morning, the u.s. two-year yield test late-summer lows, and the rio yield at singles, no reflation, oil at 50 dollars a barrel. in america there will be 300,000 deaths by christmas and in germany cases surge and the chinese authorities have detained a bloomberg news assistant for suspicion of engaging in criminal activity that jeopardizes national security. " we willethwait says continue to work as hard as possible to help her and her family." good morning. so much other news out there as we just heard from the finance minister of ireland, it is an extraordinary friday evening and afternoon in europe. francine: there is good news and bad news when it comes to the

european story. the focus is on brexit because there is another deadline we are hearing it could be postponed. on december 31st the u.k. supposedly leaves the e.u. at the same time we heard that there was the you recovering we look at stimulus in the u.s., the supreme court in the u.s., and we are not far off joe biden taking over. i think it is almost a month from now so we will try to figure out what 20 20 one has in store. the german two-year yield -.779 speaks volumes this morning. here is karina mitchell. karina: the u.s. is one step closer to getting a coronavirus vaccine.

advisors have approved the shot developed by pfizer and beyond tech. --the fda could give the final go-ahead within days. hearning from boris johnson, is saying business and the public should prepare to leave the european union single market without a trade deal. he warned that the e.u. a majorg that the --is obstacle. authorities in china have onained a news assistant suspicion of endangering national security. hayes and is a chinese -- haze f an was escorted from her apartment building monday. officials say they cases under investigation. we spoke with john micklethwait. spoken to a lot of people informally across the and we have tried as hard

as possible to find out what we have. we have the statement from the authorities detailing while they are holding her. we have reported that and we have been doing our best to try to find out where she is and what has happened and try to get her back. she is very talented person and very respected and an interval part of our newsroom. we are deeply concerned for her well-being. karina: global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am karina mitchell. this is bloomberg. tom: thank you so much. futures -212 and the vix

finally moves through the week and now that has changed. that is an important statistic there. inflation and a struggling equity market. at what: i am looking is happening with oil. this moved the market yesterday. butulus talks hung up developments on the coronavirus weighing on the sediment. dollar rising, and european stocks are down, crude oil fluctuating. international audience, a washington brief from martin schenker. good morning to you. you have done this for so many years and you know the quality of our team. what do they tell you about what mr. roberts and company will do this friday?

the ruling could come at states whose four results are being challenged by filed with the supreme court yesterday there brief asking the court to throughout the suit. the supreme court will take a look at it, and they could issue a ruling at any time, even including over the weekend or in the evening. i would suspect the supreme court to issue a decision at any moment. process is atoral process getting to this monday. does the team have a confidence that by monday there will be a certitude that mr. biden is the next president? martin: i think we have a certitude that he will be the next president already, before

the electoral college actually votes monday. donald trump has vowed to keep fighting. in january, on the sixth is when the congress has to accept the electoral decision. he is giving every indication that he will keep fighting at least until that date. francine: how is the senate race in georgia going? artan: -- martin: it is close. the polling has been pretty good and the polling says it is a close race in both races. mike pence was down there recently, trying to rally the forces because there is concern that the fraud charges will depress gop turnout which could make the difference. at thee: when you look story this week about hunter biden, how much does that change

the narrative in washington? istin: we are reporting this just a unfortunate but necessary problem for him to deal with as he takes office. it is reminiscent of the trump's surrounding children when he took office. he will have to take a very in his namingoach of an attorney general will be critical in how the case is handled. tom: what is interesting here is we are talking about 10 million americans running out of some form of food and rent i believe december 26 and we have these other distractions. focused onactually some form of income substitution or support before december 26? martin: it is fascinating to me

that there is a possibility that for congress could go home christmas without producing a rescue bill for the american economy for people who are running out of assistance. how they can face voters having failed to do that is unfathomable to me. there is a lot of speculation that they will reach some last-minute deal so they don't have to face the voters, but in this environment, one never knows. it is possible they could basically let the american people down. tom: what is the strength of senator mcconnell right now? there's one thing he knows how to do and that is how line.p his colleagues in he is very much in charge of this whole stimulus negotiation, hisuntil unless some of

colleagues break from him, it will be up to him what happens. tom: so much. the events of washington are extorting. what you need to know, futures have detroit in, i will call it , dowtrolled negative futures negative 256 as well. the vix now explodes. we will do more market checks through the morning. general kimmitt and that noon hour. this is bloomberg. ♪ every year, we set out to do one thing: help the world believe in holiday magic. and this year was harder than ever. and yet, somehow, you all found a way to pull it off. it's not about the toys or the ornaments but about coming together. santa, santa, you're on mute!

