>> the selloff continues. as theare big coronavirus spreads. u.s. 10 year yield plums to record lows. lash asbreak could s much as 500 million in sales. iger hands over the reins to the parks chief. welcome to surveillance, i'm

nejra che risch -- nejra cehic in london. futures turning negative. we are positive in the asian session but that could have been a technical bounce with the s&p futures dropping below the 30 day rsi. looks like we could see another day of losses. , down threeyield basis points. two year yield a three year low. lasthit that record low friday. pricedh gloom is being and the global pandemic. the yen has been strengthening for days. losses below $50 a barrel. bob iger is stepping aside in a surprise shakeup.

the -- as executive chairman through 2021. he takes over the immediately. chapin -- we have someone we know very well. >> the thing i've really taken away from bob iger's legacy is get the content right and everything else follows. >> senator bernie sanders felt the burden of his frontrunner status of the latest democratic debate. all six rivals delivering attacks. their aim, stalling his momentum. another focus of attacks, michael bloomberg. this after spending more than $500 million on advertising. mr. bloomberg is the founder and

majority owner of bloomberg lp, the parent company of bloomberg news. we end with growing violence in india's capital after right wing hindi groups begin attacking mostly muslim protesters protesting against the country's new religion based citizenship law. police have been ordered to shoot rioters on site. it's the worst violence in delhi in three decades. global news 24 hours a day on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm viviana, this is bloomberg. nejra: thank you so much. let's get to our top story. the u.s. centers for disease control and prevention warns americans to prepare for potential coronavirus outbreak at home will mounting cases are the globe spark concern the outbreak is widening. the embattled government with giveaways as the city struggles to stabilize the economy.

bringg us for hong kong great to have you with us. what hong kong is doing it with the latest from south korea. >> also with the outbreak of the virus today in a budget speech indicated a fiscal deficit which could see the economy see it back to back annual recession in 2020 and the gdp for the first quarter would be rather bad even as the -- they push fiscal policy to over drag. bloomberg economics calculates age 18 and above with that package that will add about one percentage point to gdp growth, that stimulus is unlikely to help the economy move out of a slump. else are we are expecting policymakers and south korea as --l to push her efforts

the government is seeking -- more on the get market impact of the virus outbreak. european stocks in the red again this morning. longest losing streak since last summer after further losses in asia and the worst two day slide. me it's the bond market we need to focus on the moment before we get to the equity market with a 10 year yield .itting a record low yesterday is it global pandemic in the fed steps in? >> i'm not sure where at that yet. there is a flux quality, that's why bonds are making such good ground. i don't think the markets are saying it's a pandemic, i just

think it's a natural reaction to respond to the equity market. from my perspective it is the equity market which is a barometer rather than the bond market. nejra: the other way i was looking at it is the past couple of days, the hit to equities is the markets waking up to with the bond market has been pricing since the start of the year and starting to question whether we get a recovery. i agree with you in the sense that the equity market has been far too slow to pick up on the potentially -- potential impact of the coronavirus. last week ms. a record high. about, i think one is the impact of coronavirus. ways aret to which the valued.

of come on here and said market look a bit choppy. when you look, the coronavirus ,s proved to be that shock depends on the nature of the recovery. the simple truth is the markets for now and his money pours out will start to see it affect the market. 500 belowsaw the s&p the 50 and 100 day moving average. how much more of a drawdown to be get? peter: we just don't now. selloff a lot more readily than you might imagine at this stage. if you look at the fundamental , filled to the data with regards to infection.

at the moment it is slow. we should be careful. maybe this is as far as we go. if you track the market against the reputation, at some point the market will snap back. nejra: giving you said money will flow of equities into the bond market, designing their close to finding the floor for the 10 year yield. if got bank of america saying we will certainly get to 125 by june. peter: we could do. i think we will get there sooner because it'sater likely that will be over the course of march and possibly into april. >> will we hear from a different town in the fed in march? peter: may be moderately. i think the fed will say there clearly risks and the risks are

the moment wildly external bring at the moment risks are external. we look at the u.s. economy remains in great shape. a's not yet time to take pause in the action. many -- nejra: we've talked equities and bonds and commodities, the -- more from peter dixon throughout the show. coming up on surveillance we take a look at some of the companies that have warned about the coronavirus. asy warned of a hit as much $420 million. plus super returns, we are live and speak to the cofounder and cochairman of the carlyle group.

that exclusive interview is coming up shortly. this is bloomberg. ♪ bloomberg. ♪

nejra: european equities deep in ,he red down for a fifth day just over an hour into the trading day let's check in on your stock movers. >> we're hearing from executors across the industry about what the coronavirus will mean for their business. impacty it sees negative due to the fact many bars and restaurants up enclosed across china. warning of significant uncertainty. a lot has to do with them putting growth products on hold especially due to the impact of the supply chain and they are

cutting their outlook as chinese water cells being hit and infant formula in china. let's look at how these three are moving based on this fresh news. nearly 1.5%.n danone is slightly higher but year today they are actually under pressure. we have been seeing these fears circulator weeks about what the impact is going to be not as the global economy but individual corporate patent nejra: coming up, super returns. can the private equity industry continue to deliver for investors. we are live in berlin to speak to the cofounder and cochairman of the carlyle group trade -- group. this is bloomberg. ♪

nejra: this is bloomberg surveillance. --'s get a look at the peter, i see a bit of conundrum with dxy. we haven't gotten to 100 yet. you look at the -- the dollar has also rolled over. why is the safe haven of all safe havens where a lot of people -- peter: recently it's been the the yen and swiss franc and buying dollars, high-yield yield and dollars. that perhaps gave the impression there was a safe haven trade.

may use it to funding trade. what we are seeing now is the reversion of the safe haven couldover and above, we just be seeing a change in market behavior. nejra: some breaking news to get to. italy's coronavirus cases rising. we are getting update after update about the spread of coronavirus around the world. beenat's what you see has the explanation for the dollar has rolled over little bit, what happens from here? does weakness continue or the receipt read surge -- research -- surge back above 100. peter: i suspect you will still get continued dollar weakness. i think over the course of the longer-term i would inspect the dollar to turn around a bit. as we said before we just don't know where that is. where then would you be

advising investors to put their money now is the ultimate safe haven, is it gold, the yen, it's not done that well. over the past three days it seems and strength. the japanese recession is been cited for the yen. >> obviously they can have the avoid a little bit. a little bit of gold for sure in some cash. it will come a point fairly soon , the shanghai compass it and then rebounded very sharply. the collapse happened over the course of nine sessions so it could well be if you get something similar that's the point at which investors will step back in. nejra: bloody if earnings take a hit? peter: they will -- what if earnings take a hit? peter: they well. you don't is early by the long-term would suggest a pickup and you will see stocks get out.

stay with us.ill we have more to discuss including perhaps what commodity prices -- markets are pricing. more investors look to private equity for convert -- for returns. while the u.s. is still the biggest market for these deals, europe has seen rapid growth in recent years. worm over to berlin delighted to say david rubenstein is with us. great to have you with us on the show. thanks for joining us. what the mood like this year? david: the mood is reasonably good. the coronavirus is some the people are talking about but people recognize it's probably transitory in their mood is good because people recognize the private equity is still very popular and returns are pretty good soil think the mood is pretty good. nejra: the hit equity markets

have taken in the past few days because of the concerns around coronavirus, is that can prevent some opportunities to private equity? david: we never want to take advantage of something like that in an inappropriate way. there's no doubt when you're investing in public equities they go down dramatically, private equities when you're holding them a private way don't tend to go down as much that way because we don't mark the market every single day. on the other hand i do think people recognize that this will probably be in time a chance to buy some things in an appropriate way. they don't have enough information to really know. nejra: if the equity market price for a deeper correction here should there be a deep correction? david: the markets have been fairly emollient. the markets were up a bow most 30% last year. it's hard to keep going up 30%

every year. in fact there is no history of the stock market going up 30% every year. at some point there will be a slowdown, you might call it a correction but i don't think it is likely or least most expert something you will see it as much this year as it did last year. in presidential election years stock market a fairly good so i wouldn't expect to decline. in the meantime private equity sitting on records amount of cash of the start of the year. how hard is a defined opportunities right now. is it to find opportunities right now? david: it's not easy and that's why we get paid reasonably well to do it. you have to find opportunities that are fairly unique, but for trillion dollars which is the amount you have which is the amount invested or available in so-called drive pattern, that is

insignificant relative to this total amount of publicly markets so 4% is really what we have available equity compared to the public market so it's not that large amount of money in that context. nejra: in the conversations you are having where does private equity investors see some of the best opportunity right now either in sectors a geographically? attractivethat are would be health care. as the population of the world gets wealthier, the more and more people want better health care. so when i was younger and working at the white house with present carter, the gdp the united states devoted to health care was 7%, today it's 18% or 19%. more opportunities in health care as people live longer the need more health care. that's a big part of the economy and where opportunities are. but in the emerging markets as well. what you are seeing is they want to live longer and if they can

afford better things is the middle class is becoming bigger you are seeing more and more opportunities for health care. another is food. as people get wealthier, they recognize to live longer you need better health care but also eating well is important so people are investing more in healthy food and things that'll make them perhaps live longer so that's a very important thing. new kinds of food but also food distribution and also access to food which is delivering the kinds of services which make it more available. nejra: what kind of reception are you getting in europe and in germany where you are now? our companies respective to private and investment -- >> many years ago probably 20 years or so ago there was a famous statement saying private equity people weren't so wonderful. that has gone away anything private equity is now respected in germany and i think germany is a very attractive place to invest.

