investments and confirms -- bands investments culling china a national security threat. u.s.andemic growth in the -- california grow -- joins texas in reaching one million infections. the city says as as the cdc says almost no one has control over the pandemic across the country. and another round of brexit talks is likely to end today with little progress. that morning, everyone. this is "bloomberg surveillance." i'm francine lacqua in london, tom keene in new york. a number of stories we need to look at. we need to look at china, china and the u.s., the relationship between trump and president xi and joe biden's relationship, what that will look like. it is finally acknowledged that he is the president elect, and we look at the coronavirus in europe with some of the pitfalls. tom: the pandemic is front and center, no question about that.

the news flow in the united states and the pandemic -- i don't believe i have ever used this word before, it is just grim. abi did in april. but the headline this morning -- maybe i did in april. the headline this morning is that we have a president. just as importantly, as you mentioned, the chinese government has commented on this. it will be fascinating to see what president trump does today and into the sunday talk programs. francine: and absolutely, we will see the executive order. i was looking at security briefings, which is something i know you want to talk about and is very significant at the moment. a security briefing for the president-elect. let's get to first word news in new york city. >> state and federal election officials are rejecting president trump's claim for widespread voter fraud. they say that the election was the most secure in american history, that there is no evidence that any state lost

votes, changed votes, or was, must. china has congratulated joe biden and kamala harris on the winning of the presidential election that ended days of speculation about whether beijing would formally acknowledge the victory. china was one of the few countries that withheld comments. reaction came after several television networks predicted donald trump would beat joe biden in arizona. barring investments in chinese countries -- companies owned or controlled by the military -- the order says china is exploding american capital to develop its military intelligence and other security apparatus. in the u.k., prime minister boris johnson's most powerful aid is quitting. bloomberg has learned that dominic cummings will leave by the end of the year. cummings was the second key advisor to johnson to depart after tensions blew up over the way the inner circle operates. he was the mastermind of the

successful brexit campaign. global news 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries, i am karina mitchell. this is bloomberg. up 31.tures i am going to call it midrange of what we have seen since the great repricing. level, 29,205. 9% -- .89%. .8 and dollar resilient? that is not cfa institute, but we will go with it. the dollar resilient. francine: i like that, tom. treasury yields dipping along with the dollar, equities down when it came to the asian markets. it is interesting in europe. they are pretty much trading sideways. they are just trying to assess prospects for additional

stimulus to help these economies bettered by the coronavirus cases. this is what we saw in the markets yesterday, and it can use to be so. i also wanted to show you what is happening with pound. pound is significant not only because the u.k. reported record infections despite a tightening locked down, but because we had this power struggle at downing street, and we should have a bit more news on brexit today. you can see currently pound 1.3179. let's go to steen jakobsen. great to speak to you, as always. a lot of focus on president-elect ayden. and a lot of focus on the vaccine from pfizer, and then this rotation with treasuries really leading the way. what happens in the next two months? >> i think the market will look increasingly on what the central banks have done in the last 24 hours and looking forward to 2021. the signs in the health care

spaced, it has shown up. the improvement we have seen, with the vaccine, but also this morning from oxford come is very encouraging to me. so i am beginning to plan 2021 on the basis that we see significant improvement in the actual underlying ability to move around and get the economy back on track, and i think in that circumstance, the central banks right now is doing a massive policy mistake by throwing everything at it. apparently i am going to see a new version by december, at a time where of course the data looks bad, but the data on the cases -- they are concerning of course on a person-to-person perspective, but overall i think science and health care will come in and start to really play a big role. i think the market in the next two months will start to reprise everything. thisine: because we have morning from the bank of england governor, from the president of

the european central bank, from the fed president, a vaccine is not going to be a cure-all, is it better that they are still cautious? or would it be a bigger mistake if they actually believe, like you, that science will fix this mid-2021? i think they have -- steen: i think they have to play on the side of safety. i think the federal reserve -- all of a sudden everything was falling apart. and i think on a credibility sort of institution -- in the future and the economy, the central bank has the worst record of all, including me, and record onitt pretty bad that. this is all the narrative they are trying to create. and the central bank loves to be part of the solution by being able to talk to the audience, being the politicians.

