more positive on a trade deal. don't say i didn't warn you. china issues a stark warning to the u.s. after congress passes a bill supporting hong kong protesters. in the foothills of a cold war. henry kissinger on u.s.-china relations. leaders way in at the bluebird new economy forum. welcome to -- leaders way in -- leaders weigh in at the bloomberg new economy forum. this is a miss and a cut, and the stock is down about 5% premarket. comp sales are down by about 1.5% on the low end. they also missed on earnings in the third quarter. they say they are confident in holiday strategies, but it doesn't look good in terms of their guidance. you're really seeing that play

out within the have and have-nots of retail, the targets versus the macy's and jcpenneys. we have the oecd cutting its global growth forecast for this year, in particular germany. they see growth up there just 0.4%. but the market goes nowhere. the markets really want to drive higher here. for globalow exchange, where we bring you today's market moving news from all around the world, from beijing to new york to atlanta. our bloomberg voices are on the ground with this morning's top stories. in china, top trade negotiator liu he says he is cautiously optimistic on a trade deal. shawn donnan joins us from beijing. whatever we learned so far from china? shawn: we learned that liu he, the vice premier, has been sending out some positive signals. what is important about that is

at comes at a time when some folks in the market and some folks close to the talks are warning that these talks are in a pretty fragile state and could fall apart still. liu he, as part of a visiting delegation last night, still remains optimistic that a deal can be done is pretty important. alix: thank you so much. staying with the bloomberg new economy forum in beijing, we've been speaking with top executives in the business world. hears the former director of the u.s. economic council on the current state of u.s.-china trade. >> i think we are having a trade skirmish. i think the two sides have disagreements on trade, and if you look at what's going on, the two countries are functioning. there's a lot of trade still going back and forth. alix: joining us now is bloomberg's francine lacqua in

beijing. you've been there talking to world leaders. what's been the overwhelming theme for you? francine: gary cohn was one of the more optimistic we spoke to. risk of a catastrophic conflict were some of the warnings we had from henry kissinger and bill gates. the mood here shifted a little bit after we also saw the bill targeting hong kong protests, and people were trying to figure out exact a what it meant for their supply chains and exactly where it goes from here. gary cohn also said president trump understands how important it is to get farmers back in the growing cycle, which is why gary cohn was saying it was a skirmish, trying to downplay it, but says it is a nobody's interest to stay on for much longer. he is also expecting a phase i deal. so i would say a lot of caution here, but some hope that

something will happen in the next couple of weeks. alix: thank you very much. the new economy forum is being organized by bloomberg media, a division of bloomberg lp, the parent company of bloomberg news. charles schwab is said to be in talks to purchase td ameritrade. for more, sonali bassett joins us on the phone -- for more, sonali basak joins us on the phone. remember, td ameritrade is down almost 15% on the year. we all know that the zero fee war has really been pressuring all of these brokers, and you see the business model changing here. not surprising that firms are emerging -- are merging.

what is surprising is that it is ameritrade and not e*trade. to thehe fed says risks outlook associated with global asking i drove -- global economic growth and trade were significant and would further on the economy. with us is michael mckee. what were some of the big takeaways for you? michael: no surprise that the fed cut rates. a majority of the committee did agree that those risks were prominent and still in place. however, they went on to say that maybe all we needed was one more rate cut. after the rate cut, they were pretty confident the economy would continue growing. it showed most participants judge that monetary policy would that,l calibrated after and likely would remain so as long as incoming information about the economy did not result in a real reassessment of the

economic outlook. some officials did prefer to leave rates standing at the meeting because there forecast were that the economy or that the economy -- because their forecasts were that the economy didn't need additional stimulus. one or two, according to the people who translate fed speak, said cutting rates could raise financial stability risks. there were some interesting aspects to the minutes. all of the brisbane's judged that negative interest rates did not appear in the near-term and judgedt ash all of them them judged that negative interest rates did not appear in the near term be effective. as they continue to raise the size of the balance sheet, they probably wouldn't need it, although it could become a useful backstop. still, they decided to put off a decision on whether to institute it or not. alix: thank you very much.

democrats held a 50 debate in atlanta. here are some of the highlights from last night. sen. warren: i have proposed a $0.02 wealth tax for everyone $150 millionthan in assets. sen. booker: i don't agree with the wealth tax. sen. sanders: they have lied and lied and lied. we should be vocally speaking be -- mr. biden: we should vocally speaking out about the violation of the commitment that they may to hong kong. kevin cirilli is with us now. kevin: people to badge come the south bend mayor -- pete ,uttigieg, the south bend mayor didn't really go after joe biden, senator warren, or even bernie sanders. instead, his most tense exchange came from tulsi gabbard.

beyond that, senator elizabeth warren and bernie sanders doing what they needed to do, according to the respect of surrogates, after the debate in the spin room to maintain the status quo of the race so far. beyond that point, the talk of the spin room wasn't so much the debate itself, but bad in washington, the impeachment hearing that is moved into more intense stages following the testimony of european union abbasid or ordinance on blend. -- union ambassador gordon sondland. alix: thank you so much. the financial times is reporting that lewis bacon, the legendary hedge fund manager, is actually planning to set his firm and return capital to investors. that comes after three decades. he has made some huge, successful bets over those last three decades. he made an 86% gain in the 1990's when he bet against the japanese market and a 45% gain

in 1992 when the european rate exchange meccas and collapsed. these were big -- exchange mechanism collapsed. these were big contrarian bets that paid off. it is sort of a legend in the market, lewis bacon, closing on mooreapital -- on capital. we do want to recap macy's, not a beat and not a raise, very different from other retailers. that stuck down 6% in premarket. they missed on earnings and same-store sales, and the guidance is lower for comp sales, as well as earnings. a gloomy day for macy's. they say they are positive and they feel good about their holiday strategy. their outlook does not say that. coming up on this program, much more of your morning trade and analysis and all of the news in today's first take. this is bloomberg. ♪