you find very well-made products here. the attractive things about german companies is they make products that are respected all over the world into a lot of exporting. the german economy is at some problems of late because the trade with china going down a bit, the exports from germany to china have gone down a bit. economy is not doing as well as they would like to do. i think that's probably a temporary phenomenon that some point the german economy will get in better shape but right now those slowdown of the export market has hurt germany more than any other single country. on the other hand it's a good buying opportunity because prices are lower than they were before. >> nejra: is the credit market causing you concern? the credit market -- david: the credit markets are interesting in the sense that interest is a very low. in the united states we expect them to say relatively low, the

fed chairman does not expect interest rates i believe he said publicly to go up this year. he hasn't committed to do that. the markets have built in another expectation of about a 25 basis points rate cut sometime this year and while the fed hasn't committed to that that's what markets are suggesting might happen. in europe the ecb is committed to low interest rates as well. the head of the ecb has made it clear you can't lower interest rates much more and so to similar the european economy and german economy you probably have to rely on fiscal moves which means more spending by governments as opposed to interest rates lowering. nejra: david rubenstein, thank you so much. this is bloomberg green ♪

nejra: the selloff continues. another down day in europe after

a wipeout and wall street. u.s. 10 year yield plums record lows. muchutbreak could slash is is $500 million in sales. dozens of companies flag mounting disruption. disney departure. bob iger hands over the reins to park chief. he will become executive chairman. this is bloomberg surveillance. we are assessing the reaction across markets the threat of coronavirus. european corporate -- -- debt risk jumping to a high on coronavirus. red afteres in the they were in the green in the asia section -- session. the 10 year yield fairly steady after hitting that low. france saying it found three new cases of coronavirus and one dead. let's get to the bloomberg first word news. >> a surprise shakeup at disney.

bob iger is stepping aside. the theme park chief is becoming the head of the world's biggest entertainment company. mr. iger stays on his executor chairman through 2021. >> we have someone that not only ,nows the company very well including fox and resorts, he is also someone we know very well. >> i intend to double down on the same strategies bob has established 15 years ago that served us so well. one thing at take away from his legacy is get the content right and everything else kind of followed suit. >> to the latest democratic debate. senator bernie sanders feeling the burden of his frontrunner status. all six rivals delivering attacks aimed to stall his momentum. another focus of attack come michael bloomberg who's been rising in national polls. this after spending more than $500 million on advertising.

mr. bloomberg is the founder and majority owner of bloomberg lp, the parent company of bloomberg news. rio tinto refuses to set targets for reducing in missions of its iron ore customers. it's taken a stance on an issue fighting the national resource industry. instead rio focusing on its own operations. to be carbonnt neutral over the next five years and to make that happen it's promising to spend $1 billion. we end with diageo. they will review sales by much three and 25 million pounds. this after bars and restaurants are shutting parts of china. the company saying it's hard to estimate how long the downturn will last but it's expected improvement later in the fiscal year. global news 24 hours a day on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. nejra: thank you so much.

let's focus on coronavirus and latin america. within the last hours a minute sao paulo has parliament early tested positive for the virus. the case be the first infection in the region. let's discuss the wider economic picture with shelley, senior director and cohead of america sovereign rating station. peter dixon is still with us. welcome to the show, great to see you. 10 year treasury yield extending its slide, right now we sit on a 1.3 to handle. what does that mean for someone wanting to invest in latin american debt? >> the search for yield will be there and that's helpful for emerging markets. what we really have to focus on is how global sentiment will shift toward latin america. latin america is already feeling the pressures of not being able to really recover that significantly.

people are concerned about rising debts in latin america and political shocks that we've been seeing in latin america since last quarter of 2019. so while the u.s. treasury which is obviously gone down. people are concerned about coronavirus and its affect. this can also mean people will be looking elsewhere as well provided that they are comfortable with the risk they see in the region. >> which aspects of the market would you say are most risky right now and which perhaps stand to benefit from this deal? >> commodity prices right now as we know have taken a pre-sharp downturn in recent weeks and that really exposes latin america. it is exposed to commodity prices. copper has been down. that obviously means countries that are exposed to these commodity prices will feel some

growth. this is additional headwind for these countries. mostly look at countries like peru and chile bill be exposed to prices. you look at countries like mexico, ecuador, colombia, they will be feeling the pinch for the oil -- for the prices at this point in time. given the average in the region is going to be lower because the u.s. treasury deals bought at a low rate. latin countries have been using the opportunity to tap into international markets. we seen an issuance of latin american sovereigns in the first couple months of this year. it has gone well. there's is been very good demand from investors looking for a higher yield and hoping fundamentals in the region while not looking that great lease we are seeing something that has been taking hold and is expected

for this year. countries have the strong fundamentals if you can put coronavirus aside. >> from a rating perspective, chile is the highest rated sovereign in the come -- in latin america. said, the fundamentals are very strong and segment risk is extremely strong. in the fiscal deficits in recent years. however, we have seen significant protest activity and chile and that is perhaps going to be changing growth in the fiscal and the debt profile of chile. a very strong starting off point. but there are downside risks we are seeing to higher pressure on spending and deficits and debt going forward. nejra: can i pick up on the

commodity point with you peter. what of the just one of the key questions in the past couple of weeks is are we talking about a demand destroyed story or a demand delayed. what are commodity markets pricing now? is how highuestion is it. get ach case you will recovery, i've no doubt about that. the question is can we get that to levels where we were prior to the outbreak of the coronavirus. example,ke ore for there are indications we have excess supply. i've been cautious about protecting a significant recovery because the demands have changed quite significantly over these weeks. >> you were saying the chile is one of the stronger fundamental

s, talk about argentina and how investors should deal with that. >> is the complete opposite spectrum. we think argentina is headed for some kind of debt restructuring so investors are clearly bracing for seeing what's the new app -- what the new ministry she will be offering in terms of debt restructuring. burden is notbt really sustainable in the imf has also come up with that new very recently -- view recently. foron't think it will look an extension. perhaps more debt restructuring. now the debt load is over 90% of gdp. it is deftly entering into private waters. >> what is your approach to emerging markets right now and is it an area of opportunity of

bottom fishing or would you stay away until there's a clearer picture for whether we do get some of the kind of recovery from coronavirus? peter: i think it's a case of investors have a lot of things to worry about without really worrying too much about where they will find a pickup. andlook around the world you see things falling everywhere. my attitude would be let's stay away until sometime we have a clear idea of what's going on and i think i will be echoed across the investor universe. nejra: what is the top question from investors of the moment? >> my people are waiting to see how the last three economies in the region again ado. people are asking us questions about whether we will see an economic recovery and how strong that will be, what are going to be the key priorities of the administration in 2020.

