strategies from blackrock, which i think means avoid danger. she joins us with an update on the equities. what is thematic strategy? kate: i have always done macro top-down equity and speaking about region country sector, the allocation fund i work on, in best across thematic lines, both >> the fed chair jay powell warns that the coronavirus poses shorter-term and longer. a risk to the economy, and tom: your head is spinning with president xi jinping says tenet this virus in china. will still meet its economic goals. we will report live from the anthony found she will join us -- anthony fauci will join us. u.s. on the new hampshire primary. and, a record loss on the meltdown at wework. calm givenremain these new and different thematic balls of worry? kate: there are two giant areas investors are worried about, geopolitics, i would put trade ♪ francine: welcome to "bloomberg surveillance," i am francine and the coronavirus in there. lacqua in london. euro socks are gaining on signs ,he second is around politics

that the spread of the particularly in the u.s. and coronavirus is slowing, especially in china. implications for policy. it is hard to predict the two investors basically at the back of their minds. saying that outcomes of the virus or how the economy can weather the trade will evolve or what will happen in the november elections virus. the u.s. 10 year yield is a good way to look at risk out there. , so we are trying to do fundamental work and have a currently at 1.63%. longer term view on what asset the new zealand dollar. it is currently up a touch after its classes -- and mary that with bottom-up work with companies central banks of the impact of the virus will actually be who have the best opportunity to short-lived. they did not project any rate generate cash flow over the shortest time. francine: does the virus change cuts. coming up later today, we will be speaking with the chief executive of ep. don't miss that interview on everything when it comes to the markets, or do we say we are "balance of power" at 5:30 p.m. over the worst? london time. kate: one thing i am focused on let's get to the bloomberg first is whether this virus is the word news on new york city. viviana: we begin in new last straw to break the camels hampshire, where bernie sanders won the primary, the first in back on global supply chains. the nation. he fended off a challenge from we have had trade pressure and pete buttigieg who finished a companies have asked how global close second, amy klobuchar coming in a strong third. trade should be.

the tight finish allows all companies are thinking about on three to claim some measure of shoring more or thinking more success, now to the coronavirus. globallyens growt about producing domestically. there could be disruption if there are big political or viral according to fed chair jay powell in comments to the house outbreaks in the areas of the financial services committee. he says that effects could spill world where we have big operations. over from china. i wonder if it will change the we also said the central bank will never "nuclear full victory function for companies around on employment" but progress has the supply chain and if it will been made. accelerate that change. francine: how would it change the bank of england's mark carney says that economy would the supply chain? be a merger this -- would be a chains alreadyy third larger. changed because of the u.s.-china trade war and does it mean everyone will minimize their impact to china? he is backing the new prime kate: that is what i am leading minister johnson's economic to. plan, warning that it may take years to make a "meaningful difference." some companies are asking how much they want to operate in a stunning rebuke here in the china. u.s., the u.s. justice pulling back would be a mistake fourtment, all 4 because we have huge conviction in terms of economic growth and consumer demand growth. on the global allocation fund, china is overweight and we have

prosecutors who backed the sentencing of roger stone have resigned. been using weakness in the it came hours after president market to add to our highest trump tweeted criticism. conviction calls. growth around tech, health care, and consumer there. mr. stone is a longtime associate of the president. as people ask themselves, if the as tony family of devices will have 4 cameras including they cannot control the environment in which something is produced or they feel like another government may intervene his sensor and a 100x zoom. in the operations of their company, does it increase the it will have a huge battery. chances they change their the starting price is i decision around the supply chain sooner? y---ing, nearly $1400 companies who try to switch meaningfully out of china into of thend the rest ecosystem does not exist. eye-watering, nearly $1400. it is not just about transportation infrastructure, global news, 24 hours a day, on air and on @quicktake by bloomberg, powered by more than it is about financial and legal systems. we are hearing more companies 2700 journalists and analysts in over 120 countries. francine: not sure who exactly talk about that. needs that. -- katee moore and back to the markets and the impact of the coronavirus, which has claimed 1150 lives and continues to spread. moore with blackrock, head of thematic strategy. there are more than 45,000 confirmed cases worldwide. but

the latest data from china what an interesting night in american policy in new signals that the outbreak maybe hampshire. with kevin cirilli and greg valliere we will spin forward to reducing. infections on the mainland fell by 5000. nevada and south carolina. this is bloomberg. the threat is still real. one bank evacuated employees ♪ from an office in singapore after one of its workers tested positive for the virus. that is after that country and most a package to mitigate in economic fallout. >> we think the broader knock-on impact can be severe as well. china's economy has been impacted, supply chains already being disrupted, so this is an impact on the overall mobile economy and singapore will surely be impacted in that scenario. so we are preparing for a strong package in the coming budget. francine: fed chair jay powell has warned that the up poses a risk to world economies. >> some of the uncertainties around trade have diminished

but risks to the outlook remain. we are closely monitoring their emergence of the coronavirus which could lead to disruptions in china that spill over to the rest of the global economy. francine: we also had breaking news of the chinese grand prix, this comes from the ft, reporting that the f1 chinese grand prix will be postponed. doing a quick google search, i found out that the 70th of april is one the grand prix was meant to be. thanks to the producers will googled for me. and it was meant to be in shanghai. for more on the market impact, the impact of central banks, bloomberg's managing editor for asian and economic government joins us, as well as our micro strategist, laura cooper. why is there a sense of the market by the damage from the virus will be limited, despite the cases rising? guest: as you say, the rate of change has come down some.

so the growth in the number of new cases has. that has given some confidence. but perhaps even more important is over the past couple of days, it has been crystal clear that china's leadership has been increasingly concerned about the head to the economic growth and is moving to undress it -- address it. we had president xi jinping yesterday saying that he was confident that economic targets ♪ "surveillance," .nd goals will be met francine lacqua in london, tom we had in the people's daily today, the vice president of the keene in new york. 10 academic of social sciences, greg valliere with us. one of china's top think tanks, he grew up in new hampshire so he can give us perspective and saying that the hit to growth imperceptible look forward. in his important research note this morning, kevin cirilli with us as well. on the full-year growth numbers, and that china's potential economic growth has not been hit on to nevada, who goes to nevada by this at all. with the up? so you have signs that china's leadership is moving bernie?obuchar or

aggressively here to reassure kevin: bernie. the hit will indeed be short-term. klobuchar now has some new momentum. let's also bring in she is headed to new york city to meet with her donors. laura, who has been looking at the market today in and day out on the orlene basis. get the checkbook out, because she has strong momentum. what are they looking at in the she beat elizabeth warren. markets? this is nearby massachusetts and that you area fact new hampshire, elizabeth warren seeing this slowing pace of transition especially outside finishing ahead of joe biden who china, which is helping to had a terrible night. assuage fears that there will be he went right to south carolina. this widespread globally. pete buttigieg and bernie it is not going to be a v- sanders, no one even knew who pete buttigieg was a couple of years ago, and the fact that he recovery, relatively short-lived reaction in the markets because finished second place behind ultimately, sentiment continues bernie sanders, we have some to propel equities higher. data from ojai -- iowa and new hampshire. tom: let's go into nevada and francine: we understand the equity point of view. new show -- nevada minutia. what are they looking at, the else? chains or something this is the morning must read out of vox.

chris: they are surly looking at this is saturday the 22nd. supply chains, certainly looking willospects for when there votersa that the early be a revival in transport and tourism, industries that have will not be physically present been hit hard. to participate in the nevada there were some interesting caucus, they will be asked in comments today from the new zealand central bank, obviously advance to rank up to five a very small economy, but those candidates by their iowa like order of preference. guys were early movers in easing policy aggressively last year. each precinct location will be cardsan unopened deck of were that has to be shuffled at least seven times by kevin cirilli, pointed in saying that they and each candidate's group will don't see a long-term impact of this point, they don't see a draw a card. need to put their fingers on the rate cut trigger. the high card wins the delegate. at this point so they are watchful and closely monitoring you have got to be kidding me. kevin: i know my friend greg what fed chair jay powell said valliere is about to say we will have a broker convention, but all of my reporting would lead me to indicate otherwise. yesterday. there is one voice of caution, ,s complex as this process is though, the head of economic analysis at australia's central bank saying today that we shouldn't assume that it will just a short-term shock. and i know there is differences we kid will that there will be significant further effects. between the way the democrats and republicans do their keepword of caution to business, but this is exactly

