biden jr., do solemnly swear -- justice roberts: that i will faithfully execute -- pres. biden: that i will faithfully execute -- justice roberts: the office of president of the united states -- pres. biden: the office of president of the united states -- justice roberts: and will, to the best of my ability -- pres. biden: and will, to the best of my ability -- justice roberts: preserve, protect, and defend -- pres. biden: preserve, protect, and defend -- justice roberts: the constitution of the united states -- pres. biden: the constitution of the united states -- justice roberts: so help you god? pres. biden: so help me god. justice roberts: congratulations, mr. president. [cheers and applause] francine: the united states inaugurates its 46th president. joe biden pledges to unify and put an end to uncivil war. covid ravages europe. britain and germany suffer their deadliest days, with u.k. hospitals like a war zone. and as lockdowns grow longer and harsher, how does the economy cope? that's the question before christine lagarde and the ecb today. good morning and welcome to "bloomberg surveillance." i'm francine lacqua in london,

tom keene in new york. i know we talked about the beautiful fireworks and what america does best, which is show the world its power, it is policies that joe biden will put in place and the fact that some moderate republicans came out against the $1.9 trillion package is not insignificant. tom: but it is not a surprise. it is easy to say president trump was unconventional and we get back to something new and may be familiar as well, but i know -- i was the only one at 5:00 a.m., and maybe we dragged schenker out of bed. president biden is working at 5:00 a.m. francine: putting up the national strategy -- we also heard from anthony fauci. i think just 20 minutes ago, speaking at the world health organization. that's get to party schenker,

bloomberg news editor-at-large. it is 5:00 a.m. and it is clear that the biden administration wants to get to work. what are they going to do to combat the pandemic? party: one of the things they are going to do that is pretty significant is invoke the defense production act. for those that are not familiar, that gives the executive branch authority to target companies around the country, to force them to produce the materials they need for testing and vaccine supplies, and other things that, frankly, the previous administration was reluctant to do. so he announced this morning at 5:00 a.m. that he is going to invoke the defense production act, and also not surprisingly impose a mask wearing mandate on all federal property and jurisdictions. francine: how difficult -- and we see it here in europe, even with strict measures it is hard to see how this will pan out, if

people will follow. how important is it that he gets the stimulus package through while doing these extra measures to contain the actual virus? marty: there are two separate tracks. there are things he can do by executive order, like the mask wearing mandate today, but he is going to have to get republican cooperation on the stimulus proposal, the $1.9 trillion. joe biden has said, stressed unity yesterday, reaching across the aisle. that will be a real test of his ability to negotiate with the republicans. tom: i noticed you stayed up to see springsteen land of hopes and dreams. when you see the documents and you see it embargoed on the 5:00 a.m. release, it is about staffing. trump was the decrease of ronald reagan, the idea of less

government, less staff. this looks like hitting the ground, it may be akin to the obama administration, a fully staffed administration. staffing seems to be a huge distinction. marty: if you recall back four years ago, there were not very many people around donald trump in the opening days, and so it was really difficult to know what he was going to do. joe biden has indeed hit the ground running, with a complete staff and a set of policies that he is imposing in the first few days, which is a stark contrast to donald trump. i mean, he did put out his -- our famous muslim band and the first days of the administration, but -- tom: we saw the president at the tomb of the unknown soldier. what was the symbolism behind that? other presidents struggled over

four years or so, and yesterday seems to be such a traditional moment. martin: it was a traditional moment. and as he said in the inaugural address, it was to bring the country together for one purpose and that is to move forward. i think bringing in those former u.s. presidents was meant to signal that there is the possibility of unity and purpose in this country. francine: marty, how does he unify? how does he reach out? does he first of all -- does the new president need to reach out to the trump base, or does he stay the course and focus on policies? marty: the new press secretary was asked that very question at her first briefing yesterday, and she said joe biden throughout his whole history has shown that that is the way he works. he reaches across the aisle to seek compromise. so it won't be anything specific, but it will be his personality injecting itself

into every policy he pursues. he will be reaching out and it will be up to the republicans to see if they want to negotiate with this president. on the confirmation side, his dni director went through the gop -- went through the senate, 85-10. that was a significant bipartisan approval. francine: when you look at what we heard from several gop senators like mitt romney, also liz cheney, who had doubts about this $1.9 trillion package, is that to be expected, or -- marty: as tom said, it is to be expected. the republicans have to get used to working with a democratic majority in both houses of congress. so they are going to basically not just embrace everything that joe biden proposes on its face.

