>> a fallen automotive giant flees to lebanon saying he couldn't get a free -- fair trial in japan. peter navarro says a trade deal is in the bag. china's manufacturing expands in december. a rally to remember. years poised for its best since 2016 and bitcoin is up 9,000,000% since 2010. ♪ nejra: welcome to surveillance.

even though it might be a happy new year, not so happy in risk assets. second down day. dropping the most in more than three weeks. caution coming into equity markets and risk assets here at the end of the year. most currencies gaining against it. edging out.yield same dynamic where money is moving out of equities but also out of bonds. the10 year yield, it was arrest the stock the financial world. carlos ghosn was put on trial in japan. allegations that he denied. the former head of nissan said he fled to lebanon to escape "injustice and political persecution."

let's bring in will. great to have you with us. carlos ghosn has been under house arrest and was allowed out on bail in april. how did he manage to get out of japan under such heavy surveillance? surveillances is in the right term for this. it's a mystery. has his threed he passports so perhaps he escaped from japan using a different name, different passport. but he was under very tight surveillance, house arrest since april. very strict plans. a camera was trained on his door at home. he was barely allowed to even speak to his wife. so there are questions about how japan sort of let him slip through their fingers. reports saying that perhaps he left on a private jet. we also did get a statement from he reallyself where

sorta criticized the justice system in japan. 100% conviction rate in cases like this. saidis has -- what has he in the thing he's released? will: the record suggest with that 99% conviction rate, you're likely to get convicted. lebanon.now in have an extrat dish in treaty with japan and also is a big hero in lebanon. billboard of support of supportive him after his arrest. they won't be rushing to send him back either. the case is now completely up in the air. davis, -- will

davies, thank you. >> hong kong's new year's resolution for 2020, to restore order and harmony, that's the message from carrie lam and her year and a video message. the leader says they have to tackle the problems they have and acknowledge the shortcomings in the system board hong kong's face six-month of pro-democracy protests with another major rally set for new year's day. russia and ukraine have finalize their gas deal with a day to spare. to continuew them the last -- next five years. ukraine remains the main export route for europe. reduce their depends on the soviet era pipeline with the nord stream 2 pipeline. it's very likely more sanctions will be imposed on iran. the comments, the way of -- in the wake of rocket attacks that have been blamed on orion proxy

forces. the u.s. -- ministerain, the prime 's signaling growing confidence he will be able to form a government. he still need the backing of the catalan separatist party. his leading council's meeting to make a final decision and if successful, it will lead the first coalition government since the 1930's. in australia, thousands of tourists and locals are seeking refuge on the beaches. that is the wildlife -- welfare crisis intensifies. thick black smoke turned the morning pitch black. two more people have been killed , bringing the death toll to 12. global news 24 hours a day on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm karina mitchell, this is bloomberg. a gauge of china's manufacturing sector added to evidence of the world's

second-largest economy is stabilizing. the manufacturing pmi index remains at 50.2 while the export orders expanded for the first time since may of 2018. joining us is our china economy editor. how should we interpret this data? is it a sign of stabilization or reflection? successa sign of some from policymakers in putting a floor under the slowdown in 2019 which could've have been a lot worse. it's also a sign the global economy is doing ok. the export orders you mentioned had quite a significant turnaround for manufacturing in china. some areas that might be causing some concern, there were employment components that did not look too great.

bloomberg economics interpretation was it's not the end. would you agree to that? thats i would agree with and certainly there's plenty in the data that shows the continued policy action in 2020 is probably going to be necessary and from my point of view one of the most worrying factors was that an index for small companies declined quite sharply in december. so it's fragile but it is a stabilization. with: great to have you us, thank you so much and happy new year. coming up from deadlock to a new prime minister and a new divorce deal, brexit has dominated the u.k. agenda in 2019. some key moments and what 2020 has in store. this is bloomberg. ♪

nejra: this is bloomberg surveillance. let's get the bloomberg business flash with karina mitchell in new york. >> jp morgan wants full control of its futures joint venture in china. lendere first global taking advantage of the opening of the nation futures market. china's allowing full foreign control. no comments from jp morgan. they are electric -- a preemptive move against the state landmark measure to ensure workers get employer protection.

neo-surging after the lost less money than expected. they still report they are running low on cash. china car markets have been slowing and they have cut thousands of jobs and started to scale back marketing. that's the bloomberg business flash. u.k., the to the story of brexit for most of 2019 was one of deadlock but now number 10 has a new occupant. how did we get here? here's a look back. i've always said no deal is better than bad deal. i thing it's a good deal for the european union. i don't want to see article 50 extended. their deal, their proposal, the one the prime ministers put is clearly dead. >> we will now live not leave on time.

greatelay is a matter of personal regret for me. i will shortly leave the job that it has been the honor of my life to hold. i do so with no ill will, but with enormous and enduring gratitude to have the opportunity to serve the country i love. , unite thebrexit country and defeat jeremy corbyn. we in the u.k. want a deal. >> we will leave by october the 31st in all circumstances. >> this reckless government only has one plan. to crash out of the e.u. without a deal. >> to advise her majesty to prorogue parliament was unlawful. >> we disagree with what the justices found. >> this unelected prime minister should now resign. we've gotten to

the stage we have no choice. >> with the biggest campaign this party has ever mounted. >> this one nation conservative government can -- has been given a powerful new mandate. of the lastory three and a half years will be at an end and we will be able to move forward. joining us now is our senior executive editor. what an impactful look back there. >> slightly exhausting. nejra: even at 100 seconds. to me the moment that really does stand out was one of the most recent ones. 10:00 p.m. on december the 12th we got that exit poll and we saw the size of boris johnson's majority because that the moment where everything really did change. we then knew he was going to get his deal through parliament. that we would have several years now boris johnson government and

completely unconstrained. no more these nailbiting votes. we won't see that in 2020. boris johnson will take this negotiation in this process whichever way he chooses. that's going to make a very different tone to our politics. nejra: that is really the most crucial interesting bit, the fact boris johnson and the eu. he could negotiate putting much what he wants. you and i may not spend as much time out in the cold in westminster. , will he still face challenges in terms of getting this trade deal through with the eu on the home front? >> there are many hurdles he's got. the deadline is the end of 2020 is very ambitious. we know european saying it won't be possible. there will be huge fights. what about the status of the city of london, access to the

different marketplaces. what can french and spanish fishermen do. different parts of your blog different axes to grind. it's going to have to be trade-offs on both sides. but ultimately yes you are right, he doesn't have to consult parliament. we've seen, you saw the supreme court ruling there on his prorogation of parliament. maybe more challenges through the courts. gina miller and her friends could beme definitely certain to see some of that. the prime minister with a huge amount of power, the likes of which we haven't seen since the big majorities of tony blair and margaret thatcher. so to very different tone and he is going to be able to get stuff done. >> were the prospects that we do get an extension beyond 2020?

i know they've ruled it out, but could that still happen? >> he said he was going to leave on october 31, that didn't happen. it didn't seem to do him any harm through the end of january. he could get to the year and say we need another six months in order to get the perfect free-trade deal and he could change his mind on that. who knows. he really does hold all the cards at this point. do we need a complete trade deal tariffs,it's areas of maybe goes into a longer transition. we won't have the same drama around that we had around no deal brexit before. so much of the relationship between the u.s. and u.k. is contained and hammered out in that agreement. >> nejra: what are the prospects

of the labour party? >> they are starting on the leadership race next couple of weeks by early spring we should know who the leader is going to be but there's an almighty battle already going on. what sort of new directions does the party need to take? does it stick with these more left-wing principles like corbyn that is enmeshed in the fabric of the party, nationalizing huge parts of the economy. we just reading wealth or to the try to move towards the center where maybe it can drag boris johnson conservative party a little bit. we will have to wait and see. membership of the labour party are largely made up of people who supported jeremy corbyn so they may decide to change the personality at the top but not the policies. nejra: what's the impact on the city and finance and all that? does the city breathed a sigh of relief with the level of

certainty? worst was a corbyn government. theon is set to remain prevalent financial center for europe. david merritt, thank you so much. today marks 20 years since vladimir putin came to year -- power in russia. we look back at his record over the two decades and see what's next for the russian economy. this is bloomberg. ♪

nejra: you are looking at live pictures of beirut. we know carlos ghosn has left japan and entered lebanon. we've been asking the question all day how exactly he managed to do that given he was under house arrest since april. a newspaper is saying he entered legally with a french passport. that newspaper citing the caretaker justice minister. today marks 20 years since vladimir putin first took power in russia but what is his economic and political record? let's talk about some of the struggles he's facing. >> one is domestic issues.