the question really is whether you can see economic recovery in brazil. really asking is whether the momentum will continue in terms of reforms in brazil. and it's all about debt restructuring talks. the questions around what kind of policy or framework that gets entrenched in argentina after it gets restructured. nejra: great to have you with us. things for joining us. up, a change of bob's. bob iger steps aside handing the reins to bob chapek. as rio tinto warns coronavirus could create uncertainty, we speak to ceo later this morning. this is bloomberg. ♪

nejra: this is bloomberg surveillance. let's get the business flash in new york. >> delays for the london stock exchange purchase according to the financial times. it's facing deeper than expected scrutiny from brussels. a form a notification of the deal has been postponed. financiald to by the data provider for about $27 billion. bloomberg lp competes with rif and native to provide financial data. notice chevron is asking traders at its canary wharf office to work from home. bloomberg has learned to taper caution after an employee was

tested for coronavirus. coronavirus has not been confirmed. chevron saying it's closely monitoring the situation. the u.k. has 13 cases of coronavirus. we end with jp morgan -- jamie dimon. he is looking aggressively at acquisitions. he said he could buy anything that's not another u.s. bank. the wall street giant has a greater appetite to deal than in previous years. saying that's held by regulators who are more accommodative. he says 2020 will be "tougher. " a fifthquities low for straight day. the scheduler top stock stories. -- let's getriven to our top stock stories. >> air methods sees the it's too early to

tell when the market will recover. they did close about 11 stores in china and reopened seven of them. lufthansa are cutting costs as well is adjusting the flight path within european cities to hong kong and solvay are expecting a tweet 5 million euro impact in the first quarter due to the virus. let's see how these companies are shaping up today in terms of trading. hermes is down about 1%. lufthansa down 2%. solvay down about 3%. really hit incorporates at a bottom line of their business. nejra: let's get more with peter dixon. a lot of people have said last year was about multiple expansion became to equities over them to move ever higher this year you're really in need that support from earnings.

if that doesn't come through as a result of coronavirus, can equities stay supported if we don't get the fed rate cuts that the market is planning? peter: they can but i think the upside and what the central bank's are doing a moment is providing a cushion on the downside. at some point apple act as a springboard to allow equities to rebound. the questions will they get back to the trend last year. you said, largely multiple expansion. that cannot continue and i just think the earnings in the absence of coronavirus would go to support a big rebound anyway. so it does really feel that soft theronment, it's probably look quite messy from an equity perspective. mine --ne thing, the

the rio tinto ceo sees chinese stimulus lifting minors after a virus slowdown. if we get broad-based stimulus in china both monetary and fiscal and we do see more rate cuts from other emerging markets central banks, but the fed stays on hold until the second half, do we get a decoupling with the rest of the world equity stays a bit better supported than the u.s.? peter: you might but i think generally speaking you will move largely lockstep particular the connectedness of virus led fears. it won't be huge. that's all stash let's also not forget it would take a long time to see these through. the markets 10 how successful that is required sometime. i suspect it will be more cautious in the past. it may not show through for

quite some time in the markets. ajra: should the fed get quickly missed -- risk mitigation 50 basis point cut? peter: no. they're looking at the extent at which this may spread at the moment. panic, not the time to let's keep the powder dry. this sort of thing might pass quickly in the fed will have acted too aggressively. i think it pays to stay on the sidelines for now. nejra: are they going to react if the two tens curve does not stay. you got other signals with the premium negative. but the twos 10 is in -- territory. past: they've said in the we are looking at that.

they got really aggressive and said be careful and of course that turned out to be correct. so i think this time they look at it and think we are not going to react just because it's moved. >> a few people have said to me they expected 10 -- a base cut. >> i think the general view in europe is a the christine lagarde is expressed quite forcefully is that monetary policy is done. it's really gonna be about other ways of stimulate the economy. the ecb has made it clear they would like to see some more from that european governments are also talking about being more aggressive than they once were. nejra: peter dixon, great to have you with us. they are reassessing oil demand

risk as the virus spreads to europe. a change of bob's. the world's biggest entertainment company surprises investors as bob iger steps aside paid this is bloomberg. ♪ rg. ♪

nejra: this is bloomberg surveillance. let's get to one of our top stories. changes of the top disney. bob iger's executive chairman and bob chait pick is the ceo. bob iger changed disney. disney bought pixar, marvel, lucasfilms and 21st century fox. we spoke to the disney leadership team after the news broke yesterday. that not onlyeone knows the company very well, running if you of our important businesses but is also someone who we know well. >> i intend to double down on the same strategy bob established that is served us so well. the thing a take away from his

legacy is getting the content right and everything else follow suit. us is matthew from bloomberg intelligence. great to see you. this is a surprise announcement. is this something shareholders should be worried about? matt: definitely a surprise. expected perhaps 12 months or so before they had to fix on that. i think it makes sense to transition so i don't think people should be concerned about it. when you thing about what's happening here you've got an overlap of two years. people of lots of respect for bob iger in this new ceo has this transition to get to grips with the sprawling entertainment company and still have that seasoned advice to kind of drawn before he is on his own. the first thing he will have to deal with is coronavirus.

matt: particles in shanghai and hong kong. the concern is with the spread of coronavirus and europe and potentially to the u.s.. they've already said there's only $200 million hit to sales in this quarter, that's just about the parks, potentially it starts to drift and other parts of business. hopefully that's a short-term issue. it is putting a squeeze on numbers. nejra: more longer-term what are the challenges? -- he will put bob in the shade and the nicest possible way. when he does leave the company in two years time you've got a company that's kind firing on all cylinders, they transitioned well into this business. the star wars franchises doing better than it is right now. disney pluses getting strength. that's longer-term challenges.

thank you so much. this rat on the screen for the fifth day. dropping below for the first time since october. that might've been the tech national and the 10 year yield continued to slide, a record low yesterday. yields are dropping across the curve. that had the record low last friday. oil also extending its life below $50 a barrel on wti. it holds that today. after bidlling back for three days. this bloomberg. ♪

tom: shock of epidemic.

row ofse three days in a market re-pricing to global recession caused by a virus. wuhan tells -- hong kong provide cash chance out -- handouts to citizen and will or can tokyo hold the summer olympics in july? the two year yield this morning plunges. will markets was a power rate cuts. nearing a 10% correction. losers take all last night of the debate. it was a raucous debate. that leads to south carolina and super tuesday. this is bloomberg surveillance from new york and london as well. the headline that came a moments ago of another death in france, it's not a hotspot but there is a diffuse mint of this virus

across the continent of europe. the time it took to get a handle on the density -- extent of that outbreak in northern italy and where people have gone, where they've gone the meantime from the canary islands to the coast of africa up to other parts of europe certainly europe in the crosshairs of this right now. tom: intercourse linking it in now. with her first word news in new york is viviana. democratic presidential debate turn into a free-for-all paid all six of bernie sanders rivals taking shots of the front runner. elizabeth warren accusing him of stealing part of her health plan . michael bloomberg says russia wants sanders to win the nomination. he said that's because vladimir putin wants president trump reelected. bloomberg is the founder majority owner of bloomberg lp, the parent company of bloomberg news. now to the coronavirus outbreak, today there is growing concerns

it's turning into a pandemic. francis found three new cases. one person has died. there are more cases in northern italy. korea has turned into a hotspot. there are more than 1200 confirmed cases. a week ago, 51 confirmed cases. worldwide there are more than 80,000 cases. more than 2700 deaths. today shares of disney are lower, investors sending the stock down after the ceo will step down immediately. mr. iger ran disney for 15 years and built the most successful movie studio in hollywood history. disney's new ceo is the theme .arks had bob capek -- chapek global news 24 hours a day on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. tom: thanks so much.

paul sweeny schedule to join us in the next hour. libby get to the data check. the dated -- let me get to the data check. futures were worth a half hour ago a little bit of that but i don't want to overplay that. 48 at 407 walla st time. well below $50. onto the next screen with the fix blowing up to 28.04. getting near 30 out of this is a big deal. it's a two year yield. .e will get that the yen to me is absolute the critical, that should read a 10990, it's not. it is not confirmed the correlation and the other parts of the market. anna: interesting to see in the

fx market. i've got the dollar and mine as well. we will start there then. alsoollar fairly stable trading. the dollar index that is. as you mentioned, the yen is hit with a 110, not with a 109. i've also got here the stock market reaction in europe. another down day. on the back foot, no europe sector -- travel and leisure being beaten up. behough that does seem to lows of the session. perhaps we found it. right now we are off the lows more than 45 minutes ago. let me show one share of the market movement here before we get to a good guests to provide perspective for you three days in a row now. the two year yield, this is

logarithmic. the election of president trump here, the higher yield environment in the beginning in the autumn of 2018, the great rollover. we are two standard deviations awn right now and this is plunge in the two year yield. now this morning. wonderful to have you with us. tell a chairman of the fed what to do? >> it seems like it can. 15 the last 16 times when the market was pricing a rate cut -- it when he five basis point rate cut within a meeting -- the last time they didn't do that was in 1996. i think it's not unusual the market reacts more quickly than a central bank.