we will get more in the sense that we get more fiscal spending, but my point is the data will not be worse for the next few month. the market looks through that, and i think it is a mistake. they can do whatever they want. they are not going to increase the solvency of the system, they are not going to take away the fact that covid-19 accelerated a lot of trends, including that a number of people, 2 billion people being put out, that will be lost in the total workspace. -- trying to close holes. tom: so much of this is the microeconomics of the micro theory of ambiguities. what is your greatest ambiguity for 2021? is it inflation and which way it cuts? yes, and that is a great question, because what is the biggest risk to this free ride that we have in equities right now? it is inflation, and i actually agree.

that's what i forgot to say before. the main impact is that we will see a massive amount of steepening in 2021, and that steepening will take up 1% in 10 year, and 1.5%. then we will see why monetary policy, endless support for monetary stimulus is not going to work because if you take a comedy like microsoft, if the interest rate goes up by 100 -- a company like microsoft, if the interest rate goes up by 100%, the fact that they have low debt, discounted with 1% higher rate coming $500 billion. tom: why have we not seen this so far? the critics of people concerned of inflation say that many times we have not gone there. why is now different? because,w is different one, we know that we are going to have a massive impulse at a time when we should be standing still. but most importantly -- and you

know this better than anyone -- what we have seen in the u.s. is that at a time when we had 30 million people -- we had the highest ever disposable income increase in the u.s. in other words, the state has taken upon themselves substitute all income rigs, but in particular -- all income brackets, but that translates into consumption, u.s. 70% consumption. if you look at the cpi for consumer goods, they are rising 4, 4.5%. if you don't understand the mechanics of inflation, you're looking in the wrong place. get back to will that. steen jakobsen stays with us. coming up, adam posen, at 5:30 am in new york, 10:30 a.m. in london. we will talk to him about inflation and we will talk brexit. this is bloomberg. ♪

karina: i'm karina mitchell with the bloomberg business flash. shares of disney jumped today, disney adding more online subscribers than it did last quarter. disney is reeling from the impact of the pandemic, but the disney plus streaming service has softened the blow. it contribute into a smaller than expected fourth-quarter loss. the trump administration is backed off from a threat to ban video sharing app tiktok in the u.s. despiteese owner -- yesterday, the judges have blocked it.

they will comply with the court rulings while the legal battle continues. and the copy recep a fiscal second quart of forecast indicated it will beat analyst projections and also suggested corporations and governments are starting to spend again. that is the bloomberg business flash. tom: we are with steen jakobsen on a friday, getting ready, reading through the weekend and trying to reframe into the holidays, into december as well. we were talking about the ambiguities out there, and i do want to talk about how within all of our series, and of course i would say they have lead on a careful analysis of this, the theories are all income statement, all dynamic, they are all to the moment unless a balance sheet analysis. can we effect what central banks are trying to do and not recalibrate our balance sheets for the losses over the last 14 or 15 years? no, and i think that's

one of the conclusions we have to take from the great financial crisis, and also now that the ability of the political system, but also in the framework to take these losses -- it is very difficult. the central banks are hoping we can get it through inflation, and that needs to be seen. but there is no overall -- there is no overall appetite for doing this. that is why i keep coming back to the fact i think the only way to do this, the path of least resistance, is that they will be a shock in 2021, the interest rates rising because of inflationary pressures. and we are not dealing with that balance sheet. solvency withor liquidity. unless central banks come in and buy like we did in the swedish bank model and like we did in the u.s. with the savings and loans. unless you start a plan where withmortize these debts the inconsistency of the balance

sheets and have a former -- a formal looking plan, i don't think we solve it. in the unitedote states, there is a new dawning awareness of the challenges of wells fargo as their management tries to do that workout. francine: 100%, and we will start looking at the pitfalls that we had here in europe. let's go back briefly to the very important inflation christian -- inflation question. where does it take hold? could it be inflation imported from china? steen: i think china historically -- i have been looking at this inflation question before, and it was a big issue. it is pretty clear that the export price out of china has a higher value than other factors used in the u.s., the fact that what you buy, walmart is 60%, 70% chinese goods. that is one link. china runs a very tight monetary