no this is a man who thrived in foreign policy and bringing back those glory days of pressure. on domestic policies he is facing economic and political struggles. some of that is stagnant living wages, career prospects are --king dim and he is on the second thing that's really what is going to struggle with the needs to grapple with, he is starting to think about what happens after 2020 -- 2024. he says he won't change to add another term but there could be workarounds. could they potentially change more power to the prime minister , the power lies in the president, and then other options almost like the resetting of a clock back to zero. changes do not have two consecutive terms and then putin can run again for two absolute terms. the clearest thing, 20 years in power.

in maintaining control of power is one thing that will probably always a top of mind. >> let's pick up on some of these themes with henry meyer in moscow. let's start with 2019 and what we've seen across some of the asset classes. such a strong year for russian stocks and the ruble. can putin take credit? >> definitely. one of the main achievements of withra has been stability economic policy. they pursued a very prudent fiscal policy, they have very low debt, they have a budget surplus and that made russia an attractive destination. there are other factors like the oil price which is helped. in general, his economic policies have helped. nejra: we were just discussing some of these in terms of his economic record and what challenges lie ahead for the russian economy.

what would you have to add on those themes as we look ahead to 2020? >> obviously russia at the moment is in a low growth situation. putin first two terms, managed to get the growth of 7% a year and was held at that time by rising oil prices and also quite market friendly policies but now russia is stuck between 1% to 2% which is not enough and that is of course his major challenge going forward, this has had an impact on people's income, they've been falling for the last five years. despite disability, what we've seen, we are in an era where you can call it stagnation. nejra: what does that mean reaction for russia central bank. the miller cut several times.

-- they have been able to cut several times. >> the monetary policy has actually proven quite flexible. inflation is now down to just above 3% which is extraordinary if you consider the levels in previous years and so that is deaf on the macroeconomic front, they've been successful. henry meyer, thank you so much. coming up, as a decade come to a close, a look back at the markets epic bull run. this is bloomberg. ♪ whether you're out here on lte

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japan. ending on a high white house adviser peter navarro says a trade deal with china is in the bag. china's manufacturing sector continues to expand in december. and a rally to remember. it has been a bumper decade for global stocks. oil is poised for its best year since 2016 and bitcoin is up 9,000,000% since 2010. you are watching "bbg surveillance." i'm nejra cehic in london. let's check in on what assets are moving now on the final day of 2019. here's annmarie hordern. >> happy new year. let's talk about the dollar, down for the fourth day today. we see some repositioning at the end of the year. on top of that, we see a little ened demand. crude oil in the u.s. is down today just under $62 per barrel. as you mentioned in the opening, oil is about to have its best year since 26 team. at the end of the year -- 2016.

at the end of the year, we see geopolitical issues. aboven is trading at just 7000, down 0.4%. over the course of the decade, bitcoin has jumped 9,000,000%. no other asset can come close to that. nejra: a mind-boggling number. let's get the bloomberg first word news. >> as you have been reporting, carlos ghosn has escaped japan, fleeing to lebanon. the former chief of nissan and renault was facing a trial for alleged financial crimes. he denies wrongdoing but says he is not fleeing justice, just the japaneseese -- rigged system. he is a citizen of lebanon. the country does not have an extradition agreement with japan. the end of the year is looking a bit brighter for the chinese economy, with the manufacturing sector continuing to expand in december. new export orders growing for the first time in over 18 months. this as a preliminary trade deal between beijing and washington is expected to be signed in early january.

needsropean central bank a more precise inflation goal, according to a board member. it is supposed to be symmetrical. itsecb is about to launch first strategy review in over 15 years. the u.k. is giving a pay rise to the lowest earners next year. the move is to deliver on the manifesto pledge to raise living standards as the country leaves the eu. the treasury says it puts the u.k. on course for a living wage of 10.50 pounds per hour after five years. global news 24 hours a day, on-air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am karina mitchell. this is bloomberg. nejra: thank you. it has been able market to surpass all others and no one side coming. or an even better decade for stocks than they

seemed. let's take a look back as we end the year. >> eisenhower was in the white house, tv was mostly black and white, and the baby boom was at its peak. that was the 50's, the last time stocks had a decade like the one that they are wrapping up now. stocks in the s&p 500 have returned 249% in the past 10 years. that is about 1.2 times the historical average. not only that, the 2010's for the first decade without a bear market, a 20% drop from any peak. there were plenty of moments to make investors queasy. six separate 10% corrections, the flash crash in may of 2010, europe's sovereign debt crisis in 2011 and 2012, and now, a global trade work. but none of those killed the bull. while the perceptions of risk were high, fundamentals were stable. u.s. gdp expanded by 1.6% to 2.9% each of the last 90 years. it is expected to be -- nine years.

it is expected to be the same range in 2019. it led to a record stretch of wins for the market, like a kid sports league, almost every investor took home a trophy. ♪ that is a look of the historic bull run in the u.s. let's focus on europe and the biggest winners and losers in 2019. joining us is sam on stead. great to see you. how good a year has actually been for european equities? >> very good is probably the easiest way to put it. the stoxx 600 trimming some gains in the last few days. very low volume come of course. it will end the year -- low volume, of course. it will end the year 23% higher. nejra: we hit a record in december. >> exactly, and we are still hovering in and around there. nejra: if we look at individual

stocks, is there anything we can deduce from the winners and losers? let's talk about the winners first. sam: as a general rule, you will see mostly individual stocks. it will be individual stories that really shine. the best parmar for this year, a telecoms -- performer this year, a telecoms company that has managed to get through some of their debt and they raised guidance this year. their shares have more than tripled this year. meal kitsh, the company, has tripled this year as well because marketing costs are going down and they raised guidance. nejra: it has been a mixture of sort of stocks trading higher or lower on fundamentals but also on some re-rating. if we look at some of the losers, i mean tula oil stands out. what happened there? tula oil, 72% in a single

day they have felt. they will end the year still down 62%. mnc health is now down about 35%. those two have only entered in december. notrest of the news is quite as spectacular as owners. nejra: you have also -- as the winners. nejra: you have also been looking at the u.k. what do you see? >> the ftse 100 has underperformed. it has underperformed the stoxx 600 i about 15% versus the 23% for the stoxx 600. tullowe 250 in december, oil, the drop in the ftse 250, has really had a great december. it is slightly outperforming the sticks -- the stoxx 600 as we and the year. nejra: great to have you with us and happy new year. inlos ghosn says he is lebanon, having fled what he calls a rigged japanese justice

system. more on our top story next. this is bloomberg. ♪

♪ >> carlos ghosn has confirmed he has fled japan, where he was awaiting trial for alleged financial crimes and that he is now in lebanon. he says that he has not fled injustice but escaped injustice and political persecution. people familiar with the matter tell bloomberg news that he fled japan because he did not believe he would get a fair trial. in a statement from beirut, he says he had been held hostage by rigged japanese justice system." we don't know how he got out of japan. there is no immigration record leaving japan and

authorities are checking whether he used an alias. there has been no change to his bail conditions, which required him to surrender his passports. hold several to passports, including of lebanon, which does not have an extradition treaty with japan. lawyer, speaking in tokyo, says he knows nothing more about the situation other than what is being reported in the media. the mystery deepens. nejra: we have more on the carlos ghosn story for you throughout the day. let's get the bloomberg business flash karina mitchell in new york. >> good morning. jp morgan wants full control of its futures joint venture in china. the bank plans to boost its stake from 49% to 100%. it is the first global lender taking advantage of the opening of the nation's futures market. china's allowing -- china is allowing full foreign control of the firms from

january 1. no comment from jp morgan. hit yesterday after analyst accounts said vehicle deliveries may miss estimated targets. it is below the company's range 0-400 thousand. huawei will overhaul its executive ranks next year after growth slowed further in the second half of 2019. china's top tech company is bracing for a painful year ahead if the u.s. maintains restrictions. that is the bloomberg business flash. nejra: thank you so much. let's take a look back at one of our top interviews in 2019. goldmanler spoke to sachs ceo david solomon after mario draghi's final meeting as ecb president. they spoke about the negative rates environment, banking consolidation, and what goldman's focus was for its european business.

