he'll continue to work with president trump as the house moves on impeachment. there is no sign trump will resign. the fbi warns of armed protests ahead of joe biden's inauguration. europe heads for a double-dip recession. j.p.morgan and ubs cut growth prospects for the start of 2021. u.k. prime minister boris johnson warns that he may tighten lockdown rules in england. plus, ubs stands by its chief executive. the swiss bank's chairman reiterates his support for ralph hamers. we'll hear from our exclusive interview with axel weber. good morning, everyone, and welcome to "bloomberg surveillance." i'm francine lacqua in london. tom keene in new york. frankly, there is no other story in the world apart from what is happening in the u.s. right now with the democrats nearing proceedings to impeach president trump. the other story is lockdowns. not only vaccines but just in the u.k., could tighten lockdowns in england. i'm not sure how that is possible given where we are in london. there is word angela merkel is

prepared to extend some of the measures taken until april. ," i saw the success -- tom: i saw the success of israel versus the known world in getting out the vaccinations. you are right, there is no other story. we will bring you the events throughout the morning. the president meeting with the vice president yesterday, what we will see on tuesday and wednesday. far more than that is the drama, and for republicans and democrats, the new measurement of the hurt inflicted by the siege at the capital. -- at the capitol. francine: let's get to first word news with ritika gupta. ritika: vice president mike pence is signaling he will reject demands to immediately oust president trump in the wake of the riots at the capitol. they met for the first time since the president's supporters storm to the building. they agreed to work together for

the last few days of the president's term. house democrats are pushing forward with their plans for impeachment. tension is growing in washington, d.c., in advance of next week's auger ration -- inauguration. could be warning there armed protests in all 50 state capitals come and the abrupt resignation of acting homeland security secretary chad wolf added to the crisis. loyalists.it trump punishing congressional republicans to overturn joe biden's election victory. they are vowing to pull their campaign contributions following the riots at the capitol. the company has ranged -- the companies have ranged from goldman sachs to dow chemical to at&t. they are demanding that josh hawley give money back.

and an unusually upbeat projection of chinese's future. challenges posted by president trump's america first policies. she expressed confidence that china would gain in the long run. global news 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more i am ritikantries, gupta. this is bloomberg. tom? tom: thank you so much. equities, bonds, currencies, commodities. inures up, the vix comes from a 24 level down to 23.3. i am going to call it an equity churn. francine is riveted by bitcoin. i will let her talk about bitcoin in a moment. year,ercent in the 10 curve steepening out to a full stick, one percentage point. the dollar churning. lots of fx calls. i want to emphasize their has been a research shift from weak dollar to dollar neutral.

that is at deutsche bank, george james lordublishing, and morgan stanley publishing. mccormick -- i got it. francine, i'm just waking up. mark mccormick just killed it yesterday on not a dollar neutral call but a dollar strong call. francine: you are like me. it feels like day 155 of homeschooling. tom: the week is almost over. francine: i spoke with a bitcoin miner earlier, tom. tom: why did i not know that? francine, what is a bitcoin miner? francine: ok, two stores. first of all, tom, the concern with bitcoin miners, the amount of bitcoins -- eddie van der walt prepared me for this --

there is a lot of energy. if you look at some of the energy that bitcoin miners use, it is as much as a small eastern european country in some cases. a needs to change with the times and become cleaner. then central banks start issuing cryptocurrencies. does it mean that they need miners? but we digress. let me go into my data check. equity and travel chairs among the top stock change in europe. bitcoin at 36.95. that is what bitcoin is doing right now. -- 36095. that is what bitcoin is doing right now. otion for mike pence to ousty on the president.