condition. by q2 next year will be fully engaged in starting the engine both fiscally and monetarily, by easing monetary policy. credit and pulses, looking nine months forward, it looks like q1 and q2 are going to be strong for china. take the box that consumer spending through durables is going up already. but overall the way the market looks, the five-year, five-year, which is expectation relative to realize inflation -- what we need to know and what we need to realize -- and a few of us remember -- in the 1970's, no one really understood why inflation went from 3% to 12%. we all knew about the energy crisis, but the rest was expectations. let me make the final market argument. if you look at the world today, one of the asset classes with the lowest successes intentional -- low success potential over the next 10 years is government fixed income.

if money was flowing out of that, it would flow into risks that are significant smaller. one of the smallest there is is inflation linked protection. in other words, if you wanted to, whether there was inflation to protect against inflation, that, from which you should suggest -- select your hedge, you can see a phenomena where inflation expectations starts to rise ahead of the actual inflation, and through that forces financial investors to get on board in terms of hedging, either not materializing or materializing much smaller. jakobsen, chief investment officer, thank you for that. the inflation five-year, five-year. .uropean close, david miliband more than that, it is also about brexit and where the world goes. that is at 11:30 am in new york,

4:30 p.m. in london, and this is bloomberg. ♪

francine: this is bloomberg surveillance, tom and francine from london and new york. no question that we have been asking ourselves, and i've also been asking guests for the last quarter of -- the last four years, five years, when will central bank finally consolidate? i spoke with thomas koch dine earlier this week on acquisition opportunities, and he talked about private banking.

here he is. >> across europe and switzerland there will be continued consolidation, and it is more domestic. transborder, cross-border consolidation is more difficult to actually execute, but there will also be cross-border correlation, i'm sure. exactannot give you an number, but what i am convinced is that conservation is needed. and it will happen. francine: is everything you do managing that through the consolidation coming, or do you want to defend yourself as an inquiry? how you want to manage wealth management? thomas: our strategy is principally based on organic growth, not in organic growth. i think we have a very strong banking franchise globally, growing 5% per year. if you took the fx adjusted

growth we had in the first nine months in revenues as well as in a um, we have a nice balance between mature and emerging markets. strong exposure to asia, where 20% of our revenues are coming out of asia. so we have, i think, a very good platform to grow organically. but we also are always open and opportunistic to look at acquisition opportunities, especially private banking, which is our main focus, so from that perspective, we will be open. and we will look at the opportunities. but our key strategy is to really improve our return on equity. we made very clear that our target is to get to 10% to 12%. we were at 10% in the first nine months of this year, so i think we are very close to our midterm target in a very difficult year,

2020, with a significant amount of provision for credit losses, but we also had some tailwind in terms of actual revenues and actual volumes. but overall, i think we are on the right track. this is our strategy to grow organically and wealth management with strong capabilities. our differentiating positioning. we are very strong and capabilities and we have broad family offices, entrepreneurs, across corporate banking, investment banking capabilities, and that is where we want to continue to grow. what we would like -- tom: what we would like to do, there is silence x 1600 pennsylvania avenue. or kevinty shanker cirilli will help us out. we have to talk about the silence of the prime minister at

10 downing street. do you expect prime minister johnson to say something today into your afternoon about this soap proper that i'm observing? francine: preferably not. you will see a story on brexit, because we go through the kind of deadlines and they get extended, and we understand that the two sides are still negotiating. what you are referring to is of course the rage of prime minister boris johnson after there was a week last week about lockdown, and so they really cracks down on leaks, and after that come over to his top aides resigned because he did not become chief of staff. we found out yesterday that his most famous aid, controversial aid, dominic cummings, will leave by december. we don't usually have a prime minister going into the public eye talking about this in-house laundering about what exactly is going on. but we understand it is very fraught and of course there is a

number of people for and against the people that surround the prime minister. tom: is this normal? has this occurred in other prime minister ships? margins, yes,he but nothing quite like this. it is a little bit like what we saw in the white house. personalities are a little more bombastic than in the past, and i would say there are reactions by either side. this is infighting. i'm sure we have seen it before, maybe not in the last 20 years. is --hat francine: coming up, we speak of course about the u.s. election with bonnie greer. this is bloomberg. ♪