the conversation we had in 2016. watchful here. processes,as the warning signs from singapore today certainly suggest that not v-shapedg -- that a bernie sanders and pete buttigieg are still getting the most votes and for the rest of america who is not as recovery isn't a baked in politically obsessed with this, a win is a win. yet. francine: if you look at the you get the most votes and you get momentum and move on. tom: give us perspective. renminbi, there is a five-year interest-rate swap at its lowest since 2016. how do you get a brokered laura, i know that you measure convention with only two or things like this on a daily three candidates? greg: i am not sure biden drops basis. what are central banks looking at to gauge how bad it is? is it the earnings or the data. out. carolina andsouth could win a plurality of i think that is something that has been flagged by central delegates on super tuesday. banks, it is just the fact that it is too soon to tell at this he has never won a primary in three presidential campaigns. moving forward, i think there will be two or three serious stage. once we begin to see more congressmen are coming out of candidates, not sure there will china this month about how we can engage the potential impact, be a broker convention but it we could see central banks may be signaling a lot more caution, will be disputed where the first but ultimately, from a market ballot winner is not clear when

they get to milwaukee. francine: i have like 25 perspective, we continue to expect central banks will step in and further ease policy if needed should these global questions. growth fears intensify. why is biden in trouble and how does he get back? francine: thank you both for joining us, chris and sleep, in greg: energy, doesn't show enough energy. francine: how do you get that? tokyo, and laura cooper, in london with me. this is a personality. is an energeticers coming up, how you turn a feeling enterprise into a successful one. we ask the executive of a million-dollar consulting firm called alixpartners. 77-year-old and people know this. that is coming up next. we think he and elizabeth warren this is bloomberg. ♪ this is bloomberg. ♪ pretty much finished, but one name we have not mentioned is michael bloomberg. i know you have to do a disclaimer, but i think super tuesday could be pivotal for him with his resources. francine: the disclaimer is that michael blumer is the founder and owner of bloomberg news, -- bloomberg is the founder and owner of bloomberg news and bloomberg lp. what is the next thing we are looking out for?

why is everything up in the air? is there a democrat problem? kevin: it is a dysfunctional family, both political parties are. we go through this every four years. we are kind of used to that. with regards to what greg valliere said about michael inomberg, joe biden competed iowa and new hampshire and loss. michael bloomberg has not competed, and you will hear some sharpened political attacks -- we have already heard them -- point blank, aggressively more political attacks against the former new york city mayor and that will happen in the next three weeks. we will have some new guidance in the next three weeks. pete buttigieg and bernie sanders competed and won and a win is a win. for for all you have done us, concorde new hampshire -- concord, new hampshire is in your soul.

it is so different than the rest of the world. why do we put such a focus on your concorde, new hampshire? greg: i think a lot of sensible voters who get into it and follow it carefully. final point, a lot of these voters are depressed this morning because as one faction or another leaves milwaukee unhappy, it is a good story for donald trump. tom: francine is right, we had a million questions. thank you so much, and kevin cirilli, thank you so much. lots more to talk about as we move forward, kate moore of blackrock as well. we will have much more on the equity markets. chairman powell, another go around at 9:30 this morning. ♪

♪ francine: economics, finance, politics, this is bloomberg surveillance here in london. let's get to the bloomberg business flash in new york city with viviana hurtado. viviana: earnings beat estimates for this company. its namesake brand posting the best sales growth in the decade. the ceo is stepping down after almost 15 years. deals under his tenure made heineken the world's second-largest brewer. it will be replaced by the current head of asia-pacific. >> i have been working alongside with those at the executive team. mewhen i joined five years ago. back when he was in the u.s..

he has worked on 4 continents and spent 22 years of the company. he is young, which is great because you need lots of energy. he is also very experienced, and i am looking forward to great years with him. viviana: nissan is suing carlos ghosn. the automaker is seeking $91 million in damages from its former chairman. the amount of the claim may arise depending on any fines or pay.ties nissan has to carlos ghosn was arrested on charges of financial misconduct in 2018. he was facing trial until his to medical escape from japan about six weeks ago. we finish with boeing. it failed to sell any commercial planes in january. that extends a slump that joined the company's finances since two fatal crashes last month the, second with no orders of its best-selling max jet. deliveries also plunging.

boeing sold only 13 points in january, don from 46 a year r.rlie francine: how do you turn a failing enterprise into a successful one. my next guest is in chief executive of a billion-dollar firm.ting he has advised a host of corporate clients on dealing with descriptions and a number of other challenges. he is simon freakley, chief executive of alixpartners. thank you for joining us. simon: thank you for having me. francine: you have a company that is known for its turnaround. if you look at what companies and what chief executives will need in the future, what kind of services do you provide? do they come to you for advice on low rates, or how not to fail? simon: we are quite famous for the restructuring and turnaround may be 80% of what we do is dealing with disruption. what our clients are doing with everyday is disruption to their

businesses and industries -- retail, consumer, every business is going through this. what i say to our clients is that the most important thing is agile leadership. what you have to worry about economic cycles. these things are pretty well-managed by governments and central banks. it is a really severe and regular disruption cycles that are testing our clients. francine: the chief executive who runs in some cases billion-dollar companies comes to you for advice on disruption, isn't the game already over? simon: it is interesting, we did a study on this. if you look at the top order are performers in any key industries, the was who are doing well are capitalizing on disruption, using data to best capture it, using digital tools to understand their customers' for references. so disruption becomes a turbocharger of their viviana: -- ♪ businesses. they disrupt their own businesses start to break up his francine: this is bloomberg integrated value chains

opportunity? the "surveillance." we have to talk about bp. simon what would they do on alix steel will be talking to something like the for another brexit.omething like the chief executive on the new targets, and mark carney on do you have to be nimble and change the supply chain, at great cost? concerns surrounding the central simon: to the big disruptions. banks, and your markets. tom: kate moore with us of brexit, we could see coming. coronavirus, we couldn't. blackrock. we had been laid laurent the tragedy of the coronavirus aside, the impact of businesses n laidler, -- beb in -- the impact on businesses is significant. we have these integrated supply chains in a globalized business, yesterday, he stated bowl. people like apple and automotive bull. companie, they have been disrupted. are attractive, do so whether it is ford or nisan you buy that? or tesla or volkswagen, people am surprised more everybody has had their supply are coming around to my view. chains disrupted. i have been convinced of being what people are having to do is .uper bowl -- uber bull just react. thankfully, it seems we may have turned the corner on the coronavirus. but it is just another

disruption. francine: react quickly, how? think about where we were coming for example ofs out of labor day where everyone thought the economy was slowing, a person building a bicycle but cannot find the components the world would end, the trade coming from china. the you have to have a supply war would disrupt any growth in chain away from china? how have supply chains change china. it was a bearish crew on wall already because of the u.s.-china trade war? street and it has evolved. fear ofa lot of fomo, simon: if you look at what happened in the u.s. with the tariff war with china, companies had to second-source because missing out on the equity market they couldn't be reliant on the , so people are participating, successful outcome of this but if you people are convicted tariff spat. people were looking at taiwan, on the fundamentals. i have been encouraged over the vietnam, and people have already of howw quarters started to have second-sourcing strategies. the coronavirus happened so quickly that inevitably, quite a companies have maintained margins. they have adapted. number of companies' tom: what is so important is first-quarter earnings will be crushed by this. moore, all of, but i think hopefully, production will reestablish itself quickly. you are talking about earnings the longer-term strategy for not cratering. companies is to make sure they are not completely reliant on see is the evidence you one source of supply. that we are trough think or have francine: simon freakley of alixpartners stays with us. a resilient earnings picture? kate: 20 pictures were --

don't miss our conversation with the outgoing bank of england governor mark carney later in earnings were tough -- 2019 the hour. you can also watch the full conversation on "leaders with earnings were tough. lacqua" on thursday at 7:30 p.m. a huge we don't have u.k. time. amount of inflationary pressure, this is bloomberg. ♪ because wages aren't eating into margins, because companies are making smart technology investments, the possibility of bullg a long, sustained market in equities is high. you think about this all the time on the macro, it is across asset valuations that also matter, not just whether a company is trading at 18 times its earnings versus its history of 15. what is the bond market versus credit? francine: what happens when central bank policy starts to be normalized? questiont is a great and i would expect that multiples will contract. an environment where

central banks were raising policy rates. that is not coming anytime soon, certainly not a 2020 phenomenon. and especiallyn going into the u.s. election and other geopolitical events, central banks well maintain this level of accommodation. against that backdrop of yields so low and private markets elevated, the equity market deserves the multiples placed on it. francine: there must be some industries where you are worried about how we are valuing things. it seems like everybody wants to be a tech company. kate: outside of tech and communications, every single sector that is tech enabled and tech driven, those of the ones we are focused on. our companies disrupting, are

they generating a huge amount of sales? sector.t every we are not as constructive on resources more broadly and we are more constructive on the consumer space. we want to be thoughtful about dipping into value drafts, especially around retail. tom: kate moore with us. it was a great theme at davos, climate change. what will corporations and traditional oil do? british petroleum defines traditional oil, and we have an interview with our newly minted chief executive officer. ♪