♪ >> and then of course we have the external conflict, the issues of the rising of the great power in the form of china rising, and the united states having its relative decline. so we are at a point, i think, that is very similar to 1944. there's ariod of war, period of peace because nobody wants to fight the country that won the war, and there's a new world order. alix: that was bridgewater founder a ray dalio speaking in beijing. time now for bloomberg first take. we are going to give you the news. you get the trade and analysis from our in-house team of wall

street traders and veterans. damian sassower, vincent cignarella, and joining us, marvin loh, state street global macro strategist. i had a plan on trade, but then lewis this news that capital.closing moore you will have stories about this. vincent: oh man. they were one of the most significant players in the 1980's, 1990's. wonderful story about moore capital. we are sitting like everyone on the street waiting for the o.j. simpson verdict, and nothing was moving, and the verdict came out. all of a sudden, the dollar collapses. why would the dollar move on o.j. simpson? moore capital used to deal through dean witter back in the day, and he hit the street with about $1 billion and sunk the

street, just sunk the dollar, and took it all back and made a huge profit. i was out to dinner that night with three traders, banks that don't even exist anymore. [laughter] lostnt: between them, they $2.5 million on that trade by dealing with dean witter through re capital. marvin: when that line lit up with moore capital, that was the best call you could ever have. it just speaks to the challenges that hedge funds are having in this environment. i'm not surprised. they are one of the original big three, with soros and tutor. some of the recent struggles, at all comes from -- i think. marvin: and it is probably something that we are all going to have to be dealing with. you got central banks saying

they are going to do nothing, so everyone is going through their 2020, with their big themes for next year. one of the themes out there is that maybe there aren't that many themes next year. it is just harder and harder to differentiate yourself. etf's are taking the position of the biggest part of the market, and you get stories like this breaking. alix: and it sort of ties into the overall lacko. -- thegot charles schwab overall macro. you've got charles schwab, td ameritrade potentially merging. central bank balance sheets are starting to expand. we see the biggest in six months here in the u.s. vincent: so much of this is electronic trading and transparency. alix: that's more of an issue than negative rates in the macro? vincent: that's why you have no fees and why everything is shrinking. everyone knows where the price is. there was a time when, if you wanted to know what the price of an asset class was, you had to take risk. you had to execute.

you had to be in it to know. ,ow everyone knows where it is so the game has changed considerably. there's no reward for the risk. marvin: the flipside of that, you can't argue that transparency ultimately is good for the consumer, if you will, whether it is the amazon effect, the fact that the regular consumer actually has data on corporate bonds now, on muni bonds. hasing around equities really brought down commission structures. that's not bad. it just shows how hard it is. vincent: i'm not saying it's bad. it's just that this is the new order. marvin: absolutely. vincent: i would like to have some transparency when i go buy a car, actually. [laughter] damian: if you see the big central banks, their balance sheets have been declining for the better part of the last year and a half, 12 can take it of

months of cumulative balance sheet decline. it is now moved back into positive territory. that is the stimulus story. anybody who is calling for a bearish dollar in 2020, that is the foundation for that bearish dollar call. marvin: after the fed effectively took negative rates, thank goodness, off the table, recession risk is pushed out. but if we get there, there certainly aren't that many bullets left. what's left if you don't go into negative rates is bigger and billing -- is bigger and bigger balance sheets. then does trade matter? it is not just me. there were some reports in blue brick opinion that you have everyone talking about trade disaster, but in reality, if the central bank balance sheet is expanding in a low yielding world with no fees, that is going to be a bigger changer than something like this. and i wrong?

itmatters because -- damian: matters because we are talking about the quality, not the price of money. especially for positive yield. like china have in u.s., rate differentials have driven the movement in dollar-yuan. that broke down in april? why -- that broke down in april. why? trade elements. assets are now decidedly skewed the other way. a lot of those relationships are decoupled. if trade tension dies down remains to be seen, but i think the trade develop its are here to stay. vincent: we are going to talk about this a little bit later, but if you look at china gdp in the bloomberg commodity index, they are incredible he correlated. essentially, what it is telling you is the trade war is affecting china gdp, but more the price of stuff is affecting china's gdp.

they sibley cannot produce enough to keep up with the growth of their economy with the size of their balance sheets, and with the debt that they have, and a lot of that we don't know. as the price of commodities ls.l, there gdp fal marvin: a lot of analysts are talking about these longer-term trends. demographics, central-bank efficacy, what happens with all of this liquidity in a world where no one really understands how it floats around. whether the future is now, talking about stagnation more than we have before. central-bank efficacy is certainly something the central banks themselves are talking about. damian: eventually that stimulus has to go somewhere. marvin: absolutely. so is the future now, where all of debt doesn't have the effect on the real economy?

it certainly has had an effect on assets, and terms of what we deal with on a day-to-day basis, but the concern with trade is eventually, it does make its way into the numbers. the disparity between income as a result of trade potentially collapsing makes its way into numbers. vincent: you will have to ask yourself, if it doesn't make its way into the real economy, it is only making its way into asset prices, at some point a reversion has to happen. i the economy needs to float higher -- either the economy needs to float higher to where the asset prices are, or asset prices need to fall. alix: i feel like we've been saying that for a decade, and we are at the point where the market just once to move higher. this brings us back to moore. when you have a bull run for over 10 years, any pullback just keeps getting absorbed, and more capital-- and moore closes. vincent: that's the disparity

between real economy and asset prices. when the hedge funds who live and breathe off of this stuff can't make it, they can't close that gap. inevitably, the rest of the world is going to have to close it. alix: i also wonder if it means he is not seeing huge dislocations. he made a lot of money in the 1990's with bids against japan. there's no big dislocation that's actually going to play out in the market. increased regulatory cost, the difficulty of the fundraising environment as opposed to those that are larger, like blackrock, that adds up at the end of the day. to go back to what the markets are telling us, i have to say come of new short-term europe benchmark that jumped overnight, when we talk about plumbing and the markets and where things might be, that is one place that caught my attention. it's only been around since october, and that is a pretty big move overnight. that means banks are coming to the market, short cash.

we are getting to year end here, and that is a risk. alix: you can make it short-term, but you need a standing repo. thanks, guys. i really appreciate it. damian sassower and vincent cignarella, things a lot. marvin loh of state street will be sticking with me. a reminder, all of the charts we are using over the next two hours, you can go to gtv on your terminal and browse the features. -- shutting down moore capital after 30 years and returning investments. this is bloomberg. ♪

viviana: you're watching "bloomberg daybreak." we begin with the blockbuster brokeragen the online business between charles schwab and td ameritrade. according to foxbusiness, it is for $26 billion in a deal that will be announced.

analysts predicted a wave of consolidation could take place. paypal will spend about $4 billion for online coupon site honey science. about 17 million people use or web browser extensions to find discounts at online shopping sites. carlyle group considering a bid for the iconic british bookmaker -- british boot maker doc martin. bloomberg has learned carlisle is in the early stages of deliberations. other bidders could emerge. alix: another company story that caught my eye, general motors stunning fiat chrysler with a racketeering lawsuit. late fiatmplicates ceo sergio marchionne in a

scheme that has landed others in jail. . it claims that fiat chrysler bribed the uae for competitive advantages. fiat chrysler denies those allegations. still, a stunning develop that shows just how hard it is for car companies out there right now. coming up on the program, more highlights from the new economy forum in beijing. lots of headlines, some confusion about trade, some optimism on trade, and the market really goes nowhere. this is bloomberg. ♪ here, it all starts with a simple...