francine: this is a bloomberg surveillance. bloomberg has learned boris johnson's top aide dominic

cummings will quit his job in the end of the year. he is the second key advisor to leave amid tensions in the prime minister's inner circle. thank you for joining us. this is a very divisive figure. some people like him, others didn't. be theeaves, who will closest confidant to prime minister johnson, and how does that change the dynamic on brexit and other things? it will be interesting if he leaves. it is two of the three of his possibly closest advisors, the key brexiteers that post-brexit through since 2016 who will have left. he has been highly controversial. johnson has been very loyal to him. outside has had influence on his thinking, not

just about brexit, but the pandemic and his management of other things in general. if he departs, it leaves a big hole in johnson's inner circle. it could mean they are moving closer to brexit, because cummings was a very hard brexiteer, and there may be a hope that his departure could clear the path to a trade deal with the eu to start in 2021. what the rules and regulations will be given the hit to the economy and business due to the pandemic. it will leave a hole, but it may leave a path forward to get brexit done. tom: what does this mean for the certitude of the johnson government? he has a government in perpetuity, essentially. i am making a joke, but out years, is his government threatened by the soap opera?

rosalind? : there are a lot of elections, and one that could be particularly tricky in scotland. why boris johnson has come to assert himself a little more and take control of his agenda and perhaps clean the slate a bit into 2021. this is quite controversial, quite divisive, and there was the controversy earlier this year. this might be johnson saying we will move away from brexit and look forward to new policies to the economy and the u.k. it could be chaotic after pretty bad year for boris johnson. this could be him signaling he is looking for some kind of reset to get his own popularity back on track. francine: thank you so much. us there. we will focus on the bloomberg

economy forum. you can watch that on bloomberg.com, the terminal, and on the new social channels on facebook and twitter. we have a number of guests. i think we are keeping them secret for the moment, but in a couple of hours we will give you a full round of. it will be heads of state, policymakers, including central bankers. this is bloomberg. ♪

>> republican officials who clearly know better are going along with this. inis one more step i name

delegitimizing not just the biden administration but democracy. that is a dangerous path. out,a one-time book president obama on 60 minutes. what was supposed to be post-election, it is, but it isn't. martin schenker has been watching this and hurting together all of our coverage. together all our coverage. still on, isn't it? isas far as donald trump concerned. increasingly the gop is coming to the conclusion we have to move this transition forward in a formal way. tom: when nixon was asked to resign, i think howard baker was involved, this was a few years and iyoung schenker

remember this. how do you sit the president down and explained to him the realities of the popular and electoral vote? marty: we have a story about how donald trump has been invisible for the last six or seven days. he hasn't made any public comments. he made an appearance at the veterans day ceremony, but did not say a word. that he is sense beginning to contemplate what his next move is in terms of acknowledging joe biden as the president-elect. i suspect that is beginning to moren and seep in as republicans call for intelligence briefings. francine: marty, even if the president does not come round to that, or takes weeks, or even longer, what is the rest of the republican party going to do? marty: i think a number of

people have made the point that they want donald trump's voters to come out for the georgia senate runoffs. they definitely don't want to get on the wrong side of donald trump. at the same time, these states are going to certify results in the next 10 to 14 days. when that happens, it will be very difficult for republicans to resist congratulating joe biden in the country moving forward with the biden administration. francine: marty, i know this is a difficult question because you don't have the polls yet, but how many people in the u.s. think something went wrong in the election? how many people think the president is right, that he was cheated? marty: actually, there was a poll a couple of days ago that said single digits think there was massive fraud in this election. upwards of 70% believe joe biden is the president-elect. the president is not on the

right side of the public on this issue. you just wonder how long it will take for him to realize that. tom: what is the role of vice president pence? well, he is also kind of invisible. at the senatehill breakfast the other day, or lunch, rather. his role has been to back the president unreservedly throughout the 3.5 years of his administration. don't count on mike pence to be the key figure. if there is anyone, it would be a family member. it would be jared kushner or whok who can -- or ivanka convinces the president to move on. tom: centered around that is fundraising. have you been able to translate with craig gordon the urgency of the need to raise money by mr. trump? was very challenged at

