china threatens to retaliate if a bill passed by this supporting -- by the senate supporting hong kong protesters become laws. and warning about the unwind of risk premia and excessive risk-taking. and it is a beat and a raise for both lows and target, sounding upbeat about the holiday season. welcome to "bloomberg daybreak" on this wednesday, november 20. a different tone from yesterday, better numbers from retailers. a different vibe going into the market. .&p down by about 0.25% rebounding off of that three week low. time for today's global exchange, where we bring you the news from all around the world.

we start with the u.s. senate bill aimed at supporting hong kong protesters. ministry said in a statement that it blatantly interferes in hong kong affairs and other china internal affairs. bloomberg's great at china editor karen leigh, walk us through what happened. karen: this follows china's line telling the u.s. to back off when it comes to hong kong. the into options that it could take. sees a bit hong kong of a more normal day-to-day

after many days off, and a standoff between protesters and police is coming slowly to an end. looking ahead towards district elections on sunday. should the government delay or postpone them, that could lead to more protests, so all eyes sickly turn to next weekend. eyes basically turn to next weekend. alix: thank you. bloomberg's matt miller joins us from frankfurt. walk us through the highlights of the report. this twice a year, as you said. they think this is a part of the responsibility they have for setting monetary policy, to also point out the risks that it poses. of course, in this extremely low rate environment, a lot of those risks are mispricing for assets, and the kind of results that

that would have. concernedurrently about bubbles. they highlighted a few different areas. real estate at one of those areas. we seen a lot of incredible real estate inflation around europe and pockets, both retail and commercial. the asset business is growing so quickly that they think they might need to develop tools in order to take care that investors don't go too far out the risk spectrum since the ecb is buying so many huge shares of high quality, relatively risk-free government bonds. finally, climate change was something they talked about. climate change may now be considered in stress tests, when they look at the profitability problems that banks have. that would be a big change from the way stress tests are conducted now. alix: thank you very much. stay tuned with bloomberg for more on the ecb. matt interviews the ecb vice

president in just a few minutes. over to the u.k. now. prime minister arrest johnson and opposition leader -- prime minister boris johnson and opposition leader jeremy corbyn sparred in their first debate. >> i would probably cite "a christmas carol" by charles dickens. [laughter] [applause] boris johnson's response, he would give him a copy of his brexit deal. what were some of the highlights? it seems like they both pulled pretty well out of the debate. reporter: that's right. a poll done right after the debate called it a draw, but at this point a draw might be a win for jeremy corbyn. he entered the debate as the underdog. he is pulling behind boris johnson. boris johnson is regarded as the stronger campaigner.

he's been very effective in previous campaigns on the trail. so the fact that jeremy corbyn managed to come off respectively could be a win. 67% of people polled afterwards thought that he performed well. even though jeremy corbyn is behind in the polls, he doesn't need to win the election in order to win. boris johnson needs to get a majority in parliament in order to get legislation through, including for brexit. if we end up with a hung parliament, which is entirely possible, where no party has the majority, you will see a situation where the smaller rallys will probably behind labour to form a government. that is why it is important for boris johnson to maintain a significant lead in the polls going into the december election. we've got another debate coming up, more manifestoes from the parties to come out, but certainly the performance of jeremy corbyn last night must be giving the conservatives some pause. alix: thank you very much.

the latest, we await fed minutes set to be released later this afternoon. fed officials still warn of increasing downside risk. michael mckee joins me now. what could we possibly learn today at 2:00? michael: there are some questions about that. since the meeting, two appearances by jay powell on capitol hill may limit the predictive value of the minutes this time. monetary policy has been pretty much discussed in another december rate cut has been all but discarded by wall street. perhaps there will be something about how many members decided they are against it, adding some weight to how long the markets will price out a rate cut. also, there may be something about how members define what would change their minds about another cut. developmentalled that would warrant a material reassessment of the fed outlook,

perhaps a little bit like the supreme court definition of obscenity, "i know it when i see it." only two members of the committee dissented last time. if it is a big number, that could influence how long markets think we may be on hold. since we won't get a lot of predictive value out of it, people will be looking for other aspects of the minutes to provide some illumination. in particular, how long will the fed continue to buy treasury bills to try to raise the balance sheet? it is well underway right now, as you can see. that is a question for the markets as they try to parse out whether the fed can control the repo market, and also any details on a standing repo facility would be welcome on wall street. alix: thank you very much. we have more retail earnings out today. target boosting its forecast, raising its full-year guidance. could open at a record.

sarah halzack joins us now. totally different from the conversation we had yesterday at exactly the same time. sarah: indeed. lowe's had a good quarter. it is important that the new ceo continues to make his mark on the company. he said this morning that they are going to restructure the canada operation, close underperforming stores there. i think that is reassuring for investors who want to see this company continue to change, continue to become a better competitor to home depot. bigger story this morning's target. it's 4.5% increase in comparable sales is pretty blockbuster, far ahead of what analysts were expecting, and it's built on the right things. the increase in traffic is quite strong, and online sales, 80% of the growth of online sales came from same-day options like by online, pick up in-store, or curbside pickup. these are more profitable forms of e-commerce that target really wants to win at, so this was a good sign it was able to do that

in a quarter. the other number approach to his gross margin. there was anything target investors had been quibbling with -- had been quibbling with the last couple of years, it is gross margin gain. this quarter's gross margin gain was 1%. this is a retailer firing on all send -- on all cylinders heading into the holiday season. alix: thank you. the fifth democratic debate happens tonight in atlanta at impeachment hearings continue in washington. kevin cirilli joins us from capitol hill. give us the landscape for both issues today. , the: gordon sondland european union ambassador, set to testify for what is being described as the most crucial day of testimony yet as it relates to the public impeachment inquiry. he was the individual whom president trump reportedly called to ask for an update on the investigations that

ukraine president zelensky was considering into the bidens in exchange for that $400 million worth of military aid. that said, republicans still very much aligned with this president, and the situation still very much a political one. but as you mentioned, we are now entering into the latest political season, with the democratic presidential debate scheduled for tonight. several of the individuals on that stage in atlanta this warren, elizabeth bernie sanders, and others, will have to jockey between being here and there as it relates to betrayal. mayores are on south bend pete buttigieg, who has soared to the top of the polls in iowa and new hampshire. look for folks criticizing him and taking a more aggressive stance against his record to see if he could really maintain his status as the front runner in those early caucus and primary states. alix: thank you so much. looking forward to that.