just wanted to say thanks. thanks for believing.

tom: this is "bloomberg surveillance."

it is an extraordinary friday. francine lacqua really focused on what is going on in brussels. i am just trying to get through friday. adam posen with us right now with the peterson institute. this is futures at -34. stephen wiseman did a wonderful book on moral conflict. in the fiscal debate in america, whether republican or democrat, i think of the late great ed lazear of stanford is maybe on the conservative side. i will let you pick your token liberal economist. there seems to be a morality play about our debt in deficit. discuss the moral conflict of too much debt. adam: the only moral aspect of aremuch debt is if you biasing today's people against tomorrow's children and that is

the moral aspect. government debt eventually gets paid. other ways it is about efficiency. when we are talking about the energy a shake show -- intergenerational -- it comes down to costs and benefits, what are you spending the money on? thanks that are just conception boomers,for the baby or on things that gets the economy in a better shape in the future? that's what it should be about, fixating on debt as some immoral something that has been a concept throughout history but not really something that holds up to scrutiny. tom: yet we are living it right , this moral drama.

adam: i got to give credit like people like michael strahan, glenn hubbard, people who are associated with conservative much who have been very concerned about it in the past and have made the choice to say, the circumstances are different now. that is not the same thing when interest rates at this low and there is a pandemic, there are other things you can do with the money. i don't think you can just say it does not matter who takes who from which side. i think the responsive --responsible conservatives have moved. i think that people think that that is a terrible thing our people who either have a plausible but dubious concern about stability or they are being supercritical. francine: is there a level of

debt that is more acceptable than others? the harsh reality is it depends on what you do with the debt. where are we right now? is it being invested where it should? adam: that is the right question, do we need to change course on how it is being spent? colleagues recently came up with the view that what matters is what share of your debt is going to interest payments. now is about helping people versus the future especially since if you are using the money ,isely, paying down the debt because the moral prospects come up. i think that is a good way to think about it. there are risks to interest rates that go beyond that, so that may not be the whole story. difficulty of doing

debt sustainability and analysis and you have to put a little more worry in that. the bottom line is what we should be focused on is what we need to do to get us through the pandemic and to deal with climate change and the decline in productivity growth that countries have suffered, and then how much of that to think can be politically supported by the people, not mitch mcconnell's group, but what the people would want to be taxed on and what they would want to get. thatine: is there a way inflation comes because of the level of debt? adam: i think that people posit that as a concern, but the

historical record is, with a couple of exceptions, for the ,ast 100 25 years or longer central banks generally have raise rates. ratese seen interest rising. i do not think we will be taken by surprise by some are wind of inflation -- whirlwind of inflation. look at paul volcker, look at in two thousand eight-two thousand 11, i do not think that central banks will mess up. they might be behind the curve a powell as i think jay rightly lead the fed into employment,t whole so they might be a little slow, but this is not a genuine threat of things getting out of hand. the other point is inflation

generally reduces debt, so in the sense, this is optimal policy if you have a little more inflation. francine: and -- there was a real splash on economic growth a few years ago, and the research said be careful here because with the government said on a debt buildup is not efficacious for the private economy. we are now in a natural disaster. does mitch mcconnell and the rest worried about debt, do they have to worry about the mckinsey and multiplier or any of the other theories or did they just loaded up and get the money out it whend worry about the pandemic is over? yes. the simple answer is people who i sighted use to advise the republicans --