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that was easy! glad i could help. at xfinity, we're here to make life simple. easy. awesome. so come ask, shop, discover at your local xfinity store today. alix: this is "bloomberg daybreak." the market is pretty calm today. s&p futures pretty much going nowhere. president trump last night

blaming everything on china, but then we have a more off a bit of stick -- have a more optimistic outlook from china's vice premier. i did want to highlight banks in europe. the bundesbank warning on german banks, moody's down grading the outlook for german banks. flatwant to point out the near that's happened in the twos tends. 15 and 16, down to reversing the steepener we've seen throughout the last few months. u.s. and china trade uncertainty is front of mine for political and business leaders at the bloomberg new economy forum in beijing. the former treasury secretary said delisting chinese firms from the u.s. is a terrible idea, and china must resist 10 tatian to protect domestic firms. headedlieve we are now in precisely the wrong direction .

last year at this forum, i spoke to the flows of goods, capital, people, technology. some predated the current trade disputes. others are a result of it. flows of goods, for example, have been impeded by the failure of china to open big parts of its markets to foreign competition, and they have been further impeded by unilateral or retaliatory tariffs from both the u.s. and china. beyond goods, i also warned about interruptions to the flows of people, and indeed, these had been impeded by new restrictions on visas, people to people exchanges, and the interactions of students and scholars. but what concerns me most is what has happened to flows of capital and technology over this past year.

both areas are vulnerable to significant negative headwinds in the form of policy changes under consideration in the u.s. and china. put simply, china must open further. it needs to resist the firms thatto delist would become stronger if they were to invest in foreign competition. but washington needs to resist some temptations, too. from u.s. china markets by delisting chinese firms from the u.s. exchanges is a terrible idea. we are going to have more updates as global leaders way in on the global trade tensions. the bloomberg new economy forum organized by the parent company of bloomberg news. marvin loh of state street still with me. kissinger is saying it is the foothills of the cold war, which i found to be really striking. what is your interpretation?

, this: i think ultimately is much longer than a phase one deal, much longer than a december 15 type tariff. the markets are clearly focused on it. asset values will be very much affected by how all of this evolves. it is not just u.s. and china. it is really reordering the global movement of goods, as well as people. it is going to take a while for all of this to completely play out, and from a global growth perspective, there's really only downside to that. alix: does it just redistribute it, though? revamp to try to attract western businesses from china. does it just reorder it? marvin: to a certain degree, it

does. the challenge right now is that that i is not growing, so we are all trying to get different pieces of that slice that ends up getting smaller and smaller. if we were talking about a few decades ago, the pie kept growing. there were advantages for everyone from global growth and trade. alix: if the pie is not growing, is at least not ranking anymore? when i look at south korea's 20 day exports, they are falling less. pmi's.een there's a conversation of, well, the bottom and they don't get any worse. is it glass half empty or half full? marvin: we are probably stable at that halfway mark at this point. alix: you're both. [laughter] vincent: to a certain degree --marvin: to a certain degree. it doesn't necessarily mean that improvean continue to unless we get improvement on the trade front. we do need stability to

companies feel comfortable making investment again, looking at new products, trying to figure out what markets they want to be in. but with this overhang, it just makes it hard. alix: so do you feel like cyclical and value are not the places to be? vincent: to a certain degree --marvin: to a certain degree, yes. they have rallied an incredible amount over the course of the last couple of months. from a valuation perspective, it made sense. certainly a lot of the market got too far ahead of itself in the doomsday scenario with regard to not only u.s. recession, but a great time so crisis environment. but we've repriced of that over the course of the last few months. alix: when you get the oecd forecast, it doesn't look great, for example. maybe there's stabilization, but they downgrade germany to present -- downgrade germany to percent. when you get those headlines, do

you still feel confident in stabilization, or if they're going to be a trigger that causes more rollover? marvin: it ultimately shows that there is a stable environment we are operating off of. there's much less room for mistakes, so you always have to guard yourself around that. you have really low volatility, but a lot less flexibility. i think some of that is around the central bank puts. everyone for the most part is .symmetric they will cut rates if they need to only to zero or lower bound. having said that, it gives assets a certain amount of stability as we go forward. but really, if there is a bad hiccup, if it is as bad as kissinger talks about, you wind up in a situation where you not really pricing it in.

alix: if you come inside to bloomberg, it is the vix, it is l.e move index, and equity vo the report yesterday talked about how the the code of the index is rising. liquidity index is rising. maybe we are not pricing in the correct scenario. marvin: what's been really interesting this year, if you look at a lot of the financial conditions indexes, they are very loose. but when you look at some of the more political indexes, they are at all-time highs. i think investors have trouble pricing the kind of risk that we are dealing with. the political risk, the tariff risk, is something we haven't seen in our lifetimes. what we can price ultimately is the central bank willingness to take risk off. alix: good distinction. marvin: the fed is not going to hike rates. the fed is more inclined to cut rates, and certainly with the ,ero and lower bound discussion

i argue that what we have is a form is qe. a lot of my colleagues pushed back and say it is not qe. bottom line, they are putting liquidity into the system. it's making its way out into various assets. alix: why do you think it is qe, then? marvin: ultimately it is aggressive expansion of the balance sheets. alix: it doesn't matter why or and what duration. it is just happening. the flow of that liquidity is significant. all of that comes back into the balance sheet, and when it gets reinvested, it does make its way into the coupons. their support once they start maturing, if the economy hiccups, they might not be able to slow it down in the second quarter of next year the way they expect to. alix: what is your favorite

view? how do you invest in that? unless you are moore capital. [laughter] marvin: they don't have to worry. the folks there have done pretty well for themselves. i think we kind of get into this new normal. we still go back to the demographics, about two things we've been talking about for a .hile income winds up being a significant component to that if you believe the central banks are going to have difficulty extracting themselves. we seem treasury yields position themselves over the course of the last eight weeks, from the perspective of yields going much higher because central banks aren't going to be as robust as they have been, really repricing where we are in that process. if they are active, comedies wind up giving support because there's a lot of liquidity in the system. it once up being one where you really have to understand what you're buying.