they will mention some concerns, but the real question is whether or not they are going to be able to work together to come up with some compromise, which joe biden says he really wants. he wants republicans to get on board on the stimulus package. tom: i want to go to the key player in all of this, the chess game, the gambit that president biden has come and that is a gentleman from west virginia. what is the power of joe mansion? he seems to be awfully important. marty: he is important. he is a moderate democrat, has voted with republicans a number of times, he wants to stay in the democratic side of the caucus. since he is a moderate and there is a 50/50 split in the senate, what he thinks is going to be supremely important because he is going to be bringing moderates with him. tom: is he going to be like

senator byrd? you and i covering years ago roads to nowhere. francine, this is a joke -- are we going to get a manchin bridge to nowhere? marty: he is a constructive force in the senate. i think he is going to be critical person in getting joe biden's agenda through. tom: i thought our coverage yesterday was really well done, and it went so much smoother than i expected. i kept waiting for them to get something wrong in the capital. marty: i personally felt when the president and his first lady were walking to the white house, i just had to hold my breath a little bit. when he came off to greet some of the people on the sidelines. but it did come off without a hitch, which was pretty strong neri. tom: marty schenker, thank you.

in new york city with first word news, good morning. >> tom, thank you. avril haines will be the first woman to oversee american spies. becoming the first member of president biden's cabinet to win senate approval. the 84-10 foot for confirmation came hours after the president was sworn in. as director of national intelligence, he oversees several intelligence agencies. that shashi -- she oversees several intelligence agencies. and almost 40,000 coronavirus patients are being treated in british hospitals. the bank of japan is leaving its main policy unchanged. the central bank for because the economy will gain more growth than previously thought. doj policymakers kept its interest rate program intact. global news 24 hours a day, on

air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries, i am karina mitchell. this is bloomberg. tom: thank you so much. let's do a data check on a day with the ecb focused on washington -- let's be focused on frankfurt for a good part of these hours of surveillance. futures up six, dow futures up 19. it is a global equity lift. you see it with the vix, 21.44 on the vix. i note yields contained. we have not had a surge in yields over the last number of days. look at bitcoin. i should not have bought it at the top. francine: you are looking at bitcoin, i am looking at sterling. optimism that fiscal spending will revive economic growth, but then i look at pound, which by the way, tom, looking at dollar-pound, dollar-sterling is rising to the highest since may

2018, and this is also on slightly stronger-than-expected inflation data that we had this week. i am looking at euro-sterling, and the concern there is that we will have many questions for christine lagarde on the euro level. i just put in crude oil for good measure because i know that you would look at bitcoin. tom: 32,660. coming up in the next hour, an important conversation. muhammad yunus will join us from gallup on their pulling of the state of america, one day after an inauguration. please stay with us through the morning, this day of european central bank meetings and press conference. this is bloomberg. good morning. ♪ 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?

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francine: that is angela merkel, the chancellor of germany, briefing the press on the covid response. they hit a pretty grim milestone. germany passing 50,000 deaths since the pandemic started, and angela merkel saying there are dangerous virus mutations that are not yet dominant in germany. the u.k. mutation was very dominant here in london. she is warning everyone that winter will be very tough. a number of people are already understanding that fulsome with nerves of steel, we are now going to buy erik nielsen. we want to talk about first of all the lockdowns. we are watching angela merkel brief the press in london

yesterday. we had the highest number of daily deaths since the pandemic started. here in the ecb, if you are an economist, do you need to change your forecast because we are vaccinating in certain countries as much as we can, but also it is completely out of control in certain parts of europe. erik: i think it is very tricky. at unicredit we are lucky that we have -- it is probably a little worse than we thought, but we came out statistically out of last year that we were ok. but here is the point, with the spreading and the rollout of the vaccination, and then i think there is not much more they can do or should do right now. i hope she will say so. you talked about the u.s. before. they are certainly not holding

back, and good for them. francine: who can afford actually to have a lot more stimulus in europe? erik: they can all afford it. here is the wonderful thing, right? after the great financial crisis, the southern europeans wanted to spend money and the germans and the commission said no, no. this time around, it is exactly the opposite. the commission is saying we have put all the fiscal moves aside, and you still have people like the spanish prime minister saying maybe we cannot afford it. of course you can afford it. if you don't do it now, when will you do it? francine: erik nielsen -- tom: erik nielsen, tom keene in new york. i would like to focus on the ecb meeting today. so many are unaware of the transatlantic gap. if you look at five years out