>> we have been investing. we have new leadership in our wealth management platform in europe and are focused on expanding our market share here. if the right acquisition in a long, we would certainly -- acquisition came along, we would certainly consider it. more broadly in europe, there is a lot of talk about bank consolidation there. a number of regulatory hurdles especially. do you expect banking consolidation? is it coming for european banks? does goldman sachs want to play a role in that? david: on the question of banking consolidation here, i think that there are lots of compelling reasons why some consolidation here would benefit the strength of european market. it isthink it is hard and not clear that it will actually happen. i think it will be good for the european capital markets region

if you had more of a european leader, consolidated european leader in some way. whether or not the local politics or the business rationale allows that to happen, i am not sure, but i watch it as you do. ano think there is certainly opportunity to strengthen the position of one or two players through some m&a, some consolidation. matt: i was at mario draghi's final ecb press conference. he says we are very happy with our negative rates experience. christine lagarde taking over unexpected to -- and expected to toe the same line. are negative rates helping boost inflation? david: i think when we look back and the book is written, it will not look like a great experiment. i don't think negative rates are bringing the benefit that we would like to see. growth in this part of the world has been lagging and negative rates have not allowed the acceleration of that growth. i don't think negative rates are

really constructive. we will have to wait and see how this plays out over the years. i worry when we look back at this experiment of negative rates, we are not going to like what we see. matt: one of the things central bankers say is that fiscal stimulus is needed to mitigate the unwanted side effects. i know that you will be talking to companies around germany. surely, they will have something to say about negative rates. they will probably want to talk about infrastructure spending they think is needed. do you feel like fiscal spending is needed? do governments need to chip in more? david: if you talk to people in a germany, there is a significant amount of fiscal stimulus being spent. if you look at some of the capital being spent to move germany toward a more green economy, there is no question. now is a relatively significant fiscal stimulus. nejra: that was our interview with the goldman sachs ceo david solomon. coming up, we will take a look at this decade's best performing

assets. bitcoin has seen eight 9,000,000% rise since 2010. we will take a look at what fueled the surge and what's next. this is bloomberg. ♪

♪ nance, economics, find and politics, this is "bbg surveillance." i'm nejra cehic in london. we are seeing a bit of caution and equity markets after the s&p 500 had its worst day in more than three weeks yesterday. u.s. futures are flat but the stoxx 600 coming off the lows from earlier, unchanged now. euro near a 4 month high. it's a story of dollar weakness for a fourth day against g10. the 10 year yields edging up two basis points. who wins when companies purchase their own shares? one argument is the company's executives coming out on top. " bloomberg businessweek" breaks down the numbers. >> lester, s&p 500 index

companies bought back a record number of shares. this year, they are on track to buy the second-most ever. one commissioner, robert jackson, had his staff study 385 recent buybacks. they found shares rose by about 2.5% more in the days after buybacks than otherwise would have been expected. they found that twice as money companies -- many companies have executives selling in the eight days after a buyback announcement as they do on an ordinary day. the value of those sales is more than five times higher. when a company buys back shares, it is signaling confidence in its future. when it's executive cell share -- sell shares after sending that message, it seems to some like a legal version of illegal pump and dump stock but if you listen. jackson wants the agency to rewrite the rules and bar insider sales for a certain amount of time after a buyback is announced. jay clayton has not agreed,

although he says he is happy to continue the conversation. ♪ nejra: that is a look at buybacks. besty markets globally, year since 2009 is what we are looking at for 2019. how much could it continue in 2020? the u.s. says airstrikes on five bases in iraq and syria used by an arabian backed militia sent a warning that president trump's patience has its limits -- iranian backed militia sent a trump'sthat president patience has its limits. >> these were defensive strikes at the president ordered. we have american troops in iraq to ensure the enduring defeat of isis. those american troops are located at iraqi military bases. over the last two months, there

have been almost a dozen attacks by iranian proxies against those bases. a couple of days ago, an american was killed, american soldiers and iraqi soldiers were injured. the president decided as an active defense to order airstrikes, three in iraq, two in syria. we are also trying to send a message to iran that they need to stop this. >> iran should stay in iran, not metal in iraq, right? >> exactly. iran has been running expansionist foreign policy for 40 years. the president has made very clear that he has shown a lot of restraint. in light of iranian provocations. we also made clear that we will take decisive action if there is an injury or harm to our personnel or interests. you have the military response just yesterday. >> we have spoken previously about the maximum economic

pressure campaign against ou just alluded to their expansionary policies. i am curious, it would appear that more sanctions are likely on the table, more sanctions in the short-term. >> right now, iran is facing its worst financial crisis in its 40 year history. this is the islamic republic of iran. as we look to 2020, less iran starts behaving like a normal nation, you are going to start seeing many more sanctions. we have put in place the most -- most pressure in the last 40 years against this regime we have put in place. they are deep into a recession. we have collapsed their oil experts. we have collapsed all the foreign direct investment into iran. we will continue to drive up the costs on the regime for behaving like an outlaw country. >> more sanctions could still happen? >> very likely. >> meanwhile, there are protests

throughout the region. how have they been influencing ah as a proxy force in the region? >> you see protests occurring at the same time. in all three countries, massive protests and in all three countries, the consistent thread is in opposition to the iranian regime. the people in each of these three countries are tired of iran's model of corruption and sectarian violence and also terrible economic conditions. regime that prioritizes ideology over the welfare of their own people. whenever they go into countries like lebanon or iraq, it always makes things worse for the people in those countries. >> meanwhile, secretary pompeo giving a speech on iran the other week about their human rights violations. he mentioned that they have submitted something like 36,000 tips and submissions using social media platforms and that

the administration has been using these submissions of violations of the iranian regime to piece together some of these horrific human rights violations. what is that number up to now? >> 45,000. there are -- work two things -- there were two things we did when the protest started. we stood with the iranian people. the president, secretary of state expressed their support for the demands the iranian people were making of their own government. the secretary also created ascension a tip box for them to submit photos, -- essentially a tip box for them to submit photos and evidence of regime violence against its own people. we've had 45,000 submissions done to telegram. >> quickly, several weeks ago when i spoke to you after that exchange of prisoners, and in fact, a u.s. prisoner being you worked iran, virtually around-the-clock to

get that individual released. it appeared that may be there was going to be a glimmer of hope that things would be trending in a positive direction. do you still have that hope? have the events of the last 24 hours completely walked back? >> we made it clear that there two tracks, the dialogue where we try to get the americans wrongly detained in iran out of iran and back home to the united states. the other track is where we are advancing our national security objectives. iran presents many threats to peace and security, nuclear threat, missile threat, regional aggression, and the hostagetaking of americans. we are going to continue these two tracks. we will try to get the remaining americans out of prison in iran but we will continue to execute maximum pressure. nejra: that was brian hooker, the u.s. special representative ook, the-- brian h u.s. special rez up that's representative to iran -- brian

hook, the u.s. special representative to iran. >> bitcoin has been up this decade nine millie percent. you heard that correct -- 9,000,000%. you heard that correct. it has been quite astonishing what bitcoin has been able to do over the last 10 years. the questions critical for the next 10 years, how do they have this mass adoption? they will be facing a lot of scrutiny from regulatory administration throughout the world. nejra: annmarie hordern, thank you and happy new year. happy new year, everyone. "bloomberg surveillance continues in the next hour. more on carlos ghosn and the year ahead. this is bloomberg. ♪

♪ matt: the great escape. fallen automotive giant carlos

ghosn flees to lebanon, saying he couldn't get a fair trial in japan. it's another twist in a saga that began with his arrest a year ago. ending on a high white house adviser peter navarro says a trade deal is in the bag. this as china's manufacturing sector continued to expand in december. closing the decade, a rally to remember for global stocks. oil is poised for its best year since 2016 and bitcoin is up 9,000,000% since 2010. good morning. this is "bbg surveillance." i am matt miller in berlin. tom keene and francine lacqua are off. i want to take a quick look at the data today. very thin trading. of course, most markets here are either closed or only partially open. for example, the dax is closed

today in frankfurt but the ftse in london is open but will close early. you can see s&p futures are up a little. very thin trading in the u.s. as well, even if all the exchanges are open on new year's eve. the stoxx 600 is down. those stocks that are trading slightly off this morning. you do see gold rising. investors are also buying the yen against the dollar, signaling a bit of a bid for a safe haven. i want to point out one chart on my terminal this morning. red over the past decade 9,000,000%. it is an asset that has had many skeptics, as well as vigilant supporters. some people call it a currency, others, commodity. if you look at it since 2010, it is up 9,000,000%.

you really had a chance to get in over the first half of the decade up until 2017 for very cheap. it then shot up and then crashed --matically, but has been has recovered to some extent. just an interesting asset to point out that i have been reporting on for most of the decade as we come to the close of what most people feel is a decade. actually, today isn't really the last day of the decade, because there was no year zero, the decade ends at the end of next year, but popular culture tells us that we should feel that the nine ends the 10 years. let's turn to the top story, the arrest that shock the financial world a year ago, carlos ghosn was put on trial in japan for alleged financial misconduct and misuse of corporate resources.