if that does not happen, there could be an impeachment vote on wednesday. from impeachment -- for impeachment to work, the senate needs to vote a majority on it. 75% of senators need to say yes to it. what is the likelihood that will happen? >> they need a two thirds majority. the likelihood of that is very small, even smaller that this would happen before trump leaves office. in terms of the calendar, it is almost impossible because the senate is in recess until -- even if a trial happens after trump leaves office, the odds of getting 17 or so republican senators to revolt against trump are very minimal, and that is based on what has happened in the past. time after time after time, donald trump has faced challenges. we saw impeachment 1.0, there is very little reason to think the outcome would be different this time around. be fuminglicans may privately about what they saw, but i think turning publicly

against the president is something different. stillne: why are they with the president? are there a number of republicans that are scared of further divisions if we go into impeachment? are they worried about retaliation because trump will stay within the republican party and hold power, or do they think he was right in inciting the mob? >> i think it is a combination. i think it is largely being set up as a dichotomy between accountability on one hand and healing divisions on the other. clearly inciting insurrection is an extremely serious charge. whye is every reason to see both democrats and republicans think that president trump crossed a line and there need to be repercussions. at the same time, there is the thought that he may only , andgate the far-right

make trump a martyr to certain elements of the far-right. if trump ultimately doesn't face a conviction, this would allow him to loom even larger over american politics, potentially keeping his aspect of a 2024 bid alive. the long-term implication of this might be to reinforce political divisions. that needs to be priced in. the bottom line is that donald trump still maintains considerable support among 30% to 40% of americans. his base stuck with him through thick and thin, and many republican congress members know that support is not fragile, even if he is starting to win. tom: sophie alexander and company report on how the money is being cut off. the money is being cut off to the trump family, and the donations are being cut off to people who are in support of some of these themes -- j.p.morgan and others saying we are not going to give anymore. i think comcast was mentioned as

well. discuss the constraint of no cash flow coming into the political machine known as the republican party. something that is very important. when it comes to some of these sponsorships, one of the things that gutted trump the most was the fact that the pga tour has withdrawn their support from one of his golf courses. but the republican party, the establishment, the machine has to be concerned about this. money doesn't make or break candidates. a lot of times people looking at the political science literature, it is difficult to disentangle whether candidates doing well attract money or whether money allows candidates to do better. needse republican party those campaign contributions to be coming in. it is important, thinking how this party is going to go forward. this is a big deal. money talks, and if enough donors say we are not going to support this anymore, we are

just not going to -- tom: they are saying that, so what is the seachange coming out of this debacle? if we move onto president biden and a focus on primaries, 2022, and all that, assuming these corporations don't turn the for people on supporting the allegations of election fraud -- i'm using that -- what arelks the ramifications of june, 2021? thomas: i think it all depends on whether donald trump wants to put his hat into the ring in 2024. he did finance a portion of his campaign from his own dollars. congress members, statehouses and so on, they need money to win, and they are going to be very, very concerned about this. maybe it is ultimately the money that is going to speak the loudest volumes, because until this point, very few congress

members -- despite what they say in private -- have been willing to turn publicly on the president. maybe the dollar figure is what they are looking at. francine: is their appetite from joe biden to actually go through with impeachment processes in his first 100 days he echo thomas? thomas: at this point he has been fairly quiet about it. i think a senate trial and the media attention and frenzy that comes with it has the serious potential to distract from his agenda for his first 100 days. most signature latest late of a -- mostnts get done signature accomplishments get done during that period. backisks of may be pushing the senate trial, which has been proposed by jim clyburn, is that you lose some of the momentum

here. we would not be in the immediate aftermath of the capitol hill storming. tempers might cool a bit, and maybe there is less of a chance of getting 17 or so gop senators on board to turn against trump. given the calendar, there is no ideal outcome for democrats. just engaging in a cost-benefit analysis of how to move forward. tom: professor gift, thank you so much. going forward with this discussion, futures up 10, dow futures up 68. joining us in a really timely fashion, given the stimulus will look to come, assume president glenn hubbard, bt and rising interest rates. this is bloomberg. stay with us. good morning. ♪

>> china continues to be recovering well, and with the opening up, it was decided in the last five-year plan, that is a golden opportunity. at the moment we want to see the dust settled first on international relationships, on china's role in the global economy. -- atwill not rollback the same time, new tariffs will not be added. we will probably see a double-dip recession in europe where the first quarter will be quite negative. and where there is a carryover into the first quarter this year, we expect a pretty strong rebound in the year 2020 would

