>> coming up on "bloomberg best," the stories that shaped week in business around the world. u.k. voted to send boris johnson back to 10 downing street. >> we got a conservative majority the likes of which we have not seen since the heyday of margaret thatcher. with this majority, we will at be able to do what? >> brexit! . >> it's a breakthrough day for trade. the u.s. comes to agreement on two deals. >> it's a breakthrough day on what is a highly partisan washington. fed signals it plans to

remain on pause. >> the consensus is no need for a rate move next year either. there's still risks to the downside, but they have lessened. >> the world's biggest ipo opens with a bang. some major banks announced changes and cutbacks. >> they have to meet the efficiency targets they set. >> the eu unveils a plan to go green that has some businesses seeing red. >> taxation does nothing for the environment. >> it's all straight ahead on "bloomberg best." hello and welcome. i'm rosalind chin and this is "bloomberg best," your weekly

review of the most important business news, analysis, and interviews from bloomberg television around the world. we start with the day by day look at the top headlines. another week began without a trade deal between the u.s. and china, and fresh data releases show the trade balance shifting between the two superpowers. x exports unexpectedly fell last month as global demand continues to wane and a trade deal remains tenting lysing like -- tantalizingly out of reach. what happens with trade data when it comes to a trade deal? >> it is a reminder how punishing these tariffs from the u.s. have been on china's manufacturing sector. just that highlighted again with the trade sector over the weekend, so exports overall from china falling 1.1 percent. to the u.s., exports were down 23%, the 12 straight monthly

decline. the expectation is that retailers and companies will be loading up on goods from china ahead of the christmas shopping season, but that does not really seem to have laid out. >> bloomberg reporting u.s. tariffs that take effect on sunday will be delayed according to chinese officials. aretime, house democrats planning a vote on the usmca next week. >> there's no question this trade deal is much better than nafta. >> it is a remarkable day in what is a highly partisan washington when we see a bipartisan agreement on a trade deal. trade politics are always tough, and democrats today backing donald trump, although insisting they really fixed the trade agreement that they called fundamentally flawed when trump brought it to them. the second piece, though, is the more market moving news that we have seen, which is the chinese tariffs.

we do know the president, were told, has not yet made a decision on this. he, for a long time now, has been looking for a way out of these tariffs. he has a lot of advisors around him and a lot of people in the business community warning these will be a huge disruption for the u.s. economy going into an election year. >> house democrats unveiling two articles of impeachment against president trump. walk us through what happens and how quickly this could all unfold. >> to quickly, the next step would be what is called a markup either tomorrow or starting thursday where the judiciary committee members can actually write up the forms of these articles that would go to the house floor for a vote. it goes to the floor next week perhaps as early as tuesday for a historic vote. jumped 10% and is trading to beer in riyadh. shares advanced even the company a market value of $1.8 trillion.

we 35.2 saudi reels as reals a share. it's a big jump, getting us closer to arguably one of the most controversial topics of the last year -- is or isn't saudi aramco worth $2 trillion? the government has tried very hard to get it in the right direction, so part of that includes just not offering as many shares as originally thought. just 1.5% of the company is being offered. there is still plenty of potential for upside because we have the stabilization manager that his goldman sachs. they have an option for 450 million shares that they can exercise in the next 30 days, and that is going to be absolutely critical. >> we are awaiting the final fed decision of 2019. the central bank's fomc is expected to keep its interest rate unchanged after three

straight cuts this year. >> as boring as forecast, no change in rates today. need for aus is no rate move next year either as they stay on hold through the 2020 election. nobody is calling for a rate cut next year and only 4 of 17 see the need for any rate increase. >> elements emerged that caused -- if developments emerge that cause a material reassessment of our outlook, we will reconsider. >> this is a fed that is increasingly confident that three cuts was the magic number. the hurdles are high for additional action, even though shows the next move will be a rate hike. the hurdle for a hike is actually higher than additional easing. when the fed today told us -- what the fed told us today was "we will see you on inauguration day." lagarde's first

meeting as the head of the central bank, delivering a positive message about the euro zone's economic slowdown. >> she was optimistic. she said there are still risks to the downside, but they have lessened. the uncertainty, she said, has loosened. she seemed to be more optimistic about her inflation expectations as well, even if it is not still at the target she wants to hit. also, she talked a lot about the review they are going to do, this strategic review. she says it's about time. they've had 16 years since the last one. she knows they were very busy previously, but now is the time to do it. she says it will not take that long. she wants to start in january at some point and be done by the end of 2020. >> the president tweeting a little bit early on the following, basically indicating that we have a very big deal on the way, getting very close to a "big deal" with china.