a central bank should be more slow acting and waiting for confirmation. it looks like the odds are pretty high now they will be forced to cut. the call on pimco has been shockingly prescient over the last 90 days. to this pimco readjust global slowdown? gene: i think we are having an active debate as to what the shape of the downturn looks like. u.it a v or a you typically experience some kind of v shape recovery. you don't know how deep it is and how long lasting it is. we're still trying to come to grips with that and i think it probably makes this not try to catch any falling knives. we are still on the very early stages of the market pricing something like a pandemic rather than an isolated event in china

or asia. this a bit you can find ? do you need to wait to see a peak in global infections because we may have seen that in the daily infections. china source which was was really meaningful and new infections. the debate i think has changed in china but what is challenging the markets investors as we have real fears of a supply-side problem turning into demand as it spreads with greater uncertainty around the world. yesterday we had another three countries added. it's that uncertainty that is challenging grade i think we are operating in something of an information vacuum. to us it doesn't seem prudent to

move things in either direction. with withanna: -- anna: that it in mind, do you see authority stepping up. we seen from hong kong this announcement that the helicopters are flying out and it be giving out cash to people in hong kong to spend. that's an economy force it was beaten up long before the coronavirus. is that going to be we -- something we see more of? maya: i think it's important to remember the traditional fiscal stimulus will take a wild to see-through. perhaps we see more's what we've seen in china the past few days. abouthink when we think monetary and fiscal to the point is not, monetary policy very effective wanted to supply shock. if it turns into a demand or a

meaningful tightening as we did in q4 of 20. we are not quite there yet. tom: we will do more data checks and i thinkmorning this is incredibly important. this is a very nuanced equity market right now with the french index with us french deaths reported. let's bring up this. with all the -- i brought up the grid a little stronger than he usually do on television, the white lines the number of cases and it shows a relatively flat slope, this is in china. a -- the red light is a death rate which is sloping

upward. gene,reda, across the -- what is the summary of your experts? gene: the summary is their response in china is laying out as one might expect. atypical itobably is not replicable anywhere else in the world. that's what china is unique and it's probably not enough that the virus is coming under control. trade-off between successful containment and economic damage. what you don't see in the news is very uneven response within china from province to province in terms of how to control and contain the virus in some you are seeing lockdowns and in others you are seeing the quarantines applied in a much

more pragmatic way. the theme of to disruption. is that were columbia needle has -- red needle has the most comfort? maya: we are very much neutral of the u.s.. to favor japan and the u.k.. to credit in particular sort of agnostic. high and emerging-market sets equally. biguld say we don't have a lean to the u.s.. annily enough of all the days very -- and insight into the effects of the coronavirus, the u.s. is the one that has

weakened where we were expecting to see some weakness coming through in europe, it hasn't at all. tom: ready to do more market checks today. futures negative five now, they were much worse one hour ago. it is not a pandemic yet according to the world health organization, we are on the edge of that but not there and it reaches to all societies. this is the spokesman for iran's health agency as well and across the persian gulf i know dubai eliminated its flights to iran. we will continue from london and new york. this is bloomberg.

anna: welcome back. concern coronavirus outbreak is turning into a global pandemic even though the who has not said so. francis found three new cases. there are more cases in italy. the death toll in iran has risen to 19. ,oining us now by skype professor of international public health. very good to see you. do you think the measures being taken in italy, are they substantial and speedy enough to give -- give containment a chance? so. hope they certainly seem appropriate to me. i think when we look at china

and the effect their public health measures have made, i think we can all around the world take encouragement that with robust measures, containment and isolation, it is possible to get this epidemic to roughly a steady state. having said that, italy is not china in societal terms and i think we need to look to see whether we will get the general public participation and engagement we really need to be able to bring this under control. the world's one of experts on the viruses of africa. you've been in the trenches there. you've been trying to cure that. what is the vera lynn's of this virus. we are panicking about travel, panicking about moving around, is that panic justified? think it's a good question

and it's important to keep this in perspective. we note the vast majority of cases are mild and that people recover from them, but they still have 15 or 20% of people who will get severe illness and those people are going to need hospitalization and it looks on average people spend in hospital but 10 to 14 days. that will put huge pressure on health systems if we get widespread outbreak in any country. tom: does it help to limit travel? was --as with us and it over the last -- lack of ability of quarantine to aid. does it help us if we limit our travel? i think from the information we have from china, the most inortant thing is to put

place social distancing measures within cities. so that is not really talking about transport, that is making sure we avoid crowds and the opportunity for people to spread it to large numbers of people. that seems to be the most important thing. , think for places like africa to have standardized border measures so that they are able to identify people either leaving or entering at isernational boundaries probably the best way to control this. as peter has said, travel restrictions can be damaging and difficult, it will affect trade, --, aidomy a,id and the and the ability to flow.

it subs information transfer as well which is so important in this case. where in the world are you concerned about a high level of undiagnosed cases? you mentioned africa and so far we haven't heard much about cases in africa despite the well-known connections economically between china and that continent. worry would beig for sub-saharan africa. the international community is working really hard i think to put measures in place there to make sure there are national preparedness plans that the diagnostic facilities are in place. so it is encouraging to see that , but we have been as well prepared as we should be for events like this. and i think it's important to remember that one of the things about outbreaks is to expect the unexpected. who would have expected that we

would get such a lighting up in the middle east from iran that would actually cause us such concern. we have to keep a flexible open mind about where the problem may come from. thank you very much. coming up in the next hour of the program, the coronavirus could create significant uncertainty. we will speak exclusively to the ceo. saying expected to see some improvement in china activity. we look forward to that conversation. this is bloomberg. ♪ ♪

>> you are watching bloomberg surveillance. we begin with the largest private real estate transaction ever in the u.k.. goldman sachs buying a blackstone group. thanns and manages more 28,000 -- across britain. exchanges stock acquisition of roof ended is reportedly running to roadblocks. the ceo is facing tougher than expected scrutiny. agreed tothe lsc purchase it for about $27 billion. it's a bid for the company deepening its push into private data. jamie dimon sees competition

everywhere he looks. the jp morgan ceo plans to be creative with what he can buy. here he is speaking at the bank investors day. >> we are looking and will be much more aggressive acquisitions across the board. you can get some form of competition from apple, amazon, facebook, google, you get payments and bank in a box and marketplaces. that's the world we will face. did come to mn day we should be very creative. >> j.p. morgan is coming out of the most profitable year in u.s. banking history. me do a data check. i wanted to take a look at the continent as well. it's a better tape than one hour ago. again is weaker. we do see a little bit more appetite for the dollar braid

stocks again under pressure there prayed 1.4% of the stoxx 600. sector -- and leisure section is the worst performing pre-ryanair down by 4.5%. once again we see a focus on the travel and leisure stocks in the mindset of the market. it is a really nuanced tape. we will do more data checks on that through the day. i will let you decide on the debate last night. raucous is one of the words floating around. maybe it a free-for-all. , difficult debate for cbs. stay with us. ♪

♪ bloomberg "surveillance," anna edwards in london for francine. a better tape in the last 20 minutes then we saw the last

hour or so, might even get some green on the screen, s&p futures about to go green. to get to our guests on this market, it is important always to know where you are when things are difficult. let's bring up the chart. of the dowog chart jones industrial average with a distance engage. here is the ugliness of 2018 and down we went to a momentary bear market. correction in may, no. correction in august, no. we are now right on the cusp of a correction -- we are not there -- and nowhere near a 20% bear market. the fine for anyone not -- defined for anyone looking at speculating, a bear market. gene: i don't think we look at

it differently from what you have described. it is a question of whether it is a technical price move coming as a function of people being caught off guard, a wily coyote moment in the sense that you made a plan for global cyclical recovery which has been upended by the virus. the other thing is something more fundamental where it really becomes a question of negative feedback loops between negative animal spirits undermining is the kindnd this of shock that could theoretically push us over the cliff into recession. we do not expect that. we see this as something more fleeting, more technical. tom: we are trying to rationalize holding our finances amid all this panic. what is the approach you would take to measure where we are in the market at any given moment over the next couple of days? maya: i sort of agree with what

you have already said in that i will take 10% or 20% corrections that we saw in the fourth quarter of 2018, are not consistent with markets rising thereafter. u.s. equities were at the highs not long ago. coronavirushow feeds through the market, we need to watch very carefully. we need to watch the news around what is happening carefully, because as we discussed, the center of the coronavirus and china is rolling over quite meaningfully. we have a number of new cases, but it is what is happening elsewhere, specifically europe, that is of concern. anna: everybody needs an epidemiologist on the payroll. you talked about supply shocks and they could be the drivers of

recessions. what is the difference between the supply shock that gets us there and the one that doesn't? i suppose the duration. gene: a typical shock is an oil depressesk which consumption and pushes you into recession. anna: we could see some inflation, no? gene: it is likely to be isolated. the risk is you will have long delays between shipments out of china to everywhere else, and that is starting to happen. you will get some delays, but to turn that into a generalized price shock is harder for me to imagine. tom: when you think of -- anna: when you are looking for places that are safer than others, we think of the typical havens, but they are correlated to what is going on. is it possible to find assets that are not correlated to the coronavirus at this point? maya: what we have seen over the

last week or so is remarkably joined up markets. u.s. treasuries, the moves are mirrored by gold and copper, or growth versus value. the markets are moving in tandem with one another and moving quite similarly to equities. alone, anmonday advantage for the euro as a whole to deliver three sigma shocks across the market, greater than what we saw the entirety of last year. markets are volatile. 10% let us measure correction, 18% bear market. bring up the chart, and they understand this is the acclaimed it it's an chart going back -- chart, going back well before the second war war.