certainly buying high yield as an income stream is attractive in an environment where everyone focuses on income, but just blindly buying this late in the cycle, that is not smart either. so really looking at the new normal, looking at potential hard assets. gold is something i've never really dabbled in because it doesn't have any income associated with it, but when you're looking at the world with a lot of negative income, it has a place in that discussion, too. alix: to that point, when you see treasuries or bonds in europe selloff, do you want to buy that dip? is that how you are playing? marvin: i think the economies we are dealing within in europe versus the u.s. are different. i am more comfortable with u.s. yields just because they are positive, rather than hoping point bund -30 basis goes back to -60. this a lot of bad things associated with that versus one

where, and the u.s., we are really trying to figure out what the inflation outlook is. alix: marvin, such a great conversation. i love chatting with you. marvin loh of state street, thick you. we are going to be live with the new economy forum in beijing with a lot of names, including chair. vice stay tuned with us for that. now we want to get an update on what is making headlines outside the business world. viviana hurtado is here with first word news. viviana: china's top trade negotiator says he is confused by u.s. demands, cautiously optimistic about reaching a phase one deal. according to dow jones, liu he asking u.s. trade representative robert lighthizer and secretary treasury steven mnuchin to return to beijing for talks. a new confrontation could put the trade deal in jeopardy. president trump expected to find

-- expected to sign legislation in support of hong kong protesters. mckay presidential candidates avoiding big fights in last nights debate in atlanta -- democratic presidential candidates avoiding big fights in last night's debate in atlanta. they did attack each other over climate change and health care differences. 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, there is no gender bias here. sachs ceos --n ceoen -- goldman sachs apple card.f this is bloomberg. ♪

viviana: you're watching "bloomberg daybreak." shares of thyssenkrupp plunging the most in a year. the german conglomerate is moving to suspend its dividend and warning losses could get worse. theplans to go ahead with sale of its crown jewel, the elevator unit. . wall street banks who had been a buzzing remco are now on the sidelines. the giant -- who had been advising aramco are now on the sidelines. stanley,, morgan and chase are among those sidelined. they were unable to deliver on promises of a $2 trillion valuation. those banks will miss out on

what was an expected financing fee. that is your bloomberg business flash. alix: thank you so much. we turn to wall street beat, and today focus on goldman sachs and the bank's defense of its apple card. to the ceo at the bloomberg new economy forum in beijing. >> we are building a digital bank that is primarily at the moment focused on the united states. we have taken some deposits in the u.k. come but at the moment, we are per merrily focused in the united states, and we are quite excited about the progress we've made over the course of the last three years. hase built a platform that four 5 million customers and about $7 billion of loans come on both the credit card platform and allows us to partner with others in the future. we have a platform that allows

us to help consumers with their with moreneeds transparency, less friction, and we are excited over what we can do over the next five to 10 years. >> this is new clients, or do you cannibalize your existing clients? >> it is a really different product. we really haven't dealt with the everyday consumer, so this is a new business for us. when you look at the client list we are attracting, there are people across all demographics, all ages. i have kids who are in their 20's, and they are very attracted to the digital application and the use of these. they are not typically walking into a more traditional bank branch. but there are people across the age spectrum that are intrigued by what we offer. we offer attractive deposit rates, less friction, and we are

trying to develop products that we think will make financial life easier for consumers, with less friction and more transparency. >> and when will that grow? >> i can't predict when it will come to asia. we are focusing on a really good business primarily aced in the united states, and as we make progress, we will focus on whether or not it makes sense to expand. alix: you mentioned your partnership with apple. you came under pressure because of an algorithm that was gender biased. when you first hear about the news, and what is the next step in how you can fix this? >> i would start by saying we are very excited about the launch of the credit card. this partnership with apple has allowed us to offer a credit card that we think it's consumers more information, more flux ability, and the launch of it by any standard has been the most successful cobranded credit card launch to date. there's no gender bias in our process for extending credit.

we don't ask whether, when some one applies, if they are a man or woman. we don't ask if they are married. in addition, when we set up our credit processes as required under law in the united states, everyone brings into all credit platforms a third-party consultant to make sure there are no unintended biases in the process. when you look at our credit process, any individual that applies for the card, we can go look at the exact specific characteristics of why a credit decision is made and communicate with them about that credit decision. one of the things we are trying to do is increase the transparency and work at that. >> there's no bias? >> there is no bias. there's no question that different applicants can get different results. but we are working, and we are going to be very focused on making sure people understand that when they apply

individually for credit, there are a whole variety of factors that go into it. gender is not one, but it is their individual credit. we will work overtime to deliver more transparency to our clients because that is one of the things we like about this credit card. if you don't like your credit line, you can call someone and talk to them, give them more information, and there could potential be a change. we are excited about that transparency, so it is a unique and differentiated product alix: where do you go over the next five years? where are putting your growth? are there units that you are retrenching for? >> we talked a lot about the fact that we are trying to find opportunities to continue to franchise ands' business. we are focusing on our investment banking business, ira sales trading business we are looking for places where we can make investment.

i think there are gaps where you are not performing where you'd like to, and the discipline of improved, what can be we do that with our business is all the time. the significant thing we are focusing on building a digital consumer platform in the u.s. as you and i talked about. we are expanding our wealth management capabilities to a broader audience. we made an acquisition earlier this year helping us move in that direction, and in addition, we are adding certain products and services that can serve our existing clients. we've built a transaction banking platform that the firm is now on, which we used to be a client of that service, and we are going to invite clients onto that platform for the first quarter. so we are making steps to expand some newt while adding businesses we haven't traditionally. alix: that was goldman sachs ceo david solomon and exclusive

conversation with bloomberg's francine lacqua in beijing. coming up, gdp might not tell the whole story and china. we are going to tell you why in today's trader take. if you are heading out, tune into bloomberg radio on sirius xm channel 119 and the bloomberg business app. this is bloomberg. ♪

alix: it's time for trader's take. joining me as vincent cignarella, voice of the bloomberg audio sqawk. . you can listen to him everyday. he spoke earlier about china gdp and commodities. vincent: i invite anyone to weigh in on this. i think this is an interesting curiosity. china's gdp tracks, and i just used the bloomberg commodity index, and put them both together, and the correlation is amazing.

it seems to tell me that china's to is far more closely tied the price of their exports rather than the exports themselves. it looks that, and from the financial crisis you can see the decline, trade war notwithstanding, maybe we don't need a trade war with china. maybe the president can just actually come back off of this a little bit because china's gdp seems to be imploding or guard us of the trade war. it doesn't look like they can export enough to create sufficient amount of dollars to keep their growth. alix: it's a global slowdown kind of thing. andng up, lale topcuoglu swell of- and mike goldman sachs joining me. this is bloomberg. ♪