-- and the year -- in the year 2021 and continuing into 2022. i would expect the normalization of monetary policy to be the right answer. i doubt the global central banks will give that answer anytime soon. axel weber of ubs with tom mackenzie. obviously representing union bank of switzerland. right now representing bloomberg joins us as guest we talk about any number of themes of european banking. let me start with something that maybe axel weber alluded to there with his struggles. is this the year where we see consolidation in european banking? -- good morning, tom. i think we are seeing some consolidation kick started, another wave of it kick started again last year with a pandemic. markets seen that with

mainly in spain and italy. there is some hope that at some point we will also bring another wave of consolidation that will be more cross-border to create real european banks that operate across multiple markets. the predominant expectation is that it is a little too early for that to happen because the constraint across that cross-border consolidation still exists, mainly regular asian and oversight making it difficult for banks to move around capital across borders still to this day. add to that the fresh wave of the pandemic and a hit on the economy, that creates more uncertainty that i think makes it difficult for a bank manager buy anotherlead and big bank in the country. tom: we will talk about american banks. bank,ure bank, deutsche

but separate from that is the state of deutsche bank. from where you sit with all of your experience, is deutsche bank america's separate and removed from frankfurt? elisa: deutsche bank had been getting to a place where, if you look at the headlines over the last 6, 12 months, it is becoming a little more boring, which is probably what it wants to be after having obviously some tumultuous years, marked by various allegations and investigations, various wrongdoing across the globe. it has struggled to generate profit. it really seems to -- things are turning a corner. it has obviously been buoyed by the strong marketing 2020, but there is optimism, they are finding their stride. clearly what we are seeing in the u.s., particularly what we around the financing

that involves donald trump could bring them draw -- could certainly draw headlines. francine: there is also talk that credit suisse is considering bonus pools by as much as 10%. how different with this be from their strategy in the past? elisa: i think what you are seeing right across the board is many of the investment banks, many of the banks that have businesses working extremely well last year posting a profit, but of course they have two take into context the broader state of the bank, and if you look at credit suisse, they are on course to post a fourth-quarter loss because they are setting tackle legacyo issues, and the bank cannot ignore that when it is projecting for the year.

across the board, you are seeing bonus pools rising maybe 10%, 15%. this strong is banks are reflecting that at a group level, and i think it will come down to huge discussion and a huge variance between top performers and the bottom performance. martinuzzilisa joining us on the future of banks. capitalp on the open, market cochairman. this is bloomberg. ♪ so you're a small business, or a big one. you were thriving, but then... oh. ah. okay. plan, pivot. how do you bounce back? you don't, you bounce forward, with serious and reliable internet.

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ritika: this is bloomberg surveillance. here is the bloomberg business flash. two of donald trump's favorite banks are pulling away from him. deutsche bank will refrain from further business with the president and his company. the president owes the german letter within $300 million. new york's signature bank is cutting ties while president -- while pressing for the presence up a resignation. softbank group's vision fund is selling $2 billion in overstock, signaling it may cash and more gains in the future. uber stock. signaling it may cash in more gains in the future. twitter has stepped up its

enforcement in the wake of the riot at the capitol. it has now permanently banned more than 70,000 accounts qanonted to sharing conspiracy theories. that is the bloomberg business flash. francine: this is what the markets are doing right now. they are more stable than they were yesterday, may be bit of profit taking or investors, tom saying, economic prospects for the world are not as bad as expected right now, and also a bit of, i guess focus that what we see with the vaccines will just improve. if you look at u.s. futures, they are trending higher. travel shares in europe amongst the top gains, and bitcoin prices resume their advances, aboveng above -- it was 36,000, now up 35,183. tom: i am going to go to brent crude. this is important as commodities continue to lift and oil continues to lift.