they want it, and interestingly enough, so do we, and it is that last bit that i think is quite important. it sounds like we have a deal. >> it does, and markets have been positioned for delay in tariffs that have been set to take place sunday, but when trump tweeted about a deal, that sent a signal that the most bullish scenario for investors might play out. by the looks of things, any escalation in the trade war will be put on hold and a deal will be announced. >> we have the market closing, the s&p and nasdaq closing at new all-time highs on the hope that there will be resolution to a phase one trade deal. >> u.s. negotiators have release the terms of a phase one trade deal with china. that agreement awaiting approval from president trump. >> we are still waiting for the deal to be codified into legal

text. we are still waiting for the details. have been5 tariffs held back, at least for now. >> it is official -- the conservative party enjoys a majority in a historic u.k. election. boris johnson's victory will allow him to carry out his main promise -- to get frexit done. the pound has jumped the most since 2017, also hit its highest since may 2018 against the dollar. atwith this mandate, we will last be able to do what? british politics upended in this election. we got a conservative majority, the likes of which we have not seen since the heyday of margaret thatcher. night for jeremy corbyn's labour party. he announced he will be stepping down. mr. johnson now the most powerful politician and the most powerful conservative leader, i should say, for a generation.

>> he needs to get his brexit deal done by the end of january. the arrangements, the practicalities being outside the eu. if you get to the end of the deal, he has only got to crash out and we are back to no deal brexit. >> how will prime minister johnson -- how will his new government he greeted by brussels in the coming weeks? >> the sense here is really a relief now he finally has that majority. he promised he was going to deliver, and the europeans are ing that he does deliver. europeanst about magically liking boris johnson. this is purely pragmatic reasons. he feels they are going to get that orderly brexit and avoid chaos. europeans, of course, do not want to be undercut by a u.k. that does not play by brussels

rules. >> chinese officials saying we have reached an agreement with .he united states the sides will work out the details. the chinese said the u.s. will remove some tariffs on chinese goods in phases. >> this is really the first time we have seen president trump, who has called himself tariff man, rolled back any tariffs, and that is a pretty big confidence-building measure here. the big problem with this agreement, and we are already seeing folks point to it, including chuck schumer, the senate minority leader, and that is this does not address some of the big long-standing american complaints about the chinese economy, and that is things like industrial subsidies. president trump says the tariffs that are still in place will give him the leverage for phase two of the negotiations, but we do not know when that phase two will start and we have a lot of

folks telling us they do not expect phase two to conclude any time before the 2020 elections. >> still ahead as we review the week on "bloomberg best," deutsche bank's ceo says his bank is prepared to deal with interest rates that stay lower for longer. us there is potential to offset. >> plus, the wework cleanup continues. goldman sachs is now involved. see vis issues that report on .ayhem in the repo market the findings are alarming and so is the timing. >> the fact this is coming in december is going to make people a little more nervous. >> this is bloomberg. ♪

>> this is "bloomberg best. let's continue our global tour of the week's top stories in europe where the new head of the european commission brought up an ambitious plan to combat the climate crisis. lien -- ursula leyen will present her deal including a timeline for various laws to be put forward between now and the end of her term. what do we expect? >> this could potentially be huge. we are talking about a green deal that could change the way many in europe operate. she has said she wants to make europe climate neutral by 2050. the goal is very neutral. the deadline is very tight, and we also know this could change many aspects of the european economy, the way carbon is priced, the way some of the

taxation is being implemented, and she has also promised one trillion euros to pay for this. she is going to need public investment and european companies to play along and that is really the question at this point. already there is pushback from a number of industries. this is not going to affect everyone the same way, and you have the european commission saying this is something they strongly believe in and they are going to go ahead. >> we have protesters calling strike after the march. pro-democracy >> organizers shown up in the street once again. police put the numbers higher than 83,000. this went from victoria park all the way here to the central district and it was very much like a deja vu where families showed up as well. perhaps they were pumped to come out after police for the first time approved these rallies for the first time since august. there were some nerves headed

into this event, but overall, pretty calm. >> china's consumer inflation accelerated to a seven-year high last month, fueled by a 110% year on year surge in pork prices. core inflation, which excludes food and energy, came in at 1.4 percent. meanwhile, factory gate prices extended their run of declines, complicating the pboc's efforts to support the economy. walk us through the divergence we continue to see. much factory inflation versus food price inflation. in welltion coming above the forecast. it's the highest number, as you said, since 2012. the flipside, they dropped 1.4% for the fifth straight month. more declines in prices at the factory gate, so the question is -- does the central bank look with us, looking at core inflation, which you say remains relatively stable once you strip out food and energy prices, or