♪ alix: welcome to "bloomberg thursday,on this

november 21. let's take it from the top. >> we should pursue common, comprehensive, sustainable security and reject zero-sum games. alix: china's chief negotiator is cautiously optimistic on trade. >> what's important about that is it comes at a time when the some close to the talks are warning that those talks are in a pretty fragile state and could fall apart still. alix: president trump sticks to his script and place the blame game with talks entering a crucial phase. there was a quid pro quo in regards to the ukraine call. kevin: the talk in these been were wasn't so much the debate itself, but back in washington, d.c. and that impeachment inquiry hearing, which has moved into a more intense phase. ambassador gordon

sondland's explosive testimony antidemocratic residential -- testimony and the democratic presidential debate. >> the resolution of the trade tensions, there's also some risks coming from china slowdown, and finally, there are two very strong factors hampering investment growth. alix: it doesn't see a big rebound in 2021 in the midst of persistent trade tensions. >> protesters are being abused right now by chinese government. we think this can help. alix: hong kong gets support from the u.s. pres. trump: i really would like to see china in a humane way solve the problem in hong kong. alix: this is despite promises of retaliation from beijing and warnings from world leaders. and a potential blockbuster

deal. charles schwab reportedly set to buy tg ameritrade -- to buy td ameritrade. plus, macy's falling in premarket as it cuts its forecast ahead of the holiday season. arehe overall markets, you not really seeing that much movement despite that with the we saw yesterday. maybe china is more cautiously optimistic. we are seeing a little bit of stabilization in the equity market. no real move in fx, no real move in rates. joining murphy hour, lale topcuoglu, loh cm senior fund manager. good to see you. something he we were looking at was the liquidity conversation yesterday in the fed financial stability report. it basically shows liquidity is rising in the vix is falling, and that you found really interesting. lale: i do. i am laughing because it is like the plumbing thing. binks?remember jar jar

i feel like i am jar jar binks. [laughter] alix: don't say that about yourself. that's horrible. lale: it's because i'm still hear talking about plumbing matters, you don't understand the liquidity risk. [laughter] alix: but i thought they fixed that? or does the ecb now have plumbing problems? lale: i don't think it is really fixed. the year-end is coming. what is really interesting, i think it is jp morgan that has done phenomenal data on this. the stability report touches on the u.s. treasury liquidity. it is down 70%. marketuidity in the gilt is down 50%. they also looked at stock markets. if you look at daily stock liquidity, it is down 20% on --nings, which qamar briefly

which, arguably -- the single stock dropped 30%. i'm going to talk plumbing again. if you put it in the context of the growth in assets, the growth in mutual funds, and the drop in liquidity, oh boy. i think it is scary. alix: let's get mike swell's point of view, goldman sachs asset management cohead of global fixed income portfolio and it's meant -- portfolio management. mike: i'm kind of like the darth vader of liquidity, so i agree with the direction lale was going down. liquidity on things you don't need liquidity for. you look at treasuries, look at government bonds, all of the liquidity you want to but there's not a lot of risk there. if you look at what is going on

in credit markets and the equity market, there is a lack of liquidity when you need it. when a sector, when a company, when there are any sort of issues, we are seeing massive movements, and it comes down to the fact that we are just in an environment where people want return, but they want return without the risk, and they don't want to take on significant risk with regard to the economy, sectors or companies. alix: you guys used to work together, so is that normal that you guys agree? is this an awkward moment? [laughter] lale: this is quite funny because there was an email exchange between me and my old team. i gave them a heads up. i think similar to the oscars, we are going to do a who wore it better. alix: oh my. this could get pretty interesting. let's turn to trade now because all of this is setting up the microenvironment as well. -- is setting up the macro environment as well. >> the external conflict, the

issues of the rising of the great power in the form of china rising, and the united states its relative decline. >> we are at the foothills of the cold war. >> i think the confidence in supply from a single source for anybody in the world has reduced. >> i worry that some of these will be irreversible. >> as trade negotiations go forward, will you see supply chains move come up production move? >> i think we are in a trade skirmish. i think the two sides have some disagreement on trade, but the two countries are functioning. there's a lot of trade still going back and forth. >> there's a good chance we will see some progress on the trade discussion. >> we should pursue common, comprehensive, sustainable security, and rejects zero-sum

war. in trade alix: based on the conversation about liquidity, how does it matter, considering all of the problems? thank balance sheet, negative rates, the plumbing issues are still there, no matter what happens to the trade deal. what do you think? lale: broadly speaking, we start ignoring the whole trade noise. it is so interesting to me. the reason why stocks move up and down, trade talks are back on, who is sitting there and actually doing trades on and off? i think for us, we basically just said let's run with the assumption that trade may not happen. it happens, great. but as we look at companies, let's just run our assumptions as the status quo, and also what we see from the companies. broadly speaking, i would probably label less, for our

team at least, a little more cautious. mike: i would say it is a very tough thing to predict from a timing perspective. one thing you can assume is that the u.s. and china will continue to have tension, and it will have an impact on growth. it is having a disproportionate impact on the chinese economy. i think from a global growth perspective, i think you largely ignore it, particularly as a bond investor. we don't care as much about whether we are going to be at 3.5%, 4%, 5% global growth. we kind of like that middle ground where growth is just good enough to get paid back. but there are definitely companies and countries and currencies that are more directly impacted on whether china's growth is 6%, 5.5%, 5%. we are a little more focused there because we think the malaise will be around -- we think the noise will be around. alix: we have a headline from a chinese new paper -- from a

chinese newspaper that the u.s. made a late december 15 tariffs, but when you see the action, who is doing that? lale: again, i'm going to refer to this jp morgan report. they came out and said the average active manager only represents 10% of trading volume in stocks. everything else is in the machines, rise of the machines. alix: we are going off of star wars onto terminator? [laughter] lale: i was scared watching that movie, so i don't think i can watch that. i don't know. again, when you talk about the companies, everybody is bracing for the worst, and that may not be a bad thing. it is easier to set your expectations low so it surprises you to the upside. you can be positively surprised. what is interesting, it is certainly impacting the industrial capex cycle. that arehe companies

most beaten down our industrial exposed to automation, capex, etc.. mike: the people trading on the snowy's -- on this noise are taking advantage of the fact that liquidity is not great. people run based on a very small amount of news. there's an opportunity to take advantage of small moves. going back to our goldman days, i trust what he says. i don't know. it is just not the game we play. mike: that is not what we do either, but there are options. alix: so where? how do you think about it? mike: it's not the game we are in. we are not in the game. but i am just saying there are hedge funds that i relatively good returns, take a get vantage of the fact that we are in a very different liquidity regime. even the more liquid markets, as we mentioned before, that actually have liquidity, even those markets lose liquidity very quickly. there is a lack of desire for

risk in markets right now, and i think part of it, as lale talked about plumbing, plumbing matters. i completely agree. if you think about the dislocation that happened in the funding markets in the fed reaction, that has caused a very significant shift in liquidity. normal liquidity providers are saying i need to get paid more. when you get paid more when there is an event, you actually get market dislocations. that can be on opportunity, but that is a very short-term type of game. lale: this is one of my other broader concerns. i think people, with the complacency is pretty big, when the times are good, the wall is low. there's this running notion that central banks are here to save basically everybody and everything. that risk premium that people want to get compensated for holding less risk assets really declines. i think people underestimate the risks and you have a shock, and it represses really quickly.