56.52 on global oil as well. we are going to do much more for and weough the morning, have political coverage all over bloomberg news. our kevin cirilli with sound on nationwide on bloomberg radio, with the democrat from richmond, virginia. i can't believe i'm saying that. the democrat from richmond, virginia, on all that is going on, just, what, 40 miles to the northeast in washington. well, up, james athey as of aberdeen standard investments. james athey on the state of the markets, and the new neutral dollar strategy. this is bloomberg. good morning. ♪

♪ this is bloomberg surveillance. this is what we are looking at

in terms of the markets. the market is more quiet than yesterday. a lot of the focus is on politics and what happens in the final 8 days of the trump presidency. to talk about the markets and treasuries and much more on negative rates after comments from the ubs chair is james athey, aberdeen standard investment director. how problematic are treasury yields? fed,: if you listen to the not problematic at all. i have been surprised as to how relaxed they seem, how complacent they seem. we know from history, they don't always have a perfect understanding of how financial markets operate. for me, cheerleading from the givennes is a risky game how fragile the situation is. of course you see the mechanical

recovery in gdp but stimulus is required to get to this point which i don't think anybody would suggest is sustainable. it does raise questions about why you want to push yields higher at this stage. at technical levels, we saw interests by in march around 127. waslevel around 129 which to mention this morning. 127 to 130. $4000ou bought bitcoin at you are at $35,000 at bitcoin. it is fibonacci or some mathematics. i am not a big fan. continue, francine. francine: he is italian, tom. you can fault him for many things. even his nationality. james, when you look at some of the treasury yield levels, you

say they are not problematic. is there a level that would bring concern to the rest of the market or is it how quickly they get there? james: i never have agreed to this notion of how quickly we get there. realistically, levels match up. we saw in 2019 when the economy was at full employment and was growing strongly and the fed was taking back some of the gargantuan stimulus of the previous 10 years that equities were vulnerable. this situation here is not comparable in terms of the economic stages. problems to deal with because this has been a huge income shock. we are going to see elevated unemployed it for quite some time. there are also structural changes going on at the same time. fiscal policy has allowed us to get to this point, hounding money to people directly rather than letting consumers at

subsistence levels. adon't know whether there is line in the sand, but think -- i think it is lower and i think we will know when we get there. tom: two questions. let's start with the dollar. we are seeing wall street shifts from a successful dollar strategy over to neutral dollar and a few talking strong dollar policy. yourw it is a way from remit, do you have a feeling the dollar has moved in us and the ambiguity cliques in and higher rates means stronger dollar? james: fx is in my wheelhouse. it is a frustrating market. int i am seeing today and the first few trading days of this year fits with my prevailing thesis. the market can sentence of 2021 was higher yield, seeger yield curve and all of the performances being large 12

event -- large relevant to global equivalents. some u.s. equities rising more than global equities. we are seeing that because it is a u.s. specific growth boost coming from expensive u.s. fiscal policy that has an effect on the rest of the world. this is u.s. exceptionalism and that is an open shut case for dollar strength. the notion for dollar weakness uess that it may get larger. we are seeing that play out this year. tom: i want to go to an incredibly important story by marian out of europe on ubs. we have all been waiting for this, where the banks capitulate to negative interest weights and they start -- negative interest rates and they start charging their bank accounts at a lower level for the negative interest rate reality. toe 607,000 dollars

$280,000. they are going to charge you for the privilege of holding her money. what does that mean for the european financial system where retail banking finally steps in and the effect of negative interest rates is felt by the public? awful, tohink it is be honest. the economic theory underlying this looks like a swiss cheese. he reality is if you can charge consumers for holding money in their bank account, that is not an incentive for them to go start spending that money to support the economy. the reason interest rates are negative is because the economy is incredibly weak with all sorts of challenges and that has been the case for one decade or more. i don't think is going to change anytime soon, certainly not by taxing consumers and making banking an unprofitable business. i see this as being another step along the route to sclerosis in the euro zone. francine: thank you so much. james athey of aberdeen standard

. we will talk more about this sclerosis. let's get straight to bloomberg first word news. ritika: for the first time since trump supporters storms the capital, the president and vice president have met and the president is signaling he will reject demands to out the president. last week the president publicly criticized mike pence for not rejecting ballots during the county at the electoral college votes. the democrats are planning an impeachment vote. kevin mccarthy is still imposed -- opposed to impeachment. republicans that the president has acknowledged having some responsibility for the riot at the capital. downbelichick has turned an offer from president trump to receive the presidential medal of freedom. the six-time super bowl winner from the new england patriot had agreed to receive the honor, but

that was before last week's riot. it was a record day for coronavirus vaccinations. it rose by 1.20 5 million according to data collected by bloomberg. there have been complaints about the slow rollout so far. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. i am ritika gupta, this is bloomberg. tom: coming up, francine mentioned the lockdowns. vaccinations, a quarantine. johns hopkins center joins us. futures advanced up nine. stay with us on this tuesday. this is bloomberg.

