francine: impeached again. donald trump becomes the only president to be impeached twice. he now faces trial in the senate. treasury yields twice, now that by them plans a covid relief package of $2 trillion. his inauguration is in six days. after giuseppe conte's junior coalition r&r pulls out. good morning, everyone. welcome to "bloomberg surveillance."

i am francine lacqua here in london. it is a big news with a lot of things we are looking at, and sometimes these things happen, so pardon the voice. there is a new package, according to new deal reports, but it is certainly changing the way the market is looking at treasuries. it is pricing joe biden to propose one point $3 trillion in spending, according to a person familiar with the story, speaking to bloomberg a bit earlier. the italian 10-year yield a bit earlier, whether giuseppe conte will stay in power. there is quite a lot of news on m&a after france saying they will rebound the advances of the canadian giants. a lot of news in the markets, determined by a lot of news and politics. now let's get to the bloomberg first word news here in london. with me is laura hi, laura.

laura: hi, francine. joe biden's covid relief package, the channel reports his aides have said ahead of the announcement, it is likely to include direct payments to americans and state and local funding. twitter is standing by its decision to ban president trump. ceo jack dorsey says it was the right decision in the name of public safety, but he sees the move as a failure to promote healthy conversation on the platform. meanwhile, airbnb is canceling reservations in washington areas next week, and moved designed to minimize any violence at president-elect joe biden's inauguration. italy's government is on the verge of collapse. a junior coalition partner has put out, wait means -- which means prime minister giuseppe conte no longer has majority in parliament. conte may step down, leading to a new round of coalition talks or a new prime minister. 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 laura wright. this is bloomberg. francine? francine: laura, thank you so much. malcolm president trump has become the first president ever to be impeached twice. the resolution was approved by all democrats in the house and 10 republicans. the president was accused of one count of incitement and of insurrection. the senate has already rejected requests to bring voters back on the pandemic to here are some of the comments on the debate on the houseful get -- house floor yesterday. speaker pelosi: we know that the president and cited this insurrection, this armed rebellion against our country. >> there is no way to help the country deal with the tragic events of last week that we all condemn. >> if we impeached every politician who gave a fiery speech, this would be deserted. >> he must not be remaining in

power and a longer. >> we must impeach and remove the president. >> if inciting a deadly insurrection is not enough to get a president impeached, then what is? >> nearly half the country supports our president. this takes their voice away. >> a vote to impeach will further flan the flames of partisan decision. that doesn't mean the president is free from fault. >> and he is capable of starting a civil war. he must be impeached. >> this must be extinguished immediately. >> last week, there was a domestic threat at the door of the capital, and he did nothing to stop it. i will vote yes on these articles of impeachment. [applause] francine: joining us now is peter trubowitz, international relations professor at the london school of economics. why do you think so many

republicans in the house actually suffer president trump? prof. trubowitz: i think the answer there is trumps hard-core supporters are still with him. that is what the polls show. so i think that many house republicans feared a kind of backlash from trump supporters. they basically tried to have it both ways, to condemn the insurrection and the attempt to sack the capital last week and to stick with the president. i think the bigger issue is what will happen when this gets up to the senate. francine: what do you think will happen, peter? i think there were nine or actually 10 representatives voting for impeachment. what does that say, that we have the 17 needed? prof. trubowitz: well, i mean, that is a steep climb still.

a lot of this depends -- it does not only depend on what pelosi does. she is going to send the papers out. it does not only depend on what mitch mcconnell decides to do, whether he moves, as reports suggest, toward conviction, and makes it possible for senate republicans to do the same, and it does not only depend on what president-elect biden does. it depends on, i think, in part on what president trump does over this next week. if trump -- and many people fear he will do this -- moves to pardon himself and his loyal followers who tried to sack the capital, i think it will be very hard for a lot of republicans, um, not to move to convict. so i think there's just a lot of uncertainty here over the next week or so, as we move towards a senate trial. francine: ok. if the senate does not convict