you look at the high-yield charts, it acts normal and then goes woof. mike: is that an actual term, woof? [laughter] alix: it goes up fast. lale: goes up fast. i think this is where people just get too comfortable. and it is year end. it is comp season. everybody just once to close their books in college today -- their books and call it a day. alix: is it the same thing in credit? lale: a little bit. you've seen it a little bit. the challenge on the credit side is, when evaluations are tight, and my opinion, it is very hard to come down with a top-down view. the reason for that is they each idiosyncratic

staples. it is easier to do a top-down view than the credit piece. mike: it might surprise you that i have a strong opinion here, but i have a strong opinion. the credit markets have been incredibly interesting. when you look at the averages, it has been tightening and very low vol. if you look at dispersion in the credit markets, very significant. in the high market, you have a bb market which is everybody's darling. i want a little bit of yield, but i don't want to take on risk. everybody has put money in there. ite you move into b and ccc, is a different world. a very different story. the level of dispersion that exists in the credit market right now is very significant, creating some opportunities.

in theown into ccc's, energy sector, you're taking a large amount of risk, but that bbb sector that has outperformed this year, an enormous amount of opportunities. alix: jar jar binks and darth vader will be sticking with me. we will talk much more about global growth and where the opportunities are on a global scale, and we are going to be live at the new economy forum in beijing with a number of names for you, including the tim cook vice chair. the new economy forum is organized by bloomberg media group, a division of bloomberg the parent company of bluebird news. coming up, -- of bloomberg news. oecdg, the we cd -- the sees a downturn in growth. this is bloomberg. ♪

>> in the u.s., the u.s. economy is doing quite well. one of our lead u.s. economists was out talking about the fact that we might make progress on trade, and policy has been more accommodative. he says we will have salvation of growth from where we are. alix: that is goldman sachs ceo david solomon speaking at the new economy forum in beijing. the oecd downgraded its global growth forecast, china in particular. we just got an ib question. you can email in and ask us questions as we go. china'stion is, is weight so levered that it will

drag it down in the future? what do we think? are we so over levered in china that will drag down growth? marvin: -- mike: i think we've seen this since prior to star wars 1. it is a real issue. it's one of the reasons why we've seen a continuous deceleration of growth in china. you have to look at the question within the context of an investment timeframe. we invest in a six month, one three-year kind of timeframe. as a result, it is not going to the china of long-term. government support is still very material, but it is going to be a measured decline. i would say the issue with china and the global economy overall is because we've had so much support from the government, we are nearing the end over time. with rates at pretty much zero

everywhere, and you look at the amount of declines and reserves in china, it is going to end at some point. these economies, as a result, andnot actually open malleable enough to deal with a very significant exhaustion us exogenousignificant shock. lale: i think a sarcastic view. 4%?a's growth, is it 6% or knows?lly we pay attention to the companies. you can look at the luxury autos some of the other companies. what does the trend look like? then you can compare that to what the official chinese statistics show. i think the pboc is clearly a critical player, and i think some of the slowdown that is happening this year is because they really clamped down on shadow banking. that was obviously creating ripples through the

system. but if you clamped down on shadow banking, something else will pop up. that is just the nature of a nontransparent system. i think china is an important trade partner here. it is important to the global economy. but for us, being the bottom up investors that we are, we really track it through the companies and then try to match it to the macro data. alix: you had the pboc stepping etc., and there's two ways to tell the story. the first is with the fed. for me, regardless of why this has happened here, we are over $4 trillion again on the balance sheet. overall, central bank balance sheets have been expanding fairly quickly. when do we feel that? when does it actually mean something to us, and what do you do with that? lale: there's a reason why they've numbered the qe's. it goes 4, 5, 6, to infinity.

there's no way of undoing this. this is here to stay because of all the plumbing issues we have. it's, and my opinion -- i mean, we are in one giant financial experiment post financial crisis. it is a game of hot potato. who wants to be the central banker who says this is just not really the right? let's create some ripples and shocks. until,ll keep going on at some point, i see the companies will start defaulting because they can't earn, and the risk premium move up. the market will eventually call the bluff. don't know when that is going to happen. but when that happens, it's going to be ugly. mike: i think it stops one of two ways. either level economies heal themselves and you actually have a resumption of organic, trend

like growth. it is not a very high probability that occurs, but it is a possibility. i think the other way it changes is if there is a significant shift in investors' risk appetite for continuing to lend to heavily indebted countries. what the implication is for currencies, very significant. i think it has happened in japan, where external investors are not willing to lend in general there, and you have a very domesticated market. but that has very significant ramifications because you had a slowdown in growth. financial institutions can't earn because rates have had to stay so low, so there's not real yield available. i think the change can happen when people stop having confidence that companies are going to pay you back. they are going to pay you back with deflated currency. we are not there now because

it's kind of the hot potato, as lale mentioned. but over time, i think that real economics, real fundamentals are going to prevail, and in the end, this nonstop increase in debt will slow down when people start to discern and look at government debt and say, i am not confident i am going to get paid back, or if i get paid back, it will be in inflated currency. alix: mike and lale, things a lot. they will be sticking with me. this is bloomberg. ♪

viviana: you're watching "bloomberg daybreak." there's word of a blockbuster takeover in the online brokerage business. according to foxbusiness, charles schwab agreed to by td ameritrade for $26 billion. today, a deal will reportedly be announced. --y were among the first

carlyle group is considering a bid for the iconic british bookmaker dr. martens. the company is now owned by a rival firm. other bidders could emerge. 10 democratic presidential hopefuls squaring off again last night. among the issues they battled over, climate change. billionaire tom steyer has framed his candidacy around it. he says neither joe biden nor elizabeth warren see climate change as the most critical issue, but biden noted that stier has investments in fossil fuel companies. that is your blumberg business flash this is bloomberg -- that is your bloomberg is this flash. this is bloomberg. ♪

alix: this is "bloomberg daybreak." i am alix steel. we got some housing data in a few minutes. traders clearly willing to underpriced the risk of something going wrong.