♪ then the emergence of coronavirus which could lead to disruptions in china that spill economy.he global >> this is from an economic perspective already bigger than sars. >> the people's bank of china

has done a number of things to support economic activity, and i think you can expect the chinese government to do lots of things to support economic activity. >> in general, the experience has been in pandemics that they can have quite significant impacts, but much of it is recovered. >> we know that there will be some very likely some effects on the united states. i think it is just too early to say. francine: that was the federal reserve chair jay powell, and bank of england governor mark carney, commenting on the impact of the coronavirus on the economy. i am francine lacqua here in london. let's get to the business of advising companies. everyone uses their phone differently. my guest is a specialist in that's why xfinity mobile lets you design your own data. turning failing enterprises into successful ones. you can share 1, 3, or 10 gigs of data between lines, simon freakley from alixpartners joins us. mix in lines of unlimited, and switch it up at any time. we are also talking in general about advising so that companies are not disrupted. we had valuations in the tech all with millions of secure wifi hotspots and the best lte everywhere else. space. wework and another number of ipos i can think of. it's a different kind of wireless network, designed to save you money.

is it a danger that because of switch and save up to $400 a year on your wireless bill. negative rates, things are getting inflated, that we are valuing things wrong and that is and save even more when you say "bring my own phone" into your voice remote. wrong much is for companies before investors? that's simple, easy, awesome. simon: wework was a great click, call or visit a store today. example, it was a tech company .ather than an office space company people wonder whether the valuation multiples are realistic. if you look at the vision fund and the success of alibaba, that was an extraordinary runaway success but it is not necessarily representative of other businesses held by the firm. so i think valuation multiples can run away. francine: how does it come back to normalcy? when you speak to a chief executive and he says, i have this company, i think it is a tech company, do you have to say, it is a tech company but it can be disrupted quickly? ♪ "surveillance." simon:. businesses can be grown so quickly the challenge is how to scale them. how to make sure a failing enterprise doesn't fail. francine in london, tom in new we are making sure businesses york. can -- making sure businesses viviana: bernie sanders important.uickly is

tightened his grip on the democratic party's liberal wing, the opportunity that comes with wining back challenges to technology, the rate at which businesses can grow. is extraordinary having a weathered i on making sure the primary, receiving 26% of the vote. pete buttigieg was a close multiples are realistic. 300continuous landmass over second followed by amy klobuchar. >> we are going to unite together and defeat the most million people helps, largely speaking the same language. the european economy is about dangerous president in the the same size and headcount, but we all don't speak one language. modern history of this country. scalability is a focus. a surprisingly investors want to growth. growth gives them equity returns so growth is the center of the strong performance, klobuchar agenda. francine: when you look at receiving almost 20% of the votes. how many don't know elizabeth warren and joe biden finished well behind. companies have to advise on whether we don't have equivalent u.s. officials are accusing see when it comes to financial services, or we don't have a huawei of being able to tap into trade deal? simon: brexit isn't actually mobile phone networks. those officials believe they use back doors designed for law done until we get to the end of the transition period. enforcement, huawei rejecting i personally don't see how we do the allegations. that by the 31st of january. -- wek a long-term deal the trump administration has urged allies to bar huawei.

would like a long-term deal. the super bowl of dog shows in the u.s. at madison square i think michel barnier is very unlikely to give us that. garden, the westminster kennel club named its champion, a we will have a short-term deal with our continued equivalency dependent on performing a way.in standard poodle. she strutted off with best in my judgment is that we will end up with an extension to the show. transition period. francine: what does that mean for your company? she hits the tv morning shows. "surveillance" will see a uncertainty? simon: uncertainty. it is yet another disruption to their business that they have to take into their strategy i photo op at the top of the empire state building. think. it is a bad thing for our global news 24 hours a day, on clients, and i think that is air and @quicktake on twitter, powered by more than 2700 what the federal government has to focus on this being done. journalists and analysts in more than 120 countries. hurtado. so much has to be done that i wonder whether that is possible in this. did you know that golden retriever's never winning best francine: period simon freakley, in show, but daniel made off thank you for being with us today. coming up, bernie sanders wins new hampshire with top sporting dog. tom: doesn't cut it. i am thrilled kate moore is on primary. we have a full roundup of the u.s. election. the today but she is not here to u.s. election. talk about the markets. on the westminster dog show with cora the golden rich people -- golden retriever, they cannot

win against the frufru dogs. kate: there is a deliberate and unconscious bias against the goldens. it is heartbreaking. tom: there will be a thing at davos next year. poodle and they are a duck hunting dog and they just frufru'ed them up. kate: goldens have been bred to be the best animals on earth so this is really shocking. home,ith real dogs at this is an outrage. we are now going to turn to what is truly an outrage, the media hysteria over this virus out of wuhan, china. we are thrilled to have peter anthony fauciand

with us. what is your single message today to people, about the declining rates of change we are seeing in this virus? is it good news? dr. fauci: we better be careful about jumping to the conclusion that this is turning around, because when you look into monitoring of infections, you sometimes see it go up and down. i am glad it is not greatly accelerating, but the numbers of cases each day are still alarming, up to 45,000 cases with 1115 deaths. we have to be careful that is much as we want things to turn around, wishful thinking, we still have a serious problem in china, and as we get more travel related cases, the threat of

this becoming more diffuse is great. tom: whether it is diphtheria or tie right -- typhoid, viruses of another time or today, how do they disappear? how do they go away? dr. fauci: what would happen in the absence of any intervention like a successful vaccine, which as you know historic we has eradicated smallpox and eliminated polio for most of the world, and a variety of other infections, but when you don't have an intervention, generally there are susceptible people in the population, and those less susceptible. when the susceptibles get infected, it is a deadly virus. they will either die, get sick, and recover, or be protected so francine: fed chair jay powell the virus will have gone through warns coronavirus poses a risk the population, made people

to the global economy. sick, killed some people, and president xi vows china will still meet its economic goals. the rest of the population is bernie sanders wins the new protected until the new babies hampshire primary, pushing pete buttigieg into second place. that are born come into the we will report live from the population. u.s. it is the natural dissipation of and softbank's roller coaster -- the japanese tech giant returns the virus. to profitability after its francine: anthony fauci, how do record loss on the meltdown at wework. we know if it is getting better or worse? good morning, good afternoon, you say we could have a better phase or a worse phase. good evening. this is "bloomberg surveillance ." do you monitor how it gets just over 1.5 hours into the infected? is it the mortality rate? trading day, let's check on what are the tools? european stock movers with dani dr. fauci: before you have burger. dani: i have a lot of earnings news. sensitive diagnostic tests that -- you can widely distribute. test, butdiagnostic heineken, we learned yesterday one that is easily distributed around the world, you count the that their ceo was leaving. their numbers are positive for the decade is right some number of cases that come to the concerns. attention of the medical community and count the number show the bigs of deaths. cases thatthe 45,000 geographical diversity nature have come to the attention of

of their business. medical authorities, guccis all about gucci -- overwhelmingly 90 plus percent are in china. the thing that often gets missed provides about 80% of as there are many more people who are infected but have either minimal symptoms or no symptoms kering sales. abn amro, the only negative one at all. countederally don't get i have on the board today, missing on fourth-quarter earnings. a lot of this has to do with , so everyone feels rather cost. confident that the total number the coming management is saying of infected people are much there are lots of uncertainties, greater than the 45,000 count we not to mention a dutch probe into the company. are getting from china. the other big story, one of the in some respects, that is day headlines, softbank. comforting news because that we are learning that they are means a lot of people are scoffing -- scrapping their $105 getting infected and not getting billion target for the vision very sick, even though the fund. overall mortality counting just you can see what a roller coaster ride it has been today the people who come to the when the japanese trading happens. intention -- attention of the shows jump 13% after we learned medical community, is about 2.4% they were finally able to get which is very high compared to approval for their sale of sprint. so that is helping. seasonal influenza which is only and some of these shares are better in the week because we 0.1%. francine: i don't want to sought -- not only news that the

oversimplify it, but is it more vision fund is going to be smaller than we thought, but dangerous than the annual they also had earnings and it influenza but less dangerous showed a 2 billion-dollar loss for the original vision fund. than sars? it shows there startup is would that be a fair way of describing it? dr. fauci: i think what you said struggling. they had their record loss the quarter prior thanks to a lot of is the truth. the wework write-downs. there is still many unknowns, toncine: let's get straight but given what we have right the bloomberg first word news in now, it is spreading rapidly. than certainly more deadly new york city with viviana hurtado. viviana: we begin with the a typical seasonal influenza, coronavirus. it has claimed more than 1100 but not nearly as deadly as sars lives there it more than 45,000 which had a mortality about 9% people have been infected, but the latest data from china sars didut stars -- signals the outbreak may be easing. the number of cases in hubei not spread as easily. province this month was the in an entire year, there were lowest. in india, that is where narendra only 8000 cases of sars, which modi's party has conceded his just dissipated and went away. seat in the key state election. right now in the first two religion citizenship law months or seven weeks, we have 45,000 cases. we have more than five times as