him, peter, what future, politically, does donald trump have? can he actually split the republican party? prof. trubowitz: um, possibly, you know, it is possible that he would still have a future. a lot of that, i think, will depend, first of all, on what comes out as the investigation of the insurrection takes place. i fear that the other shoe has not dropped and that there will be more information coming forward, and you heard allusions that yesterday, even by members of the house republicans who voted not to impeach. they are worried about more information coming out. moreover, there is a possibility here that, you know, that biden or that the congress calls for some kind of 9/11 or warren commission that really investigates this in such a way that, you know, that trump is

damaged in the process. the purpose not to damage trump, but i think it will be very difficult, given all his actions, to kind of block the peaceful transfer of power here, for him not to come under, you know, considerable scrutiny. so i think it is just very hard to say. francine: professor, is there something that would actually convince trump's base that he is not right for them? and how does joe biden and the new administration move the focus from constantly talking about president trump to what they will be doing? prof. trubowitz: i think the latter will be difficult. for biden, he basically has to make sure that his administration is not consumed or subsumed by the senate trial, so he has got to try to keep a safe political distance from it and get the senate to focus, you know, on confirming his cabinet appointments and his agenda. i would look for, and i would recommend, if i were biden and

one of his advisers, to hold regular, perhaps daily, news conferences, to keep the public focused on defeating the pandemic and putting people back to work, kind of underscoring that those are his priorities, not what happens to donald trump. francine: is this, i mean, what should joe biden's priority be? if you look at the covert relief fund, there are various reports of him doing that. is this what the american economy needs right now? prof. trubowitz: yes, i think this is what americans are expecting, so i think he needs to move very quickly on that, and i would not be surprised to see it followed by an infrastructure package, to basically put as much pressure on the republicans, to peel off some republicans, you know, around a kind of industrial policy of some type, but an infrastructure policy, most fundamentally. so i expect to see him move in

those kinds of directions quickly. there will be republican pushback, especially in the house, and you asked the question of -- how do republicans stop thinking about donald trump? focusing on joe biden and pushing back against biden's agenda. that is the way to change the conversation. that is a very partisan outlook. francine: thank you so much, peter trubowitz there, international relationships professor at lse. coming up, we will look at the markets. 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. powered by the largest gig speed network in america. but is it secure? sure it's secure. and even if the power goes down, your connection doesn't.

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francine: economics, finance, politics. this is "bloomberg

surveillance." i am francine lacqua here in london. let's get straight to the bloomberg business flash, here's laura wright. hi, laura. laura: hi, francine. the french government is opposing a deal, with the finance minister saying the pandemic highlights the importance of the country controlling its food supply. he says a rule on the screening of foreign investment could allow the government to block the deal. standard charter is positioning a singapore resident to replace ceo bill winters. sources tell bloomberg that simon cooper, who runs the investment bank and commercial operations, has been taking developing and leadership courses to prepare him for the top job. no word from standard chartered. could space be the next investment opportunity? kathy woods is launching a space etf. the actively managed fund will track companies engaged in exploration and innovation, after massive inflows this year,

her niche firm now oversees $41 billion in etf products. that is the bloomberg business flash. francine? francine: laura, thank you so much. joining us to talk politics, treasury moves, and the dollar is toby nangle, global head of asset allocation at columbia threadneedle. toby, welcome to the program. are we looking at the reflation trend to continue -- reflation trade to continue? toby: the reflation trade has a good -- it has everything you would be wanting for that reflation trade to carry on its way. the news overnight, while it is hardly surprising, the $2 trillion number, is just another brick in that while. francine: what does that mean, toby, for what you expect treasuries to do, and how does that change your investment strategy? toby: so, we have been seeing slight outlooks on treasuries, a

breakeven, 10% on the 10-year, a lot of road has already been traveled. as i mentioned, the narrative is in place, and the narrative, i think, is going to be important. the question from our perspective is whether that narrative becomes reality, and /or whether it trickles out. at the moment, it seems the narrative has got at least another 4, 5 months to run before we see that reality comes through, with rising core inflation measures coming through, clearing out consensus about the right place for fiscal. from an investment perspective, we have not completely thrown out the non-reflationary narrative. we have still got some positioning and some high-quality u.s. funds, which would not really benefit from that reflationary narrative, but we do have a victim visits on asia and japan, which is part of that cyclical, which does benefit from the narrative, and as such, i think we are