do they bind their hands and make it difficult to enact aggressive stimulus should the economy continue to slow? >> saudi arabia released its latest budget. what have we learned about spending as well as revenue increases? >> the kingdom is embarking on three years' worth of spending cuts, which is a bit of a u-turn. they are confident enough they can start relying on the private sector to pick up the slack. our chief economist for the region has crunched the numbers, and he says this budget is a little more realistic -- down from $85 a barrel from the budget basis assumption to about $61 a barrel. >> the vis says september mayhem in the market was not just a temporary hiccup. >> we know it was more than an issue than the calendar and when there's this windowdressing on

balance sheets and therefore more demand for cash, and that means people are already sensitive, worried about what might be the squeeze, and then suddenly we get this report saying that there is a structural problem and that maybe the temporary hiccup we saw in september will not be resolved with the fed's recent operations in the report -- repo market. one of the conclusions were people were less confident about managing these transactions, the banks were less well staffed for handling these type of transactions. jp morgan's ceo, jamie dimon, says it is actually regulation preventing his bank from moving into provide liquidity when we did have problems in september. i think the report is coming out, even though it was a report that could have come out any time of year, the fact it is coming out at the start of december is going to make people a little more nervous. itsurkey's central bank cut interest rates when policymakers

were emboldened by the stability of the lira. plus, they were egged on by turkey's president erdogan's calls for more aggressive easing. >> the lira has enjoyed the past six months. the new one has overseen a whopping 1200 basis points of rate cuts. the central bank's wording did suggest it is going to slow down the pace of easing now, and the , taking intoe account inflation, is now down to 1.4 percent, so if you look at that, it does not seem as if the central bank has that much more room to cut rates. >> another central bank chief has unleashed a staunch defense of negative interest rates. the president of the swiss national bank insisted the controversial policy is the only way to keep the frank in check and help the economy -- keep the

franc in check. >> we have no reason to change monetary policy. if you look at our inflation a gross ratehave that is roughly 1%. next year, maybe 1.5% to 2%, so we have no reason to change this monetary policy. >> israel heading to its third election in less than a year. that's after prime minister and his main opponent benny gantz failed to achieve a majority. what is at the heart of this political impasse? >> at heart is the prime minister himself and the indictment he is under now. the opposition party is basically saying they would like to go into coalition with the voting party, and netanyahu is saying we want to do this coalition, but the issue is the opposition leader, gantz, is

saying not as long as netanyahu is under indictment. they don't want to do the deal then. , the party time basically is sticking to netanyahu as their leader. ♪

>> you are watching "bloomberg best." deutsche bank told shareholders this week its latest restructuring plan is on track. they said fixed income trading is up from last year and

announced the ecb has reduced its capital burden for next year. the ceo told bloomberg the bank has active -- acted decisively to reduce the impact of negative interest rates. >> we took swift action in terms of passing on negative rates to side.ient we see from the first five months in this bank how much potential is there on the revenue side but also on the cost side. all in all, looking down the ,oad for the next three years we are hitting all the goals. the comfort that we can achieve despite these challenges, our 8% return on equity in 2022, so therefore we are confident that we can achieve that, recognizing clearly the challenges, but with the track record we have, we

have seen no reason to adjust. >> you talk about passing on the costs. in early days, you took substantial measures to offset negative rates. can you elaborate on what kind of dust on what those measures are? >> on the one hand, as we set already three or four weeks ago, we started to pass on negative interest rates to certain client morents, but we focus far on and even optimized advisory for our clients to change deposits into other investment funds. a lot of good work has been done in the private sector, also to really make sure that clients are benefiting from that. we do get a benefit from the ecb, there is no doubt, and we have also in a conservative way started to increase the one or

the other loan books segment in order to upset, so it is a flower of mitigating measures, and it shows us there is potential to offset. imagine interest rates staying negative. are you prepared for interest rates to stay negative the next five or 10 years. >> i think we have taken the conservative outlook on the interest rates. therefore in this regard, we also changed our underlying planning. think we have been lower for longer. that's part of our overall plan, so we have prepared for that and we need to adjust our interest model, and we started to do that in july. >> coming up on "bloomberg best," more news from european banks including a profit warning from credit suisse. plus, more on the outlook for monetary policy and the eu's new

climate plan. >> the outlook for negative interest rates i think is flexible. >> this is bloomberg. ♪

welcome back to " bloomberg best." capital putting almost a third of its flagship fund into a fund that can profit from black swan events. we spoke to a guest to thinks markets are underpricing risks. >> china, the easing has been small. it is partially because