one other story i am watching , the, banko santander future isn't actually in europe. the spanish bank is looking to latin america and the u.s. for growth. -- erik schatzker spoke to santander's chairman in an exclusive interview. > we are ready to grow our business. there's a lot of growth here, and it is going to be profitable. reporter: does growing in the u.s. eventually mean buying in the u.s.? > not necessarily, no. i think we can grow organically. alix: meanwhile, she says she is not happy with santander share price. coming up on the program, the ecb is out with its semiannual initial stability review. we will hear from the ecb vice president next. this is bloomberg. ♪

♪ out with his semiannual financial stability report. it warned about side effects from its own loose monetary policy. jpning me now is ben mandel, morgan investment management global asset strategist. where is the biggest mispriced? ben: right now, i think there are two shifts we've seen over the past month or two. you've had downside risks receding vis-a-vis the macro outlook. we think that's been largely priced out. the second i think is the upside risk you get from a situation where growth is probably going to revert back to trend over the next two quarters or so. we are seeing now is consistent with things bottoming out. you have monetary policy, which

remains accommodative. that is the underpinning for the financial stability report. that combination could cause devaluations tailwind, whereas right now you seen earnings come to fair value. alix: hang tight. you're going to stay with me here. for ecb publishing that report, we had matt miller sit down with the ecb vice president. >> in the case of the asset management industry, there are situations that would get right -- that would give rise to potential problems. in the investment strategy, they are taking more risk and investing more liquid assets. not as much in the case of europe, but in the case of the states, they are thinking more leverage. , in an investment fund, you have to face up into her three days, so you have to deal with that.

so our recommendation is that you should have a toolkit of instruments for asset management. we have it for the banks. in the case of the banks, this is much more intense than the case of the asset management industry. of potential can be misused. matt: does that mean you are developing a toolkit to be used? have started to talk about that. the importance of the industry is much higher than it was. perhaps because of the low interest rate environment having a bigger impact on the banks, it is altaneously, question we are living with continuously. matt: you have tools already to work with. , and you are

coming up with new ones. likeabout asset bubbles, for instance, real estate? guindos: our view is that there are some pockets of vulnerability, but it is not a pervasive situation. there are some specific segments , there are over valuations, but this should be addressed by national authorities. generalized miss valuation of real estate in europe. specific, you have some very particular segments, but i could not say that this is a problem for the euro area. matt: can you point us to regions or areas? let's talk about the countercyclical capital buffers. it's a complicated topic, but one you spend a lot of time

talking about during the briefing. would it be most appropriate to increase these? are there regions here where you it would be more appropriate? guindos: for all the euro area countries, there are different situations. matt: because he said some countries should increase their share. indos: you can have different levels. simple.message is very the level of capital of the european banks now is a delicate one. we are above 14%, as you know. but the problem is it is a very small part of this total capital. very small, marginal. that in termsl is the cycle,vertime,

and having a positive impact on the people of europe, it would be very difficult to have that kind of cyclical buffer that is something to increase in the good times while you await the bedtimes of the business cycle. that is why we are recommending that. aboutare you thinking changing your recommendations or requirements for the total share release of all capital in bank buffers? mr. de guindos: this is something we have started to analyze. again, it is not the actual level of the capital. --en

[indiscernible] you do not have to quantify the negative impact on the evolution of the economy. matt: in terms of bank profitability, you talked about the cost to income and the cost of assets. you see the chart there. you said you consider the structural problems a far bigger --blem the negative rate bigger problem than negative rates. when do you see that changing? mr. de guindos: i think the big change, when we go into the management of the different banks and start to use the costs. -- to ease the costs. alix: that was ecb vice president luis tick windows -- president luis de guindos speaking with bloomberg's matt

miller. more next. this is bloomberg. ♪ s is bloomberg. ♪

viviana: this is "bloomberg daybreak." back the orderg for boeing wide-body jets. 30 --rline will now by 40 then buy 30 787 originally planned. the airline has also slashed orders for airbus planes. bankers first saudi aramco see enough demand to cover the ipo. bloomberg has learned they are indicating they already have enough orders to cover the institutional portion. authorities have pressed the kingdom's wealthy families to invest.

alibaba set to raise about $11 billion in its mega hong kong stock offering. it has priced shares at a little over $22, roughly a 3% discount. it will be hong kong's biggest share sale since 2010. that is your bloomberg business flash. alix: still with me, ben mandel of jp morgan asset management. repko --ples of saudi of saudi aramco and alibaba. where are animal spirits? are they alive? ben: over the course of 2019, we ring the alarm bell twice on global recession risk. is that has receded over the last month or so, we can discuss whether that is right or not, it's created some space for higher expected returns, and specifically, in equity markets that have been most damaged by those dynamics over the course of the year. so emerging markets fits the bill well for that. --erally, global sick little

global cyclical equity markets are poised to do ok in an environment where downside risks are coming off the boil. alix: are you taking on more risk in emerging markets, for example? ben: we've been buying back under weights to risk that we've had over the course of the year, and in some cases moving a little more overweight in those equity markets. i think this is an environment which is particularly amenable to that old strategy between u.s., your high-quality quality, high r.o.e. market, and defensive in certain ways, and those cyclical markets, which have been most damaged by the trade war and things like that over the course of the year. alix: does the same thing apply to europe, then? ben: europe has done fine over the past month or so. i think it is just simply less levered to some of those growth stories which we think are improving, so the fact that global manufacturing is coming closer to a trough every day,

somewhere closer to the bottom of that dynamic, i think part of is slightly more levered to that story, although both should do ok in that environment. alix: ben mandel of jp morgan asset management will be sticking with me. we will dig much deeper into the news and the analysis of the markets in today's first take. it is a little soggy and the equity market, down by about 0.2% for the s&p 500. yesterday you just want the markets to be in the green. today feels a little bit calmer, moving off of that narrative a little bit. this is bloomberg. happy wednesday, everybody. ♪

