♪ francine: down to the wire. just hundreds of votes separate president trump joe biden in georgia. pennsylvania remains too close to call. the president says the election is being stolen, despite no evidence of widespread illegal voting. jerome powell says it's a good time to let the institution of democracy do their job. the fed says the virus away on the economy, as cases topped -- daily cases topped 100,000.

welcome to our special 2020 election coverage. it is so nice to stay up altogether. i think the world is really riveted by what is happening with the vote counting in u.s.. i am francine lacqua. tom keene in new york. interesting to look at market movement. the world is watching this razor thin election, just trying to understand why it is taking so long in certain counties, and of course trump -- to find out what happens in the senate race and what happens with the president. tom: it's going to be extraordinary this friday and the uncertainty of where we are friday afternoon, where we are into the weekend. one thing that is very evident as we edged towards recounts, which will move us nicely from november and even into december. one telling statistic, the sum right now of the five states, forget about alaska, the five

state disparity between these 3,919 votes out5 of 150 million that have been made. francine: we are talking about razor thin changes. the latest electoral vote count 64, the moment, biden 2 trump, 214. we did see a rally over the last few days, but that rally is slowly fading away. market bond yields narrowing. huge in thehing markets today. gold basically unchanged. this global equity rally showing signs of easing. .he dollar holding to a two- year low you can see gold flat and crude oil declining. tom: ellen ruskin of deutsche

bank i thought was lights out about the currency dynamics. it is our deepest market worldwide. it is the one that gives us the most information tick-by-tick. on the bloomberg it is simple, sustain weaker dollar this morning. 1840, what a rebound 1.16.f the level. yen --ow, the bin of the bid of the yen blowing through that level. francine: we will have plenty more of course on urodynamics. the race for the white house is still too close to call. counting continues in crucial swing states, with joe biden catching up with president trump in georgia and pennsylvania. biden currently trails in georgia by 463 votes.

if you look at the states still in place, arizona, georgia, north carolina, nevada, and pennsylvania, which are the ones where we could have more of a clear idea on who wins in the next hour or so? is -- seems georgia like that is going to be very soon. you could be talking by sunrise in the east coast of the united states that you will see joe biden take a nominal lead in that state. i asked pennsylvania lieutenant governor john federman when he thought that pennsylvania was going to flip to a biden nominal lead, his answer to me was "inevitably." there is a lot of blue vote out in pennsylvania, a little blue vote in georgia, and not much red in either state. both of those trending to be a nominal lead for joe biden before you get to military votes coming in, as well as potential

recounts. tom: how will thae republican combine react to the president's comments last night? >> i see a lot of people coming into congress who are backing him, either explicitly or to some degree. you are getting very few actual repudiation's from people coming in. will heard, the texas congressman who is leaving,, castigated trump. tommy tuberville, the senator from alabama, linked right back up with him. you are seeing a fair bit of that dynamic. a lot of the strongest republican voices against trump do not have a title. francine: derek, thank you so much. derek wallbank looking at the u.s. elections. let's get plenty more on this historic u.s. election. with more analysis, our next

guest is former deputy chief to the u.s. embassy in london, now at signum global advisors. to.lukens, welcome the program something we have not really focused on but seems significant is, how well the republican party deal with the latest comments from president trump yesterday? saying that this is a rigged election, when we have actually no proof of that. >> i think we are seeing a split in the republican party leadership. some senators and leaders have come out in support of president trump, but i think some of the more cautious members, including mitch mcconnell, will start distancing themselves from trump , especially as the day goes on, as georgia flips, pennsylvania, and it becomes clear that joe biden will have think thelection, i more serious members of the senior leadership of the republican party will start looking to the future and figure

out how they can rebuild the party in a post-trump era. electoralthe latest college vote count is joe biden 264, donald trump 214. how many recounts are we going to get? are you going to be very cautious for the next couple of il we deal with the legal challenges and possible recounts? lew: i think so. theost states, one of request to recount is if the margin of victory is less than 1%. case, the trump administration or demand recounts. this will -- can drag on for weeks and weeks. i think the end result is somewhat inevitable, but i think the trump campaign would do all it can to drag this out and throw out legal blocks along the way. tom: what is so interesting, and