but the other point is my team made a huge contribution that that particular piece of their work does not hold up. there is not evidence that that kind of government debt is a problem except in development countries we have massive amounts of debt and a lot of it being funded in foreign currency. tom: we are almost out of time. we could go on for like three hours on this. the singulared, difference here is we are america, we have the exorbitant privilege of the currency and the ability to do what we want with our budget down the road. frankly whatever we want. is that right? yes: for the time being, you have to worry about not wasting the money and having enough legitimacy about what to do with it so you can raise

taxes if you have to and about how much you are putting interest payments on future generations instead of stuff that actually helps them. it's not quite that simple. the other thing is this aorbitant privilege is now widely shared privilege. if you look at the world today, all kinds of governments are issuing an awful lot of debt at awfully low rates. it is about the world changing. that has to be recognized. tom: got to leave it there. thank you so much for joining us. coming up later, mohamed el-erian of the university of cambridge. this is bloomberg. good morning. ♪

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karina: disd is projecting netflix outgrowth for the streaming services. --disney is projecting netflix outgroup for the streaming services. disney plans to spend up to 16 alien a year on content. apple building its own cellular

modems, a move that would replace components from qualcomm. the modem is one of the most important parts of a smartphone had apple bought intel last year. first doordash and then airbnb, the two startups went public and the valuations skyrocketed, i send that both companies could erase a lot more money than they did. 150% above its ipo. therts say the reason for demand was from retail investors and a scarcity of shares. tom: thank you so much. overnight, back to my childhood, the time magazine person of the year gala always anticipated. the president has very much wanted to be on this and he is not pre-they have selected president-elect ayden and vice president-elect harris to be the

person of the year. features deteriorate, negative 37. reallyis is a big deal, giving way on friday. this may be eventful. yieldo-year, the 10 year rather, point 8865. if you look at what we there is sentiment towards the region's most indebted nation. the european central bank announced it w expand -- on globalis, later, wealth. ♪

francine: this is "bloomberg surveillance." still with us, adam posen,

talking about debts and managing debt and everything else. brexitnish yield and kind of go hand-in-hand in dealing with the pandemic, but are we focusing too much on brexit? is this a largely domestic problem if we do not have a deal? adam: yes. i've had the pleasure of being with you and tom for years talking about brexit and they were a number of us that said s up.is where it end a difference about disruption and it is mostly on the u.k. and a little bit on the netherlands and northern france and ireland. ultimately for europe this is secondary as it was treated in the european council meeting last nightm. it is time to get over it as some say if you are not british.

britain, but about just get over it. when you look at brexit, does it mean that the rest of europe will integrate further? does it mean we will have a capital markets union, a banking union? adam: that is a good point. i think it is not yes are no. additionalis putting impetus towards european integration and combined that with that response of the and combine that --europe is more unified than it has been an brexit has contributed to that. use --you mentioned the spanish yield, this is a sign that the

hasstribution of risk really gone up. colleagues represents this as a hamiltonian moment and i think it is more incremental than that, but any market person who at a risk had to have marked it down and that is what you are seeing. of: you are a great watcher german culture. comfortable slipping into some form of charles de gaulle into the 21st century. what part of the german mythology after world war ii can leaders do? adenauer, what is there basis to move forward?

i think the german political culture of the last 70 endedsince the occupation has been extraordinary in the consciousness with which leaders in germany have thought about symbolism and historical responsibility. that came through in the handling of reunification, which was not perfect economically, but was bringing in some terms. ofjust had the anniversary that following on his knees at the war memorial. what happens next for germany, i think it remains the idea that europe is about preventing more and about liberal values.