♪ alix: this is "bloomberg daybreak." markets a little softer this morning. 0.25%. by

any tradeexposed to conversations. in other asset classes, a couple of things going on irrespective of trade. onea lowering its rate on and five-year prime loans. . you also had very weak japanese exports. those two things irrespective of the hong kong/u.s. trade situation. time now for bloomberg first take. we are going to give you the news. you get the trade and analysis of the markets. joining us is vincent cignarella , gina martin adams, and still with me is ben mandel, jp morgan asset management global market strategist. so you are a trader. you come in this morning. what are you thinking? vincent: i think it's amazing how well the markets are holding up given all the negative news. we talked about this yesterday as well. there's a selloff on negative

news, but it is a week selloff. the positive news gets absorbed very quickly and jumps. it could happen again. i don't know if the markets really think that a trade deal is even necessary at this point. we just seem to be muddying along, and the interesting part of it is, the longer the trade it's starting to get a little worse for china because corporations are moving production away from china. the longer it takes for china to get there, the more and more production is going to move away from china. ding actually going to them pretty hard now. did you guys think of the idea that we are just absorbing bad news? gina: i think the market was due for a little bit of a cool down, but in our opinion, the markets have been rising on a lot of factors, not just trade. the news that maybe we won't

necessarily get an imminent trade deal as a result of a lot of contention between the u.s. and china regarding hong kong, t is not that significant. i think there could be disappointment if we don't see movement on trade, but that is not the entire story. you had pretty good earnings affecting things right now. we want to keep an eye on it, but it is not all that matters. ben: i think you do need to see a trade deal here. phase one is fully priced, not just on a level, but in the volatility as well. the market is no longer discounting stark outcomes for trade. it used to be 1% or 2% swaying

on trade news now. -- on trade news. now it is 0.5%. that tells you there's a lot of reliance on this thing actually happening because the market is not pricing the worst or best case scenario. that is somewhat fair in the sense that the political economy is aligning for the steel to happen. the equation is very ash for this deal to happen. the equation -- for this deal to happen. the equation is very simple. about thethinking fourth tranche as being particularly damaging to the u.s. economy, i don't think -- everyone kinds of understands that dynamic, so resetting trade vis-a-vis a phase i deal almost have to happen. vincent: hong kong has now become a real threat with what the senate has done. it goes to the house, it goes to the president. it is going to be politically difficult or him to veto this deal.

we don't know what china's responses. there is a story yesterday where the trade tariffs are going to be in discussed. lighthizer says it is really just 35%. he says if he can sell it to the public into china, it is covering a position -- covering a bigger swath then you would think. from the monetary policy standpoint, you see the fed probably capitulate a little bit, which would help markets as well. i don't think they do really help the real markets, but psychologically, the thought would be the fed is on hold at worst indefinitely. alix: this is china's response over hong kong in that senate bill. president trump has an opportunity to send a signal to markets. if he doesn't do anything, isn't that a defect at all of ranch? you are laughing and nodding. gina: i was thinking something very similar when i was came in this morning.

. this is not a president that typically holds his tongue, and suddenly we are not hearing anything from him on this issue. it is entirely coming from the senate. so i think there's a signal at least so far. let's see where we go from here. nonetheless, i do think there's a signal that the parent in his cabinet trying their best to come to some kind of trade arrangement. they are trying to separate the issues. i don't know if that is actually possible in the long run, but it does signal to me we are on the test towards progress. to let it goway is to the house and then blame it on the democrats. it is the will of the people. he's always said that come of the issue and hong kong is really a china story and a hong kong story. it shouldn't be what the rest of the world does. and lest china does something militarily, you can probably still hold that line and get away with it. but the house and the senate

aren't going to let him get away with it. he's going to have to make a decision at some point. ben: i kind of agree. this is taking place on a bit of -- bit of ak to parallel track. think we've entered a new trading range for phase two. i don't think we will get any resolution on some of those issues, much thornier, having to do with trade policy and things that

into the future. from a market perspective, it just means we are going to be writing those waves for some time. alix: this goes into, how much risk do you want to be taking on? when i mentioned the japanese export data, a lot of that is going to be south korea and the trade issues they have, but the we -- but we know that the trade has issues. that is either going to mean something separate or is part of the same thing. vincent: i think it is going to be part of the same thing. if you are moving business out of china, you are not moving it to japan. they have issues that are ongoing and will continue unless they except some sort of immigration policy to bring in cheaper workers to do what is being done. for the equity markets, this feels almost like that goldilocks scenario where nothing gets done. for the overall economy, not a good thing. you always get that caveat, the economy cools down and the fed will come in and save the day. you always have this glass half-full feel to it. if you are a fixed income and fx

trader, you have to take the other side of that track. ben: we are talking about a structural change in the nature of the global trading system. as the headline global growth, you're not going to notice on maybe even a year to year basis, but there's multilateral and global supply chains are collapsing more into regional supply chains. this narrative over the past 15 years that is china jones the -- as china joined the wto, that ch,d of ate mexico's lun where mexico's imports from the u.s. stayed stable while china's exploded. how do you gain exposure to those winner-loser stories? vincent: that is a good point. if we get to usmca, what does that mean for mexico, and even canada, for stepping up to be a supply chain?

actually does put the u.s. in a reasonably could concession vis-a-vis europe, for instance, as we have a supply chain options that may europe doesn't have. alix: before we go, i wanted to get your take on financial instability in the markets. we had the ecb semiannual report. though dudley was also out with a bloomberg opinion column warning the next two years are fine, but then it could be a problem. here's what he also said about debt. >> if rates start to climb at some point, that is going to lead to more supplies. i think it is a potentially vicious circle for the u.s. treasury market, which right now is completely benign. alix: you did some work on that, coincidentally. statementink the key is if interest rates start to climb. 10 years, i've been hearing interest rates are eventually going to subside.

it is going to dismantle this entire thing. i think that you can't invest upon the notion that at some point, things are going to change. you have to actually acknowledge what the data tells you right now. in the bond market, we find very important for driving the outcome for stocks, one of them is the funding markets. the funding markets are showing a not unusual, but still high level of distress compared to the equity markets. credit markets are telling you there's nothing to worry about, to fear -- to worry about, nothing to fear. a lot of that is this relationship is essential to maintaining equity markets. get a really strong nessusbreakout, and that