china wants to maintain a stable rmb. , they need to do stimulus aggressively. come up with the equivalent of five arrows. reforms and fiscal policy. even quantitative easing. i think that would lead to a weaker remnant be -- currency. positioned? short? >> i am bullish on the chinese economy. rates morecuts aggressively and does more they will stimulus, be bullish for stimulus. to a weakerad currency. >> what position do you think is ,ositioned in that those risks

those investments at the moment? but ituld say about 30% varies. there are moments where it could be higher. uc dislocations twice a year. it may be more stretched out. if and when that happens, my belief is it will be a lot larger than it used to be. incidences are less but the magnitude is going to be more. >> as big as the last crisis? what thet depends trigger is but i would not rule it out. everyone is long right now. european finance was the focus of bloomberg's exclusive conversation with the vice

chairman. francine lacqua asks if he thinks europe might take rates lower in 2020. >> they could. i think there is some room left in theory. i think they would prefer not to do that for many reasons. further negative interest rates is negligible. will not be required in the baseline scenario. the preference would be to not do that. we will see what the macroenvironment provides. not terrible. particularly in price pressures. especially in europe. aboutnow there is concern

liquidity in the markets. especially the end of the year. what about 2020? >> what i worry about most, it continues to be political surprises. big political shocks. trade risks manifested themselves an actual risks. move that we can sideways. if we can stay away from political risks, that would be positive. my sense is the market is underestimating inflation could become a story. you see it in the nonfarm report. wages are coming up. inflation is seen some signs of life. from a banking perspective, that could be a positive. muchyn: there was

discussion of the green deal, the new program put forward to bye the eu carbon neutral 2050. it would have an impact on many industries including their airline industry which would taxes.gher the ryanair ceo said exactly what he thinks about that aspect of the plan. >> taxation does nothing for the environment. newave said to the commissioner, european airlines are investing 170 billion dollars over the next decade, buying new aircraft which will carry more passengers. but burn 20% less fuel. we are investing in an industry to deliver growth in a more way, andle gray --

taxation will setback that agenda. >> i imagine the response would be, that is not enough. the airline industry is threatening to overtake power and utilities. biggestis one of the emitters among the airlines. what do you think the industry can do to absorb higher taxes? ofi think there is a lot misinformation. we are one of the most efficient industries. we account for less than 2% of co2 emissions. shipping accounts for 5%. despite that fact, we are investing heavily to reduce those emissions. these technologies are very much at the formative stage. we discuss this with the

commission. the commission needs to step up and do more. pay 600 $30 million a year in aviation taxes. been trouser by european governments. we want to bring forward the development of new propulsion systems and sustainable aviation fuels. increase or improve battery technology that will help us lower the carbon footprint from the already low figure of 2%. the assetuld management industry review big oil? in terms of investment strategy? humanyou look at how activities lead to greenhouse parts ofions,, some

the system are easier to decrepit eyes then others. lot more focused they are. even in a world heading toward net zero omissions, in line with what the scientists say is necessary, even in such a scenario, we can use oil and gas for some sectors. some sectors are harder to do carbonized. maybe for petrochemicals. we can still use oil and gas. want tompanies do we hold. we look at things like the operational omissions efficiency. how much they are transitioning toward alternative energy in their mix. you can differentiate between some of the companies.

a manager of a fund would one to be thinking how much that would want to align their assets with two degrees, or indeed 1.5 and then taking a view how much oil and gas we need in such a view -- world. ♪

"bloomberg best."

of the newsroundup and politics. some of the biggest banks were in the spotlight, reshaping their businesses. overhaul.sweeping cl, they areterim replacing their top investment banker and operations officer. ve for aa confident mo man that is in interim ceo. very forceful move for someone brought in as the interim guy. this shows he is putting his stamp on it. you cannot rule out one external

candidate. citigroup. he is left in there, a recent shakeup of the bank. rendy commercial bank out there for several years -- ran the commercial bank out there. >> they are tightening their belts. reducing -- about >> they have to meet efficiency targets. out actually called technology units of the bank. invest inen banks automation and other technologies. this seems to be the first time we see a bank saying, this is not going away. >> credit suisse this morning and focus.

negativesions and trait tensions away in the bank tensions weigh on the bank. >> i think investors are going to be surprised but most of all, disappointed. they have cut back their main target. share buybacks, dividends, safe for now. is going toow what happen in the next couple of years. >> deutsche bank considering deep cuts. we have learned they could be cut as much as 20%. they try to eliminate billions of dollars of costs. what happens if -- >> deutsche bank and obviously they have been trying to turn around this investment banking

unit. how do they retain talent while also cutting that onus pool? they may choose to pay their top performers. what the investment bank looks like a year from now will be an interesting story. ted says the bank is truly sorry he may have exposed people to harm after an linked to child-abuse. the bank is also reeling from allegations of money loss. wiped $5 that has billion out of the lenders value. currently onare shareholders questions. these are mainly from small retail shareholders.