i totally agree with the recount schedule into december and the right to have a recount, given very narrow victories, which it seems we are heading. what are our projections from december into january? how vulnerable are we right now lame-duckedness. lew: if now was the time to --se trouble, the longer this drags out, the worse it is for u.s. democracy. i was texting with a friend this morning. synagogue,ident of who lost the election, and had to stand aside for a challenger, if he had said some of the things that president trump said last night, we would have been

condemning it in the strongest civil terms as americans observing their election. so it puts american diplomats overseas in a bit of an awkward position when the u.s. government itself is turning its back on some of the standards that we have upheld or promoted around the world for decades. tom: what will be the special relationship between a president biden and a prime minister johnson? lew: i think it will be fine. there is a lot of talk that biden will be very tight with france and germany and the european union and turn his back a little bit on the united kingdom. i don't see that dynamic. i think that in some ways, the united kingdom and united states are much more closely aligned on some policy issues, including how to deal with iran, climate change, the fact that we need to deal with climate change. there might be an initial awkwardness as the two leaders get to know each other, but i think the policy realm, we will be much closer aligned and we will come together and continue to work very closely globally.

francine: thank you so much for joining us. lew lukens, senior partner at signum global advisors. we will have plenty more on market action and analysis. we will continue with jim o'neill of chatham house. us ♪ next and this is bloomberg.

♪ it has really destroyed our system. it is a corrupt system, and it makes people corrupt, even if they are not by nature, but they become corrupt. it's too easy. mr. biden: we continue to feel, the senator and i, we continue to feel very good about where

things stand. we have no doubt that when the count is finished, senator harris and i will be declared the winners. so, i ask everyone to stay calm, all people to stay calm. the process is working. andcount is been completed, we will know very soon. ♪ francine: democratic nominee joe biden and president trump as well speaking on the stay of the election. trump took no questions after the news conference. it was certainly very divisive. bloomberg news reports there is no evidence of widespread illegal voting in the election. i think we will come back to the comments of the president shortly now. joining us to talk about the election, but also the ramifications for the world and what this very contested election means, let's welcome jim o'neill. please share of chatham house. great to have you on "bloomberg surveillance." when you look at the closeness of the race, doesn't actually change the way that u.s.

politics will move from, you know, now on? what are the overlying long-term effects that we are underestimating right now? knows is my opening,. -- opening comments. i was watching my -- your show with the previous guests and the comments you are making, too. importantaow in g20t, the schedule meeting hosted by saudi arabia. this is obviously important for many reasons, but in the covid environment, it is particularly important for further efforts to support who-based initiatives on equitable distribution of treatments, therapeutics, and

vaccines around the whole world, particularly the low income world. from everything i hear, i think a biden led presidency would be a lot more supportive of a, let's call it, a more rational covid approach and a greater u.s. involvement in such issues kovacs and have you as opposed to the 1 -- cov axx. the build up to that g20 meeting i think in itself will be extremely important as to the reality of the ongoing shenanigans involving possible vote counts at all that stuff. very goodthat's a point, and something we need to keep an ey on. the other thing is u.s. stimulus. we don't know the winner of the

presidential race and what will happen in the senate, but are you confident that the american people will get some of the stimulus that they need in the first quarter of 2021? of thaterested in all and interested to get your reaction to this. maybe it's a generational thing, but i am of the mindset that i think a split congress with a democratic president would for the be pretty good medium to longer term economic ,tability of the united states as well as constraining the wild elements on the two fringes of the modern tone of the democrats and the republicans. which is a somewhat different thee to some degree than immediate fiscal stimulus. it would seem obviously a split congress would constrain the amount of stimulus that a democratic clean sweep would

give. but i think not clear to me, given the likely path of vaccine aroundments, i.e., just the corner, whether a mammoth fiscal stimulus is as necessary as many people are talking about. i personally think a split congress would not be a bad thing. tom: tom keene in new york. good morning to you. i don't want to throw a brick in the discussion, but let's throw a brick in the discussion. when you look at the acceleration of yen strength, what does that signal? jim: so i was listening to what you are saying about that earlier and actually, i have been keeping informed by bloomberg radio the last two days. i was laughing to myself when i heard you guys getting all excited about the moves in the dollar yesterday.