positioned quite well for this. we have not got a lot of duration on the bond side. francine: so duration on the bond side, what exactly are you interested in in asia, toby? toby: in asia, i have got positions on japan, korea, taiwan, and also positions across china. now, those china positions have obviously been in the headlines, in the headlines with action and the impact on that, but on the reflationary scene, that has really benefited korea and taiwan, especially with things like shortages, pushing up prices. francine: where do you see, toby, valuations being risky or equities running hot? toby: yeah, i mean, so, the valuation cases, in aggregate, the thing which makes equities not look expensive is the

context of low bond yields, and as such, that reflation theme and the degree to which it can unsettle bond yields is fairly pivotal. so we are fairly comfortable with u.s. 30-year treasuries, up to around 2%. beyond that, that starts to get quite problematic. other places, i mean, there's obviously individual stocks, and there's lots of stories about that all over the place, but other than that, you know, in the context of a supported monetary policy, increasing fiscal support, we do not see that valuation look too stretched. francine: is there anything to do with gold right now, toby? toby: um, we are not really making a play for gold right now. gold, the way in which i think of it, as a player that can take you from one regime to another. bitcoin is another asset that

has seen an explosion of interest. that is not something we are going into, because we do not see the threat to the monitoring environment to be sufficient to explore those sorts of trades right now. also, a rising yield environment, albeit limited, is not going to be one that we see that will be conducive to gold right now. francine: toby, thank you so much. toby nangle from columbia threadneedle stays with us. coming up, treasuries slide on reports of biden's $2 trillion proposal. how much can they slide? we talked treasuries next, and this is bloomberg. ♪

francine: live from london and around the world, this is "bloomberg surveillance." i am francine lacqua here in london. it is a beautiful shot. treasury yields climbing follow reports that president-elect joe biden is planning for $2 trillion of stimulus. joining us now with the very latest is bloomberg's dani burger with a look at the

markets. how much is it that yields are actually moving too far, too fast? dani: francine, we are learning more about investors who are rattled at this point, but it goes further than that. he goes to the fact that we heard more fed speakers, four at this point come out of 18, starting to say that they are thinking about thinking about starting to reduce those bond purchases, so the threat of caps pulling back. also concerning we might get something such as the 2013 taper tantrum. we see more strategists and market players are starting to say this is what they had their eye on. we do need to remember, though, that the market is wildly different than 2013. they are still developing their toolbox. communication is down, at this point today. also, if you look at where 10-year yields are wary,

pre-pandemic. so this story, why aren't yields higher at this point, especially considering we were sent to get a big fiscal expansion, risk assets are at all-time highs, and we are expecting a big global growth pickup at some point this year. so the fears are out there, francine, but perhaps unfounded at this point. francine: dani, when you look at, you know, is there a point where they can trigger other asset classes? dani: there's quite a disagreement on this point, francine, i think they fall into two camps. there is a rise in treasury yields. jp morgan, for example, said that a rise in 50 basis points on the 10-year over the span of a few weeks as when we get concerns and echoes of a 2013 taper tantrum. others, like mizuho, safe we get 1.6% on the 10-year yield, they say at that point is when we

will get big reactions on emerging markets, which of course are sensitive to u.s. treasuries. on the other hand, you can take a totally other view, as namura does, and says i do not care about the level or the pace it rises at, it is all about real yields. at the moment, they are staying stubbornly low. so if you take that into account, it does not even matter what the 10-year yield is doing, but francine, at the moment, it is still quite low, despite the fact that it is over 1%. all things considered, it is not a level that many people feel comfortable with, but we will have to see how quickly it moves or how high it moves from here. francine: thank you very much, our dani burger with the story of the day on treasuries. politics, the package that reports are saying joe biden is putting in place for covid relief. treasury yields are actually rising, after reports on this

relief fund being about $2 trillion. in europe, if you look at the stoxx 600, still up, banks, automakers leading gains. shares were down as much as 7% after the french government expressed opposition to a canadian company buying that company. italy with a coalition on the brink. unclear if we will have a technocratic government, if the prime minister can keep his job, but you see the italian 10-year yield, 0.89. coming up, can a country handle a political crisis on top of a pandemic and a recession? we talk italy next. this is bloomberg. ♪

francine: economics, finance, politics. this is "bloomberg surveillance." i'm francine lacqua, here in london.