the end of the campaign in terms of coming up with campaign funds. going out fors defense funds. what is interesting about that is if these court cases, which don't look like they are going anywhere, end that fundraising continues. he can use those funds basically anyway he wants. tom: thank you so much. our chief content officer. from an exhausting period november 3. it continues. arizona has gone joe biden and is official if not certified. the chinese have said greetings to the president-elect. we say greetings to bonnie greer, the former chancellor of kingston university with 9:00 a.m. eclectic view of the special relationship. she has lived the special relationship. i name joining broadway years

ago, she said forget that, i'm going to london to be a star. you have a twisted interpretation. can you fathom the restoration of a special relationship as to be something of old with president biden and prime minister johnson? say quickly it is great to be on with both of you and, tom, i remember the nixon ballet tol. it was backstage and the finale was a helicopter on the south lawn. that was all we saw. it is different now. forspecial relationship most americans is a broadly mystical thing. people don't know what it is, but it is nice to have around when you want to come for a visit. tofar as it being integral most americans lives, it doesn't exist. however, the british people are led to believe it does. this is where the clash is.

tom: i look at the clash and the times we are in. we you have lived this so much. raisedt tension in the new definition of raised? biden address these issues in the history of the democratic party and find something modern? bonnie: the great thing about biden is he has been a member of the senate foreign relations committee for almost a hundred years. he is a diplomat. he understands what needs to be done. he is very proud of his irish ancestry and roots. i think with the people of britain have to understand is joe biden, and this is true of the congress and senate too, there are no votes in harming ireland in any way. the president-elect will be very conscious of that. very careful of that.

the present government will really get clear that ireland is very important to him. whatever agreement comes up has to include ireland in a good way. laancine: how will kama harris change u.s. politics? bonnie: she already has by being elected. it is an incredible act. i am very proud of the united states, actually, in all of this mayhem. that the american people were able to do this. what she has done is give a kind of sanction and permission to young people, especially young people of color and children of immigrants, to feel the american dream is possible for them. inis an experiment, not set stone. what this president has done is bust the norms which has held us together. harrise president elect

is going to restore some of those by her very being and restore the dream. that is the thing that holds us together. francine: we understand representation matters. the vice president is usually someone to support the president. kamala harris pushed the reforms that will help minorities in the u.s.? bonnie: joe biden, one thing he said of barack obama, he make sure i am the last person in the room. harrise president-elect will be the last person in the room. levels, is sony important. she brings nine a enormous experience and life experience. -- she brings an enormous experience and life experience. just so everyone

understands, and i think this is important, in the 1980's it was cool to talk about going to the edinburgh festival. this. greer actually did she has a visceral understanding of scotland and britain because she did it. is the union really threatened? in thee the outsider zeitgeist of the united kingdom. is the union actually threaten from where you sit? bonnie: i feel enormous respect for the independence movement in scotland and the people of scotland. i feel a little strange about , becauseis to you, tom i am a naturalized citizen and i took an oath of allegiance. .om: stop prince charles blessed you. stop it. bonnie: i need -- it is important to me not to say that there is a breakup.

the people of scotland want their independence, many of them. it has to be listened to. you have to listen to people's cries for independence. tom: thank you for joining us. her thoughts on her chicago and america as well. not a bad friday as we slide into the holiday season. we will be briefed on the outlook for december in 2021, the censuses of our economics with all we speak about each day. this is bloomberg. good morning. ♪