♪ this is bloomberg surveillance. james athey.ith you look at what is happening in the u.s., europe and elsewhere, where you want to put your money -- where do you want to put your money? james: u.s. exceptionalism is not something fleeting. i think that the structural set up of the u.s. economy allows it to ride out storms and return to more cyclical activity. i think the cyclical outlook is stronger than anywhere else. the problem i have is i still have this notion of value in understanding the price that i am paying and what exactly i'm getting for that. i am that second filter -- that something -- second filter does

not leave you with many options. i think the u.k. market is still cheap. investors have been assuring the u.k. because of the brexit scenario and the brexit deal is a meeting -- the brexit deal is amazing. i think there is some value still in the u.k.. i think there is some value in japan, a lot less than there was six or 12 months ago. we are struggling to find anything cheap because we know the price has pushed up on just about everything. francine: what part of the u.k.? don't want to have a whole heap of cyclical exposure. partly because of the brexit stuff we just talked about, but also just the makeup, the sectoral composition of the ftse

100 lends itself to the environment we are seeing which is to say we are seeing a u.s. dollar which is marginally under pressure and has been for quite some time that is pushing commodity prices higher. we have also seen yield curve steepening and given that you can market has a decent amount of commodities and financial services, that is a decent tailwind. we will see sterling weakening for a global exposure. a weaker sterling is good for the domestic currency earnings. and thecal tailwind u.k. is cheaper than most. tom: does the united kingdom service sector rebound when this is all over? there is an assumption of that in america. is it the same assumption there? james: i think so. services covers a multitude of things. one would have to be careful about to all-encompassing in describing the service sector.

a lot of professional services in the u.k. and things we have been able to export, that is going to be disrupted not because of covid, but because of our changing relationship with the european union. long-term term, absolutely. the industry can adjust as necessary and be successful short-term. it might be trickier. with respect to covid, you have the parochial services, local services which are provided by small and medium enterprises that involve a lot of human interaction and face-to-face hairdressers, restaurants and bars, these sorts of things, there's much more disruption there and that side of the u.s. and the u.k. economy is going to be challenged for a lot longer. i am not as convinced that consumer behavior will revert as quickly. that is the area of the economy where we will see some of the severe supply-side instruction. -- supply-side destruction. what that means in terms of pricing power and the strength

of businesses that managed to survive, i think the reality and the costs of that impact on the economy are yet to be known and i think they will be larger than many are suspecting. ultimately, the recovery and things will normalize, possibly trickier than some hope. francine: thank you so much for joining us today. 'smes athey, aberdeen standard investment director. directorachs senior joining us shortly. this is bloomberg.

ritika: this is bloomberg surveillance. check out is valued at $3 billion after a $450 million investment led by china global management. the valuation is a most triple what it was valued. the company processes companies such as pizza hut. 35 fighter jet is being cloned in 8 other countries but

it remains marred by software and hardware deficiencies. have issuesms could with maintenance. with upss teaming up to test the use of 5g drones to deliver packages. the company touted the ways that theill change the world as consumer electronic show in las vegas. they are trying to get consumer businesses to embrace the new network. t bloombergr lates business flash. tom: it is important to understand somehow wall street continues forward. we will get to that in a moment. a conversation with martin chavez of goldman sachs. martin: the core business model has some challenges that remind me of the pre-regulated banks

business model challenges. it is nothing particular to these companies. it is just in the nature of unrestricted profit maximization. if your business model is maximize profits, like every good capitalist enterprise, and if your model is, maximize profits by maximizing revenue, and you maximize advertising revenue by maximizing engagement and time on site and we maximize engagement and time on site i ,aximizing emotional resonance particularly outrage by confirming biases, as we have seen, this has led to all kinds are classicces that externalities. it is no different in principle from a company that is making some chemical product and flushing its waste into a river. that you saying that you