-- and that is not necessarily a bad condition for equities, but there are a lot of codependency dependencies we want to acknowledge. right now i'd say the bond market is somewhat neutral, sending a neutral signal at large. there are risks, but also strong sources of support. , ginavincent cignarella martin adams, thank you. ben mendel, always great to have you on set. tune into bloomberg television. we will be live on thursday with the heads of goldman sachs, ubs, standard chartered. any charts we use throughout the two hours, check out gtv on your terminal. browse the features and check them out. coming up, we want to get an update on what is making headlines outside the business world. viviana hurtado is here with your first word news. ritika: up another notch between u.s. and china. the u.s. passing a bill in the

senate aimed at supporting protesters in hong kong. china threatening to retaliate. it told the mess to stop -- he's the most anticipated witness in the impeachment hearing so far. today, the u.s. ambassador to the european union testifies before the house intelligence committee. gordon sondland has had president trump did not offer quid pro quo to ukraine, but there are inconsistencies d account andan' those of other officials. over to the u.k., labor leader -- u.k., labour leader jeremy corbyn and a crucial to village of debate with prime minister born johnson. in personal approval scores, he is trailing johnson. the candidate battling over trustworthiness, pegs it -- the

candidate battling over trustworthiness, brexit, and the national health service. 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'm viviana hurtado. this is bloomberg. alix: coming up, dingdong. another profitable startup comes knocking at the ipo market door. if you have a bloomberg terminal, check out tv and watch us online and check out anything you may have missed throughout the program. this is bloomberg. ♪

viviana: you're watching "bloomberg daybreak." disney has a new problem. password thieves. some customers of the new disney plus streaming service say their usernames and passwords have

been sold online to third parties. disney says it's system hasn't been hacked and is working to resolve this issue. new york state reportedly has given fidelity's bitcoin business approval to operate. "the wall street journal" report hat should help the bank adjust to its new currency platform. another sign of cutbacks at wework. it has already been announced the struggling office sharing startup is going to lose several thousand jobs. now wework is cutting back at so-called odyssey market stands, ts -- wheredan yttendants at we work can bu snacks on the honor system. alix: man, no more snacks? we turn now to wall street beach. plan, i, hsbc's new

bank new chief. direct list -- then doordash's direct listing dreams. and it is the blackstone-warren face-off. claimrm says the that they profited from the 2008 housing crisis is false. with me now is sonali basak. let's go to the hsbc story. this is: --sonali: somewhat of a big name. i saw hyman bali last year -- i saw him in bali last year. of thefirst report story, they said it right that he was the last man standing in his generation of investment bankers. there's a big sweeping change in the industry, not to mention at

hsbc, before a lot more sweeping change ahead. the other thing was i thought this would be a two to five year job because there we many job cuts in that division. it is undersized as it is. it wouldn't be surprising to see many more people go. alix: interesting. let's get the second-story story, which is doordash considering a direct listing. is that surprising? caroline: yes. normally --sonali: yes. normally when you think about a direct listing, using about a to company that doesn't need raise a lot of money. they did just raise money. if you are raising money in private markets like that, you're doing it at a different cost. it is not a profitable company, so if it does have a huge flop in its direct listing, it will discourage more unprofitable on companies using this model.

but it looks like silicon valley loves it, not to mention bloomberg points out it is an interesting way that the softbank model has been working people haveso many thrown so much money at the company, and now it has 35% of market share in that industry. alix: ok, fair. i'm still a little skeptical. let's go to the battle between private equity/blackstone and elizabeth warren. totally fascinating to me. it started yesterday with blaming blackstone for profiting off of the housing crisis. interesting to me because blackstone fought back. most people kind of let warren do her thing. but blackstone said, listen. warren said they shamelessly profited from the wake of the crisis, but blackstone said the $10 billion stabilized that market. it was a really interesting day. maxine waters actually had nothing to do with the

single-family homes. she said the toys "r" us example was the poster child of the private equity debacle. remember, 33,000 people in that case were left without severance pay, and workers have been in washington for months, and kkr and bain eventually put $20 million toward a fund. alix: it does highlight that she is not backing down and she is coming after you. sonali: and coming after a broad sweep of retail, profit clawbacks, taxes. she is going to the private equity owners. what was interesting about this, they had a lot of supporters in washington also. sonali: that is a great point. -- alix: that is a great point. thank you very much. in today's women of wall street, we have the best places for go -- the best places to go for women looking to start their and business. these off of the most supportive entrepreneurial conditions for women.

58 markets were included in the report. 25 saw their ranking improved from the previous year. you may want to be able to raise money, but you shouldn't leave the company because comfort with female leadership in politics .nd business is widespread a group ofcomes from women political leaders. germany, surprisingly, not that into a woman leader despite they have this -- despite the fact that they have a woman leader. aramco what saudi could mean for the oil market. if you are heading into your car, tune into bloomberg radio on sirius xm channel 119 and on the business app. this is bloomberg. ♪

alix: time now for trader's take.

joining me as vincent cignarella, voice of the bloomberg audio squawk. you can listen to vincent using squa . you are looking at a whole bunch of things. vincent: talking to traders overnight, they are worried about the spread between alberta crude and wti as crude prices are falling. this is another reason it is -- going to weakness.adian dollar . the trade issues are front and center. the speech yesterday by deputy governor wilkins very dovish, suggesting the bank had room at the current interest rate. look out for it a potential push prize -- a potential surprise for the bank of canada got actually cut rates in december. that bottom yellow line is the 200 day moving average. if we stay and hold that and had that is another reason to

a nice pop air and. -- nice pop at your end. i wrote about this over the summer. that we would see dollar closer to $1.35. there are a lot of reasons had ang up, where cat really good run at the beginning of the year, and it is catching up to them at the end. alix: coming up on the program, we are talking retail earnings. of mead capital management will be joining us. this is bloomberg. ♪

♪ alix: welcome to "bloomberg daybreak" on this wednesday,

november 20. here's everything you need to know at this hour. let's take it right from the top. >> but i would probably leave under the tree for him would be "a christmas carol" by charles dickens. gox: corbyn and johnson head2head on brexit in the latest debate. >> even though jeremy corbyn is behind in the polls, he doesn't need to win the election in order to win. boris johnson needs a majority in parliament in order to get legislation through. alix: a pole after the debate chose jeremy corbyn tying with bojo. >> the people can't see what is coming. they see the steady effort to erode the comet -- erode the economy and their freedoms. it comes as hong kong sees it as a more normal day-to-day after many days off, and the standoff is coming to an end.