thehaving been around foreign for 40 years, i am like, -- foreign-exchange for 40 years, i am i, this is nothing. bring it back to a world where currency actually does not move. jim, i did the math last night with alan ruskin at deutsche bank. this isn't 1981, is it? tony: -- no it's not. i think what is going on here is lest thet perceiving fiscal stimulus, which commits easyed to an extremely monetary policy, combined that with a more cooperative further

ring and the rest of the world -- and the rest of the world, it would all suggest an environment where the dollar should we can. that's pretty much what i would have thought. i'm not surprised to see the foreign-exchange market doing that yesterday. and i would not be surprised pending the hourly and daily set flow here that we are and train already a new fiscal policy framework and one that is consistent with a weaker dollar. the next issue before we know will be, at what level are the japanese and others going to try to's drop their currencies from strengthening? otherwise, dollar-yen is on course to go through 100 and the euro is going to go through 1.20. francine: i am looking at a great chart. i was going to ask you about china, but i wanted to talk to

you about emerging markets as a whole. i am looking at a great chart on the bloomberg terminal which says emerging market looked to riskier assets, given what they know of the u.s. election so far. will that continue? jim: i think so, yes. if you look at the broad level of valuations and link it to the policy framework i have just said, unless there is, if i think of what kind upset this, i suppose a surprising, quick, and sizable uptick in u.s. inflation that forces the fed to behave very differently. --hout that, the emerging environment for so-called emerging-market equities is very good. it is the one part of the investment universe that is not particularly expensive from a valuation perspective, and now we have got the whole policy thrust going there favor as well, including how chinese policy is operating.

jim o'neill thank you so much. coming up, one story in town as the vote continues. joe biden is narrowing the gap in pennsylvania. we will have a full breakdown of all the states that are still to report some of the vote counts, georgia, pennsylvania, nevada, arizona stone play. this is bloomberg. ♪

♪ >> economic activity has continued to recover. joblessness has been especially lower for service jobs for women, african-americans, and hispanics. the economic dislocation has upended many lives and created great uncertainty about the future. the rise in covid-19 cases in the united states and abroad is particularly concerning. we expect to maintain an accommodative stance of monetary policy until these employment and inflation outcomes are achieved. the demand for loans is very low right now. companies are not borrowing. when i say we are not out of ammo, i am looking at a couple of our tools mainly. the asset purchase program, there is a number of dimensions in which we can adjust that, if we deem appropriate. right now, we like the job it is

doing. i think we will have a stronger recovery if we can just at least get some more fiscal support, when it's appropriate, and a size that congress thinks it's appropriate. it supported to take a step back and let the institutions of democracy do their jobs. francine: jerome powell there, sang more fiscal and monetary support of course is needed. wavess we see the second also in the u.s., we will have a look at u.s. jobs and hiring dynamics. tom: it will be interesting, to say the least. we got the election returns coming in this morning. next, ambassador gardner, anthony gardner will join us. this is bloomberg. good morning. ♪

francine: bloomberg surveillance. tom and francine with the u.s.

election special. it is 4:20 in new york, and we need to look at state-by-state the ones that could flip, the ones that -- we spent a lot of time looking at georgia. georgia we understand, through certain counts of the associated press, could have flipped. we have all become experts, about the counties, and the state of georgia. clayton county has just updated its totals, giving the former vice president a narrow lead in georgia. we have not closed it. there could be recounts. a number of things are still wide open, but this feels significant because it is something that the markets are looking at. i don't know what's priced in. if they are pricing in a biden presidency because he has the slightly upper edge. the georgia news is extremely important. anticipated. for international audiences,