sparked a protest across the many cases in a month and a half country. there was an aggressive campaign to win the capital, but has not with this infection then we had with sars in an entire year. formed a government there for two decades. we end with samsung betting on a francine: thank you so much for all of the insight, dr. anthony big camera upgrade for its new galaxy phones. -- it will come with a 16 fauci. a number of banks are reporting tomorrow, including credit gig memory and a huge battery. starting price, nearly $1400. suisse and barclays. we will be speaking to barclay'' ceo jes staley about the virus global news 24 hours a day, on air and at quicktake by bloomberg, powered by more than and how it impacts banks. 2700 journalists and analysts in i'm than 120 countries, this is bloomberg. viviana hurtado. ♪ this is bloomberg. francine, it is that 100 times zoom. francine: really, what are you zooming? don't zoom us. $1400 may be a little bit too much. thank you. bernie sanders has won the new hampshire primary. pete buttigieg finished second. the surprise of the night was

amy klobuchar, who came third on a surge of support after last week's a but debate. however the candidates reacting? it seems usually by this point we have someone that could get the democratic nomination. is it still up in the air? >> the contest has been blown wide open. bernie sanders is trying to position himself as the front runner, taking a victory lap. you're saying small victories for pete buttigieg, the former south bend, indiana, mayor. for buttigieg, it was the fact that he was so close to sanders in this contest with 24.4% of the vote. for amy klobuchar, the fact that she passed senator elizabeth warren and former vice president joe biden, coming in fourth and fifth place respectively. a big disappointment from those

campaigns. joe biden for his part left new hampshire early last night and flew down to south carolina. he addressed supporters from there. he said new hampshire and iowa are two of 50 states, but that this is the opening bell, notin. francine: what contests are coming up, and which ones are we really watching? kailey: we have the nevada caucuses coming up in about 10 days, but the real focus, especially for the biden campaign, is the south carolina primary on that when he ninth. south carolina is much more diverse -- on the 29th. south carolina is a much more diverse state than iowa or new hampshire. joe biden is putting his focus on that, and of course we have super tuesday coming up at the beginning of march, in which we will have 14 state primaries, including california and texas, which will have hundreds of delegates. ♪ tom: bloomberg "surveillance," for buttigieg, sanders, and klobuchar, they are looking much more coming up.

forward to super tuesday as well. candidatesow are the look for the complete carney interview with francine lacqua. stacked in national polls right now? kate moore with us. of tuesday morning, i want to bring up a chart that gets to the heart of the bernie sanders passed joe biden. thematic martyr -- matter and biden had slid down to 16, and esg. that was after his disappointing showing in iowa. or the broader the gap could perhaps widen international markets as well. further. the dynamic we are seeing playing out is the progressive this is a great story normalized back to 2007. seems to be tilting more toward what is my waiting in international -- weighting in bernie sanders, less toward elizabeth warren. it is less likely that she will international? kate: we are being selective. be able to compete with him for the base, but the moderates are still up in the air because you , and thestocks have biden still leading in the national polls. leinz in newley companies that are generating good growth, have good global sales and are geared toward the york, thank you so much. we will have a roundup of the consumer in china, are trading u.s. election -- and a at a massive premium to the rest disclaimer, michael bloomberg, of the market. running for the democratic they are not cheap. or angle off nomination, is also the founder and majority owner of bloomberg

lp, and therefore the owner of international investment provides comfort given the bloomberg news. volatility? joins us now. concrete stocks in thailand? kate: there has been a huge great to have you. -- our guest joins us now. ray to have you. evolution in terms of the how much will the economy composition of the indices, and change? >> the big focus for november one reason the u.s. has outperformed is because of the thomas and -- dominance of this year, i think we need to get more currency on what the technology and technology enabled companies. democratic candidate looks like. this is why we see china markets is theng performing well. there has been a massive story of central banks had low interest rates. the u.s. what kind of composition and the index towards technology and technology enabled companies. economy -- are the jobs being they are generating free cash created quality jobs? are voters happy with what they and constantly innovating and they will lead the market higher. are seeing? if you are in index like europe with ok growth in the domestic at is athey are looking very stable environment, where environment but not a lot of the macro growth gdp number change in leadership over the last 10 years, it is a harder looks stable. inflation is not a threat, and call at the broad index level. how does esg investing really this comes down to the central bank in the u.s. keeping rates lower for longer. change these indices? kate: it has an impact on the

i think the market sees that as being on hold for now. francine: and there are a willingness of investors to own different sectors and around different companies. million things going on with coronavirus. we look at not just the publicly canwhether the economy rated esg scores for companies weather the storm. we cover, but doing our own work you look back over to determine is there a change what has been a long-running in these companies relative to equity rally now, actually where they are scored today? markets are very willing to work through political and some other news flow that has necessarily been negative, and going back to energy, where energy has shrunk assetndamentals, which is to less than 4% of the s&p. it is a place where some allocation decisions in a low companies are performing well, interest rate environment back to the equity markets. others are not, so you have to francine: thank you so much. choose the winners and losers. francine: do you worry about gareth mccartney stays with us. of britishef companies not reinvesting enough and focusing too much on giving petroleum, don't miss that back to shareholders to make exclusive interview on balance them happy and make sure they of power. this is bloomberg. ♪ don't go looking elsewhere? in five or six years, we realize there is not enough investment in key industries. ine: especially the capex

investment cycle is top of mind. given the uncertainty, companies are making smart decisions around investment and i don't expect it will be a meaningful change around the capital return strategies. more dividends, more buybacks, and it is the right thing to do in a rate where and but -- environment where rates are low and they can generate that kind of capital return. tom: kate moore with blackrock. we continue to see drips and drives out of the effect of the virus in wuhan. now it is more about what we are seeing in travel, and getting to conferences. this is a major mobile conference that will be canceled due to the virus. this is bloomberg. good morning. ♪

francine: this is "bloomberg surveillance," and this is what you should be looking out for today. the internet giant is battling fines that cost the company nearly $9 billion. we are respecting european industrial production figures. data shows sharp contractions and outputs across major economies. it is also day two for fed chair jay powell for delivering his semiannual report on the state of the u.s. economy to congress. b.p.'s new if executive, bernard looney, delivers his vision for the company in london. we will speak to him exclusively at 5:30 this afternoon u.k. time. let's focus on the your area economy. three of the european central top policymakers have

defended their position. gareth mccartney from ubs is still with us. do they work? do they work for the transmission mechanism? one of the ecb does, do they need mean negative rates? gareth: i think it is a question of which part of the economy you are looking at. clearly we are still in an environment where the scarcity of growth, most of the growth is technologyhe sectors. i think the debate is which part of the economy you are looking at. for the banking sector, negative rates make it quite challenging, and you have seen that in how they have underperformed. a great story in europe has some ♪ francine: this is bloomberg "surveillancefrancine:." bps new impact there. francine: what does europe need? if you don't get structural chief executive will set out plans to become a net zero reform, does it just need fiscal company by 2050 or sooner, spending and the person to make sure that countries deliver on

that? gareth: the market is looking speaking to alix steel. for two things. up, because we with new leadership in the ecb, how that plays out and what the are focusing on bloomberg green, policy will look like. and what investors are looking a great initiative launched in davos. for is the fiscal stimulus to come from the biggest economies within europe. the men who spearheaded this is jonathan ferro. francine: where do you see the he heads up bloomberg green biggest challenge? if we have u.s. tariffs in among many other jobs. germany, german carmakers, does we had that announcement from bp that change everything in and the concern investors will europe? back,: taking a step talkhis bp is talking the europe has been almost stepping but will they walk the walk? in with the value factor bucket for global investors. they have taken a barbell approach, which is really putting their camp down to given bps size and invest in equities as an offset to low or negative interest rates, and they have taken a barbell approach to dividend yields and both stocks. history, they cannot make everyone happy. it is the most ambitious climate on the other hand, gold has performed well, and u.s. plan of the five major oil treasuries have performed well. companies in the world. next evolution of the story is fromare carbon neutral to see more diversification and normalization back toward their own operations by 2050, emerging markets. and if you look at scope three and i think europe as well, where there is a value case to carbon emissions that you