alix: china tells the u.s. to stop meddling in its affairs. and it is a beat for target and lowe's. increase in4.5% sales is far more than what analysts were expecting, and it is built on the right things. alix: plus, it sums optimistic about the holiday season. bigger impactg a on the asset management banks. alix: the ecb warns of a lower interest rate environment. >> it is a potentially vicious circle for the u.s. treasury market, which right now is completely benign. alix: former fed official bill dudley also warns of excessive risk taken by investors. in the markets, it really different feel from yesterday, although holding up pretty well. s&p futures just down by 0.2%. the conflict with the u.s. and

china continues, and everyone is tying back at the same time. yields down by about four basis points. joining me for the hour is brooke sutherland, bloomberg opinion columnist. we were talking earlier about siemens. it looks like they will try to pick up their energy unit, the next step in these big conglomerates changing. brooke: they might actually selloff 75% of their power business and only retain the 25% , so this is a continuation of joe kaiser's strategy. he talked about that fleet of ships rather than the old-school conglomerate model. and it makes sense. this business has not been doing well. at you have to do is look ge. alix: i just wonder if we will be sitting here in three years, having this conversation. brooke: does the pendulum swing back? exactly. i think that is a fair question to ask amid concerns of a downturn.

alix: the u.s. and china tensions heat up once again. the senate passing legislation supporting hong kong protesters. foreign ministry spokesperson said that "at applies double standards and blatantly interferes in hong kong affairs and other china internal affairs. it is in serious violation of international law and basic norms governing." joining us in new york, bob io, and with trust c us in the studio is tony --errer, smyczek management smita capital management -- scherrer, smead capital management. i thought we would have come in here with a significant loss in the market.

>> i don't think anyone should be surprised that the senate is taking the stands they are taking. it is to the political advantage of the chinese to react the same way that they are doing. this is going to be an air reconcilable difference for a long time, and from an investment perspective, the key thing is resolving hong kong or the inability to resolve it is another difficult agreement in trade negotiations because if the chinese go in hard on hong kong, it is impossible for there to be a trade deal. , what other uncertainty is out there right now? you've got hong kong, you've got trade, but other are the risks weighing on the markets right now? tony: there's a lot of uncertainty, and that creates a wall of worry. china and hong kong trade wars and u.s. trade wars, just the

general malaise of investor sentiment across a whole area of the market, anything basically economically sensitive or cyclical. no one believes that, and everyone wants to doubt based on the future expectation of a recession around the corner, etc. there's always a lot to worry. what's going on is the market has climbed that wall of worry all along the way. brooke: i follow the manufacturing industry and pay a lot of attention to the data there. we seen some signs of potentially a bottoming. is that just a blip? is there a risk that we got one month of good data and might see that trend the other way in a couple of weeks? to be bottoming out after what was probably a mini recession around the world. but it is a very small part of the u.s. economy. what it does mean is that when the economy is growing at 2% versus 215%, it is a lot less

forgiving. lessrsus 25%, it is a lot -- versus 2.5%. is a lot less forgiving. one of the key things that has evolved is the removal of key risk in the market. the removal of recession risk. the removal of the fed having any chance of raising rates and reversing themselves. at least for now, the removal of starting risk that is to reenter now in the last 24 hours. that is not as much of a positive as it was a few days ago. those are three risk in a very different place today relative to 30 days ago, and that is positive for the manufacturing sector. alix: that is the glass half-full. td securities had a bombshell 2020 report yesterday that said, "unfortunately, 20/20 shows no signs of reprieve by being battered by structural

uncertainty. if anything, going from a trade war a cold trade truce only sets the stage for a re-escalation in u.s. politics from the next presidential election." what do you do? tony: the idea that 2020 or out years are going to be dictated by that kind of thing you're report,about in the "td report, perin the your description, i wouldn't put too much credence into that. recognizeds become increasingly so as an area on the globe that is growing,

growing their gdp and populists -- and populace. overall, the market looks very healthy. brooke: just to bring it back to the trade war a little bit, is the u.s. really the primary beneficiary of a truce, or could you look more at europe? they have been sort of caught in the crossfire. bob: they have been the unintended victim, especially the german export sector. we would expect them to rebound. of conversation all the time. are we starting to see the bottoming out of europe? we think it is a little premature. we prefer to be overweight u.s. equities, still, but that is getting a lot of our attention. alix: that pivots well to the value trade. where are the value traps for you in the u.s. market, and where are you buying value?

again, there's a lot of things out there. take target. i know we will get to this in a second, but take target for instance. a couple of years back, that was a great -- that couldn't have been more doubted. it is a great value name now. old media companies that are incredibly cheap right now. a lot of the health care complex is very cheap right now because of the expected political rhetoric that will continue to go on. banks are incredibly cheap. there's areas to look at and areas that are worthwhile, high quality companies on sale still in this market. brooke: how do you make a case for the banks in a lower for longer interest-rate environment? what is the upside? tony: one of the upsides you should expect in banks over the next five years is the main thing they do to make money is lending, and that has been

something that has been grossly missing in this economy because there has not been the levels of risk that people have wanted to assume on their balance sheet because of the delay in something like health care formation, etc. etc.g out and having kids, there's going to be a demand for mortgages and risk-taking. that is going to be a wind to the sails of these banks. alix: bill dudley had an interesting bloomberg opinion piece that said, basically, or t -- the next year or two. as long as inflation stays low, the fed will reign friendly, but this is unlikely to last. pressures are already building on the financial stability front that will make the next economic downturn messier than

anticipated. to miss.'s really hard you missed that, you don't get your five point 5%, 6% long-term return. we prefer u.s. risk through diversification, then de-risking at the first sign of trouble. you've got to get in just before the fall, and most people don't get back in at the right time. if they are out before the dip on september 30 last year, i know very few people who got back in in january. over the next year, we still think it makes sense to be diversified,. that will be a pivot in policy once the market starts focusing behow different it world can with or without president trump.

so we are increasingly focusing on the election risk is one of the key macroeconomic risks for 2020 and 2021. brooke: one of the other points he makes is about the glut of corporate debt, particularly at the high yield levels. is that something you are concerned about? we bob: bob: are not forecasting recession --bob: we are not forecasting recession. we think it is fine for the asset class overall. our defaults going to go up? absolutely. but we still think investment grade bonds, even bbb's, outperform treasuries. you've got to be thoughtful. you've got to be diversified. you've got to think up whether you are giving up liquidity. now, we think the quality of earnings is really high across the u.s. economy and rates remain low. i think that it's a pretty good environment for investment grade bonds. alix: tony, are you de-risking anywhere? are you selling anything? tony: our strategy is an equity

mandate, and we are fully invested. so the answer is no. we de-risk by moving things in our portfolio down in the valuation spectrum to own cheaper stocks, stocks that have less excitement. fair point. tune into bloomberg television. we are going to be live out the new economy forum in beijing thursday with big names including the heads of coleman stocks -- of goldman sachs, standard chartered, and more. avoiding thewe's detail woes. this is bloomberg. -- the retail woes. this is bloomberg. ♪