let's get straight to the bloomber first word news with laura wright. laura: last year germany saw its deepest contraction in more than a decade. the economy shrank 5% as the pandemic raged at the government was forced to lock down citizens and close businesses. germany is likely to have fared better. france and -- better than its peers. donald trump has been pitched by the u.s. house of representatives for a historic second time. democrats and 10 republicans voted to charge him with incitement of insurrection for the role he played in his support of the attack on the capitol. the charges next go to the senate for trial, but a conviction is all but impossible before joe biden becomes president. the u.s. is considering easing restrictions on travel, given new requirements on virus

testing. the centers for disease control and prevention are discussing lifting curbs on flights from brazil and the european union while is priority is for protecting the public health. the cdc says it is aware of the economic damage of travel bans. 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, this is bloomberg. francine? francine: thank you so much. let's get the latest from italy, the prime minister giuseppe conte struggling on to power that struggling to hold onto power. it was said last night that ministers from the italy alliance party would quit the cabinet. he says the prime minister isn't doing enough to tackle problems. but speak with our bloomberg columnist. thank you for joining us. there are a million ways that this could go. the prime minister either finds a couple of parliamentarians to give him the support, he stays

in power come he resigns, whether the president will accept it or not. does it make sense first of all to have a political crisis during a pandemic? >> i think in principle it can make sense. remember, this government -- the pandemic has helped keep it together because there was a lot of ruling by decree by the prime minister, but they are do very -- there are very different forces. you have the democratic party and the centrists, and they are trying to pass quickly a recovery plan quickly for italy to access the e.u. pandemic recovery fund. the government is not able to make progress in important economic -- and important economic decisions. it can make sense to have a political crisis, but we don't

know if the next government is going to be back to the one that we had so far. francine: we don't know if it will be a technocratic government or if we will have a new prime minister. what are the consequences of italy's sovereign debt? ferdinando: at the moment the central bank is buying plenty of italian debt. as we can see, the italian debts are on the move today. i'm worried about the long-term consequences for italy. this is an incredible opportunity. fiscal rules were relaxed in europe. you have the european central bank providing this incredible support, and overseas politicians squabbling without coming up with meaningful investment plans for the country. it is something that may come back to haunt the country in the future. francine: thank you so much,

ferdinando juliano. what does this mean for the recovery plan? what does it mean for the commission plans, and is there any opportunity in europe right now? >> so, i very much agree with the opinion from a couple of moments ago. it is about opportunities in europe. francine: do you like italian bonds or assets right now? toby: we are, like many people come along on italian debt right now. when you have bumps in the road like this, the question comes up is a common italian political crisis. it is existential and it looks more like the former rather than the latter.

as such, we are relatively relaxed about taking spreads on italian bonds right now. but i agree that it does set up a more difficult time thinking about leadership within europe, fiscal rules being suspended, through 2021. but it is up for consideration in the spring, or whether something more -- francine: what happens in a country like italy if they don't get a recovery fund, if they don't get their act together in the next six month and try not to squander the commission money that it gives them, to make sure the economy is on a better footing? toby: the pressure is on four countries to use that recovery funds well.

but i think the real issue is about how fiscal rules affect -- fiscal rules are set. i think there will be some deeper thinking about what happens, and whether we have another north versus south battle going through, and whether italy is in a decent position to argue with credibility within those discussions, and so that is really the test, i think, about how it sets itself up. the rules set within europe. francine: this is a very 2020-2021 problem, the zoom problem. what do you do with u.k. assets? toby: on the u.k. side, you can see there is a lot of structural

headwind associated with brexit, but right now we see the prospect for relief is there. the u.k. has a good tailwind and there is a lot of m&a sitting there. in the pipeline, waiting to come through, waiting to come to a resolution on the brexit deal. so while we have a very skinny deal, i think it sets the country up brilliantly for the future, but there is a resolution that provides a catalyst for m&a to come through, and that would help the market, we believe, benefiting from the reflation that we are in right now. francine: thank you, toby right. coming up, we talk green investing. that is coming up next, and this is bloomberg. ♪