be made. francine: for something like produce as a company but your coronavirus, emerging markets products will create as well, could be adversely affected. gareth: that is clearly an the language is a little vague. unknown. the way the markets approach that is something people will be jumping on. this is to look through it for tom: part of your chart is you now and say if this is a shorter-term effect, i've got a are as cynical as anyone i have ever met on europe. little bit of a perk with central bank policy, and you 1.12% per year have already seen a clear response that the central banks will continue to be accommodative. and therefore investors are for the last 10 years. looking through that and looking at a growth environment, and the some would say net zero is there risk to their portfolio is what do they not own, and i think return to shareholders. what will they do to match the emerging markets with europe would fit in that underweight category. well-intentioned efforts with that is where their risk is. francine: how did you choose the to shareholders? john: if you look carefully at emerging markets? the statements, you will see 2020 was an emerging markets there is a line about how the story when you came to ceo pledges to make sure bp will stay on sound financial footing. venezuela, idiosyncratic concerns like for turkey. this caps the dilemma the oil where do you go? majors have. gareth: it is looking for what do we stay doing what we are is differentiated exposure that , org producing oil and gas you cannot get within the developed market, so that lead

you down the path of growth. so i think you will be looking do we try and diversify? for countries where there is macro political stability, plus if you look at bps statement, you are looking for individual they are trying to do both and or more idiosyncratic exposure to growth story, so either there signaling to the market they is disruption or there is will keep on paying the dividend underlying growth links to the macro. as the shares rise. francine: the underlying growth they are doing a lot to diversify away from gas, and the comes from, again, monetary big question, big dilemma they stimulus, or is there real growth? gareth: that is a good question. face, how quickly will they i think there will be two parts diversify? tom: with good green intentions, to that story. one is monetary actra. if you see softening in the great. what does the south side about dollar, that will -- one is aboute -- south side say monetary backdrop. if you see softening in the dollar. francine: don't miss our revenue will replacement? do they replace the revenues or conversation with the outgoing downsize as a company? the dilemma this is bank of england governor, mark carney. we discuss brexit, the challenge that all the oil majors face. of climate change, and much more. you can watch the full if you look at the statement conversation on leaders with that they are trying to do both, thursday. they are not trying to get out of oil and gas forever. this is bloomberg. ♪ they are talking about trillions

of dollars of investment needed as we rewire the global energy system, so clearly there is money to be made outside of oil and gas. look at the revolution of battery technology and solar and wind. that is the question on every investor's lips. francine: thank you so much. out so nowong way could happen between now and then. do not miss our exclusive interview with bps chief ,xecutive at 5:30 in london 12:30 p.m. in new york. hasclimate conference disrupted everybody and mark carney is the center of the debate, serving as envoy for climate as well as his central-bank role.

carney: there is always a danger of complacency and we see it time and time again on climate change, the question of societal attitudes. unfortunately, one of the things we do is we oversee the insurance sector, so we see the physical manifestations of extreme weather events and where that is likely to go. , in the carbonn of the atmosphere effectively is more of these, even if we start to make serious progress. the reality is we are talking about making more serious progress but the curves are not bending and need to start bending fast. francine: why aren't they? people do not believe it, they think it is harsh? mr. carney: it is hard.

what their needs to be, and one of the things the u.k. wants to glasgow is to at a minimum get a shared understanding in the financial sector of what the financial -- transition is supposed to be, and then every company in the real economy or the financial sector can answer the question, what is your plan for the transition? as you get that out, that is just one of the things that is looked at. francine: what surprised you the most when people looked at this? was it the more questions you asked to the institutions, the more questions it raised from them, or the complexity? very fewy: initially, had thought through some of the francine: economics, finance, politics. let's bring you our interview with mark carney. -- so there was an inconsistency has seen an

between how many greenhouse gases can be in the atmosphere tumultuous. thea 1.5% or 2% target, and in his time as the governor of the bank of england. in this week's episode of "leaders with lacqua," i asked stock of hydrocarbon assets on the books globally. if he would have taken the job if he knew the ups and downs of there is an inconsistency. brexit that were in store. if we are going to accomplish our net zero objective, not all of them will be burned. mark: well, yes. i knew at the time as a central if i am in the financial sector be -- that i would i am thinking, which ones are most likely to be used in a the economy recovered -- transition, which are less remember, statistically we were likely, how do i assign relative on the cusp of a triple digit recession at the time i took the job. valuation? i felt it was important -- i different people have different think i said at the time that views, but you would think everybody would have thought this was where the challenges through those questions. were the greatest and central that is starting to come banking, and i wanted to centerstage as is the question contribute. the challenges were even greater of which renewables and energy maybe than i realized at the will come in. and i have never regretted billions orns of it at all. it has been a privilege. hundreds of billions questions francine: would you have done in terms of valuations which

anything differently? will play out. mark: not on the big calls, no. ago peoplee years francine: it is not necessarily think it is an interesting policies, but there was given question and should look into it. occasion at times that came that is not surprising. under criticism. yeah, but it comes with now it is moving centerstage. people are asking that question. the territory. that way we look at it, the way i look at it, households and the energy companies are supplying energy to the real businesses absolutely understood economy, so it is as much, what what we were saying. rates were going to stay low, is the consumer products company they saw quite a market , what is their trajectory and adjustment in household business expectations. as important an audience for plan toward net zero? francine: you can catch the full guidance because you want to give them the confidence that interview with the bank of england governor mark carney on the economy was -- that the leaders dutch "leaders with recovery was going to take hold. lacqua." in terms of financial markets, they moved along with the data and the committee. , absent brexit advance, but if you look at the focus will be on the sterling or interest rate through that period, it performs coronavirus and what central banks can do to counter that. very well. the markets got it, households crude oil is rallying. got it, and we provided the stimulus. we are seeing signs that the if you look at the track record,

we went on the cusp of triple spread of the coronavirus in china is slowing. digit recession to the treasury yields are edging fastest-growing economy in the higher. g7, and unemployment went down, leading thed miners inflation at a target that we way in europe. were preparing the financial sectors. the new zealand dollar jumping we are simple people, though, the most in two months after the and canada. central bank said the impact of we look at those metrics, the virus will be short-lived and does not project the need numbers. francine: but with a window not for rate cuts. only for the bank of england but for central banks around the jay powell back on capitol hill world where there was pressure to deliver his semiannual to raise, given what we are testimony to the banking seeing now? a.m.ttee at 9:30 mark: i don't think in general that is the case because i we will have full coverage of certainly don't subscribe, and i anything jay powell says. don't think my fellow governors this is bloomberg. ♪ subscribe to the idea of let's raise rates now so we can cut them in the future. the point is to manage policy so that you achieve the inflation target in our case. if you look at the performance of the economy -- i will give

you example. if you go back to where we first put guidance in 2013, 2014, the historic reaction function, what the mpc's before would have done, is raised interest rates by 150 to 200 basis points. that is because there used to only be demand shocks, not supply shocks. we said no, we are not going to, we are going to hold, and we did not raise rates. what happened to inflation? broad-based, it was the right call to make. even though external commentators, the shadow and bc, others said we should have been raising rates all through the time. you can look at the total core inflation, at a minimum, it is not inconsistent with what the mpc did. if you want to talk more strongly, it was entirely consistent with what the mpc did. happened on the brexit referendum evening when

you found out the results? were prepared for that possibility because our job is to prepare, even if we thought it was a low probability we would have prepared for it. around 7:00,ome 8:00. people had to vote as well. we had people staffing all through the night, and my intention was to come in somewhere around 3:00, 4:00 in the morning, but if we had to do something, to work along. so i tracked the results as they went. i was in it at 3:30 or something like that with a number of colleagues to monitor markets. we wanted to make sure the markets did their job, which is to function. they did an outstanding job. prices moved a lot. there was not gapping, it was orderly. and then early in the morning we prepared a statement, which we had prepared a week in advance.

you refined the statement when you know you're are really going to give it. and then i spoke to the sequenced thatwe the prime minister was going to give his statement and we followed on from that. the other thing we had done, which was crucial, is that we had been speaking to all the g7 and major g20 governors in -- you know,the the secretary of treasury and others, and then in the morning i spoke with them individually. we spoke collectively and make sure -- and made sure we were lined up. francine: you can catch our full interview with the outgoing bank of england governor mark carney on "leaders with lacqua," tonight in the u.s. and tomorrow in the u.k. and asia. we are back with gareth mccartney. when you look at the bank of ♪ england, it is externally difficult given that we have a month for negotiation between to know what-- romaine: jerome powell makes an

their looking at. appeal for fiscal policy, gareth: there is no doubt, highlighting the difficulties the fed and other central banks are facing longer-term rates talking to investors, and near zero. particularly international bernie sanders winning the new investors, that we are looking for opportunities here, hampshire primary, trying to solidify his status as the particularly in the u.k. domestic space as we get more standardbearer for the clarity on how this plays out. democratic party still split between progressives and francine: what if the u.k. moderates. leaves the e.u. without a trade and relief permeating global deal? does it change everything, or markets right now amid a slow just because brexit has not done down in the spread of coronavirus, but is the headline already investors feel more stable. gareth: that probably still optimism obscuring a flight to safety beneath the surface? would be perceived as a tail welcome to "bloomberg daybreak" risk outcome and they would be on this wednesday, february 12. readjustment around that. but i think what you have seen, i'm romaine bostick, in for alix and take the market here in the steel today. u.k., there is still an awful right now the price action is lot of attraction as a place to list your company. relatively positive. asia stocks started off the day for an international exposed shrugging off the impact of the company, the disruptive software coronavirus. we saw the bleed over into story, the growth story, a very good audience. european stocks. the story now is, can we then the stoxx 600 at a record high right now. see the domestic story, get that

stability we need for more certainty on the brexit process to continue that story to play out. francine: how will it play out? is it in currency come in equity? does that change a lot for investors? gareth: the excess -- the fx market is where the moves are. the broader market is still, as is the global market, you're seeing the asset allocation into equity. in a low interest rate environment delivered by the central bank, equities look very attractive. francine: thank you so much, gareth mccartney. bloomberg surveillance continues. in the next hour, tom keene joins me out of new york. later, alix steel speaks with the bp chief executive. ♪ hi! we're glad you came in, what's on your mind?