those are allegations that he denies. now, there is a new twist. nissan and renault says he has fled to lebanon to escape persecution. we are joined on the phone by dana. what do we know about carlos ghosn's whereabouts? >> hi. we know he is in lebanon, but we don't know exactly where he is. there were a lot of reports of how he got here. i went to his house in beirut in the early morning. there are no signs of him being there. some of the windows are shuttered, some are open, few photographers outside. that shopkeepers and owners around his house said they did not know that -- even shopkeepers and owners around his house said they did not know that he arrived. we don't know exactly where he

is staying. is apparently, he a figure that looms large in lebanon. i read that he is on the face of a stamp and i also read that he has met with the president already. how big, how famous is carlos ghosn there? na: carlos is a national hero in lebanon. beforebeen as such even this whole ordeal began in japan. arrested, there were billboards that sprung up nationwide, you know, in support of carlos ghosn. people really love him. they admire him, because he is seen as one of the people who -- one of the lebanese who actually made it big outside of lebanon. lebanon is a very small country -- like, bige

numbers of immigrants. he is one of the people who made it big. lebanese officials have a voice to their support for ghosn when he was arrested actually, saying that they will give him the support that he needs. one of the officials today, the caretaker state ministers said he entered lebanon legally. he said he used his french passport and national id to enter the beirut airport. the are also other reports saying that he was smuggled in a box from his home in japan to here. these reports are unverified. as for his meeting with the president, this has not been 100% verified by our sources here. so yeah,. matt: very interesting story.

we will continue to follow this. any idea what he might do next? we heard that he will hold a press conference in lebanon, but we are not sure when this will be. matt: all right. joining us from beirut. let's get to the bloomberg first word news with karina mitchell in new york. >> breaking news from baghdad. according to the associated press, iraqi shiite militia supporters broke down the gate of the u.s. embassy and stormed inside the compound. there are reports of gunshots reportedly in response to u.s. airstrikes this week. in china, the economy is ending the year on a brighter note. the manufacturing sector continued to expand output in december. production recovered for a second month.

more u.s. sanctions on iran are likely. the u.s. will continue a campaign of maximum economic pressure. brian hook says u.s. actions have caused the collapse of iran oil experts and foreign investment the country. the australian wildfire crisis has gotten worse. at least 12 people have died and thousands are seeking refuge on beaches. the emergency has put a spotlight on australia's capacity to fight the blazes. fire services are mostly manned by volunteers. global news 24 hours a day, on-air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am karina mitchell. this is bloomberg. matt? matt: thanks very much for that. the dollar has dipped for a fourth day, as investors close out a dramatic year for most asset classes. it has been quiet -- quite a

2009, despite the global rally for stocks. bitcoin is up 9,000,000% from the start of the decade. oil pole eased -- poised for its best year since 2016. gold and silver ending 2019 on a bit of a high know as well. joining us to discuss all this and more is valentin marinov from credit agricole. let's kick it off with the greenback. do you expect this bearishness to continue into 2020? valentin: yes indeed, to a degree. we do think that investors will remain less excited about the dollar, let's put it this way, especially in the first half of next year. the view is based on our expectation that the u.s. will of soft trend annualized, which would ultimately force the fed

to deliver yet another insurance cut as soon as june of 2020. the first half of next year could prove challenging for the dollar. unwinding ofsome the so-called a dollar carry trade funded in euro, funded in yen to continue in the coming we expect some unwinding of the so-called dollar carry trade funded in euro, funded in yen to continue in the coming months. we expect to the markets to be the cautious -- we expect markets to be more cautious on the dollar in the coming months. we see euro-dollar targeting 1.15. dollar-yen down towards 1.06, 1.05.

pursue could indeed or chasing the coming months. matt: euro 1.15. is that due to euro strength as well as dollar weakness? valentin: i have to say it is really both. the dominant driver some unwinding of dollar carry trades on the back of deterioration in u.s. fundamentals. we do expect that the euro zone economy will start consolidating at the start of the new year. the combined factor of some recovery in the region's main trading partner, china, plus some abatement, finality about brexit could help the regional pmi's to recover. we could see industrial production finding a bottom. overall, manufacturing sector in the euro zone may put 2019 behind and really see some recovery. on the back of that, we also expect the ecb to keep rates relatively stable.

the euro somewhat less attractive as it seems. taken as a whole, those two considerations give us higher euro-dollar from here. matt: we have a great map on the bloomberg showing analysts and economists expectations for 2020 in terms of central bank moves. the market doesn't expect anything out of the fed or the ecb. i am wondering if your opinion differs or if you could see maybe an outside chance that we get cuts on either side of the atlantic. valentin: as indicated already, i think the fed will be forced make another cut as soon as june 2020. this will come on the back of the continuing expansion of the fed balance sheet. in other words, we are questioning really the market consensus for unchanged rates

next year. on the others of the land, really in frankfurt -- of the frankfurt,eally in the consolidation we expect in the economy, plus the fact that the ecb is now going through a time of reassessment of its policy, of really its inflation target may make the bank a little less willing to overall.te further in other words, we believe the ecb is very close to the rock bottom of its easing cycle. what we have in mind for the next 3-6 months is a policy convergence of sorts, whereby the fed will have to ease, continue its balance sheet expansion. the ecb will be largely sidelined during that period. that gives us the stronger euro-dollar profile we have in our forecast. matt: you're going to stick with us as our guest cohost for the hour. valentin marinov of credit agricole. ending on a high.

white house advisor peter navarro says a trade deal is in the bag. this as china's manufacturing sector continued to expand in december. we will discuss next. this is uber. ♪ -- bloomberg. ♪

♪ >> this is "bbg surveillance." i am karina mitchell and let's get your bloomberg business flash. a group led by tencent is purchasing 10% of the world's largest music company. it values vivendi universal music at almost $34 billion and will allow tencent and its partners to increase the stake to up to 20% the next year. vivendi has been trying to cash in on the soaring value of the music business.

tencent could help universal get better access to china. uber and postmates are suing california, alleging that labor rights laws set to go into effect are unconstitutional. they argue the move will threaten worker flexibility and unfairly targets certain companies. they also complained that other industries are exempted from the law. a shakeup at china's largest technology company. huawei will overhaul management ranks after revenue growth slowed in the second half of the year. u.s. sanctions on huawei have spooked customers and suppliers around the globe. the trump administration has called huawei a threat to national security. that is your bloomberg business flash. matt: thanks very much. a gauge of china's manufacturing sector held steady in december, adding to evidence that the world's second-largest economy is stabilizing. the manufacturing pmi index remained 50.2, while the outlook for new export orders expanded for the first time since may of 2008.

joining us from hong kong is and a current, bloomberg's asia economics correspondent -- enda curran, bloomberg's asia economics correspondent. data is about something that happened before we got here. what has caused it? before, but i guess it does reflect the sentiment was improving really into december. there were expectations that the two governments would come to some kind of agreement and that is perhaps what we are seeing. other factors were at play, too, such as higher commodity prices, higher oil and steel prices. there is a good reading on the new export orders in particular, rising above 50 for the first time since may of 2018. softness for small

companies. backs upa whole, it this idea that china's economy is stabilizing as we head into 2020. it is on something of a firmer footing now once a trade deal is signed off. it will be in a better place for the start of the new year than it was even a few months ago. matt: we have seen reports that it is possible the the phase i deal could be signed as soon as this weekend. what are you hearing? enda: well, it is pretty interesting. the expectations are that this deal will be signed over january. we have not seen any specific commentary from the chinese government yet. if it does happen, there would be two key things that observers will be watching for. what are the actual details of what they are agreeing? what substantial issues have they gone across? and then of course, what has been left on the back burner?

the second half of that will be critical for how this trade deal is judged in terms of its durability and impact. there are a lot of other areas of economic tension between the two governments that are not likely to go away through 2020. nonetheless, if we have a deal agreed in january and signed off, that will help sentiment. matt: thanks very much. curranurrent -- enda talking to us about what has to be the most important story for markets in 2019. valentin marinov still with us from credit agricole. i assume trade will be one of the biggest stories for the mark in 2020. how do you see this playing out now beyond a phase i deal? valentin: well, we do expect

some of the risks or tensions to persist. what we should say, however, is that further escalation with tariffs between the two countries could be rather limited at cell -- at least until the u.s. presidential election next november. that much may really help the chinese but also the euro zone economy, really economies lying on -- relying on trade. they need a rebound in the first half of next year. going into the second half of the, the issues that have been driving the conflict, the trade tensions between the u.s. and china are still very much there. intellectual property rights, if you wish, the u.s. demands for restructuring of the state on chinese sector, geopolitical risks related to what's happening in hong kong, all of these are still very much there and could flare up one way or another. if anything, the conflict may

persist but will take different shapes and forms really from here. matt: all right, valentin marinov, our guest cohost for the hour is going to stay with us. we will get more from you throughout the program. i want to point out, new year's celebrations have kicked off around the world. in sydney, they are ringing in the new year a little bit early. it is 9:21 p.m. local time in sydney. you can see the fireworks starting in sydney harbor. this is bloomberg. ♪