-- world war. number of epidemics including the colorado pandemic of indonesia years -- cholera pandemic years and years ago in indonesia. we keep moving along. gene: i guess i would nuance that point and simply say we have not had the potential pandemic rent in a world -- threat in a world that is so highly integrated. if you look back to sars in china where you had a fraction of chinese traveling abroad in that period, it was a different degree of integration globally. the other point on your chart was simply that we have to look at where valuations are. we know valuations are elevated in this cycle. pe takes aof temporary hit.

i don't see any reason why people should revise down except a couple of quarters. priced for were cyclical reflation when the shock hit. anna: post the trade war tensions it seemed. thanks to both of you. let's go to bloomberg first word news with viviana. viviana: breaking news in the newsroom, and south korea a u.s. service member testing positive for the coronavirus and is in quarantine. this comes as u.s. health officials mornay coronavirus outbreak could cause significant disruptions. they have outlined emergency plans including school closings, concerts, and business meetings. they say it is just a question of when. violence in new delhi, the worst

in almost three decades. groups in the indian capital attacking protesters who are mostly muslim. at least 20 people were killed and protesters were demonstrating against the religion based citizenship law. in the u.k., a think tank is urging the chancellor of the exchequer to raise taxes, saying they need funds. they doubt if the government can meet its commitment to balance the budget in three years. 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: thank you so much. for our international audience, and a nation is in order for 7, 8, 9, 10 debates. last night's debate was different. we saw a lot of discussion about policy, but mostly mayhem centered around going after the

frontrunner, the senator from vermont. >> not only is this a way to get donald trump reelected, we got a house to worry about, senate to worry about. >> i like bernie, but i do not think this is the best person to lead the ticket. work, andn, i did the then bernie steam trashed me for it. >> bernie hasn't passed much of anything. >> donald trump thinks it is better if he is president. i don't think so. vladimir putin thanks donald trump should be president of the united states and that is why russia is helping you get elected, to lose to him. tom: anna is getting too much time, absolutely extraordinary last night, very different from las vegas. the vote on saturday, and then onto super tuesday. i was taken by how little conversation there was directed usness of super

tuesday. rosalind mathieson is our debate correspondent. absolutely extraordinary to see the nuances from debate to debate. where you dip -- surprised last night? rosalind: not really. is they areseeing getting competitive around two things, bernie sanders on the left and that she fund, michael bloomberg. candidates will point their attacks at those candidates in the debate. policyecoming less about and what people will stand for, and painting those as one of two things, bernie sanders as a

democratic-socialist who would lead us down a dangerous path, and michael bloomberg for many years who was a republican so you cannot trust him to advocate the democratic values. not so much about the policies. tom: what is so fascinating is we get to saturday and we move on. did we see some of these candidates last night for the final time? rosalind: possibly. joe biden at this stage is possibly going to win on saturday, but in the opinion polls he continues to trail, so just because he does well on saturday doesn't mean he is getting significant momentum. after super tuesday, you can see these candidates fall away. some do not have machinery of fundraising in place to do particularly well on tuesday. you could see some of those start to drop off, and we are heading towards possibly a contested democratic congress in the middle of the year.

we may not have a candidate to go into the congress. bernie sanders could again be one of those two. anna: rosalind mathieson with an update on the democratic race. coming up, private equity tightens gathered in berlin for the annual super return conference. we will speak to jonathan korngold, coming up next. this is bloomberg.

♪ i am anna edwards in london with tom keene in new york. with more investors looking to private equity for returns, the industry has seen assets hit $4 trillion. while the u.s. is the biggest market, europe has seen rapid

growth. joining us from the super return event is jonathan korngold. let me come to you with the big picture questions around how excited you and those at the conference are about the opportunities in private equity versus the listed market. could you say that one more time? there is a bunch of background noise. anna: i apologize for the background noise. how excited are you about the opportunities you look at in 2020? lots of macro uncertainty, but what are you excited about? jonathan: i think this is an incredible time to be an investor. there is a lot of conversation about there is too much capital chasing after yield and by definition that is true. when you are at a firm like blackstone with unparalleled scale and resources, you can

help companies innovate with the set of opportunities that were not available to them in the past, notwithstanding the near term volatility. it is a great time to be an investor. anna: with so much money looking to get involved in the sector, is that pushing up prices and making deals less likely because they become more expensive? jonathan: definitely pushing up prices across all asset classes. you are finding yourself paying the fair side of a price. it is raising the barrier for investment firms where it used to just be finding the right company and trend that is sufficient. nowadays you are finding yourself in a position where you have to use strategic operating resources to unlock value through -- exposure. as a result of that, large firms like blackstone will be in a

unique position to unlock value. tom: thank you so much for being with us this morning. you and blackstone have a heritage in china. you are fluent in mandarin and a guy named schwartzman has a focus on china. what is the blackstone research on the pacific rim and china in the last week or so, and how they extricate themselves from this virus crisis? jonathan: my heart goes out for all these families globally being affected by coronavirus. stop the god we can escalation so it does not become a pandemic. we take a longer term view on the markets we are in, so we are not near-term dissuaded in any way by the coronavirus. we are doing everything we can to prepare and protect our families, but we remain bullish on the region. within the-term

typical hold of private equity of seven years, you can squeeze that to a more short-term framework and say that we need to look beyond the virus, or would you act now to deploy differently because of the virus? jonathan: no, i think from our perspective we are looking for long-term secular trends that will be on the right side of history. we are not trying to take advantage of near-term arbitrage and certainly not at any was expense -- anyone's expense. onare not looking to isolate any dislocation happening in the market. tom: if i can move to the debate we had last night, the south carolina debate, and we saw las vegas a week ago. there is a primal scream from a large part of america against the fatcats, the people living on park avenue just as a generalization.

how should private equity respond to what we are hearing from the democratic candidates? i think it is less about democrats versus republicans. private equity can get tainted -- painted by the same brush. we have been huge net contributors to job growth and innovation, so it is too simplistic to create this artificial demarcation of wall street versus main street. that is not a fair representation of where we sit in the ecosystem. we are investing in billions of dollars of capital that are facilitating hundreds of thousands of jobs. it does not dissuade us from our role. we are continuing to add value and be on the right side of the world -- where the world may be going. tom: mr. jonathan korngold speaking to us from berlin, we thank him for his time. we will drive forward this

conversation working with mr. rubenstein at carlyle group, there co-ceo, hassan liu he. yen showing 110.40, a little bit of stability in a difficult third day for the markets. this is bloomberg. ♪

♪ have someone that not only knows the company very well. run afew of our him just few of our important businesses, but someone we know well. >> bob has his -- i will double down -- the thing i take away from bob iger's legacy is get the content right and everything else falls in place. tom: never do i say never. i will say it now, i have never seen the shock of the south side like last night. and i'mto paul sweeney thrilled he will join us in the