been one shareholder after another demanding to know what was wrong with the culture. that allowed these mistakes to be happening. was there not enough investment in technology? the bank is making a start by saying they are going to get a lot more precise. softbank isarning tapping goldman sachs to provide one of its biggest -- the company we work. there will be a line of credit for $1.75 billion. it is effectively a we work alone. but -- loan. >> it is a 1.7 $5 billion letter of credit goldman has reached out to other banks to see if they would be interested in

participating. what is making the facility more bank asis south the borrower. think weworkight is a concerning name, they have soft bank as a guaranteer. >> nestle is selling its ice cream business in the u.s.. the deal aims to create a stronger challenger to unilever. they are selling their u.s. friends to a joint venture that owns some european brands in order to take on unilever. businesses,uropean were sold eight years ago. they formalized that in 2016. if you looked at the global ice cream market. putting the u.s. business will

give a 10% share. it gives them a chance to compete and bring out new products. to actually compete with unilever. >> shares of boeing lower today. the certification of the 2037 -- 737 max extending into 2020. >> the most recent update was might givet the faa them leniency to start delivering the plane in 2020. the messaging today leads me to believe that will not be the case. the reason that is problematic, if you are not delivering planes, you are not getting paid for them. strikes, the of prime minister has laid out is governments new public pension

system. age will bent increased for the youngest. after a series of concessions. unions say the plan will not do enough. we have 42 different systems for the pensions. wantrime minister said, i one universal system for everyone. get the full pension, you will now have to work until you are 64 years old when the official age at the moment is 62 years old for full retirement. the question is whether with the details of the response, it will make public opinion switch before the speech. public opinion equally split.

world anti-doping agency has banned russia from the olympics for four years. the agency said, russia was afforded every opportunity to get an order. for the good of its athletes and the integrity of sports. it chose instead to continue deception and denial. a it was clear russia as national team cannot compete over the next four years including the summer olympics in tokyo. the world cup in qatar. only those individuals who can demonstrate no association with doping will be able to compete and then under a neutral flag with no russian officials permitted to attend at all in the next four years. >> saudi aramco jumping for a second day, pushing the oil giant's value.

how likely is that these gains are going to continue? >> a lot of people expect government funds to support that. you have hedge funds on the index. we have a few days of this kind of limits, we will see some of the retail investors looking to cash out. pressured put downward going into the new year. >> paul volcker has died. , threemer chairman decades later, led barack obama's bid to rein in per tire terry risk-taking. the age of 92.at what did he invent? way they carrye

out monetary policy. weekhad to figure out in a to week basis, where they thought the fed rate would be trading. that was a different way of doing and. it ended when voelker left. the was his contribution to mechanics of monetary policy. ♪

to see whereking you think nine different asset classes end up around this time

next year. put your reputation on the line. about 30,000 functions in the bloomberg and we always enjoy showing you are favorites. here is another you will find useful. it will take you to our quick takes where you can get insight into timely topics. here's a quick take from this week. andhitty chitty bang bang, harry potter, all feature something people have been dreaming about for decades, flying cars. to ask, aretural they next? although jetsons style family flight is still decades away, their taxis could be in wide use by 2030. they would be less like a flying car from the movies and more like a hobbyist drone.

they are designed to be lighter, quieter, more environmentally toendly, and less expensive operate than helicopters. a major difference is they will run on electricity. they will not be used like a typical on-demand taxi. more like a fairy running between two points. as technology regulations and popular acceptance advance, they operated remotely and eventually autonomous leap. companiesmore than 70 with development projects. the biggest hurdle is batteries. large, heavy, and do not last long. but battery technology is improving, taking us closer to

our flying vehicle dreams. there are a lot of regulatory hurdles. become dangerous if anyone could become a pilot. air taxis could take longer. regulators will be especially pilots at flight. but test flights could begin ton and uber elevate hopes connect cities to their suburbs by 2023. driverless car's are expected to reduce traffic and take passengers door to door. that was just one of the many quick takes you can find on the bloomberg review can also find them at bloomberg.com, along with the latest news and

analysis. thank you for watching. i am rosalind chin. this is bloomberg. ♪

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[captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. visit ncicap.org] ♪ >> i am in san francisco in for emily challenge. this is "bloomberg technology." coming up, tech stocks on the move. the u.s. and china agree to that ne of a trade deal includes splectwal property. simmering tensions. continuing to floor