♪ eve: good new year's morning. i am a matt miller in berlin. tom and francine lacqua are off. let's talk. 9,000,000% since the start of the decade. annmarie hordern has some details on the rise of the cryptocurrency. >> i know you like this story and happy new year. it wasn't only the best asset over the decade, also the most controversial. 9,000,000%.t 900, it has gone through a lot of booms and a lot of bus but that is how much it has gained over the last 10 years. the big question that is critical for bitcoin is what happens the next 10 years?

it needs to have mass adoption which it doesn't yet. it will likely face a lot of scrutiny. it is already under a lot of scrutiny but it will face more of that around the world, especially when it comes to regulation in order for this to be treated as a tender of exchange. matt: i just want to make this clear, we all understand there was no year zero, right? >> yes. matt: so, the end of the decade would be in 2020. we will just leave that for now. of thezen, president peterson institute for international economics later. ♪

♪ matt: i am matt miller in berlin. tom and francine are off. .appy new year's eve

let's get the bloomberg first word news with karina mitchell. : iraqi supporters of an iranian backed militia have attacked the u.s. embassy after smashing a main door. gunfire. reports of it is not known whether the staff still inside. finalized akraine deal to keep gas flowing for the next few years. gas supplies have been cut twice in the past 13 years because of political and financial issues between the former soviet allies . population growth in the u.s. has hit a speed bump. .t was the most this year ,ccording to the census bureau the u.s. population rose by almost .5% or 1.5 million.

the u.s. population is about 328 million. global news 24 hours a day, on air and @quicktake on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am karina mitchell. this is bloomberg. matt: thanks very much. the arrest that shocked the financial world a little over a year ago. autumn might've tightened -- automotive tighten carlos ghosn was put on trial in japan. there is a new twist. the former head of nissan and renault says he has escaped japan, fled to lebanon to get away from political persecution as he puts it. stephen: carlos ghosn has confirmed he has fled japan where he was awaiting trial for alleged financial crimes and is now in lebanon. he says he has not fled justice

but escaped injustice and political persecution. he fled japan because he did not believe he would get a fair trial. in a statement from beirut he said he had been held hostage by a "rigged japanese justice system." what we do not know is how he got out there is no immigration record of him leaving japan and authorities are checking whether he used an alias. the tokyo district court indicates there has been no change to his bail conditions which required him to surrender his passport. he is said to hold several ,assports, including of lebanon which does not have an extradition treaty with japan. his lawyer says he knows nothing more other than what is being reported in the media. the mystery deepens. stephen engle, bloomberg news, hong kong.

matt: thanks to stephen engle. for araders are on alert repeat yen flash crash this january with japanese markets closed for an extended period as they were in 2019. this is according to mark cranfield. let's get back to valentin marinov and see what he thinks about the theory. we did see a long break before the last one. does that set up the japanese yen a problem? valentin: it is too early to tell. untily have to wait tuesday, thursday, friday. just to look at the data from japanese retail platforms, the stomping ground of the japanese carry trader, would suggest that retail traders are indeed running short yen positions. we do not have data for

december, that if last year is anything to go by, chances are those short visions have been accumulate -- positions have been accumulating, which may set the stage for a rebound in the currency in the early stages of january. just looking at the positioning, retail investors seemingly very short the yen against the dollar, euro, pound, and turkish lira. crosses may be the pressure point that may experience heightened volatility in the early stages of 2020. matt: your forecast for the yen is 105, because you think the fed will be pushed. on theh does that rest state of the japanese economy,

and how much is simply the yen's position in final markets as a haven currency? valentin: similar to the euro, it is both. similar to the euro, yen has emerged or has been for a while a funding currency of choice. the boj's policy of negative rates, dovish outlook has helped that perception. we think that next year will usher in a period of relative stability for the japanese economy. the government has announced a fairly aggressive fiscal stimulus and we have the construction work going on ahead of the tokyo olympics, all of that painting a constructive picture for the outlook next year in the first half of the japanese economy. that is coupled with the view that the boj is at rock bottom of its easing cycle.

easing cuts or further measures are expected at this stage, so this may lead to a situation where we could have some unwinding of dollar carry trades funded in the japanese yen, with the yen similar to the euro looking less attractive funding currency. yen, we have seen japanese euro rise this year. that people use to judge risk. yen andstrength in the the euro against the dollar, but how do you see the yen-euro pair laying out in 20 -- laying out in 2020? valentin: the way the market is positioned, it is short euro and yen, but that is coming from a period of heightened geopolitical tensions partly

because of the trade war between the u.s. and china and also because of brexit, whereas the yen was able to benefit during the bouts of market uncertainty against the euro and pound. the euro itself largely struggled. the euro is trading as a funding proxy for the yen but with a significant political discount. going into 2020, the political discount the euro was traveling and may start to dissipate indeed, that may translate in greater resilience of the euro against the yen. euro-yen higher in the first half of next year and potentially into the whole of 2020 as a shift -- is a function of shifting perception and market positioning. matt: valentin marinov, you will stay with us, head of fedex -- fx at credit agricole.

coming from deadlock to a new prime minister to a new majority to a divorce deal, it looks like it will finally get done. brexit has dominated the u.k. agenda. we will look at some of the key moments, and ask what 2020 has in store. this is bloomberg. ♪

♪ this is bloomberg "surveillance." j.p. morgan chase plans to be the first global bank to take advantage of the opening of china's futures market. the bank wants 100% ownership of its joint venture. fund full control of

future firms. has learned a chapter 11 filing could come in the next few weeks. seekingt is said to be a $2 billion bankruptcy loan. carlos ghosn has had a video camera trained on his door and followed everywhere he went and tokyo but was able to -- in tokyo but was able to escape to -- his movements and japan were restricted. he is a citizen of lebanon which has no extradition treaty with japan. that is the bloomberg business flash. matt: thanks very much for that to the u.k., the story of brexit for most of 2019 is one of deadlock. number 10 has a new occupant and he got a new majority, and now

westminster may have a divorce deal that could pass. how did we get here? >> i have always said no deal is better than a bad deal. we have a good deal. i do not to see article 50 extended. i profoundly regret the decision this house is taken. >> there deal is clearly dead. >> we will now not leave on time with a deal on the 29th of march. this delay is a matter of great personal regret for me. i will shortly leave the job that has been the honor of my life to hold. i do so with noel well, but with in norma's and enduring -- no ill will but with enormous and enduring gratitude. >> to deliver brexit and defeat jeremy corbyn. we in the u.k. want a deal.

i want a deal. we won't leave by october 31. >> this reckless government only has one plan, to crash out of the e.u. without a deal. >> to advise her majesty to prorogue parliament was unlawful. >> we want the justice system bound. >> this unelected prime minister should now resign. >> i don't want an early election. we have gone through the stage where we have no choice. >> we will go out with the biggest campaign this party has ever mounted. >> this one nation conservative government has been given a powerful new mandate. the story of the last three and a half years will be at an end and we will be able to move forward. matt: joining us now is david merritt, bloomberg senior executive who has been covering this story from day one closer

than the rest of us. still with us, valentin marinov. i cannot believe you are not tired of talking about this, but it has gotten more and more exciting at the end of 2019. what do we expect for 2020, will this deal pass? david: watching back over that video, nostalgia was probably what i was feeling for all of those key moments throughout the year, all defined by now biting votes in the house of commons. the big vote for theresa may, got it forward over the line, had to resign. next year will be completely different because we have a prime minister with a big majority behind him, the sort of majority the conservatives have not had since the days of margaret thatcher. that means no more late night now biting votes in westminster

and mr. johnson can push through whatever version of brexit he sees fit. it is almost certain his withdrawal agreement will pass in january and britain will leave the european union on the 31st. we don't go into this transition until the end of 2020. it does not mean the fight is not over because it will then be the wrangling over the free trade. it will not happen in westminster were so much of the drama of this year unfolded. before ray get to the brexit implications on the currency. ask, brexit aside, what can boris johnson do with this majority? what can he do with the conservatives? what can he do with the u.k.? david: almost anything he likes. we got a flavor of it last night , the government announcing they