are more concerned about the facebooks and twitter's of the world than you are about the amazons of the world? it is my nature to just be concerned about everything and everybody. it is really a classic concern of antitrust regulation, whether anti-competitive behaviors that happen when a company has been wildly successful and what happens when you have completely unrestrained profit maximization. but now the banks have been restrained by having capital and liquidity requirements. and the whole idea of the banking regulation is that, in a negative event, the banks still have collectively for sufficient -- collectively sufficient capital to capitalize themselves. the same principle applies to the tech companies. it happens with every industry going back to automobiles, oil,

telecom, you name it. the industry becomes sufficiently powerful and it is doing what capitalist enterprises are supposed to do, maximize profit and in the government has to tie those profits to externalities. tom: martin chavez of goldman sachs with a voice on the risk forward for global wall street. we can continue this discussion but last night, sophia alexander and others brought important news on the future of the president's family. sonali joins us now. island,e bank, long they started it up, they handle private accounts. they are going to return $5.3 million to who? ivanka? sonali: she was on the board of the bank for some time. to donald trump themselves --

for donald trump himself, they are looking to distance themselves from the longtime client. they are doing it at the tail end of his presidency. they did react directly to the riots and had said that they would -- they believe it would be appropriate for trump to resign. tom: where does the president put that money? jp morgan says no on corporate donations to washington, all of them that you report on every day, if they get a check for $5.3 million, where did they go with it? sonali: this is interesting because there has been discussion about trump trying to broaden his brand. --you start to look brought abroad, deutsche bank is also distancing themselves from donald trump at this time. up a christmaset

club account of commerce bank. $300 million, everybody says that is a local number. you are the expert. what is the real number? sonali: i think that is a fair number. deutsche bank has come along way and trump's own banker no longer works there. she resigned recently. while deutsche bank has not said anything on the record about their relationship as signature bank had done and called for resignation of trump, according to our sources, they are distancing themselves from him right now. what becomes of the $300 million worth of loans. francine: are we going to see more banks to the same or have they already done the same? how difficult is it for wall street supporters to distance themselves from trump now? sonali: it is not just about trump anymore. you are seeing the big wall street banks start to pause political donations. if you are jp morgan and citigroup, you are pausing it to

both political parties. a political memo reacted directly to money that was directed toward josh hawley in 2019 and what they had said was that they won't be supporting candidates who do not respect the rule of law. it does go beyond trump. you see morgan stanley halting donations to people who had supported going against the biden certification. you are seeing goldman sachs considering the same decision. it does go beyond trump although the trump question itself, it does become a complicated story. francine: if you look at banks on both sides of the atlantic, what is their biggest concern for 2021? i know it is different in europe because they have to deal with negative rates but overall, it is what to do with the economy and bonuses. sonali: i they that there are long-term risks because a lot of the damages are not happening

tomorrow. pressures in the commercial real estate market that are ,nderlying these banks and also it depends on what biden does. there are evictions around the corner. there are a lot of loans that are currently facing moratoriums right now. once you start to take away the band-aid, what does it look like? tom: it is president biden, he is a democrat. democrats have dealt with wall street for years. what is your perception about president biden and wall street? sonali: one thing that is interesting so far, and you this,marty talk about they are welcoming regulation to some degree. i can say it with a straight face. talking about a stress test and saying we did not mind having a stress test on the financial firms. they expect regulation, not just from biden, but from everybody else. is someoneant to see

taking care of global relationships. tom: i have more questions and not enough time. thank you so much. an important story, i saw margaret collins driving forward that bloomberg story last night. coming up, an important interview. he is someone associated with growth matters. glenn hubbard, former chairman of the council of economic advisors. your growing and deficits. the vix, down .85%. this is bloomberg. good morning.

♪ tom: this morning, will speaker

pelosi move forward impeachment of the president for being engaged in insurrection? she awaits the vice president. the president blamed antifa people for the siege, according to axios. bankdent trump's personal will return $5.3 million and says trump should resign. deutsche bank is done with trump. at some point, they would like a return of over $300 million. you remember the markets, yields move ever higher. good morning. bloomberg surveillance in new york and london as well. there is such a focus on america. i really want to start with the united kingdom. 30 or 40at headline minutes ago of a further locked down for 10 days. what