that is richard breslin writing today. you are seeing that reflected in the market. not seeing a lot of movement in the equity market. with other asset classes it is a similar story despite conflicting trade headlines. you can see the curve continuing to flatten in the u.s.. we are trending steeper. 16 basis points is where we sit. housing data coming out -- actually jobless claims. jobless claims 227 thousand jobless claims filed last week. we are waiting for housing data. that will be around 10:00. the fed index we are waiting for as well. the idea that housing might stabilize as the fed winds expanding its balance sheet, lale topcuoglu and mike's well of goldman sachs are still with me. how do you view the housing market. what are your thoughts? housing markete

is one of the core underpinnings of the u.s. economy. , housingmer is healthy will continue to support the economy. i do not see that is is he to beget risk. what you have seen is the fed has stepped in. that has an impact on the housing market in an indirect way. the mortgage market is where most mortgages get funded. there was some dislocation there and rates shot up as a result of those plumbing related issues. from an investment standpoint, i think agency mortgages and asset classes -- the fed bought the mall and drove the rates down to a low rate. now you're trying to find that buyer, there's been dislocation there. it is one of the reasons we have seen dislocation in housing it has been an opportunity from an investment perspective. i think housing will be a strong tail wind. lale: we do not play mortgages but i can share some statistics i did not know. this is 2016, which is probably

gotten worse since then. ,or the lower income housing about 60% of their wealth is in housing. own, is it rent? lale: it is a mix. it is a staggering number. it is the heart of the consumer. alix: how do you play? mike: how do i play the housing? a few different ways. one is owning existing mortgages relative to owning treasuries where you are having a significant payment. two is investments in consumer oriented companies that will continue to be supported by significant turnover in housing and depreciation of house prices. lastly, the nonagency mortgage tied tos definitely housing prices. there continues to be a significant risk premium there

as well. as long as the housing market is stable or growing, there returns to be earned in taking direct exposure to house prices. to point outwant that the philly fed index did wind up coming down. new orders coming in light. the estimate was 26 and we got 8.4. the prices received were also light and the prices paid came in light. it looks like a lower growth order and a lower inflation kind of scenario. you think the trade issues we have seen have actually filtered through into the real economy? we have not seen the price indication for it. what you think. lale: a company's guidance is forward-looking so that is why we do not see capex going up. that is when we look at the consumer oriented companies, it is all in the guidance. i think the market starts pricing this in, which is why

think when it comes to trade, the issue is not whether we signed a deal or not. the details will matter in terms and whatets a tariff are the tariffs we rollback. the initial impact of the tariffs has been too much. didn't they going in september? it is peanuts and the grand scheme of things. the numbers have been impacted by the eagles slow start and the 76ers slow start. alix: very possible. mike: the impact, while sniffing it in the actual numbers is having an impact in the board room. if you look at companies desire to hire and go forward on, it has limited significantly. it is not just a u.s. issue, it is also a china issue. it is having a significant impact on your. from a forward guided standpoint , the trade issues can be

significant. munis. want to turn to take a look at muni issuance as well as return. we are looking at the best year for muni flows. sean carney of blackwell joins us now. do you think muni, that continues? sean: i think that continues if you think about 2019 is the your record inflows. a large imbalance of supply and demand. at the same time performance has exceeded expectations. supply has begun to pick up. for the first nine months of the year we had a rather benign supply. we are coming off of the month at 55 billion issued in october which sets up for a big q4. no upset in performance thus far. something we want to keep an ion. -- an eye on. lale: two questions. a little while ago you didn't

interview yet -- you did an interview where you talked about the key gauge of the muni being broken. i was want to spend more time on munis but it never really happens, i lump them in with taxes -- alix: i thought i did that. lale: it happens to me, too. class, isas an asset it a late cycle asset class? sean: very good question. your question around the traditional muni treasury ratio being broken. we spent $80 million in mutual fund inflows year to date. there are many reasons retail tales about municipal bonds. whether it is the negative correlation to equity and equity risk, the high credit volume and low volatility, then you look at the asset class and they tended

care less about the relative value. my point was that is retail is driving the flow, look less at muni ratios and more the benefit of munis. munis are somewhat of a late cycle. you are speaking earlier about the housing market resilience. it is more late cycle. the underlying fundamentals of the market continue status quo if not improving because of the length of the credit cycle we have been in. the technicals are what are driving the market. the massive amount of demand chasing less and less high-quality fixed income assets , as well as in the taxable universe is what is driving the underlying. alix: mike, what you think about munis? mike: we have spoken about three topics very interrelated. we think about on the equity market the huge demand for growth versus value and everybody wants the growth stocks that do not have risk and that works until it doesn't work

anymore. then you have the credit market, everyone wants the yield without the rest. the muni market is the poster child of that phenomenon. you look at the shape of the muni curve in the amount of money -- i do not to pay taxes, i want high-quality assets, but i do not rates to go up and a negative in my p&l. there is so much demand for short end, zero to five year munis. the area where it makes sense for a lot of investors is to take their investment risk and longer munis. that is where you're getting -- you're getting a significant tax benefit. unfortunately there so much money that has gone into the short end. there's a lot of that in market on the longer end of the curve. sean: we currently have a barbell in the front end of the curve in the first five years. -- that you can pick up

is a trait we like. to your point, for many years we were taught that munis were attacks harbor for the rich. mathematically, that is not true. if you take a double-a intermediate municipal bond, tax adjusted the municipal bond out yields the corporate bond all the way down to the 22% tax bracket. we have seen individuals who had been investing in munis investing more, but we have also seen a broadening of the base. it is long but our thought that individuals in traditional fixed him portfolios -- fixed income portfolios -- munis are an imperfect hedge. there will always be a bit of risk when hedging u.s. treasuries tend to be the best way if you look at your duration within a portfolio being able to hedge using interest rates. the only problem is you will have risk introduced because it

is not a perfect correlation. munis are eight -- when you like them you buy more, and when you do not you sell them. u.s. treasuries tend to be the best hedge. mike: there of been a number of funds in the muni market. they manage one of blackrock, goldman sachs has one as well. couldn be varies -- you be very successful in a muni structure. the barbell structure sean talked about and the ability to pitch out the rest for these flexible muni funds that -- the long end is cheap but my client only wants to take five years of interest rate risk. using treasuries to take on that risk is something we actively do. alix: we will leave it there. sean carney, thanks for coming in. we have some breaking news. bloomberg has learned louis bacon is closing three funds from his more capital hedge fund. he will return client capital from three of the funds and participate in less trading