♪ alix:alix: shares of target and lowe's rising this morning. had a nice beat endres scenario. with me still are -- beat and raise scenario. with me still are tony scherrer and bob browne. are there other retailers you want to at right now? -- want to add right now? tony: we don't want to be adding target here. coming into today, it was our second most highly weighted name in our portfolio, so we are there. we've owned it for several years, so it has kind of worked its way up in our own portfolio. but certainly, when you compare it, for anyone out there who might want to care impair this -- might want to compare this again some of its peers, it still looks incredibly cheap compared to some of those other retailers that are doing well. brooke: pivoting to lowe's,

restructuring came in, and i'm reminded of how hard it was for target in canada. what is it about that market that retailers can't seem to figure out? tony: good question. we don't own lowe's. we own home depot. that.s i don't know about each retailer has its own specific battles to fight there. it's a bit of a different market. we like to be positioned in companies that are over indexed to the u.s. fair point. brooke: you would think it would be the same challenges, but you can't just expected to work. alix: you are right. bob, where are we for the holiday season? do you still see that the consumer can be as strong as it has? bob: historically, there's pretty high correlation between

the return of the equity market going into the holiday season and retail sales, so that bodes pretty well for the retail front. we will see if that correlation holds up. it should, given the strength of the equity market. consumer confidence is still pretty high. over our ski tips. a few more years of this and we will get to that. right now i think we should have a pretty good season if the historical relationships stay in place. brooke: bloomberg economics is calling for slightly slower growth if we did see a somewhat disappointing holiday season. could that be enough to push the fed to act? bob: probably not. i think the fed wants more data before they move again. our own forecast is that they cut twice over the next six months. we think both the fed and the markets don't appreciate what a 2% economy feels like relative to the 2.6% we've had for the last five years.

that's a huge difference on a $21 trillion economy. we think that low growth environment and china slowing down as well continues this excess demand we've had for high quality financial assets. the fed is going to once again put it on the table, the risk of an inverted yield curve if it doesn't keep cutting. alix: what we have seen is the fed has impacted the mortgage market. if we take a look at consumer actually white line is consumer debt adjusted housing. that has really come down. they've been able to repay a lot of their housing debt with those low mortgage rates. if you take it out, the debt service ratio is actually much higher. at what point do you get worried about the consumer, about target being the second largest holding in your per folio? tony: the overall debt service ratio since the fed started releasing it until today is at the lowest levels it has ever been.

the way we look at it, when you look at personal balance sheets, especially along millennials, which we think are going to be the big factor in the big driver on getting main street going again, this economy has been driven by technology and some of the very high growth areas, and they've got all the valuation multiples ascribed to them already. what has been missing is the flyover states, the main street phenomena, household formation, those kinds of things. those look very clean, very strong. incomes are generally stronger in the generation of millennial's that are going to get going with those things over the next decade. we think that things are set. the tables are set for things to resume in their growth. we think the fed will actually become vindicated by the reason they were doing coming into 2019

. at some point, we think the curve, they've taken care of the inversion issues, and at some point we think they will get back to actually needing to raise. brooke: home depot yesterday had some trouble. if this something you expect to see continued speed bumps with in the retail history? tony: in some cases. home depot has been struggling with that for a while. as look -- it's looked well so that it has driven their multiples forward come but they were kind of an early adopter with point-of-sale, using various apps for instance, years ago. we think they will solve it. we don't think that is going to be an obstacle toward continued growth. browne of northern trust and tony scherrer of smead capital, thank you for joining.

the ecb warning of potential bubbles that the ecb at salt helped cause -- the ecb itself helped cause, but what do they say about climate change? not much. this is bloomberg. ♪

viviana: you are watching "bloomberg daybreak." alibaba set to raise about $11 billion in its mega hong kong stock offering. it has priced shares at a little over $22, roughly a 3% discount to its last american depository shares in new york. it will be hong kong's biggest share sale since 2010. the european central bank warning of potential side effects from its own loose monetary policy. a new report highlighting how years of unprecedented stimulus could lead to financial instability. the ecb saying low interest rates have encouraged excessive risk-taking by investment funds and insurers. that is your bloomberg business flash. alix: thanks so much. what i was really struck with is

how much they didn't say about climate change. brooke: especially in europe, where this is a much more consensus view, that people are very concerned about the climate. you had protesters jump on top of airplanes to stop them from taking off. for the ecb not to acknowledge that seems like an omission. there's beens like when you have a narrative in the market that the ecb could actually go in and buy green bonds to develop that market, you have bank of england governor mark carney saying this is a material risk to future growth, and they are like, yeah. brooke: progress has been made. alix: and companies have been doing stuff. easyjet is going to be the first carrier to offset carbon emissions for some of its flights. brooke: they are talking about having carbon free planes by the 20 30's. you also have the fed coming out with a report comparing climate

.ange to oil price shocks alix: it is hard to maybe warn about it, but it was stark that it was not necessarily as talked about as, say, negative rates, for example. brooke: they have their hands around all different types of risks and understand the different impacts. alix:alix: apparently rail travel in europe is taking off, especially sweden. brooke: it is very nice. very luxurious. alix: i have not done that. coming up, the future of health care. we will talk to one expert in the field on his opinion and what the real conversation should be. this is bloomberg. ♪

alix: this is "bloomberg daybreak." i am alix steel. two narratives in the market. off .2%res are just despite any issues with the u.s.