this is a state with the next ordinary history, in 1968 that voted for george wallace, who was usually controversial. that wrapped around racial issues. it was a state that was devotedly democratic up through 1960. then things changed. you can wrap it around the civil rights act. president trump defeated secretary clinton in georgia by about 5%, and right now we see a say theht vote, to least. on this friday, 56 hours into tuesday evening, it is good to speak with anthony garden, -- anthony gardner. gardner, with his perspective on the e.u., has been advising the biden campaign and mr. biden directly. ambassador gardner, thank you so much for joining us today. i think one of the great questions for our audience

internationally and indeed domestically is the trite statement that this will be an obama redux. i am sure you disagree with that. what is the key distinction between an obama term one, term two, and what you would expect from a biden presidency? anthony: it is great to be on the show. you're right, i don't think this is going to be a biden redux. look, no one can pretend donald trump didn't exist. by the way, he's not going anywhere. we cannot go back to a few minutes before midday on january 20, 2017. too much has happened. on trade, a good example. the days of getting an ambitious trade agreement are gone, even with our closest partner in the e.u.. i was in on -- i was involved in that effort, which failed, unfortunately. i think joe biden will be soon

hopefully recognized and elected president, but i don't think anyone is imagining we can just pretend that he never existed. those frustrations are there, and a lot of skepticism exists in both parties about the trade deals. we will have to be very targeted and focused and explain how this is good for the middle class. have a regime change, it would be a dramatic regime change, no question about that. one of the questions here is within our polarization, we have defined a common ground, a middle ground. are we able to do that in our diplomacy and within trade? is there any chance of taking the divisiveness and bringing it into a middle ground coalition state? of the bigat is one questions. the middleground is not very strong now. policy,is on foreign

something on foreign policy. even on trade, we keep in mind some common ground with our closest partner. i'm not talking about some country in asia, i'm thinking about the old tpp, now renamed. i'm thinking about the e.u., and specific things with the e.u. that we can do to create jobs and to promote exports. for example, getting rid of tariffs, looking for things we can do to reform trade with our closest partner. that should not be a partisan issue. and i was in brussels, i never thought i was promoting a partisan agenda here. there areeful that things we can do that are good for all americans. ambassador gardner, is there anything more concrete that will actually get the people that voted for president that this is a

legitimate election and that joe biden could become their president if biden becomes president? theony: i think that counting of votes is a profoundly democratic concept. -- you are right, underneath your question are very important questions. tell the american people that working with allies, working with the multilateral system we have built with europeans and other allies around the world -- get better results for the american people. we have to do a better job to prove that case, because obviously we haven't proven that to the american people, and to show very concretely that we do a better job, for example, getting china to address structural issues in terms of

market access and their investment practices. case can make that successful, i do worry that in four years we will be faced with either donald trump or somebody who looks like donald trump. that is the question. anthony gardner, we are looking of course at georgia, and we understand that joe biden could have a 0.2% lead , but again, it could flip, so we have to remain very careful in everything that we say. it could behat important for the markets. what are you expecting donald trump to do next if he is not the president? could he rerun for election? is he going to be the biggest voice of opposition to the president? i don't expect him to go away. i think it would be very optimistic for anyone to think he will go away.

he certainly has tremendous influence over the republican party. that will translate to very practical things. will president biden have to rely on executive orders, challenged no doubt by the courts? how much can he do, for example, on minimum wage? how much can he do on regulating tech companies. how much can he do in terms of raising taxes? i expect donald trump will be very active with his allies, and it will be very difficult to govern, i think. that is a challenge. so much forank you joining us, anthony gardner, former u.s. ambassador to the e.u. we will have plenty more from professor gardner throughout the days and weeks. let's get to first word news with leigh-ann gerrans. leigh-ann: the u.s. is the first country to report over 100,000

daily coronavirus infections. according to johns hopkins university, that brings the u.s. total 9.6 million cases. the number of deaths is also climbing, going over 1000 for the third day in a row yesterday. mortality rates are remaining lower than the first wave of the pandemic back in spring. in europe, france has posted a record 58,000 new virus cases as the health minister warns of a violent second wave of the pandemic. france is also facing a surge in intensive care patients. .ow at 85% of capacity the country started second lockdown last week, meeting movement and closing some shops. a mutation of covid-19 that started in denmark is spreading to other regions of the country. there are 12 known cases of humans who have been infected with the new strain. to worldn is talking