activities. the flagship funds will keep running partners money. this is a blowout story. it is three decades, the legend of hedge funds, huge winner, particularly in the 1990's coming in and returning client capital. what i feel this signals is how hard it is to make money. how hard it is to make returns. you have negative rates. this is what happens. louis bacon, i never would've thought. mike: i talked before about short-term dislocations are current and the opportunities. you would say that is inconsistent with this move. it is actually not. the opportunities are out there, but they are out there for a short period of time. these large bulls of capital trying to generate alpha, very very tough. but as you shrink the pools of capitals there are opportunities. lale: that is why we run

capacity constrained. all of our funds are capacity constrained. as soon as we reach what we determine the capacity to be, we are done. alix: to avoid this exact problem. mike swell, great to get you on set. mike swell of goldman sachs. lale topcuoglu is sticking with me. coming up, macy's falling in premarket. they wind up having a non-beat and a non-raise. that stuck down almost 5%. a lower guidance for earnings. remember bloomberg users, interact with the charts we used throughout the show, gtv . this is bloomberg. ♪

viviana: this is "bloomberg

daybreak." i am viviana hurtado with your bloomberg business flash. luke -- bloomberg has learned lvmh boosted its offer for tiffany and company, a 1.2 billion dollar increase from the popyrin made last month. the offeror it made last month. the deal would expand lvmh access to u.s. luxury choppers. a member of the executive board at germany central bank is concerned about low profits at the company's banks. she also says companies may be underestimating risks. she spoke with bloombergs matt miller in frankfurt. >> a lot of geopolitical conflict. what if these risks materialize? what if the external sector impacts domestic markets? these are our downside risk scenarios we have to be concerned about because we have to understand how those scenarios affect -- viviana: shares plunging the

most in a year. the german conglomerate is moving to suspend its dividends. it is also a losses would get worse. it makes products ranging from toel to summaries and plans go ahead with the sale of its crown jewel, the elevator unit. i am viviana hurtado and that is your bloomberg business flash. alix: time for bottom line. we look at companies worth watching. today we will do a deep dive into amazing. shares are plunging after the retail giant cut its forecast ahead of the holiday season. by is howstruck little the stock is down compared to the number that came out. >> they cut guidance by 20%. the shares have been down all year. the concern is that no matter what they do, they have too many stores. when they talk about retail results, they talk about underperforming. what will they do with their

stores? right now 50% of their stores -- what about the other half? what do they do? alix: why haven't they done this already? m: they have been static -- they have been cutting stores. they have an analyst meeting. they will probably talk about it then. it is anecdotal. i live in new jersey. new jersey is known for strip malls and if you drive by it is crickets. the more they shut down. there are a number that have gone bankrupt. everybody is effectively shutting stores. is whatad, what i have does that mean for commercial real estate, for the landlords? there are cascading events -- there are cascading effects. it is a common theme. poonam: it is.

stores have been closing for several years and we have seen those spots converting into mixed-use building. you will have some rental, some real estate. you have restaurants open. more food centers. were experiential type places. stores are still expanding. if you look at tjx, they are building. lululemon is growing. there are clear winners and losers and that trend continues. alix: you raise a good point that everyone is trying to grapple with. you have all the stores that are going to have to close and the malls are wiped out. you have a huge space and it will not be wework. and it will not be the american mall. what will it be? what happens to the real estate value? poonam: i don't know. there is obviously a trend for experiences in food. if you look at some of these food service companies, that is one of the things they talk about. independent growth in the high

single digits consistently. food and restaurant has a high failure rate. i do not think it is exactly a slamdunk, either. i do not think anybody has figured it out. we were talking about personal experience like going to target in this era. to me they are finding the right between the online experience and the in-store experience is critical. i love going to target stores, which sucks because your credit card bill is through the roof because i need that. alix: it is only four point -- it is only 4.90 nine dollars, i need that too. poonam: you have been in that trap? even macy's does not give out online sales. they are growing. they had a data breach in october. how much that stock has impacted

into holidays, we will wait and see. that is the growth engine. alix: poonam boyle of bloomberg poonam boyle of bloomberg intelligence. thank you. we have news. charles schwab is ready to buy td ameritrade. bloomberg is reporting that news. it would mean in this world of price pressures, two of them would be teaming up. the question is what does it mean for the likes of e*trade. the deal would be about $26 billion. not to make you comment on a specific stop, but this came as no surprise. when you all have zero fees and different types of other ancillary products, at some point you have to get together. have a phenomenal analyst on our team who has done work on the broader industry. is wherenteresting this industry makes their money is actually the cash --

brokerage accounts. fees -- it is competitive. what is your advantage? what is jp morgan's advantage over citigroup? it is the same business. there is no secret sauce. there were thoughts around consolidation regardless. it is all about the deposit board. alix: and also that you pay for using certain trading platforms. lale topcuoglu, so great to hang out with you. i feel like you need to come up with a different star wars character, but i love the star wars reference. xmomberg radio, sirius channel 119 and the bloomberg business app. this is bloomberg. ♪

alix: time for technically speaking. what will set you up with some trades for the morning. bill maloney, voice of bloomberg's equity squad is joining me now. you can listen to bill every day. on thea terminal. bloomberg reporting td ameritrade and charles schwab are teaming up. bill: kbw worried a bit about potential antitrust. you can see the stock has been a long-term downtrend. broke the downtrend earlier in the month. what you want to look at today is retracement levels of the move. first level is 51, above that is 54. alix: i want to go to macy's. very not great guidance at the end of the day and there stop is only down 4% or 5%. at one point it was down 10%. bill: that's right. another stock downturn long

trend. this dates back to 2015. first support is 14. below that you are looking at 12, dates back to 2003. 14 looks like good support. alix: bj's, want to look at that moving average as well. bill: that stop getting hammered a bit, down 11%. what you want to look for here is this long-term trading range, support around 21. basically no man's land. alix: thanks very much. great to hang out with you. bill maloney joining us. that does it for bloomberg daybreak: americas. coming up on "the open" with jonathan ferro, mohamed el-erian, bloomberg opinion columnist. this is bloomberg. ♪

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jonathan: coming up, the president set to sign the bill supporting hong kong protesters. china pushing ahead with straight talk. american officials receiving an invite to beijing. investors investors between cautious optimism and consumer -- and confusion. with 30 minutes to the opening bell, good morning. here is your price action. equity futures going nowhere on the s&p 500. foreign-exchange beating price action. the euro flat against the dollar. in the bond market, a little bit of a lift. to 1.75sury yields up on the u.s. 10 year. let's begin with the big issues. investors between cautious optimism and confusion. >> difficult for the market to begin to see through some of this. >> the political situation in hong kong is obviously important. >> bipartisan support. >> this could be impairing