china and hong kong in the middle. the markets want to go higher. the other is we still have risks in the market. you are seeing an ice move into the bond market in the u.s. and in europe. the dollar and the yen are the out performers in the fx market good the broader risk is policy for 2020. democrats hold their fist debate tonight in atlanta. one topic on the mind of many americans is the state of u.s. health care. --ning us is dr. lorde minor dr. lloyd minor from stanford university. thank you so much for joining us. dr. minor: great to be here. brooke: if we talk broadly -- alix: if we talk broadly about 2020, it is everybody in the democratic field and even president trump talking about how to revamp the system. what is the right question they need to be asking? dr. minor: the first question is the problems we need to address. one of them is our u.s. health

care delivery system is focused on after-the-fact care. it is focused on reactive, treating diseases long after they have begun. we need to be more focused on predicting and preventing disease. if we are, health outcomes will be better and will be able to control costs. a lot of the cost in the system today is the cost associated with ultra complex care. that is one area we need to focus on. the second is although we are collecting a huge amount of data in health and health care, we used to have all paper records that decorate ago. -- a decade ago. now we have all electronic records. we have got rid of the paper filing cabinets and replace them with electronic filing cabinets. we are still not garnering the information embedded with that data. until we do, we will not be able to transform health and health care the way we have done to transform so many elements of the economy when we have

acquired and leveraged and used information. cornerstones of the issues and problems, one being moving toward more prevention, a second being how do we start to get information from data and then act on that information, i think those will be critical areas to getting better outcomes and controlling costs. brooke: on your first point about preventative care, there was a great story earlier this month about united health working with homeless people to give them housing as a way to reduce cost. what you think about that program? is this a good way to get the issue? dr. minor: absolutely. we know social and environmental determinants of health account for 70% of health. ourmedicare we provide, genetics, our 25 to 30%. the more we can do to address the social determinants, access to housing, access to good food

supply. i think it is a sad fact that the best predictor of longevity is not our genetic code, it is the zip code we live. that is directly related to social, behavioral, and environmental factors. alix: when you look at what politicians are talking about, do they address any of this for you? think it is embedded within some of the messages. i would hope it would come out more the forefront. how do we get more information and data? cms and hhs both are taking the issues with electronic health records seriously. are trying to look at ways of incentivizing better access to information and making health data more interchangeable while protecting privacy and security. it would be better for all of us if there were more attention to the areas of prediction and

prevention and to the area of accessing information. brooke: i think it is fascinating that it is united health, an insurance company, taking this proactive step. another private company looking to get into health care's google, which is looking to increase transparency. is there risk of putting that data in the hands of the technology giants? dr. minor: there will always be risks associated with electronic data. a key responsibility for me as a position and a leader of an academic health center is to earn every days trust of the people we take care of and more broadly, the american people. anyone working within any area related to health has to do that as a first responsibility, whether we are delivering health care or a large technology company. a lot of gaining and sustaining trust is in transparency. it is letting people know exactly how their data is going to be used and then respecting that.

if data is not to be used for ,urposes of commercial activity that needs to be clarified and respected. until we are able to bring together these large data sources, we are never going to be able to get the information that is embedded within. alix: you just completed a new hospital that has interesting technological features. can you give me example of things you have done in our unique actually go toward prevention and transparency? dr. minor: sure. the operations of the hospital leverage technology. is pharmacy, the dosing initiated by robots, which frees up the pharmacist to practice what they've been trained to practice. brooke: there is -- alix: there is a robot arm literally pulling the pills and counting them out? dr. minor: that's right.

in the delivery and supplies is done by robots controlled devices. brooke: kind of like the retail warehouses. dr. minor: exactly. facing lot of patients innovations in technology. for example, every patient has an ipad where he or she can see what is going to happen bargain that day. you can order your meals and also interact with your discharge planning to make sure what you need after you get out of the hospital took place before you leave the hospital. doctor asare also a well as a dean. i want to get your take on vaping and whether there should be regulation and what is your take with where we are at in the e-cigarette world? dr. minor: i am concerned about vaping. on the one hand, we know electronic cigarette devices deliver nicotine in a noncombustible way, those are among the most effective ways we

have to get people to quit smoking. far more effective than medications. that is encouraging. the discouraging part is i fear we are creating a new generation of nicotine addicted adolescents because of vaping. the concern is that later on, many of them may switch from vaping to combustibles. we may create a second wave of children become addicted to nicotine through vaping. there is a critical period of brain development in adolescence where people are much more predisposed to becoming nicotine addicted. for someone in their 30's or 40's starts to use nicotine for the first time, the risk of becoming addicted is lower. for a teenager, it is much higher. brooke: there are no fda drugs approved to greet -- approved to treat teenage addiction? dr. minor: that is correct. it is encouraging to see the fda

taking more steps. i think regulation will play an important role. dean of. lloyd minor, the stanford medical school. now i want to get update on what is making headlines outside the business world. viviana hurtado is here with first word news. viviana: up another notch. that is the status between the tension between the u.s. and china. the u.s. senate passed a bill supporting protesters in hong kong. china threatening to retaliate. it told the u.s. to stop threatening in hong kong repairs. -- in hong kong affairs. it is unclear if president trump will sign it. he is the most anticipated witness in the impeachment hearing. today the u.s. ambassador to the eu testifies before the house intelligence committee and private testimony, gordon sondland has said president trump did not offer a quid pro quo to ukraine, but there are inconsistencies in his account and those of other foreign services and national security officials. 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. hurtado.ana this is bloomberg. alix: thanks so much. santander chairman sees the future and it is not in your. she says the bank is willing to grow in the u.s.. erik schatzker sat down with her for an exclusive interview. >> we spent the last five years fixing the legacy issues. dallas andi was in have joined the u.s. board one month ago is because we are now ready to grow. the u.s. is big. it is a big market. it is a market that has huge relationships with latin america and europe. there is no other bank that can -- your customer in michigan is called android -- this is a real story. they are attacked and

manufacturing company. they want a business in mexico and to finance it on a local basis. santander was the bank. they now want to go to brazil. we can help them in brazil. i can give you dozens of examples with europe. that is the second thing. by the way, we are announcing next week an interesting -- at the other end of the spectrum, there are millions of mexicans spending $36 billion from the u.s. and mexico. we are offering a fast, competitive remittance system. there are a lot of things we can add and bring value to the u.s. consumer. >> ultimately you have two clear choices. you can invest in the brand and eventually expand the business, make it more profitable, or you can reevaluate and sell. you want to grow.