6:00 hour. alex webb joins us. rich greenfield was stunned. paul sweeney was stunned. why did this happen? alex: we knew he was going to leave probably next year. surprised it has come this year. it is unclear what is going on. there is some suspicion something else is going on behind the scenes, but we had already seen bob iger delay his departure a few times. he stayed on three years longer. we have seen potential successor after successor left disney to take jobs elsewhere. maybe it was an effort to fend off those risks but someone came calling for the job and said, give me the job now or i will go elsewhere. some people-- anna: making the point that there is

some transition time built in. the new guy talking about if you get content right, the rest will follow. is that something investors want to hear? alex: we have seen that bob iger did some deals, he bought pixar, he bought lucasfilms. they also bought fox. we don't know where that fox deal will prove. it was a significantly bigger check they wrote for that business, 70 odd billion dollars. they had problems with fox's films. they have not been as successful as previously in recent years. that content piece that fox perhaps one of the pieces why he will stay on, help on the creative side, remedying some of the issues fox may have is a priority. --a: alex webb doing us

joining us from bloomberg opinion. are you concerned in the context of the coronavirus tensions in the financial market, are you concerned a credit event might transpire? gene: i don't think we are worried about a systematic credit event, but it is clear that certain companies or industries will face credit stress, particularly if this is long-lasting. i would probably distinguish between three things, one is china where the credit stresses in the private sector have been significant, and you probably have a certain amount of confidence that the employee -- authorities can bridge that. in u.s. corporate credit, we have had long-standing concerns about the pricing, so we will see what the sector looks like as the time rolls out. credit and china looks pretty attractive. pimco thisrieda with morning, greatly appreciate your

perspective, and alex webb, thank you as all -- as well. i want to do a data check. checks do more data throughout the morning. what you need to note in the market is a better tape than an hour and a half ago. we have curve steepening with a remarkably low two year yield, and oil the bellwether at 49.25, just a moment in the 4:00 hour have the 48 handle on west texas intermediate. the yen is essentially important, it does not confirm the gloom, weaker yen through the morning. stay with us, another hour of bloomberg ♪

[ fast-paced drumming ] [ fast-paced drumming ]

♪ this morning,tom: the shock of epidemic to the

reality of a pending pandemic. three days of a market repricing. by abal recession caused virus, wuhan is a new hotspot. china will hand out cash to citizens. will and can tokyo hold the summer olympics? a little better in the last 40 minutes. barrel andlow $50 a the dow nears a 10% correction. losers take all, it was raucous. leads upus debate that to south carolina, a vote on super tuesday as well. from new york, i am tom keene, anna edwards in london. just an update on the sense in london of getting to europe. we had those headlines out of france in the last hour on new

deaths in france as well. what is the transportation feel that you see out of heathrow, out of city? anna: there is a lot of conversations anecdotally around the business community as to whether those business trips are necessary. gradually there is a realization that the trips to europe will be curtailed, certainly two parts of italy. people are asking tougher questions whether they can go now. extremely busy four hours for bloomberg surveillance. i spoke to jon ferro and i'm looking forward to some of the guests on radio. let's do it equity -- let's do an equity check. away -- i turned away from the terminal, -15 to flat,

now back to -12 with curve steepening. that is a lower two year yield against a higher structure to the yield curve. oil is a headline item, 48.34. 1.17%, a lower yield an hour and a half ago as well. , essentially story not confirming the angst. we need a ¥109 to get my attention. anna: it is moving in your direction. well,the oil price in as the brent price. that is down 1.7% again compared to yesterday. the mining sector under pressure , some of the moves we have seen in iron ore. stoxx 600 down 1.7%. things worsening again.

the dax in germany down by more than 2%. tom: i am using a different chart, but this sets up beautifully for greg poodle of bmp -- greg boutle for bnp paribas. a correction here, a bear market here, and we did get to a bear market in that ugly december period of 2018. up we go, down we go, not a correction. we see ourselves right on the cusp of a 10% correction in a bear market, dow 24,000. equity withombines derivative dynamics. what does the derivative market tell you now? what does it tell you about the catharsis that could be out there? greg: coming into this

correction, there was a lot of leverage in the system. we see the vix in the high 20's, testament to the velocity of this move. what we have seen this date in the u.s. is reminiscent of what 2018, an extremely volatile drawdown. tom: what is the gamma, not seen in vix but generally in the market? is there an accelerated force to come? greg: our view has always been if we get a big break, it is likely to induce more selling and leveraging so we certainly do not think it is behind us. we will get more moves on the upside and downside. z ceo i spoke to the allian who said the panic over the coronavirus is not warranted. warranted or not, it has been coming our way. greg: we have to remember where we were coming into this

derisking period. u.s. equities were looking expensive and we think there is leverage from retail hedge fund and systematic strategies. it is not surprising as we see this move, this has been accelerated. it is more volatile. anna: tom is interested in the yen so i should get your thoughts on that. anything you see in the yen on how the market is positioned? typically a safe haven but does not always play that way. -- one of thehis things we will be looking at is across asset correlations of volatility. oil has been hit hard. u.s. bond yields, tom was talking about earlier, and the rates are coming under pressure. tom: i want to squeeze this in before we go to kevin cirilli. here is the yen chart. this is the five-day intraday

chart with the regression. what will force strong yen? how does that happen? greg: a big acceleration of the risk off sentiment. it is a risk barometer so as this move accelerates, that is something. tom: we go to our chief washington correspondent in charge of raucous debates, kevin cirilli. does the debate last night affect the vote on saturday? kevin: no. that formerions vice president joe biden would win this weekend in south carolina, i spoke with his campaign in the spinner last night and they feel confident that the trajectory and dynamics have not significantly changed. ' spoke with bernie sanders former senior advisor and they are confident for super tuesday.

the buzz of the spinner last night is they are anticipating significant drop-offs the morning after super tuesday, meaning this field will likely win no on wednesday morning -- winnow on wednesday morning. tom: it is all about money. who is the most out of money? kevin: i think when you look at what the reality is, it is going to be difficult for people like senators amy klobuchar and elizabeth warren to say they are going to be able to continue onward past super tuesday if they don't have momentum. warren is probably better positioned than klobuchar in that regard, but also tom steyer , and public comments he gave late last night after the spin room, he said if he does not have a strong showing in south carolina he likely would have to reevaluate.

i am paraphrasing, but that is the vibe we are getting. -- hast has been very not been very dignified watching the party attack itself and there is plenty of that in democracy. what have we learned about who can take on trump, because that is what they are trying to achieve? kevin: that is a great question, and it really depends on which campaign you ask. that all suggest democratic voters want to see president trump defeated, however they don't think their second choice or third choice would be the best person to do that. i think that is why you are seeing there be such an aggressive rhetoric, ratcheted up reddit -- rhetoric at the debate. there are a handful of large contests two weeks or so after super tuesday, and that is really where former vice president joe biden is hoping that the dynamics of the race,

the mento him -- the momentum of the race will have shifted. weekend inin this south carolina to project that confidence, because the sanders campaign is mentioning if they do not get the delegates needed to clinch the nomination, that they would like to see the nomination wrapped up. tom: kevin cirilli, greatly appreciated. it is always an important meeting in berlin called the super return private equity event. this year, it takes on a different cast, a different tone given the global viral crisis. we have spoken at davos to general atlantic ceo william ford, and he is sitting with our matt miller in berlin. matt? : the coronavirus conversation is front and center, and i was surprised this

conference was so well attended. the do you think not about attendance of the super return, but the coronavirus impact? portfolio think 18 companies or so in china, 10% of your aum inna -- china. william: it is really a tale of two cities. online companies which is about , aref our portfolio actually benefiting from the virus as people stay at home using online channels. conversely, consumer investments and some of our health care investments are being negatively impacted. business,tremendous about 400 restaurants, they are down 30% and it will take some time to recover.

the other area we are not as exposed to but have a little bit of exposure to as the chinese traveler, 175 million trips last year. that is down over 50% on the back of hong kong travel being down. it is a pretty big issue for our china sector. matt: the markets have slumped over the last few days but have generally been optimistic. everyone i have talked to except for mohamed el-erian expects a v-shaped recovery. how do you expect it to play out? bill: i think it will take longer and push out into q3. i think the chinese economy is not going to fall back to 6%. i think it falls back to 5% because as it has become more of a consumer economy, it will be significantly impacted. as it has spilled over into the western world, the comments

about the cdc and u.s. saying there will likely be an outbreak , it will change the behavior and i don't think it will cause a snapback in behavior. using half a point of global gdp and a point and a half off of china, but that goes to the negative, not the positive, as this unfolds. matt: will that change the way you invest or the way people invest with you? bill: i don't think it will have a long-term impact on the interest in private equity. we will ber a cycle, fine and china will be fine. i think near term, there will be some caution. one of the big questions for us now, will valuations in the private market begin to adjust to a correction in the public market and a higher level of risk? trillion of $2.5 private capital that wants to

find a place to go to work, but on the other hand you have a public market that is flat for the year and maybe trending further down. maybe we will see an adjustment as a result. matt: there is a lot of talk about the bain & co. report at this conference, in that it looks like if you invest in money in the s&p 500 over the last 10 years, you would have done better than if you were invested in private equity. what do you think about that report and the public versus private comparison? bill: it is always an issue of when you start and stop the analytical theory. if we did this a year ago, private equity would've been 300 to 400 basis points higher than the s&p 500. people are estimating equities generating 4%, 5%, 6% coming off a global financial crisis. if that is true and private