francine: this is "bloomberg surveillance." we are getting breaking news, data out of germany, and the german economy probably stagnated in the fourth quarter, according to the -- office, and this comes a couple days after angela merkel says she will have to prolong and push forward for more lockdown measures. in less than one week, the u.s. will have a new administration. while many will focus on the transition of power, investors are placing bets on what a biden white house and democrat-controlled congress will mean for markets. particular investors and green funds are hoping that the many pledges on the environment actually become a reality.

we are delighted -- i am delighted particularly to be joined by a portfolio manager, who managed the bny mellon global equity fund. what a great treat to have you on the air to talk about something that is really important but has actually been at the margins and sidelined because of all the political news out of the u.s. what are you expecting in terms of eng regulation, investing from the biden administration? >> thank you francine, so much for having me. this is a real treat for me as well. i have been waiting for this for a couple of years now. yeah, so, i mean obviously the blue wave that we see not just with biden but also with the democrats taking the senate and the house is a very exciting time for the environment. i think that already, even under the republican administration,

and a lot of things in the u.s. are run at the state level, and we saw a lot of the more progressive shifting in the last few years toward renewable energy in the utility sector. this is very exciting in the sense that now on the federal level the government will probably make more of a push toward renewables. and we do see that this is also great for job creation. so, you know, for example, if you look at wind generation, the wages in that sector are very high. they provide employment in very rural areas, all of which is very positive for the u.s. economy. francine: is there a concern that a lot of the esg label stocks will be in a bubble? they are some of the most important risers of 2020. what happens to them in 2021? yuko: i do think that the

companies that continue to execute will continue to remain at very high valuations. there is definitely an esg bubble. in the past year that has become very apparent. as investors we need to be cognizant of that fact. what we try to do at newton's look at more of the transition names come as we call it. so companies that have committed to certain milestones in terms of going more green, be it investing more in renewables or transitioning their energy source to renewables, committing to net carbon neutral targets. and we basically monitor those stocks, and what we are transitioning to all depends on the execution levels. if a company is at lower levels

now, than it has committed to becoming much better, we think that is a much better investment opportunity than the names that have already been elevated in the market. francine: we see some of your calls are staples, you favor strong brands. you need for esg to take off even more. is it taxonomy? is it more transparency, making sure that greenwashing is something of the past? yuko: i think all of those things that you just mentioned are great for esg investing. personally, i think is cheap investing is just a new chapter within the evolution of investing, and in particular equity investing, where it is really, if you are a long-term investor, it is a form of sensible investing because you need to look at a variety of esg risks that will impact the price if it closes a material risk and

investment case. in that sense, government becoming more aware of those risks in the form of e.u. taxonomy is a very positive thing because i think not just from the regulatory side as well as pushing from the investment side all enable companies to have much better disclosure, and it enables us to analyze the company in a much more holistic way. francine: is there a part of the world where you are more attached to esg companies? is europe, because of the recovery fund, doing better in other parts of the world -- doing better than other parts of the world? yuko: definitely esg in europe, front in europe has been very aware. investors in europe are really focused on green and really

focused on the environment. so it has always been progressive in nature. what i have really focused on is , going back to our original point, the u.s. has seen, especially in terms of esg disclosure, huge improvements over the past two years. i have definitely seen a much more favorable tone, both from the investors but also from the companies themselves, in terms of disclosing more metrics. i think that the u.s. is on a very positive trajectory. francine: will asset managers vote more and more against boards that don't -- yuko: we have been looking at governance over the past month -- over the past 15 to 20 years, so we have a long history of voting, and usually on a typical

year we go against the management recommendations, 30% to 40% of the time, and so we remain very active in that sense as well. on top of that, voting is very important but also as asset managers, engagement is very important, and we think that engagement is a key for active managers to hone in on the companies that we invest in and interact with them on a regular basis in order to push for change. francine: is there something that you see over the next 2, 3, 4, 5 years daca how much can your space actually grow? you started working on esg and sustainability long before many people. is this going to be problematic for the next two or three -- programmatic for the next two or three years? yuko: definitely. this is going to proliferate the