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can you save me from this conversation? that we can't do, but come in and see what we can do. we're here to make life simple. easy. awesome. ask. shop. discover. at your local xfinity store today. francine: fed chair jay powell warns coronavirus poses a risk

to the global economy. president xi vows china will still meet its economic goals. bernie sanders wins the new hampshire primary, pushing pete buttigieg into second place. we will report live from the u.s. and softbank's roller coaster -- the japanese tech giant returns to profitability after its record loss on the meltdown at wework. well, good morning, good .fternoon, good evening depending on where you are in the world, i am francine lacqua in london, tom keene is in new york. bigger drop than actually expected, so we spent a lot of time -- or i spend a lot of time -- looking at the strength and weakness of the european economy. there are a lot of things to look out for, including the fallout for the cdu party. tom: acquired her markets today, francine, all of it set around what to do in an ever higher churning equity market. we will have good guests on the

equity market, how to be in the equity market this february. francine: let's get straight to the bloomberg first word news in new york city with viviana hurtado. theana: bernie sanders now undisputed leader of the democratic party's left wing. the democratic-socialist winning the new hampshire primary with 26% of the vote, edging out pete buttigieg. he had a little more than 24%. now sanders is taking aim at the next state on the political calendar. we are going to nevada, we are going to south carolina. we are going to win those states as well. amy klobuchar having a surprising strong third-place finish at almost when he percent. elizabeth warren and joe biden both disappointing. they each finished in single digits. the death toll from the coronavirus has risen past 1100. the number of confirmed cases on the mainland china is up, but the daily figure was the lowest

this month. that is an encouraging sign for health experts who are looking for the peak of the outbreak. a stunning rebuke to the u.s. justice department before federal prosecutors who backed a long prison term for trump ally roger stone. they quit the case there their bosses cutting by more than half. sentence's recommended . next week a federal judge will sentence him. global news 24 hours a day, on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in i'm than 120 countries, viviana hurtado. this is bloomberg. tom: thanks so much. for our international audience, the announcement on mr. stone and the prosecutor is buried in the news last night, as everyone was focused on new hampshire in america. that is a huge deal. much more on that, including and "balance of power."

i have one screen. when was the last time i did that. futures up 1.11. the year churning fractionally stronger, oil fractionally stronger. francine, that's all i've got. francine: what do you mean that's all you have? i have a good one. today i have new zealand dollar. new zealand dollar is on the up, the highest in two months, and this is on the back of the coronavirus. the central bank said any impact from the virus will be short-lived. they also do not project the need for a rate cut this year. it is a small open economy, very exposed to china. tom: i'm glad you put it in there because i missed that quote. that is why we do two different data checks. francine and her team see different things than i see. each day in beijing, our tom mackenzie. we get an update today. viviana alluded to the

plateau of the dying. go through the calculus on the rate of change and the rate of change and the rate of change of all these different medicines and pathologies. tom: there is that pace, that number out of the province of hubei, the epicenter for the virus that has dropped to the cases. number of the confidence to see the pendulum swing now away from the measures and more focused on getting the economy back on track. you have been hearing that from the central leadership. president xi jinping with a conversation with his indonesian counterpart say we are going to targets.economic he said this is an important juncture in fighting the virus. we're still seeing the impact on

the likes of singapore, where we had the evacuation of an office, 300 employees taken out after one of their counterparts picked up the infection. measures continue -- they have about 49 cases. there has been some progress as the chinese pharmaceutical companies started reducing production of the drug there, untested largely, but they are producing a drug to see if it goes any way toward curing some of the people afflicted with his virus. and johnson & johnson in the u.s. is working with government sharing funding to push forward a vaccine as well. francine: we also found out that the chinese grand prix will be postponed. what is it like living in beijing? are the streets empty? do people go out? how do you get groceries? tom: there is not a sense of panic. i was at the supermarket yesterday and it was pretty busy. people were buying produce, but they were getting in and out quickly.

they all have their temperatures scanned when they go into the supermarket. back at your compound, they scan your temperature as well, and that is passed on to the local authorities. a few restaurants are open, but very few people are in them. goldman sachs and jp morgan, it took me 15 minutes to get into the building. there heat sensors scanning us, making sure that our temperatures were below the virus infection level. there is concern, leading us into the office building after a 15 minute check. there are more cars and buses on the road, but a lot of white-collar workers are still working from home. next week it is expected to pick up. francine: tom mackenzie, thank for holding before for us in beijing. fed chair jay powell with his own morning to house lawmakers. >> some of the uncertainties around trade have diminished, but risks to the outlook remain. monitoring the out -- the emergence of coronavirus could

lead to disruptions in china they could spill over to the rest of the global economy. james bevan joins us. always good to have your thoughts. are investors too optimistic that they can look through this? james: they ignore this as their -- at their peril. guys, really? i can understand why it is on the back of earnings results, the optimism that he will keep the party going and the people will feel benign toward equities. but to say that the coronavirus is not a risk i think is a serious error of judgment. francine: where would you price it? do you wait for data from central banks, earnings, or doesn't impact everything? james: i am anticipating the growth in china for the first quarter, court or on quarter the be zero. factoring the expectation of

zero growth. and therefore, i have been taking money out of names like ovi mh, which to me is an absolute long-term portfolio holding. i have been cycling away from into a company that has less direct earnings risk. tom: james, good morning. we will dive into the ratios later in the hour. i love what you say about the wuhan virus as being a postponement there there is a fair amount of hysteria, gloom, investment tone on this horrific illness in china. for will join us in the next hour. -- anthony faucher he will join us in the next hour. ours: what we will observe

genuine green shoots of recovery in manufacturing and nonmanufacturing, and the expectations that we should expect growth based on the lead indicators to me says that we have very strong liquidity conditions. you and i have been around the block a few times and we both know we have never seen a great diversification between financial market conditions and the real economy, and that worries me. that is why i think we are in the midst of a genuine melt up as opposed to the stock market being driven by fundamental progress. this from james bevan, folks. it is remarkable to hear from these bowls, given so much of the caution that you see out there -- from these bulls, given so much of the caution that you see out there. he said we have been around the block a few times. alluding in any way, shape, or form. francine: i did not take it that

way. tom: coming up, he has been around the block before. did good, maybe not as good as the last time around the block. we are going to look forward to nevada, to south carolina. kevin cirilli with us next. this is bloomberg. stay with us. ♪

tom: "bloomberg surveillance." good morning, everyone. the ratings say all. the ratings over the last couple over america looking at its political process have been extraordinary. we are going to go to kevin cirilli, who is knee-deep in all of this little process. i thought david plus, who ran

the obama campaign, was absolutely brilliant last night at msnbc. and now it is about money. affect the money to nevada, south carolina, and to go on to super tuesday? of these new hampshire candidates, who can move forward with a strong budget? , pete bernie sanders buttigieg, and amy klobuchar is going to be in new york today to fund raise, because she got a strong third-place showing. it is about money. michael bloomberg is pouring an infinite amount of resources into the race. but it is also about momentum, and the grassroots effort. that is something that bernie sanders is able to seize upon. he has done this before. his belief in the climate around him -- joe biden, who had a very disappointing finish come in single digits, is heading to south carolina, where he gave

his speech last night. but candidly, that is where iowa and new hampshire really matter. for as much as other candidates who have underperformed like biden come in the beginning of this race, or outside candidates like michael bloomberg, they do not have momentum. bernie sanders, pete buttigieg, and to some extent amy klobuchar are able to seize upon momentum. senator from the vermont play in a surprisingly urban, surprisingly union las vegas? i think a huge body of americans, and our international audience, thinks it is las vegas, all the casinos you go to. how does the senator from vermont play there? kevin: it is about hospitality workers. it is about restaurant workers, union workers. here is what you and i know. , outsideverseas looking at this, i would put forth this.