equity can generate returns in the midteens, we will do a great job for our investor. long-term averages, 15% comp on returns for private equity. matt: i have asked the question to a number of executives. does private capital fare better than public markets in a downturn? why do you think private equity is a better investment than just the indexes in a downturn? aboutyou and i talked this before, volatility is our friend and the reason it is our friend in private capital is you can call capital when you see opportunities. we return capital when we see quality assets. we have generated $22 billion of cash liquidity. exit conditions were excellent. our job was to capitalize them. if the world changes where valuation is correct and we have

a more volatile and uncertain environment, we will do much better because our dealmaking skills, the fact that we can invest when we see opportunity because you have long-term capital, we don't have protection coming out quarter by quarter, should create a window of opportunity. , hugelet me ask about esg topic for our viewers and for people here. aries is starting a climate fund. do you see an opportunity in investment to fight climate change or diversity or clearing out governance issues? is that important to you? bill: it is very important and every global investor has to have sustainability as a part, but it does not stand alone. esg across drive your entire investment capability and that is what we are trying to do. we are talking about great

boards, diversity at all 80 portfolio companies. it has got to be embedded in everything. at blackrock, i have a front row seat with larry -- larry fink he has really taken that to heart and pushed it through the investment fund. time.appreciate your thanks for stopping by. i will hand it back to you. anna: thanks very much for matt miller at the super return conference with bill ford. let's get some breaking headlines around what is going on with coronavirus. the e.u. commissioner for health and safety making an announcement with the who official briefing the press, saying coronavirus deaths in italy are now 12.

cases are increasing in two regions in italy. sharing information on the virus is crucial, and saying that the e.u. is in containment phase. some of the experts talked to us about you are in containment phase and after that may be comes mitigation and you hope you do not need to go to that phase, but that is the natural progression. europe is in a containment to delay the spread of this virus. tom: it is really interesting to see. this is the time of day where we have seen this the last couple of days, these headlines. it is a flighty tape with futures almost flat and the yen weaker today. please stay with us. this is bloomberg. ♪

♪ you are watching bloomberg "surveillance." we begin with the largest private real estate transaction ever in the u.k., goldman sachs selling iq accommodations. the price, a little over $6 billion. iq manages 600,000 beds for students across britain. jamie dimon sees competition everywhere he looks so he plans to be creative. mr. dimon speaking at the investment day. >> we will be more aggressive in

acquisitions across the board. you will get competition from amazon, apple, alipay, black label, and marketplaces. that is the world we will face. when it comes to m&a, we should be creative. ofiana: jp morgan coming out the most profitable year in u.s. history. shares are dipping lower, investors sending the shocks -- the stock down after news bob iger will step down. he built the most successful movie studio in history. year disneyis a 27 veteran who has run the consumer and home video bit -- division. that is your bloomberg business flash. tom: there are people who understand the heritage of any given company on the style -- on the sell side, on the buy side,

maybe someone like michael nathanson, and then there is paul sweeney. he not only understands the present of the shocking announcement at disney, but understands the history of 1966 to 1984 where disney was lost in the creative wilderness, and sid bass went out and found michael eisner. it was amazing to see how he changed the company. iger did the same thing. paul: he really focused on content, intellectual property, ip as he refers to it. constant acquisitions, pixar, marvel studios, lucasfilms. off the president getting air force one, arriving at joint base andrews and on his way to the white house, no doubt, to consider last night's debate.

let us continue. when we look at this transfer, it is almost like walt disney giving over the baton to roy disney when he built disney world. atl: he has actually been the company for 27 years and has done consumer products and dvds when that was the growth business, now theme parks, and he is getting the big c. to continue the transition that bob iger initiated, moving this company toward streaming video, you think about disney plus, espn plus, hulu, that is the future of the company and that is what they have to continue to execute on. anna: interesting to see despite -- you are talking about the continuation of the strategy and getting the content right and all about streaming. coronavirus will be something of a headache for this businesslike for others. they will be hoping that people

if they are forced to stay at home, watching their content, but they will have to think about theme parks in certain parts of the world. paul: they are absolutely exposed to the coronavirus and the stock is down 11% this year. the shanghai and hong kong parks have been closed for one full month. shanghai disney was a $5 billion investment, so it is a huge growth driver and that is an issue. there is concerns about domestic u.s. park attendance going forward in that travel is impacted into the united states. tom: was the invention of the gummy bears the success? paul: i don't think that is it. -- richh grin feel greenfield is stunned, you are stunned. the guy who wins the virus says, i have to get disability. is that the leading theory? paul: the timing is suspect.

most observers thought we would get succession news next year. the fact that it came this year in the middle of the coronavirus crisis is really an issue and is really surprising. thank you so much, paul sweeney from bloomberg within it -- update on -- with an update on disney. let's get a look at what is going on in the markets, the stoxx 600 weaker by 1.1%, the dax down 1.2%. selling taking place in germany. the italian market actually bouncing a little bit, up 3/10 of 1%. this is bloomberg. ♪

tv just keeps getting better. how you watch it does too. this is xfinity x1. featuring the emmy award-winning voice remote. streaming services without changing passwords and input. live sports - with real-time stats and scores. access to the most 4k content. and your movies and shows to go.

the best tv experience is the best tv value. xfinity x1. simple. easy. awesome. xfinity. the future of awesome. tom: bloomberg "surveillance," anna edwards in london, tom in new york. there is green on the screen,

much better than an hour and a half ago. with our first word news, here is viviana hurtado. and south korea, and u.s. service member positive for the coronavirus and is in quarantine. it comes as health officials warned the coronavirus outbreak here could cause significant disruption. they have outlined emergency plans of school closings, cancellations of concerts and business meetings. the virust to see spread into the u.s. and it is a question of when. violence in new delhi is the worst in almost three decades, hindu groups attacking protesters who are mostly muslim. almost 20 people have been killed. the protesters were demonstrating against the new religion based citizenship law. three jurors in the roger stone law say bias played no role in his conviction.

the jurors testifying at a hearing on stone's bid for a new criticizing the president for what she calls false news reports, saying it could endanger jurors. in the u.k., a think tank is urging the chancellor of the exchequer to raise taxes, saying they need that to spun their fund theirn -- spending plan. 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. tapeagain, a constructive as we move through the early morning in new york. last night, we moved to another the 19.7 million that gazed upon las vegas, there was south carolina. it was a very different debate.

the attendees went after the senator from vermont. >> not only is this a way to get donald trump reelected, we have a house and senate to worry about. >> i like bernie but i do not think this is the best person to lead the ticket. >> i dug in and did the work and bernie steam trashed me. >> bernie hasn't passed much of anything. >> donald trump thinks it would be better if he is president. i do not think so. vladimir putin thanks donald trump should be president of the united states and that is why russia is helping you get elected so you will lose to him. tom: bernie giving it right back to mr. bloomberg, the founder of bloomberg tv and bloomberg lp. we are thrilled to bring to you someone who combines astute political analysis with in the trenches reality of our american -- gina, jean is a no

they know. core competence in american government, great. what is the core concept of the democratic party? >> they are completely divided between bernie sanders and the moderates. if they don't dwindle that number of moderates down, bernie sanders will probably walk away. tom: this came up last night. you have people monopolizing the debate where they have 9% or 11% of the vote where we can state 88% of the people did not vote for them. why are they still on stage? jonathan: that is the question -- jeanne: that is the question, and i don't think we will see them off the stage until after super tuesday. apperceive dirt -- after super tuesday if we do not see the number dwindle, bernie sanders will get enough delegates which

is a problem for the moderates. when you combine the moderate vote, there are many more moderates than progressives and socialists. tom: this is an incredibly important point, this is really important to say that what we saw last night wasn't the moderate party, it wasn't the 40 moderate congressional districts represented. anna: it was a different conversation, and if we see sanders vic doria's and the democratic competition -- victorious in the democratic competition, what does that say if he is the man on the ticket? jeanne: it increases the likelihood that you see a reelection of the incumbent president. it is an uphill battle for democrats with an economy as strong as it is. 80% of the time in the 20th and 21st century the president will be reelected with an economy like this. you add a democratic-socialist