we have had discussions recently , reaching out to the ayden administration, and i think europe as the world's liberal conscience takes on new meaning. the deal they made on being the walk ofmost over moving any significant and's on climate change. that is going to be defining going forward. tom: discuss how close the building transitioning biden cabinet look to the second term of the barack obama, is it obama 3? tell.it is too soon to it is different. there is a new generation of people for tickly on the economic side, and if you --

particularly on the economic side. this is not the same people who were totally under clinton and obama. there's been a much more emotional deep connection talking about distributional issues, racial justice issues, rule of law issues. i think that commitment is sincere. ofeign policy, the question whether it is a second term obama, that becomes more critical, in the sense that if you start the term with aspirations for specific tradership, transatlantic partnership, and you end it with frustration, so i'm hoping that

moreiden team will be cautious. tom: this is been valuable. thank you so much. the bloomberg 50 much centered on our focus internationally and on the markets, time magazine was the person -- with the person of the year, the president-elect and the vice president elect, with our first news, karina mitchell. karina: the fda could give a go-ahead to the coronavirus vaccine within days. experts voted that the benefits of the shot may outweigh any risks. the fda does not have to follow that recommendation but it often does agree with its advisors. in germany, the neighbor -- the number of daily deaths rose the

much -- the most since the pandemic began. that is increasing pressure on german authorities for a hard lock down over the holidays four states arch the supreme to reject the texas lawsuit and declared the 2020 election over. the lawsuit wants to overturn results in these states and keep them from casting their electoral votes. --nsylvania s the justice ask the justices to send a clear message. news, the u.s. will impose sanctions on turkey from buying a russian missile system. we have learned that the president signed off on a package of measures paid is not clear what they involve. global news --

global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. karina mitchell, this is bloomberg. tom: thank you so much. we are going to talk to david pearl of epic investments. if you need courage in the market, this is the guy to talk to unintelligent value and cash flew -- flow. this is bloomberg.

karina: coming up, reid hoffman and linkedin co-founder, this is bloomberg. ♪ tom: this is "bloomberg surveillance." good morning. heaven forbid we would actually talk about the markets.

david pearl from epoch investments has been doing what he does which is focus on the character the quality of cash flow. the log of amazon, a straight line even higher. david, not only is it a use of cash exercise but a use of growth. i say this after the frenzy of airbnb and doordash and the others. define what use of growth is, for someone like amazon. free cash flow investors and one way to tell if a company is a good steward of is return on invested capital.

we've had a period because of covid where growth companies have done well for tickly those that are internet related our work from home related like amazon. the issue is amazon puts in a dollar and really gets maybe a dollar-five back. it is not particularly efficient in investing money but it has been rewarded for this revenue growth when the economy has been shut down. that is been the story of the throughrom january september 30 or so. ,ince the vaccine in particular the trials came out in november, amazon has lagged and growth stocks have lead. we are now focusing on companies that can sustainably grow profits. there has been a change on the

market. tom: this is delicate. i want to go to this, so important. , i assumepo frenzies you are not participating, and we see almost a manufactured scarcity of equity issuance creating a frenzy. where you sit, does the government have to step in to adjust this manufactured frenzy of limited equity issuance? is just the cycle we are in. unfortunately we have been in a bubble reminiscent of the 1999 where when you do a discounted free cash flow, a fast growing company is worth more even if it barely makes money today.

this is the time we are in. you can see bitcoin doing the same in. towill end badly, i hate say, but the good news is the market has been broadening over the last month and a half and we are getting back to fundamentals to a greater degree. that will not stop the excitement and sizzle of these very high growth companies that go public, but i do not think that will be the case for the market going into next year, particularly the second half of 2021 and forward, back to companies that go with the economic oath of the economy. --growth of the company. tom: -- airbnb,: if you look at is it a tech company? this is a company that could be growing when the economy picks .p

david: they are in a sector that at least will have a cyclical recovery. travel will come back. it is a question of how well they manage it. , they are aer logistics company. they have to make sure no wild parties are happening, if you are in a condo that the unit does not break the rules. they have learned over the years and they are doing better. i am not saying there are not fundamental opportunities, but the valuation at the ipo pretty much discounts and incredible future. if you look at another company like netflix, they benefited by the lockdown, and as we move into a more normal environment, their compares are going to be

hard. they said they had to increase spending, so there cash flow is negative and going more negative as that compares are harder. there are exceptions, and you want to be in the upper center areas, the ones that were hit by covid, travel being one of the biggest ones. doordash is almost the opposite -- opposite. they have and offended by the lockdown hit it will be harder on a quarter by quarter basis to show that growth as people want to go back and eat out at restaurants and go out again. you really have to think about the business model and where the sectors are. francine: if you're talking about bubbles and the search for yields which is made by we are seeing this ipo market. , could this become systemic if they first at once?