the folks who run the unions are very different than the coalition of the workers who make them up. republicans learned that the hard way last election cycle. it will be interesting to see if democrats are able to figure out that lesson as well. union bosses are different than the folks who actually do the work. francine: if you boil it down, is it all sorts of play? is joe biden in real trouble? it seems like there are mixed messages in terms of turnout. kevin: joe biden is in a lot of trouble. joe biden has to win something. joe biden is in trouble. point blank, there is no other way to say it. bernie sanders has -- buttigieg to spend thatable he is going to be able to pick up in centrist ways, if he will be the standard bearer for the party. but there is no doubt about it. joe biden started the race as the national front runner, he ends the race behind elizabeth

warren, who also had a bad showing yesterday. she is from neighboring massachusetts. tom: kevin cirilli, thank you so much. too early in the morning. we appreciate our chief new hampshire correspondent joining us today. we should point out that mr. bloomberg is a founder of bloomberg lp, and bloomberg news, these radio and tv facilities as well. we want to dive forward with a further discussion with stephanie kelly at aberdeen standard, and james bevan. he is a bull on equities as well. stephanie, an open question. your thoughts on the american political process and how it fixates all, and how it then folds into our investment thinking. what do you do with that? stephanie: i think in particular , this year's election is a prime example of how investors are already trying to make that calculation, which is that

really complicated thing of all of a sudden having to understand how the delegate counts work and who will win the democratic primary, and if they win that, how they will do against trump. with the primaries show so far is that surprises can happen. in particular what is most striking to me about the new hampshire win is not so much people talking about sanders, and investors are very focused on sanders because of his progressive policy agenda. but the news media is focused on who has momentum, who has beaten expectations? it is fair to say that bernie sanders met expectations last night, but he did not beat them. amy klobuchar -- or biden or buttigieg, he is a relative moderate and will not be hugely disruptive. thatthe many populisms are out there, with ireland and germany and what we saw in the last 10 days, certainly the soap opera of the united states -- of

these many populism's, it is about weaker economic growth. the politicians cannot survive on weaker economic growth. assumingey politic weaker economic growth, or do they have to deliver a message like president trump, like we are going to do better? stephanie: that is the nature of particularly populist parties, pointing to everything about the economy. the country is saying this is because of the establishment. if we can shakeup the establishment, we can change this. wing,ularly on the left it is not just about growth. it is not about economic growth per se, but more abound -- more around economic inequality, social inequality. and how you addressesident trumh focused agenda, but on the left,

bernie sanders is shaking up the way the economic system works, altering taxation and spending. that could have huge implications for investors. isncine: unless there something ugly with the economy, is president trump a two-term president? stephanie: i think you always have to give him a clemency benefit. if you're in the white house, we know the trump administration is twoing the campaign on tenets -- one is a strong economy, the other is painting the other guy as a socialist. with bernie sanders, it is easy to paint him as a socialist. we should not underestimate the degree of concern among democrats, and independents about the term so far. crucially, it will depend on who gets the nomination. at the moment, the only candidate who has clear air over trump in a runoff is joe biden. we know joe biden has significantly underperformed,

and the next two states will make or break him, i think. francine: james bevan, what does this mean for the markets? do they just wait until -- ames: markets would face return of mr. trump because they would be a real risk that the tax reforms and regulations would be key supports. that would be exceptionally bad news for the market psychology at least. marketmes, the psychology and politics -- do you buy the theory? thatw up in a house the market and politics are linked. do you buy it? i don't. james: economics really matters and politicians are just on the surface. what happens within the great body of water as an economy is the ultimate driver of corporate earnings growth. companies have to have the facilitation for better things from government, but i would say the governments have more

capacity to be negative than they do to be positive. tom: interesting. james bevan, thank you so much. stephanie kelly, rightly appreciate your time, with aberdeen standard in edinboro this morning. chairman powell, back on the hill today. round two. senate banking 9:30 a.m. interesting, the headlines yesterday. , to hold orflation to exceed 2%? i believe we get inflation data tomorrow as well. this is bloomberg. good morning. ♪

viviana: this is "bloomberg surveillance." more problems at the start of investments at the softbank group. the japanese company losing money in his vision fund again. the total roughly $2 billion over the last quarter. that comes one quarter after softbank posted a record loss driven by the meltdown at wework that has prompted ceo masayoshi son to change goals for the second fund. >> i have learned a lesson from the past. at this moment i believe we should play to a smaller start for the vision fund 2. viviana: for the second vision fund, masayoshi son hopes to raise $108 billion. will -- thew chief

present his bp will new vision. there are new demands for investors to go for clean energy. tom: viviana, thank you so much. a headline that is absolutely extort neri. i will do a chart in the next half-hour on -- absolutely extraordinary. i would do a chart in the next half-hour. there are .99%. the shockay enough, of that number, to the international finance system as well. that is a superb statement on the group people -- on the greek people. this is bloomberg. good morning. ♪

francine: people said the bank of england is politicized -- -- ♪ i have a long conversation with mark carney. that airs -- that airs tonight in the u.s. and tomorrow in the u.k. and he details how he dealt with the fallout from the markets on referendum day, and whether he thought about just felt like a foreigner at times -- felt like a foreigner at times. tom: interesting to see what he says about inflation. ,he compression in yields

amazing that there is a negative yield in the united kingdom and then there is greece. dow 30,000, growth in america, greece in crisis as compared to italy, and we go down to this massive compression in greece below 1% yield. this is extraordinary. james bevan, if we have market greek and price up in other tertiary yields lower, what does this say about the path of the united kingdom yields? james: i think the u.k. yields stayly because we now have a political framework that can have international. yields would be materially higher had mr. corbin become prime minister. a certain setas

of challenges we should not forget. getting set tois spend 20 billion euros a month to support the economy. we have talked about modern monetary theory which is neither modern or theory, but will assist the funding of banks. she is acting as the long stock for any excess of supply relative to demand, and this expectation, as long as the ecb buys, it needn't work yields from you. where we are at the moment in the european economy is shrinking populations and -- workers are shrinking, productivity is relatively flat. view and economic view, stephanie kelly with us.

do you just assume given what that populism will continue and will be ever deeper as we saw in germany recently? stephanie: i think there is a little bit of nuance. in greece, the government changed. the election that took lace in the summer -- place in the summer, that was one of the reasons it was a rated. -- upgraded. populist parties, and go. it is not new that they are around and greece is further along in the populist story versus germany where you have a real push within the center right party. how far right do you need to go to hedge the threat of the afd? you are seeing a push to the left.

the polarization story, we have plenty far to run. the way the populist parties participate in that is changing. thecine: have we understood underlying causes of this polarization and populism, and are we fixing it or is establishment pretending like it does not happen like -- like it is not happening? stephanie: on the former, we have a pretty good idea of the reasons why voters have decided to go the way they have. economists, we always talk about the economy, income inequality ,ut there is social inequality liberalization, and for those who were not on that train, if you are left you might go further left. if you are not left, your inclination is to pull back.

understanding the drivers about polarization is not usually problematic. it is the global inequality, income inequality story. has anyone figured out a solution? i have not seen one. the kind of thing that worries me when i get asked, is populism at a peak? earnings.think about until someone comes along with a solution, i think we will keep talking about this story. do you see any end in? sight? james: the drive is towards nationalism. areal goods and services

undergoing deflation. core deflation is quite pervasive. andle who are low income spend money in their domestic economy find it hard. we don't like these cheap goods and services. we want a better standard of living but none of it comes at a non-capacity to enjoy the standard of living. tom: stephanie kelly, thank you so much. --the abouta: bernie sanders 36% of the vote. sanders said eventually democrats will unite behind a single candidate. >> we are going to unite

together and defeat the most dangerous president in the modern history of this country. in a surprisingly strong performance, amy klobuchar with almost 20% of the vote. elizabeth warren and joe biden finished well behind. optimistic about the chinese economy and says they can meet their goal, but market economists are not so sure. this year, chinese growth could be as low as 5%. in the united states on capitol hill, the senate is expected to clash over iran. mitch mcconnell is urging the defeat of a measure that would restrict donald trump's military powers. some republicans support the legislation. and itaido returned home

was a chaotic scene in caracas. he is able to return without being arrested. and washingtonos and vile -- violated a travel ban. 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 viviana hurtado. this is bloomberg. tom: he is not the most interesting man in the world, but certainly the most interesting man in central banking. they said enough on negative rates and they are doing things with cash that are absolutely original. ingvesn the 9:00 hour, of sweden. ♪

