stand the test of time? >> that is a tough question. who knows? blockchain technologies are here to stay, because you see more and more projects using blockchain technology to power services. is leading governments to think about their stable coins, and that is an evolution that comes from bitcoin into something more mainstream. joe: one of the things is how cryptocurrency went from

individuals to large and your own company's trajectory mirrors that. you start off with wallets, and now you are doing more in the enterprise face. what are you doing to specifically bring enterprise security to crypto? manager wants to say we lost the keys to $200 million in crypto. what are you doing to solve that problem? >> everything comes from retail. sayingtail clients were we are hedge fund and we want to access the bitcoin at the same moment, therefore we cannot share the same private key. so we have a product we are taking to market that is bringing something good to the industry, not just security, but

governance. , the businessules rules, the administrative rules, so we believe this is an important step for the industry, but our product is still young. we started to commercialize it it will geter, and all the more sophisticated in the future. to be taken into consideration seriously, more than in the past. we believe we have the right technology to help. romaine: we are seeing other competitors enter the space. >> it is like saying, where do i put my coins? can they actually secure them? this is the main problem of this industry, bitcoin,

cryptocurrencies, blockchain is a great backbone, but the one big problem is the security of the endpoint. the game is over once you lose the private key. this is the problem. romaine: our thanks to pascal gauthier. this is bloomberg. ♪

♪ kong taking a step against protesters, enacting an ordinance to ban facemasks. shery ahn is here with the story. the thinking is you have to show your face, and therefore fewer people are likely to protest. >> not just protest, but violence. you can be there and marching in a peaceful way, but the problem is the violence has escalated.

now pro establishment lawmakers and police are urging more action from the government in order to deter protesters from being violent. they could use legislation that has been in place for half a century. the 1967 public order ordinance could allow the government to put in curfews and close some areas. the 1922 emergency regulations goes farther and says any regulation can be implemented by the hong kong government if they think it is necessary, so we have not seen the carrie lam office respond to these local media reports, but in august, there was a press conference and she did not completely rule out the possibility that these legislations could be used. to: how extraordinary is it see these laws being invoked? >> we saw the 1967 public

1900s,ce in the early these are really, really obscure, so this would be a dramatic escalation from the government. index higher, finishing in the green, because agape assents to markets that it could mean an end to the protests. it is not showing up yet in the markets, right? numbersetail sector taking a hit, some calling for the hong kong peg to break down, so there has been some international reaction so far. lawmakers are looking into that could lead to certifying hong kong's trading status every year, which could be a huge thing. caroline: do you think the

facemask element will work? are hearing from different lawmakers and opposition lawmakers saying this will lead to more riots, because you are adding fuel to the fire. for more, don't miss daybreak australia and daybreak asia. don't miss this tomorrow. the u.s. trade balance, and the big one, u.s. payrolls for september. joe: i will be watching jay powell at a fed listens event in washington. romaine: more central-bank news. the reserve bank of india setting its policy rates. caroline: that is all for "what'd you miss?" romaine: bloomberg technology is next. joe: have a great evening. this is bloomberg. ♪

♪ >> i am taylor riggs in san francisco. this is "bloomberg technology." after up, demand down tesla's third-quarter deliveries failed to match forecasts, analysts reevaluate the stock price. we have the latest. ,iversity and inclusion corporate governance in the tech sector.