why? the reason i asked why is because one can make a strong argument for selling. in the consumer finance business, at least the u.s., generates a very handsome return on equity. the bank is not that profitable. you could sell it for billions of dollars and reallocate that capital or take some of the capital and bolster your capital ratios and make the regulators happy. >> sure. but i need to make my investors happy today and in the future. when i get asked the most difficult thing about my job. it is balancing the dividends. we have $16.5 billion to our shareholders, but also investing for the future and making sure -- the u.s. is a key part of that. you cannot look at the u.s. as a consumer lender central bank. it is an integrated business,

even though we do not run it that way because of many reasons. we are improving the bank. we have close the net interest margin. we just appointed a new ceo to the bank. we have a new service that will attract new customers and we have committed to getting to 12% growth on tangible equity over the next couple of years, which is way above our cost of equity. we have the means to do that. it is an important part of the santander footprint. >> what about raising brand awareness. barclays put its name on a stadium in brooklyn. hsbc on jetway's in new york and around the world. what about something like that? >> that is why i am here today. if i came here a few years ago, we would spend the conversation saying when is the next sign going to come, when we get out of for them. it is not a great conversation. that is why i joined the board,

we are ready to grow. our business in dallas is great. there is a lot of growth and it will be profitable. >> does growing in the u.s. eventually mean buying in the u.s.? >> not necessarily. i think we can grow organically. we have not been able to launch a new product for five years from the bank. that tells you how much potential there is. we are launching a blockchain based retail cross-border payment with a u.s. company. that is coming to the u.s.. there are a lot of things -- we created the north america region, mexico and the u.s., so we are now running these businesses together. you see good results in the coming years. alix: that was the bank santander chairman speaking in an exclusive interview with erik schatzker. coming up on this program, holiday shopping sales not

looking cozy for retailers. we take a look at how online retail is warming up for the holidays. is next inushion today's bottom line. this is bloomberg. ♪

viviana: i am viviana hurtado with your bloomberg business flash. target separating itself from its rivals in the retail industry. today shares are surging after the discounter raised its full-year outlook. target also reporting quarterly sales that beat estimates. the company avoided the fate of department stores such as kohl's. that chain cut its forecast for the second time this year's. earningsising its outlook for the year despite reporting third-quarter sales that missed estimates the home

improvement chain saying it will close 34 underperforming stores in canada. amazon opening amazon go supermarkets and pop-up stores. bloomberg has learned expansion technology to other retailers. the new store format could launch as soon as the first quarter of next year. amazon is testing the tech in the seattle store. i am viviana hurtado and that is your bloomberg business flash. alix: time for bottom line. we look at companies worth watching. today we look at retail. target and lowe's were among those bucking the gloom over the sector. bloomberg is predicting a lackluster holiday season. let's get the reed on the ground. for our outlook we are joined by jeff yurcisin, president and ceo of the online retailer zulily. what have you give us some

background on what zulily does? with momstarted finding the best product and offering them to mothers at unbeatable prices. over the years we started expanding and offering more products but continuing with the promise of having the most unbeatable prices out there. in terms of these products, and as we have expanded, we are able to deliver those because we have a new supply chain that is different than amazon or the other internet giants. one optimize on cost rather than speed. from our point of view, it is not about next day shipping. it is about passing along the savings to customers. our supply chain is built around events. we do not hold a lot of the inventory we have. we make the deal after the customer make the purchase. by doing that, we are able to put a lot of items into the box. for anyone willing to wait a week, she can say five to $10 on every single gift. brooke: part of giving the

savings back to consumers is his best price promise. we will let people look at the best price practice. does that generate a race to the bottom on price where you are trying to undercut each other and potentially ending up with low profits? jeff: it potentially could, but we are not seeing that happen. what is more important is that for each retailer to understand their path, their own unique business model. ours is quite different than amazon and walmart. it is not about the free fast shipping. there are inherent costs. our best price promise, we are proud of this, we are seeing millions of customers respond positively. what we have done, what we believe no other retailer has done, rather than having a price match guarantee that puts the onus on customers, we are giving that information to our consumers. 65% of our consumers think amazon and walmart have the lowest prices online.

day,1000 products every zulily has lower prices 97% of the time. we take the recent prices on amazon and walmart and show it to the consumer so she can make the right decision at the moment. you said two day shipping is not the most important thing, and that would buck the trend. i have to say i would not need everything in two days. i want to expand on that and say how you came to that decision. jeff: there is a need for two day shipping and one day shipping that serves many customers. but the majority of households, what we are hearing, it is not about great products and it is about savings. ist we have done at zulily found a model that allows us to pass along the savings to consumers. brooke: what have you noticed -- alix: what have you noticed in terms of the impact of u.s. china trade more in terms of

prices and demand. where are you seeing it? it is less ofly an impact than other retailers or other brands who may be holding onto a lot of inventory or looking at thrown supply chains. we are partnering with brands who may or may not have their production facilities in china. we are rarely stuck on this inventory. going back to how we can have the most efficient supply chain from across perspective is the fact that we have low transportation costs because consumers put three or four items into their box. do not have markdowns or over stopped which impact the p&l for most retailers. instead we pass along in real time the right amount of the inventory that the consumer is asking for. we get into her hands in the most efficient way possible. so much.nk you appreciate you stopping in. jeff yurcisin. and brooke sutherland, thank you for joining me for the hour. we will have much more on

today's retail market moves in today's technically speaking. we go breaking headlines. gordon sondland's testimony has been released. he is testifying at 9:00. this is the eu ambassador from the u.s. the headlines is he worked with giuliani on trump's orders. he says the giuliani request was a crate quote pro for the white house -- was a quid pro quo for the white house. that headline dropping. he is one of the only official step direct communication with president president trump and personal knowledge of what the president wanted with ukraine. that is what make this testimony silky in those testimony dropping that -- this testimony silky and that headline -- this testimony so key. bloomberg. ♪

alix: time for technically speaking. phil maloney, voice of bloomberg's equity squad joints me to set me up with your trade.

squa on your terminal. let's go to target. bill: it will break out to a record high here. let's go back to the tenure weekly chart. you had a break in august. your levels to watch today 1.23 and 1.31 a target. lowe's had a totally different story than home depot. bill: we talked lowe's yesterday. it will trade at the top of the range. that will be potential resistance, but above there it is off to the races. alix: good stuff. bill maloney. that is it for us. coming up "the open" with jonathan ferro. this is bloomberg. ♪ here, it all starts with a simple...

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jonathan: coming up, senator sending a warning to china, passing a bill backing hong kong protests. president trump stuck between breaking with republican lawmakers are risking a trade fromocks risking back all-time highs. here is your wednesday morning price action. 3%ities drip lower, down .30 on the s&p 500. the euro a little bit weaker. euro dollars. treasury yields heading south by four basis points to 1.74 on the u.s. 10 year. let's begin with the big issue, the u.s. senate unanimously passing a bill supporting the hong kong protest . >> the protests continue because the people hong kong see what is coming. they see the steady effort to erode their freedoms. the