health organization, which has said it is very word about the findings. there are concerns this mutation could derail efforts to develop a vaccine. global news 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more i am120 countries, leigh-ann gerrans. this is bloomberg. tom? francine? leigh-ann, thank you so much. we will have plenty more on georgia. they are still counting the final polls. i'm looking at twitter, our great graphics team, keeping us up-to-date every second on this ballot count. coming up, we will see whether -- the georgia election results. some of the constituencies there, we have all become very familiar with it. it could lead to joe biden taking the state of georgia. that could be a critical move in the race. he has a very small lead.

we will see what happens in the next couple of minutes. this is bloomberg. ♪

>> perhaps a president like joe makingwho is focused on deals and compromise might be a the positive outcome for country going forward. >> i have been in a room with then vice president biden and majority leader mitch mcconnell, and they can work well together. like president trump, like

cheney, like president bush before him, he will govern by executive order. gridlock, the markets don't seem to be too worried about that. they seem to be pretty comfortable with the potential for gridlock. >> we have to take a step back from the election, even though that has been the focus for the last couple of days, and realize that covid is what is driving this market and economy. increasing the probability of -- the other thing is it is all clear that they have made it clear now that taxes are not buyg up, and people can go risk assets and play the game. francine: some of the comments there as the u.s. election still hangs in the balance. georgia is something that could of course be significant for joe biden as we are looking at the

tally of the electoral college. he needs 270, a couple points , and asee on the market president trump is challenging these vote counts, if joe biden takes more state, it will be a comfortable position. if he makes it to 270. the presidential election count continues, u.s. futures unwinding. the dollar is holding near a two-year low. our next guest has been excited about that she is one of the top dealmakers. a senior position at nomura. he joins ubs as the chair of global m&a. fast-forward to 2018, and swiss the picked him to seed leader there. for joining usch today, piero novelli.

the trading for the investment bank at ubs, you're expected for anything to happen in the election. but what does the scenario now mean for the markets? francineod morning, and tom, and thank you for having me on the show. it is generally an important day, an important time. we have seen significant changes in the market environment over the last few days. clearly there are three factors that will drive the markets going forward. number one is the u.s. election outcome, and focus on fiscal stimulus. number two is clearly the vaccine, both in terms of the phase three trials and deployment of the vaccine and production, and approvals. number three is of course the development of covid-19. the unfortunate development in europe and the lockdowns that may -- that are following that.

clearly as it relates to the first topic, it seems that while any election outcome may face core challenges and potential recounts in several states, investors seem to have decided on the outcome of a biden presidency and on a split congress, with the republican senate and a democratic house. clearly this is a big change in the trading on wednesday -- and the trading on wednesday reflected this policy. the market had been assuming for most of the largest part of the last month a blue wave, so clearly the trading on wednesday will bring strong moves into growth stocks with the expectation of a split congress and a biden presidency. a lower fiscal stimulus package, potential may then ao $1 trillion less

blue wave could have had, so clearly big changes there, and also big changes relating to corporate taxation as well as capital gain taxes and reregulation. clearly all of this is affecting the market environment and the trading, and now we see market internals weakening with profit-taking by investors. where would you see a possible surprise? you laid it out, exactly what the market worries are, how do you see that developing over the next five to six months? are you going to see the market fine until recounts, or do we have a clear understanding of what the relations are? or are we seeing it priced in already? be volatility.ll over the last two trading days, we have seen the vix coming in,

on wednesday it went down by 17%, yesterday it would down by 6%. the difference between a blue wave and a split congress with a biden presidency -- so clearly the volatility is there to stay. there will be more dispersion and more sector rotations. clearly there could be surprises as it relates to equity markets u.s. andrm, both globally. they clearly there can be surprises relating to two or three things. number one, the lockdowns in europe and mobility restrictions that will cause a double dip in growth, negative growth in q4 in europe. number two, potential negative surprises on the vaccine. we estimate that two thirds of a positive outcome is already prized in the -- priced in the markets right now. so any delays in approvals or negative news, negative