are putting up the minimum wage four times the rate of inflation , delivering a significant pay rise to low-paid workers. look at who are now voting conservative? they have tory mp's for the first time in a very long time. 's intent to look after these tory voters. that is a much broader church then traditionally you might think of as a conservative. the biggest thing we need to talk about is the budget. later in the winter, early spring time where we can put some flesh around this. we were told before by the previous chancellor there would be a big brexit dividend getting the deal passed. if that is the case, the

government will have more money to spend and we can see they will try and spread the wealth to those areas, up in the north of england perhaps where growth has been sluggish. matt: what do you expect for the , as boris year johnson attempts to get his deal through and i think markets are discounting for the most part any kind of hard brexit? thistin: maybe next year, year is almost over, but next year -- it has been a roller coaster ride for the markets. we expect at least for now the risk of the no trade deal brexit which may be the big risk for the pound downside next year will not be haunting the currency for the next three to six month. the finality we got with the landslide victory of the tory party surrounding brexit, the

greater -- greater clarity about the brexit process may translate into more up the pmi, consumer sentiment, and so on, which may point to a rebound of the u.k. economy in the first half of this year. that could mean the latest rebound we saw after the election, seemingly regaining momentum, we could see that rebound continuing in the coming month. again, whicho 1.34 would be our target. 1.84 couldng down to be in the cards and the picture could get less clear because by july, the u.k. government will have to make a decision whether they want to extend the transition period and accommodate further trade talks, or decide against that, risking

a no trade deal brexit. this is where the outlook for the pound becomes less clear, less certain. any prediction will depend very much on a binary outcome of that decision. 1.36 may be the high for the next year for cable for the time being. matt: thanks very much for that. we will keep valentin marinov with us for a little while longer. coming up, the spike in the repo market spooked some investors this year, but the new york fed's year-end operations were under subscribed. we have the latest on that and some new challenges -- the new faces i should say joining the ecb, and the challenges those

people face. this is bloomberg. ♪

♪ matt: i am matt miller in berlin. happy new year's eve.

let's get to central banks. isabel schnabel is one of the new executive board members joining the ecb this week. under christine lagarde, it will launch its first strategy review since 2003, tackling questions like why price growth has stayed low despite trillions of dollars -- euros in stimulus. why do you think central banks have not been able to restart inflation, and are any of them going to find a solution this coming year? inability of the central banks to revive inflation has been a topic of many discussions over the years. the more we discussed that, the more we realize there is no one

single answer. explanations range from subdued market productivity which means subdued wage growth explanations that include advances in technology which lower the prices for many services in good . the process has been altered by good with the advent of amazon. the globalization meant that the labor markets for many developed economies have opened up. we added many more workers in low-cost locations where even mobile capital has translated into lower cost of production, lower prices, and lower inflation. map: you saw that fantastic

we had up there in our survey. it does not look like the market is expecting a change in policy at all for the u.s., canada, and europe. you disagree with that, right? you think central bankers will continually cut rates, that rates will be forced lower and lower through 2020? valentin: that is mainly the case of the fed, and we are talking about an insurance cut keep themeant to financial conditions in the u.s. as accommodative and favorable as positive. the repo market tensions caught the market by surprise, but the fed announced an expansion of its balance sheet which will likely be with us through the second quarter 2020. financial conditions may need further accommodation and this is why we believe the fed will

be forced to cut rates in june 2020. on the others of the atlantic, a personal view would be to agree with the sense -- consensus that no rate cuts in the foreseeable future. you mentioned the ongoing process of the ecb and there reinvestment of the policy target and tools, it is not time for them to consider further easing so they should remain close to rock-bottom in there easing cycle. matt: thank you so much for joining us. night,fantastic and safe balentine mironov. -- valentina marinol. ♪

♪ the great escape.

giant carlostive ghosn flees to lebanon, saying he cannot get a fair trial in japan. it is another twist in a saga that again with his arrest year ago. -- began with his arrest a year ago ending on a high white house adviser peter navarro says a trade deal with china is in the bag. china's manufacturing sector continues to expand in december. closing out the year. nots a rally to remember only for global stocks at the end of 2019. oil is poised for its best year since 2016 and bitcoin is up 9,000,000% since 2010. first, we take you live to auckland, new zealand, people ringing in the new year. it is midnight in new zealand and you are watching a fantastic fireworks display. we are going to have fireworks around the world. i am used to seeing them in new

york city. i am used to saying about an hour of professional fireworks put on. here in berlin, it is an entirely different experience. the germans set off explosives all day long until late in the day tomorrow, and i'm talking about the citizens just blowing stuff up on the streets, an incredible experience, not as beautiful as this, but something i would recommend. let's look at the data. it is a very thinly traded market today, not a lot of people in the market. s&p futures changing -- trading higher. u.s. exchanges will be open today. in europe, it is a different story. frankfurt and milan are closed. london and paris will close early. 1522.76tinuing to rise,

for a troy ounce. investors are looking for a safe haven in the yen at 108.53. i have a cool chart i dug up from way back in the day and updated for you here. carlos ghosn made me think about auto sales. he no longer has any effect on renault or nissan, but back during the great recession we would always cite this figure that you can see in the blue line. the white line is monthly car sales in the u.s., but the blue line is the average age of a car on the road. we were astounded a decade ago it was 11 years. that number has continued to grow, whether it is just because modern cars are that good or people do not have the money or credit to buy new ones.

the average age is more than 12 years, which i thought was astounding. you can get that on the terminal by typing g tv . the dollar has dipped for a fourth day in a row as investors close out a dramatic year for asset classes. 2019 showed us an incredible rally for stock indexes around the world, but a lot of other assets ran up as well. if you look at the last 10 years, bitcoin is up 9,000,000%. oil is poised for its best year since 2016, and gold and silver are ending on a high note. joining us now is john ryding. i wonder what you think were the most interesting -- the rally that we saw in stocks is pretty astounding in 2019. 30%,n some cases

everything was up. is that all over now? john: i think there were be challenges ahead for 2020, but 2019 came off the disaster of the late fourth quarter ending with the christmas eve massacre. in a sense, some of the stock recordedce in 2018 got in the rebound in the early part of 2019. what is the challenge? profitllenge is that the margin is at the macro economic level have been squeezed since mid-2014 because labor cost increases are exceeding productivity gains plus price increases by corporations. as a result, that has slowed profit growth. at the macro level, profits have been down over the last year, so as we go risk on with the trade deal, here is the challenge.

difficultiese have restoring profit margin growth, and it is important we do, but to go risk on, bond yields will rise and that will raise the discount rate for equities because profits will be discounted to higher yields. i see those as the challenges. we calculate the markets a little bit overvalued based on profits divided by corporate bond yields already. those are the challenges. can we overcome them? yes. we need a resumption of capital spending. that needs to be the focus. get rid ofeal, uncertainty and start raising productivity. 2019 cutslso saw in deepere fed, cuts into negative territory at the ecb, and a resumption of quantitative

easing at major central banks, even if they do not want to call it that. they are back in the markets buying stuff. if that does not continue or increase in 2020, what does the market do without that support? john: you raised some good points. we all think the fed has the signaling right, which is a good thing for 2020, and there is no chance interest rates go up. there might be a cut and that is how the market is positioned. areks in central banks unlikely to affect the market. bank has taken the extraordinary and technical by this balance sheet to reduce bank reserves to $1.5 trillion, additionbalance sheet

comes to an end in the next months. the fundamental driver of equity prices has to be profit growth, and that is where i see for the market as a whole, the major challenge, whatever is happening in the interest rate environment. stay withare going to us, our guest cohost for the hour. appreciate you taking the time with us on this new year's eve. let's get to the bloomberg first word news. froma: breaking news baghdad, iraqi supporters of any iranian backed militia have attacked the u.s. embassy, breaking in after smashing the main door. there are reports of gunfire. embassy staff and the ambassador have been evacuated. u.s. airstrikes killed errani and militia fighters earlier this week.

china, the economy is ending the year on a bright note. the outlook for export oriented firms brightened and production recovered. more u.s. sanctions on iran are likely. the u.s. will continue a campaign of maximum economic pressure. brian hope says u.s. actions have caused the collapse of oil export. wildfirelia, the problems have gotten worse. at least 12 have died and thousands of stranded tourists are seeking refuge on beaches. fire services are mostly manned by volunteers. global news 24 hours a day, on air and @quicktake on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am karina mitchell. this is bloomberg.