david: there's probably a real issue for retail. advent ofe the robinhood so people could buy one hundred share of tesla, that is really change the dynamic petey can see that on message boards. people who cannot get out have become a traders. we have seen this phenomenon periodically. when you look at the man for these ipo's, retail was like 9-1 buyers, institutional were sellers because the price doubled in the first day. francine: thank you so much. david pearl from epoch investments. up next, dr. andrew pekosz from john's hopkins, a public health professor, looking at the number

of cases and deaths. this is bloomberg. ♪

karina: this is "bloomberg surveillance."

oracle has come out with a forecast for revenue, a sign there is improving demand for this software company. oracle says sales jumped 33% last quarter. most employees at apple will not return to the office until june, the word from tim cook. has had success during the pandemic and it could lead to more working remotely. way aroundas found a his old firms demand for returning more than $10 million, he is giving the money back to charity. that is the bloomberg is this flash. francine: thank you so much. as we track the virus, bloomberg has developed a unique

partnership with johns hopkins. every day we bring insight from experts in public health experts and emergency preparedness. joining me today is andrew kosz. why are some people still -- questioning mask wearing? dr. pekosz: sisi guidelines suggest we should be wearing masks even at the work place. i am currently at work and i am wearing my mask. we've seen record number of cases the week after thanksgiving, two weeks after big skimming and that we are seeing record numbers of deaths here in the united states, things we knew were going to happen and things we know how to prevent. need a much better commitment here at the united states to try

in this pandemic. francine: will people relax the rules too much feel like they will not be affected because we are a couple of weeks away from the vaccine being approved in the night dates -- united states? dr. pekosz: i hope not. the expectation is that it will until sometime in the next calendar year. the fda hearing yesterday went well, and the plan brought the vaccine in frontline health care workers and residents in communities is all in place, but the vaccine supply will come through an a measured manner and it will not be widespread for some time. we have to do something now. we cannot wait for the vaccine. vaccines some of these

are not recommended for women who are pregnant or children under 12, people with severe allergies. why? dr. pekosz: this is the next most important question, the pfizer trial and the moderna trial next week both focused on individuals between the ages of 16 and 90. what was excluded from those groups are children under the age of 16, pregnant women and several other groups. that is not to say that the vaccine has some sort of extra concerns for those groups. they just have not been studied yet to make sure that the vaccine is safe in those groups. but the fda clearance allows is now say the vaccine has shown efficacy and safety, and now we can move to some of these other groups which are important to

immunize. pregnant women are a perfect example of a group that is often avoided in clinical trials, but is incredibly important to protect in a pandemic. we will be moving to those groups soon, as soon as we get more data for safety and efficacy for those groups. which was to countries --what happens to countries for the treasuries do not have the kind of access to funds? dr. pekosz: there are several initiatives that are going on to make sure we get a global distribution of vaccines paid we have to remember here in the u.s. and europe, we can deal with the pandemic here but we have to deal with it globally. otherwise we will continue to see cases and continue to see the virus spread.

we have to have a global response to make sure we tamp down infections everywhere in places that are economically disadvantaged, they need to get help to distribute the vaccines there safely because that is part of what we have to do in a global pandemic. francine: thank you so much. kosz from john's hopkins. tune in everyday from experts from john's has spent --johns hopkins on a look at the coronavirus. next, more of "bloomberg surveillance." ♪

how do wages go up when? some people are out of work? >> the important thing to keep in mind as we are starting a brand-new economic cycle right now. >> there is going to be a lot of investment and spending. >> the stimulus is not there yet. you have a complete lack of coordination. >> the central banks have locked themselves in. >> it is not that we will not grow, it is will there be enough? >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. new york andm london, good morning. this is "bloomberg surveillance" radio. bloomberg tv and tom keene with me. lisa abramowicz taking the weekend off. another uncomfortable 24 hours for the global economy. jobless claims in america going the wrong