market going forward. and eventually maybe in a decade's time, this will be more of a standard practice, for a nish segment that for a niche segment in the market. i am hoping that will happen. francine: thank you so much, yuko takano. coming up later, our interview with the deputy chief executive, chief financial officer. we will talk about car emissions, also about covid-19, the pandemic, and the impact on the world economy. this is bloomberg. ♪

rep. pelosi: we know that the president of the united states has incited this insurrection, this armed rebellion against our common country. he must go. he is a clear and present danger to the nation that we all love. francine: that was speaker nancy pelosi after president trump

's unprecedented second impeachment. he was charged with incitement of insurrection after the role he played on the attack on the capitol. a conviction is all but impossible before joe biden becomes president. let's get to the bloomberg business flash. here in london with me is laura wright. laura: the $20 billion bid for -- the french government is opposing the deal, saying the pandemic highlights the importance of a country controlling its food supply. he says a rule on the screening of foreign investments could allow the government to block the deal. a trading app is warning it may have to restrict purchases this weekend. ichiro is feeling so much demand it may have to put limits on cryptocurrencies. unlike stocks, crypto trades 24 hours a day, and volume often surges at weekends when retail

investors have more free time to play the market. twitter stands by his decision to ban president trump. ceo jack dorsey says it was the right decision in the name of public safety, but he sees the move as a failure to promote healthy conversation on the platform. airbnb is canceling reservations in washington next week to minimize any -- given new requirements on virus testing, the centers for disease control and prevention are discussing lifting curbs on flights from brazil and the european union while its priority is protecting public health. the cdc says it is also aware of the economic damage of broad travel bans. standard chartered is positioning a single or -- a singapore based executive. simon cooper, who runs the

commercial operations has been taking readership courses to prepare him for the top job. no comment from standard chartered. could space be the next big investment opportunity echo kathy woods, head of ark investment, is launching a space etf that will track company expiration and innovation after inflows over the past year. the niche fund now sees over $41 billion. renaud is -- renaud -- the carmaker is targeting a more than 3% operating margin by 2023a, and returns of at least 5% two years after that. it comes as result is battling -- as -- the executive speaks later today. the u.s. is said to be dropping his planned investments in

alibaba and tencent. the treasury department says the move has been blocked. officials also debated blocking a search engine but also dropped that plan. that is the bloomberg business flash. francine. francine: we had the german data early on, and that we have gdp forecasts from the french finance minister, saying that in 2021, a 6% growth target is within reach. the main story and francis with the government said is with car rrefour. with legal decree or explanation. we will look at the market. treasury yields rising, stocks rising today after a report suggesting president-elect biden plans covid-19 relief of about $2 trillion. biden's advisers recently told allies in congress about the cost of the package, according to the report, and biden is

expected to announce his economic support plans later today. i'm also looking at tech shares in europe, banks and automakers leading gains. bloomberg surveillance continues in the next hour. tom keene joins me out of new york. we will also look at what is going on in china. alibaba and tencent climbing after the u.s. decided against banning american investments in the chinese tech giants. we will look at china, u.s. politics, and italian politics. don't quite know what the day will bring in terms of a possible new government or a new prime minister. this is bloomberg. ♪

francine: impeached again. donald trump becomes the only president to be impeached twice. he now faces trial in the senate. treasury yields rise on a report that president-elect biden plans a covid relief package of about $2 trillion. his inauguration is in six days. and italy's government risks collapse after giuseppe conte's junior coalition partner pulls out. good morning and welcome to "bloomberg surveillance." i'm francine lacqua in london. tom keene in new york. tom, i think the story in politics -- we have various political stories, about the u.s., about inauguration, but also it is the impact on treasuries because the covid relief package is much bigger than the markets we are expecting. tom: the numbers shifted on stimuli, and i mean that as a plural idea. we have gone from a general zeitgeist of $1.2 trillion, $1.3 trillion, and getting