matt: thanks very much. let's get to our top story of the day. theas the arrest that shot financial world a little over a year ago. automotive tighten carlos ghosn carlos ghosn titan was put on trial and now there is a new twist. he put up $9 million in bail money and has escaped from japan in what he calls injustice and political persecution. let's get the perspective from beirut. lebanon ande is in it is in a sense his home. uprew -- grew up -- he grew in brazil. has he gone to meet with the president as some reports have said?

that ghosn is in lebanon but not exactly where. some reports say he met with the president, but this was later denied. houseoutside his beirut in the early hours of the morning. wass not clear if ghosn there. there is no security outside his house. windows are -- shuttered, others open. entereder said ghosn lebanon legally using his french passport and lebanese id via the beirut airport. we don't know exactly where he is. matt: he has probably got a number of passports. his lawyer in japan earlier gave a press statement and said they hold at least some of his

identification materials. we are not clear how he got out. a rockstarome sense of the automotive world, and in lebanon, he is a huge figure as well, right? dana: yes. as a national hero in lebanon. billboards arrested, sprung up across the nation in support of him, calling for his release. lebanese officials say they will extend any kind of support for him during his trial. he is seen as one of the immigrants that made it big. hero,seen as a national like you said, a rockstar. matt: thanks so much for joining reporting one your the ground. , the white house

advisor peter navarro says trade talks are ending the year on a high note. the deal he says is in the bag as chinese manufacturing continued to expand in december. this is bloomberg. ♪

matt: we have here live pictures, live video coming to us from baghdad. the u.s. embassy, dozens of angry shiite alyssa supporters broke into the u.s. embassy have -- shiitee

militia supporters broke into the u.s. embassy compound and they have set fire to the reception area. we will continue to bring you developments in this breaking story. dozens of iraqi protesters stormed the u.s. embassy complex in baghdad following an airstrike targeting and iranian backed militia. joining us now from washington, d.c. on an entirely different story, kevin cirilli, bloomberg tv and radio chief washington correspondent. we got a story just recently across the wire that joe biden holds a narrow edge over donald trump in a head to head matchup in florida. we are starting to see polls

where it looks like trump could be beat? kevin: according to these new polls that have just been , former vice biden president leading president florida and 45% in ahead in virginia. president trump maintains a steady lead against senator warren. theou looked about electability argument the biden campaign has been making, they have been consistent, and this poll would embolden them into the new year. senator elizabeth warren's fundraising numbers have dipped while joe biden has gotten a boost. if you are joe biden staring down the primaries and caucuses, this goal will further their case the has an electability

argument in a general matchup against his democratic peers. matt: in florida, i guess both of them really loom large. mar-a-lago, and the voters i guess are of a higher average age. does that help someone like biden against younger competitors like elizabeth warren? kevin: florida is such a crucial battleground state. in contrast, president trump has been looking to win back pennsylvania, wisconsin, michigan, ohio, key battleground states from the russian perspective. they feel the trade deals will help them in this cycle as well. you also have reporting out of the situation from iraq. what are you hearing? more, as we hear

yesterday i was able to speak with the u.s. special envoy brian hook about the potential for more sanctions against iran as a result of the situation going on, and those airstrikes the u.s. carried out, defensive airstrikes against iran on a host of different facilities. listen to what he told me. 2020, andook ahead to less iran starts behaving like a normal nation you will see many more sanctions that we have put in place. the most pressure in the last 40 years against this regime we have put in place, so they are deep into a recession. we have collapsed their oil exports and the foreign direct investment into iran, and we will drive up on the cost on the

regime for behaving like an outlaw. matt: thank you very much to kevin cirilli for the reporting on both of those stories. still with us is john ryding and i'm interested to get your take on the u.s.-china trade war or trade truce, if you will, in light of the 2020 election. does donald trump gain more by making a deal and helping to boost the economy into november, or does he need to continue to , a sort of line populist hard line against china to get more votes? interesting,ry is because there has been two wings within the white house. you have larry kudlow at the nec who is in favor of free trade deals.

navarro,have got peter which has got simplistic and negative economics and thanks that tariffs increase gdp by reducing imports. now you have navarro seeming to be moving over, so it looks like the modus operandi is a phase one deal, move on to negotiate phase two. i think this president would have no hesitation, if china does not live to the details which we have not seen of the trade deal, that he would go back and put on tariffs. going into you the elections in have thismarkets saying, do not want to disrupt the markets through something you can avoid. , think that what we see here the phase one deal is done and that we will move forward with

negotiations on a phase two deal. matt: john, we will keep you with us for a little bit longer, our guest cohost. this is bloomberg. ♪

♪ about, on thisk new year's eve, some serious gains for bitcoin. it is up over the last 10 years 9000%,00%, not 900%, not

or even 900,000%. thes an astounding number, likes of which in my career at bloomberg i have never heard. joining us to talk more about this is sam on stead. you are dipping your toes into the world of digital currencies. what do you have? sam: you have more real-world experience with bitcoin than i do. that is the interesting thing coming up. the gain is quite insane. whaty the question is, will the next decade be? it will likely be a maturation. it needs to answer the existential question of what is this asset actually for? matt: that is 100% true. it has not changed much since i lived on it in 2012, in terms of

usability. $600 buying bitcoins for and now they are selling for over $7,000 so in terms of price, it has been quite a ride. have a fantastic and safe new year's eve. coming up in the next hour, adam posen, president of the peterson a.m., 12:30 p.m. in london. this is bloomberg. ♪

beyond the routine checkups. beyond the not-so-routine cases. comcast business is helping doctors provide care in whole new ways. all working with a new generation of technologies powered by our gig-speed network. because beyond technology... there is human ingenuity.

every day, comcast business is helping businesses go beyond the expected. to do the extraordinary. take your business beyond. [ drathis holiday... ahhhhh!!! -ahhhhh!!! a distant friend returns... elliott. you came back! and while lots of things have changed... wooooah! -woah! it's called the internet. some things haven't. get ready for a reunion 3 million light years in the making. woohoo! -yeah! ♪ matt: happy new year. i am matt miller in berlin. sincemarks 20 years

vladimir putin took power in russia, but what is his economic and political record? here with a look back is annmarie hordern. let's talk about the struggles he faces now. what are they? annmarie: they are very much domestic driven. we have seen him bring russia back to a global scale. hurdlesally, he faces way. we have seen falling real wages in russia, thick regina -- career projector really for trajectory for young people, they are leaving the country. 90% approval rating at the annexation of crimea. his approval rating has dropped domestico it is these

issues he will be battling with for the remainder of his term. matt: you cover on bloomberg tv the energy sector as well, and that has been critical to vladimir putin's years in office. he has gotten a gas deal signed with ukraine. annmarie: they just signed it in the nick of time. they had one day to go. for five more years, we will see russian gas flow through ukraine. you know sitting in germany how important this is for germany and other european countries, some of whom get 50% of their gas from russia. there is still tension between russia and ukraine given that russia is trying to build the nord stream 2 pipeline with germany. they had to stop the project,

but for five years we will see most of that gas go through ukraine. only twice in the last 13 years was that cut off and when it happens, it is troublesome for europe. by them being able to think this this deal in time, we will avoid a winter shortage. you: throughout your career have been covering energy, vladimir putin, and russia. what comes after putin? who comes after and when do we expect him to retire? annmarie: that is the biggest question and dilemma. his term ends in 2020 and he has said he will not change the constitution -- his term ends in 2024 and he has said he will not end the cons -- change the constitution so he can have

another term. he said he heard proposals of to the more power parliament and the prime powerfulwould get more compared to the president. it two termske altogether and putin can run again for two other terms. we are talking about 20 years of this man in power, whether he was president or prime minister. how does he maintain power? likely this is someone who will want to stay in power. matt: annmarie hordern, thank you very much. covering everything that is .ussian, putin, oil, and gas let's turn to china.

president xi is giving a new year's address right now, and says prosperity and hong kong is the anticipation of the chinese people. there are no live pictures of the speech, but we will monitor the headlines. one of them is his prediction on gdp. china 2019 gdp expected to be , according touan cctv. $10,000, ballpark figures for gdp per capita. let's get to the bloomberg first word news. karina: there is breaking news out of baghdad supporters of an iranian back militia stormed the u.s. embassy compound. teargas was in the air and there were shots of -- sounds of

gunshots. the protesters have been removed. a stunning turn of events in the saga of carlos ghosn. he has fled from japan to lebanon to escape what he calls a rigged justice system. he was arrested more than a year ago on financial crimes and has been out on bail in tokyo since april. he says he is the victim of and ukrainessia have finalized a deal to keep gas flowing to europe for the next five years. the deal averted a winter supply crisis. gas supplies and europe have been cut twice in the past few years. population growth in the u.s. has hit a speed bump. it is the lowest this year and a century because of declining

births, increasing deaths. yearopulation growth last was .5% or 1.5 million. the population is just over 328 million. global news 24 hours a day, on air and @quicktake on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am karina mitchell. this is bloomberg. matt: thanks very much. let's get to the u.k.. the story of brexit was one of newlock but number 10 has a prime minister with a new majority. how did we get here? said that noays deal is better than a bad deal. i actually think we've got a good deal from the european union. i don't want to see article 50 extended.