and the way our electoral system works, this election will be decided in five or six states. those states like florida will democratic-socialist talking positively about people like fidel castro. bernie sanders has a very strong base, but it is 30% to 35%. in the general election, he will have a real challenge against the incumbent president if he is the nominee. that is what you heard pete buttigieg, mayor bloomberg, and joe biden trying to make the case. anna: with the stress on the economy -- strength of the economy, what would be the line of the attack any candidate should take to be trump? conversations suggest he will be difficult to be. what is the weak spot that can stick? jeanne: they have to acknowledge the good aspects of the economy and where they think they can

improve it. for instance, they can talk about the fact that while wall street is doing very well, we have not seen the middle class, has not experienced that type of growth so the economy has not been as strong for everybody across the board. the real key for democrats is turn the page from the economy and talk about health care, the cost of health care and pharmaceuticals. that is how they won the 2018 house. tom: it is a policy thing last night and i'm like, wait a minute, was anybody in nevada where health care was predominant to the vote for the senator from vermont, and yet there was nothing last night on the results of nevada. is the energy in south carolina the same that people will say health care is the issue i care about and bernie is the only one talking about it? jeanne: democrats have to do a better job. in 20ats win the house

because of their message on health care. they should talk more about health care, gun control, and issues people can agree on and move forward. tom: this makes brexit look like 18 party. how do you -- look like a tea party. how do you summarize this? volatility,l drive and super tuesday is something we have been flagging as a potential hinge point for the markets. markets do not like uncertainty and people will get more of that. anna: thank you so much to both of you. coming up on the program, rio tinto warning the coronavirus issues.use significant ♪

♪ "surveillance," anna edwards and tom keene. many more data checks this morning and it is the most constructive tape of the day. upht now we have a lift eight on spx futures and the yen going out to 110.64. paribas, i with bnp want to do a single best chart and give you a window into the cross moments that the pros look at. this is one of the more spectacular reasons you have a bloomberg terminal. surfacethe volatility of the standard & poor's 500.

usually i would use a currency here but i have it with that flaring red, the world is coming to an end s&p going down. what does the derivatives structure you see, the skew skewedness show you about the bet being placed? greg: there is a lot of short-term fear so we are seeing short dated options spike, and the expectation of mean reversion through time. there is a large kink in the service in the november election. tom: this is really important, the v-shaped bottom that bruce kasdan would talk about, down we go and up back. you are saying this is -- sophisticated market will fold the election into the analysis. greg: no doubt, this is something we have seen. we have seen before and

political events where a kink has developed that has been outsized compared to the event. people are more worried about this volatility than in previous election cycles. anna: when you look at what is going on with the various assets you cover, the extensive negative orbetween positive, is this a stand down moment in the sense that assets are now correlated? greg: if you look at the sector moves in the u.s. for the last two days, every single sector is down. there has been a lot of correlation. as this continues to unfold, we tion, andmore decorrela more winners and losers across those sectors. anna: where will that be? it seems like an important moment in place to identify. greg: the initial shock is more of a technical one.

if we see for example the u.s. consumer start to slow, the labor markets soften, the nameser discretionary could come under pressure and they will look for stronger balance sheets compared to those that could suffer. tom: jon ferro just emailed in and said you have to go kinky. here is the kink in the volatility service of the standard & poor's 500, back to valentine's day. this is how sophisticated greg's market is, this teensy, weensy aberration. this is what you were talking about. greg: a couple of weeks before this bounce of de-risking, we had two kinks in the volatility, one in november and one around super tuesday. the market prior to this is

expecting volatility next week. tom: my head is spinning. thank you to our team for inventing this. this is just dazzling what you can do. home i know you do this at , looking at volatility surfaces all the time, but this is brilliant. anna: thanks to greg boutle for joining us and thanks to jon ferro for offering the production assistant on that one. up next, an exclusive conversation coming your way with the rio tinto ceo jean-sebastien jacques to talk about the impact of the , andavirus, the shares more. ♪

♪ you are watching bloomberg "surveillance." we begin with tesla and panasonic, they will end their partnership in a factory for

solar panels. panasonic is losing money. they have worked to ramp up production in new york that will still work together in nevada. blockorce -- keith lessing down, receiving attention than the founder marc tenure, sales his increased fourfold and rose 35%. emergent galactic resuming taking deposits for future trips into space. richard branson's company is trying to maintain momentum despite losses. no information on how many seats they will offer or how much it will cost. anna: thank you so much, viviana hurtado. the world's second-largest mi

nor is weighing the impact of the coronavirus. rio tinto says there could be a boost from china's efforts to combat the virus. i am pleased to say we are joined by the rio tinto ceo jean-sebastien jacques. thank you for joining us. we summarized a little of what you said about china this morning. at least the source of the coronavirus, you also said there is some improvement in china at the moment. what is improving? this is an important point to focus in on with the markets as they are. jean-sebastien: we are watching china carefully because it is 60% of our business. we have around 200 people in shanghai and beijing looking at the situation day in and day out. where we are is there is clearly

uncertainty in relation to movement of people and movement in terms of supply chain. as we are having this conversation, if we look at the , to move the product from china, we do not have a problem. we are watching very carefully and there is uncertainty, however as you pointed out, we have no doubt the chinese government will implement a stimulus package and you can argue they are taking some steps at this point in time. from a mining standpoint, we know the chinese package is significant from a community standpoint. seeinghy are you not difficulty in shipping to china? is the economy not doing as bad as we think it is or are people still buying? jean-sebastien: it has not

really impacted the service sector, construction sector, or manufacturing, but the industry is still making the aluminum and cotton -- copper smelters. at this point in time, the impact on our part of the business has been limited, however the situation can evolve quickly. we are convinced the chinese are taking the right steps. the key elements in terms of uncertainty is getting people back to work and the basis of the government to manage the issues. somebody working -- trucks are not moving. they need to put back the trucks on the road in order to move the material. anna: given that intelligence from the 200 people on the ground assessing the situation, what is your opinion on growth in china?

jean-sebastien: there is no doubt in my mind that quarter on quarter, china is likely to experience negative growth in the first quarter this year which will be the first time for a long time, since the 2000s. the other will be the shape of the recovery, v-shaped, u-shaped, w shape, we do not know. we are waiting very carefully. -- traffic jam in beijing, shanghai, and the coal sector. anna: we hope that does not calm with an uptick in viruses you also paid out a record dividend today and concern around global demand and global growth with the coronavirus increasingly spreading, how sustainable is this return of cash to shareholder story? jean-sebastien: it is very simple. we have strong assets, we are a

good product, good relationship with the customers, strong balance sheet. if you look at the last four years in a very volatile, uncertain environment, we have returned $6 billion to our shareholders. am i overly concerned about the way forward? the answer is no because we have the right balance sheet, customers, and no matter what happens as we continue to generate cash and allocate cash -- anna: you don't see any reason why you can continue dust cannot continue doing what you have been doing? jean-sebastien: 40% to 60% of underlying earnings through the cycle. is 40% to 60% of underlining earnings dust

underlying earnings through the cycle. what doesna: transition mean for rio tinto? what does that mean for a company like yours because it is easier to see in oil than mining. jean-sebastien: it is about four things. it is an opportunity. , we will needon more copper, more aluminum, more minerals for the battery technology. that is the first driver. did inond driver is we 2018 remove 300 tons of co2 and to a nete will get zero position. anna: your own operation. jean-sebastien: the strategy is around working with our customers. now we can improve the emissions footprint.

we went to apple who is a customer of a customer and the government of quebec in , the aluminum supply chain. the largest steelmaker in china and the university in beijing, and order to work on one of the solutions to improve communication across the value chain. stopping short or setting out scope three emissions or setting a limit for what customers should be doing with your products, are you want a different page two bnp on this -- page to bnp on this? jean-sebastien: i can only speak on behalf of rio.

to improve the supply chain and emissions across the value chain, technology investment, we will not set targets for customers specifically because and climate change, you will need more copper, aluminum, more nickel. you cannot say -- anna: jean-sebastien jacques, ceo of rio tinto. the markets are focused on coronavirus, the u.s. markets ticking upward. andfutures fairly flat, president saying on coronavirus, there will be a briefing this afternoon. this is bloomberg. ♪

♪ >> bernie sanders.

>> bernie. alix: the attacks on senator sanders as the debate turned bloody. virus contingent. to 2700. toll rises u.s.on in the welcome to "bloomberg daybreak." i'm alix steel. it has been a difficult two days or four days for equity markets. seeing u.s. investors trying to push risk on. we saw the same thing yesterday, but did not see it rollover. in the currency market, the dollar is the outperform or. -- the