surprises on phase three trials will be negative for the markets, and then third there -- the markets are still looking to age to 21, and discount the economic witness. there is a sector that is in great pain, and so are many companies. there is a question mark as to potential weakness on -- on credit and potential corporate defaults. in the new year. so clearly these are the things that could be negative for the market, and the key risks that we need to be focused on. morning to you. you have an exceptional experience, merrill lynch to ubs, at nomura, and then back to ubs inadership at europe. the question worldwide is what will the u.s. banks do? with their advantages and

flexibility, they will go to europe and try to take market share. are you worried about that? how will you defend europe, switzerland, and the rest against a u.s. onslaught? piero: it is a very good question, a question from a competitive standpoint we have had to face for the last decade. we feel that our strategy now reflects those challenges and those, and we are confident that we will be able to withstand and actually gain share as we have done over the last nine months, demonstrably based on our results. that is driven by the fact that at ubs we are a different type of financial institution and we are proud of that. we are the largest wealth manager globally, we have a capitalized strategy, and we are generally very diversified in terms of our geographic footprint. while all of our u.s. competitors have more than 50% of the revenues in the u.s. or approach 50% -- tom: i don't mean to interrupt,

but the blunt instrument is the weapon that the u.s. banks have is massive funding capabilities to make transactions go forward. can you -- with all the regulations of europe, and it is not so much the swiss giants, but the other continental banks. how do they defend against that stunning financial flexibility? it is content, ideas, artificial intelligence, technology, and data. on the corporate side respecting and demanding, we have been investing consistently for a decade now in our technology platform. we feel proud of the resiliency that we have had during the crisis. our resolve shows that. we have gained market share across key products, equity capital markets, so it is again, content, ideas, technology, artificial intelligence, and data. that is what is going to drive

the market share gains, and we feel strongly that is the right strategy. francine: how has your strategy of hiring top bankers in the u.s. progressed, and do you feel like you are competitive on a bonus level to make sure that you attract the top talent? is that the only way to keep your top performers? been veryhave always competitive as it relates to compensation, and we have always and continue to be very targeted and disciplined with respect to our growth in the united states. there are areas where we know we are strong globally, and we are strong as a financial institution, and we know we can compete and succeed in those targeted areas. we are investing in the u.s. and we are pleased so far with a market share gains. asity derivatives as well ecm. it has gone well so far. tom: thank you so much for the time. we look forward to seeing you again, and particularly at some

point when i am back in london. piero novelli is with us, copresident of ubs investment bank. please stay with us through the morning. biden leads in georgia. this is bloomberg. ♪

tom: good morning, everyone. election 2020 on a friday after tuesday. we are seeing extraordinary movement, including the vice president, mr. biden, taking the lead in georgia. that will be our major theme in the next hour as we await further election results. andrew sheets of morgan stanley will join us, linking our economics, our finance, our investment into this great political moment. stay with us. this is bloomberg. ♪ i feel like we're forgetting something.

let me check. xfinity home gives you peace of mind from anywhere with professionally monitored home security built around you. no, i think we're good. good. so when you're away, you don't have to worry. the tent. we forgot... the tent.

except about that. xfinity home. simple. easy. awesome. hey look, i found the tent! get xfinity home with no term contract required. click or call today. francine: down to the wire. just hundreds of votes separate

president trump and joe biden in georgia. update on georgia. pennsylvania remains too close to call. as joe biden appears to pull ahead, the president says the election is being stolen, despite no evidence of widespread illegal voting. and jay powell says it's a good time to let the institutions of democracy do their job. the fed says the virus will weigh on the economy as u.s. daily cases top 100,000. good morning, everyone. this is bloomberg surveillance. tom and francine from london and new york. day three of our election special. we look at georgia, and we have been saying that georgia could be quite significant because it was for such a long time a red state. it is razor thin. we saw joe biden ahead by a couple hundred votes. we continue counting, i believe, so it is not definitive. what we have been saying is that we have to be careful because there could be recounts and we could