♪ "surveillance." what we tried to do is have really focused, intelligent conversations on the ratios of the street, to compare and contrast. we can do that with james bevan who has written a brilliant note. get it from ccla. on are absolutely brilliant the growth stock valuation versus history. growth stocks are trading at 32 times their earnings versus the center tendency of 58 times their earnings in hinge history. you are -- history. you are telling me growth is

cheap? james: i am, and if you were to duck the valuation of the top six stocks in the u.s. market, of 80 timesmultiple that everyone regards as super inflated to six or seven times, which is reasonable in low growth, low inflation, low money rates. it is ambiguously dutch unambiguously good news. -- unambiguously good news. tom: you were buying amazon and the others. are you buying their revenue growth or is there a ratio cocktail in the income statements? james: we have to focus on the long-term free cash flow yields of these companies, and i look at the extraordinary capacity of the great companies in the united states. there in measurable capacity to surable -- their immea

capacity to deliver yields. the money is stealing money legally, offering rates of return that are less than the rates. we grew up where nominal bond yields could break with nominal growth, at which point we would say nominal growth is stable. we are in a funny money world where the risks of deflation have led to values being depressed. how on earth was not that permitted to happen? francine: what does that mean, we will see more populism until this gets reversed? james: populism is a slightly rude term about people being angry. they have a right. francine: it is not really rude. there is good and bad populism. james: it is a rational response to the global economy. --ncine: let me rephrase it

will we see riots in the street? james: no. francine: why not? james: people know they get a distant deal -- decent deal via central banks. expect is a shift in the political climate towards for aments being prepared client of more equal growth and equal distribution of that wealth. francine: if you have negative rates in europe and they may not become more negative, but if they are not going away, do you need to make sure there is fiscal spending to match it? james: we need fiscal spending, deregulation, to let businesses do what they do best, create wealth. governments do not create wealth.

spending money creates growth is absolute nonsense. we need central banks and governments working to support the creation of growth by entrepreneurs, businesses, and hard-working people. that is the engine of real and sustainable growth. francine: thank you so much, james bevan stays with us. ,his is what we have coming up mark carney governing the bank of england during a period of record low rates across europe. dustoke about limits those limits of monetary policy and why he doesn't see helicopter money anytime soon. : we are closer to those limits but not at those limits. one thing i have been saying for a while is there is a risk of a global liquidity trap, and by definition that is when you get to a spot where the tools are no longer effective, they are effectively exhausted. we are no longer there, but some of the reactions of some of the

central banks over the course of the last year has been a risk management approach, which has been to forestall the risk of getting that much closer. we are closer because of that and lower equilibrium of interest rates, other things that bring us there, but the structure of economies changing is pushing that. we have argued that the nature of the international monetary system itself is increasingly anachronistic that the dollar is as dominant in finance relative to the size of the economy. there is reasons you lock in positions in reserve currencies, but it is not a healthy situation in the medium-term. francine: how will that change? mr. carney: it is hard to change because it is a network externality and everyone uses dollars. it changes as a way of urging

hegemon's, china in this example. that will change, but it takes much longer. the u.k. was the reserve currency for much longer than its economic weight in and of itself justified, strictly speaking, but you had the reinforcing effect. there is a possibility that to some extent the changing nature of commerce, driving commerce online could help with that shift, but it remains to be seen. it is not going to change in the short-term, which means -- to go back to your question -- the risk is one of those factors that makes it riskier and riskier that we could be low. francine: in the short-term, is there a chance we would see helicopter money? mr. carney: not out of the bank of england. francine: out of the u.s.?

mr. carney: no. i am a strong believer in the separation of responsibility. mandates andclear we can execute against those. part of that, if inflation is persistently below target, could be asset purchases. in that environment, it may be in the government's judgment, they may have fiscal room and may use it, but that is not helicopter money. the fusion is not necessary and is a dangerous idea. francine: you can watch the full interview what the bank of england governor mark carney on "leaders with lacrosse." -- "leaders with lacqua." ♪

viviana: you are watching

bloomberg's "surveillance." from the previous quarter, sales growth at gucci slowing down but beating estimates. reversing the slump in u.s. sales, fourth-quarter sales rising more than 10%. the brand makes up about 40% of the profit. shares of lyft are lower, disappointing investors. lyft did provide guidance on when it would turn a profit. this year, shares already rose 25%. that raises the bar for yesterday's report. that is your bloomberg business flash. tom: it will be the global wall street interview of the day tomorrow. francine the claw -- francine europe.ill be in we speak with marcus ashworth,

and james bevan with us as well. on the state of european banking, whether it is credit suisse or ubs or any of them, there seems to be a timeline so different from the anglo american timeline. their idea of rightsizing, executing, is in one year or five years or 10 years. can european banking work on a timeline that is so slow? markus: not really, and i don't think it has much chance of improving itself. deutsche bank has gotten a bit better after being incredibly bad for so long. credit suisse has gotten itself in a tussle of its own making. ultimately, i think it will bounce back out of it so once they get a proper new ceo rather replacementation --

and a new chairman as well. banking needs to marriage, but it will not happen in the current framework because cross-border merges do not look like they will ever happen. tom: you look at the cross-border mergers never going to happen, and i had a panel with david rubenstein three or four years ago where we said the same thing. there is an institutional doubt to get efficient in european banking. can you own those shares? banks,i own no european not only because of the premise that reconciliation with the realities of hard economics will be a long time coming, but because negative interest rates make it almost impossible for banks to make money. , theve a target two system process by which central banks of europe borrow and lend from each other. germany provides more money to keep the periphery going.

the bun has to provide the money -- bundesbank has to provide the money and say, we need more money. the central bank sends the money and a bill. negative interest rates, you have to send us more. commercial banks cannot make sensible returns for their shareholders. francine: what needs to happen to own european banks? consolidation, the end of negative rates, or something else? james: it is both of those. francine: so 2023? james: you need to look at the global framework of competition and jp morgan is head and shoulders above every european bank. if you are a commercial bank wanting to do serious business lending, jp morgan will eat you alive. if you want to do lending in asia, they find that china's banks will eat them alive

because they will compete on non-economic terms. it is hard to see where the european banks turned to make money. tom: hugely valuable hour, marcus ashworth, thank you. james bevan with us as well. we have a few days we are trying to reframe and reprocess the idea of where you should be in the equity market. she is head of -- strategy at blackrock, kate moore. of whole question of balance international and u.s. investment, and low yields, the greek 10 year yield under 1%. this is bloomberg. ♪

♪ this morning, walls of

worry. , iseat bull market international value investment a trap? kate moore of blackrock. the path all the g of the wuhan virus, 1100 plus are dead. in new hampshire, the air is so it is to south carolina for sanders and company. this is bloomberg "surveillance." an important interview with governor carney, what did you learn? francine: we looked at his 10 askednd ask -- tenure and about things like whether he felt politicized being a foreigner, and went into technical things with helicopter money, what that ever happened and he said absolutely not. the rule of communication when you are setting rates for an

open economy. tom: the role of communication is something to look at. we need to communicate the news. viviana: bernie sanders is the undisputed leader of the democratic party's left-wing, winning the new hampshire primary with about 26%. anddged out pete buttigieg now sanders is taking aim at the next states. nevada, weoing to are going to south carolina. we are going to win those states as well. viviana: amy klobuchar had a surprising strong third-place finish at almost 30%. elizabeth warren and joe biden each finished in single digits. the death toll from the coronavirus has risen past 1100. the number of confirmed cases on mainland china is up two.

health experts are looking for the peak of the outbreak. a stunning rebuke of the u.s. justice department, four federal prosecutors who backed a long prison term for roger stone quit. this happening after president donald trump tweeted criticism of the proposed punishment. next week, a judge will sentence stone. 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 viviana hurtado. this is bloomberg. francine: we are getting breaking news out of bp, a new chief executive in charge, focusing on sustainability. you would say it is counterintuitive given if you are an oil producer, oil major, one of the biggest polluters in the world, but he is setting out an ambitious plan.

overall they are trying to limit some of what they are selling. netays they will get to zero in about four to five years. are you looking at anything regarding bp? they are aiming to have a carbon intensity of the products it sells. ving the carbon intensity of the products it sells. tom: we have spoke about this with lord brown and me know about the gulf of mexico years ago. what i find interesting is the sensitivity of old oil versus new oil. we were: in davos talking about some of these companies as big oil and they were pushing back. toyou look at what happens this industry as the future is in doubt, we talk about peak oil

and pollution, it is interesting to have the bp boss setting his vision. he will be speaking to alix , 12:30t 5:30 p.m. london p.m. new york. tom: let's get to the data, a quieter market. futures up 13. dow 40,000predicting sometime before the golden retriever's win the westminster dog show. -- 1.0 914.9 francine: i have a similar data check. i decided to show you new zealand dollar. i thought this was interesting because we do not talk about it a lot and it jumped the most in two months. the impact from the coronavirus will be short-lived and does not project a rate cut. tom:, head of thematic