i profoundly regret the decision that this house has taken tonight. >> their deal, their proposal is clearly dead. >> we will now not leave on time with a deal on the 29th of march. this delay is a matter of great personal regret for me. i will shortly leave the job that has been the honor of my life to hold. i do so with no ill will, but with enormous and enduring gratitude to have had the opportunity to serve the country i love. p.m. johnson: deliver brexit, unite the country, and defeat jeremy corbyn. we in the u.k. want a deal. i want a deal. we will leave by october 31 in all circumstances. >> this reckless government only has one plan, to crash out of the eu without a deal. >> the decision to advise her majesty to prorogue parliament was unlawful. p.m. johnson: i strongly disagree with what the justices have found. >> this unelected prime minister should now resign!

p.m. johnson: i don't want an early election. we've got to the stage where we have no choice. >> we are going to go out there with the biggest campaign this party has ever mounted. p.m. johnson: this one nation conservative government has been given a powerful new mandate. the sorry story of the last 3.5 years will be at an end and we will be able to move forward. matt: joining us now is david our senior executive editor from bloomberg. john ryding still with us from new york. do we expect now that is deal, this boris johnson divorce deal sales through parliament -- sails through parliament and he gets to work to finish the trade agreement? david: the first part of that is almost a certainty, the

withdrawal agreement is certain to sail through parliament. he is in parliament with a huge majority, but brexit will tip into the second phase for the beginning of february and that is far more uncertain. the europeans are saying it is not possible to stitch this up in 11 months time, and there is a huge amount to argue about. financialf london services, straits of gibraltar, lots of things that need to be hashed out. the prime minister saying he will stick to the timetable, delivering a possible clipper to the end of the year. as we get closer to the deadline we will see whether he is able to extend or not. dieledged to leave do or and had to extend and it did not do any harm.

u.k., he has got the strength. the question is, can he do it with the e.u.? negotiating a trade deal like this in less than a year is as a team likele leicester city winning the premier league. john: it will not happen this year. it is liverpool's title. turning to the trade negotiations, the deal is just an agreement to start negotiation. we know one thing about deadlines in this process, they have been flexible. if boris johnson was going to be dead in a ditch, in his words, if we did not get it done, and the timeframe has been extended. the majority he has means he is not so beholden to the extreme right of his party, and with the

support of the country behind him, the historic win gives him a mandate. he can extend the deadline and will extend the deadline to get the next phase done that favors the u.k. as much as possible. to end certainty compared the uncertainties in 2019 -- the uncertainty compared to the uncertainties in 2019 will be less. matt: what does it mean for the pound? john: i think it is probably positive for the pound. i think the pound is undervalued. i do think the fear of crashing out on a hard no deal was a factor keeping the pound under pressure, and we have to think about the fact that eventually this government with a majority can turn somewhat away from

brexit and focus on domestic policy issues, focus on progrowth issues and deals with other countries. that could be a positive for the u.k. and sterling. what do you expect boris johnson to be able to achieve with this majority? the biggest majority the conservative party has had since margaret thatcher, under her tankwe saw the pound initially. what does johnson want to do? to be they are now going out of focus on things like how to grow the economy. the government has done nothing effectively over the past three years except obsessed over brexit. we have an announcement from the treasury that they will whack up the minimum wage by four times the rate of inflation, a big pay raise for millions of british

low-paid workers. that is a sign of intent. people a whole load of who used to be working class labour voters who are voting conservative for the first time, and they need other policies that will support them in this post brexit future. more spending, the end of austerity, all of that is being signaled, more police officers, more spending on the nhs. we will have to wait until the first budget in a few months to see whether they can make the numbers and serve the constituencies they will have to keep if they want to stay in power. matt: david merritt, thank you. john ryding will stay with us. when we come back, we will get the final thoughts from our guest cohost. the last guest cohost i will

interview this year. this is bloomberg. ♪

♪ this as surveillance." i am karina mitchell. j.p. morgan chase plans to be the first global bank to take advantage of china's futures market. they want 100% ownership of the joint venture. starting tomorrow, china will allow full foreign control of futures firms. mcdermitt is in talks about filing for bankruptcy and a chapter 11 filing could come in weeks. they are seeking a $2 billion bankruptcy loan.

biggestoised for the yearly gain since 2016, up about 34% this year. are saide stock piles to extend declines. that is the bloomberg's newsflash. -- bloomberg business flash. matt: let's talk about what is going on in germany, berlin, frankfurt, and new york and washington, with john ryding. a former advisor to central banks, the bank of england and a senior economist at the fed, i want to start by asking about spending in germany. living in this country, it is shocking to see what bad shape the autobahn is in. the infrastructure shortfalls they have, and they are trying

in some sense to fix those things, but they have a huge surplus. we just saw a picture of isabel schnabel from the ecb. the central bank would love them to spend more money. will they do it? john: you probably have better insight than i, but they need to. from the end of the second world 1970's, itil early ultimately failed because surplus countries did not adjust and the adjustment fell on deficit countries. we have the same problem with euro where the impetus falls on whichficit countries, requires them to deflate, which is extremely difficult for them to do. armany has put itself in tighter fiscal straitjacket then required by the euro rules. germany is running a surplus and

the debt to gdp is below 60%. if they don't adjust in a stimulative directive -- , then they need to do it for the good of the monetary union because the monetary union cannot rake up -- breakup. i literally mean cannot rake up because there -- breakup because there are no other currencies to fall back on. matt: this is the question. holz and he olaf sc said, we are spending as much as we can. they will give various excuses about why projects are not bureaucracy or

which is so widespread, but even if we spread more, -- spent more, even if we paved the road with gold it will not help the economies of italy, spain, and portugal. is this wrong or is this berlin spinning the facts? is it difficult to transfer that growth? john: he is absolutely wrong. it makes no sense that a relatively open region where a country that would have a balance payment surplus calculated, would not draw in imports for the rest of the region, would draw in labor as well given the free movement of labor in the e.u. i think that is very bad economics and goes against the principles of econ 101. matt: john, you will stay with us for one more block. you will be the last person i talked to on bloomberg

television in 2019, what an honor, john ryding. looking at futures, you are still going to be open. we are closed in germany, but the s&p, dow, and nasdaq will all trade today, albeit light. green on futures. ♪

♪ happy new year's eve. berlin.t miller in tom and francine are off today. we have actual news today. china's president has finished his new year's eve address and says 2020 will be a milestone for china's development. gdpaid the 2019 per capita is expected to reach $10,000. he did not mention elections in taiwan or trade matters, but we will bring you headlines as they cross. we have a special guest with us, john ryding.

before you kicked off your illustrious career at bear stearns, where you finished as chief u.s. economist, you were an advisor to a couple of central banks, the bank of england and then you were a senior economist at the fed. i want to get your take on what the fed should do in 2020. i know they want to stay a al, butal -- apolitic should they not move policy as needed? john: the fed said policy is not on a preset course. the problem is there is no chance or almost no chance they would raise rates in that environment, and as needed would be code to cut rates. that code appeared in june of ats year when powell spoke the chicago fed conference on the future of policy, that i

attended. they should do what is needed in response to the data and that cuttinge opening to rates. that is not the course they are on. they will hold rates steady and if there is a problem, they will cut rates. it is not political. this is just a dovish fed and that is the way they are operating. matt: john ryding, appreciate the time with you today. --will be continuing bloomberg "surveillance" will be continuing on radio. i wish you the best of health, wealth, and happiness. ♪

♪ : joe break -- david: jailbreak.

carlos ghosn flees house arrest. china continues to show signs of stabilizing as manufacturing pmi's stay in positive territory. and market deed to her. it was all heading up until yesterday. welcome now to "bloomberg this tuesday, december 31. i'm david westin, in for alix steel. let's start with equities. futures are up in the united states, towards the session highs so far. the stoxx 600 is down. don't pay too much attention to that. most of the exchanges are closed, but that is the second day in a row the stoxx 600 is down. this is the fourth day in a row the dollar has been weakening against essentially all g10 currencies. new york crude selling off a bit after the best run they've had in m