>> that is certainly good and welcome news for the medium term, although significant challenges and uncertainties remain about timing, production, and the efficacy of different groups. it is too soon to assist with any confidence the implications of the news for the path of the economy, especially in the near term. >> as we get more news on the vaccine situation, not only will it give encouragement and hope,

but reduce that level of uncertainty over the outlook. we are not really there yet. fors important, i think, having tocause we are make monetary policy and conditions of extreme uncertainty. >> i don't want to be exuberant about this vaccination, because there are still uncertainty about the logistics of the transportation, the rolling outcome of the fabrication, the number of people that will be vaccinated in the course of 2021 so we can reach the herd immunity which will then give us more certainty from the health point of view. tom: nine a interesting set of voices as we begin to -- an interesting set of voices as we begin to consider the path of 2021 and beyond. sen with the bank of england and inviting so much of

the economic discourse in the united states. thank you so much for joining us. yearglobal review for next speaks of our existential threats. we all know that, but we have to tosecute or create a process address those threats. how do we do that? adam: thank you, tom and francine, for having me. the existential threats our real. it is climate change, the pandemic, and arguably the rising international conflict and the mass unemployment the pandemic has induced. these all matter greatly. i think part of the roadmap in ard, which we are doing project at the peterson institute about rebuilding global economy, it is operation is necessary for addressing any

of these threats. if you are going to sustain a response to climate change there has to be accommodation for the countries,egions and the paces they will go in terms carbonization. is we have to rebuild institutions in some abstract way, but practical measures of international cooperation. tom: i want to talk about this balance of the present president , more authoritarian and go it alone in the united states, versus how we are redefining democracy with a new president. how does democracy act given these existential threats and get something done? the arch complaint is the wheels

just spend and spend and spend -- just spin and spin and spin. how does america get something done with the inefficiencies of democracy? adam: the inefficiencies are the divisions. it is one thing to have institutions with deadlocks, but another thing to have a society that deadlocks. it is that situation that has led the u.s. situation so dangerous and so undermining of democracy. this is why the pseudo-fascists get in. that is when mussolini got in in the 1920's. he made the trains run on time. can democracy make trains run on time? people tend to focus on china doing well after the fact of the epidemic started, and they have, but there are vibrant democracies like japan, taiwan, new zealand, australia, and singapore that have done perfectly well by any standard in dealing with the disease.

onhave to stop focusing these institutions and labels and start focusing on getting practical agreements among particular government agencies and particular constituencies. secondly, we have to focus on government capacity. you are going to be hated no matter what you do if you are an elected official. you will be suspected no matter what you do. at some point, if you're going to do something, do it right, do it strong, and don't worry about it. the mapping between how well you do something in the short term and how ambitious you are versus how you will be treated is very irregular. that is a social science way of saying you might as well [indeterminable] francine: you deal with infections and trying to contain the virus, but what do you do economically? adam: economically, as you watch,, i know because i

is first and foremost you have to get the virus under control as best you can. that isn't a question of lockdown versus not. it is tracking, tracing, people having discipline, being very judicious in what you close and what you don't. the second thing to go into stimulus, as many people are arguing, you need to keep the bridge going until we get to the other side. because of the vaccine news and what we have seen in the east asia pacific it is possible to get to the other side. it is a matter of months, god willing. be ablecase, we should to sustain stimulus for small businesses and unemployed people. until then, in the u.s. and in stateces, stimulus or local government and whatever manyational support is, so

of the first responders, education, and human services depend on that budget. tom: we will talk about this, the austerity of the moment. the original austerity in the united kingdom. what we see about the -- what we see out of the u.s. senate going forward. futures up to 85. 200 85. a nice rebound on friday. dollar resilience, euro 1 18.22 this is bloomberg. ♪ when you switch to xfinity mobile,

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you can shop the latest phones, bring your own device, or trade in for extra savings. that's simple, easy, awesome. visit your local xfinity store today to ask, shop, discover the latest on xfinity mobile. tom: this morning from phoenix to beijing, biden is president,

arizona adds 11 electoral votes to the blue column. there is no direction from the white house. a perfect quiet to the markets. the dollar is resilient. there is one direction for the virus, and that is exponential. dr. fauci says the nation must double down. new york city schools are likely to close. the ivy league cancels ice hockey. how will they survive in the dartmouth bubble? this is bloomberg surveillance from new york. francine lacqua in london. the pandemic has hit in. in sports-crazy american we are starting to shift into a new round of cancellations. i wonder with the media and disney earnings yesterday, and all that, where will we be in 90 days or 180 days living this pandemic?