and then the five-year out from there inflation expectation, it has never been wider than in 2005 before the crisis. between inflation expectations u.s. and inflation expectations europe. what does that mean for madame lagarde? how does that limit her choice set today, this huge gap in inflation expectations? erik: a very good question, tom. what we have now is an exceptional period where the central bank has decided, correctly in my opinion, taking it to the fiscal authorities. you don't really have to worry about inflation. there is nothing today that will impact 7, 8, 10 years out. that is probably ruled by some structural factors. the biggest risk we have today is that the pandemic is going to kill off activity that should

not be killed off, and therefore we have a lower potential growth rate, and thereby -- tom: that's fine, but it has bounced up again against the austerity and the historical austerity of all of europe. are we free about sarah ready -- are we free about austerity, or is there a blanket of hope going forward? erik: the only restraints in this area, in my opinion, is in europe where people are worried too much about the public debt. go to berlin and the finance ministry there, and there is a complete new open minded approach in the right way, i think. europe is not held back as we were almost 10 years ago. francine: how does the ecb

actually talk around euro? erik: i wish it didn't, to be honest. on any measure that i'm aware of, the euro in trade-weighted terms against the dollar is not all value. give or take -- it is not increasing levels. the central bank should not be playing after the exchange -- sit back and relax and see how it is playing. it is part of the overall monetary conditions that they do look at, and in a sense they have committed to -- that is the right policy. that is the big story, in my opinion. francine: what about yield curve control? does it actually matter? erik: i think that is exactly right.

they would never admit that and for good reasons. but back in march, they state it, very clearly, that the objective is a tightening of monetary conditions. that yield curve control, and that this is very important. so it applies to all constituencies of the eurozone. limiting the -- it is the right policy, it has widened, but that is because of the domestic policy in italy. francine: erik nielsen of unicredit stays with us. coming up in the next hour, ken rogoff, a harvard professor. we will talk about policy and

foreign relations. that is at 6:30 a.m. in new york, 11:30 a.m. in london, and th

karina: this is bloomberg surveillance. united airlines is mapping out a recovery plan from last year's record loss. the goal is t top pre-pandemic margins out to 2023. united says it is more than halfway to finding $2 billion in cost cuts.

meanwhile, alcoa is warning that higher costs may weigh on its earnings this quarter. alcoa is forecasting mining costs in its alumina business and lower selling prices. twitter has blocked out another big name in washington. this time it is china's embassy to the u.s. tutor is unhappy over china policies, sanding -- china says it is puzzled by twitter's actions. that is the bloomberg business flash. francine? francine: thank you so much, karina. data pointing to what we are hearing from the ecb, not ask pecking much in terms of actual change of policy, but what we are hoping to find out more is how christine lagarde sees progress ahead. so let's get the data if we can to give you an idea of exactly what is going on, and the pound rising. i'm also looking at

euro-sterling, and a bit of a lift to european stocks, from 0.4%, tom. tom: futures up six, dow futures up 22. the victim watching closely, it seems a little bit of an adjustment off the inauguration with a lower number, less of an angst, less of a fear there, 21.49 on the vix. we don't get the correlation with higher yields. this will be interesting with lagarde today, for her yield discussion as well as her bitcoin discussion. she has been a critic, down $2600, 32,200 on bitcoin. the laureate, stiglitz, this afternoon on bloomberg. good morning. ♪

>> there is no question there is broad support for second

economic relief package. >> i think what governors need is not just short-term stimulus, but probably something we can play out over the next. >> couple of years. >> initial proposal for his double the size that wall street was expecting. should end up in the low end of the $750 million range. if they try to get 10 republican votes. >> let us not pretend we are in intensely part of this environment and joe biden wants to win on his agenda and will use every political trick to do it. tom: yesterday was wonderful. the conversations put together. we were blown away by some of these conversations and perspective, a window into some patient people waiting to voice their interest in america. eric nielsen, he is an optimist.

renewed america, no doubt. what is the price of stimulus? erik: when you have the central bank that buys the debt and keeps interest rates low and the cost of doing it is huge. i am an optimist. i am optimistic about the u.s. in particular. tom: can you suggest we will see a greater productivity? i look at almost a changed immigration policies where maybe there is a tone where we get a more sprightly nominal gdp because of a changed immigration policy. is that feasible? erik: for sure. in many ways what you do now is your putting money in hands --

about putting money in the hands of people who have no money, no savings ratio. they go and spend. that is a nominal process but it is the right thing. what you want to do is avoid the collapse of companies and suppliers and along the way yet to talk about the investment that gives you the productivity growth. francine: how long will it take for the u.s. economy? let's say the biden administration gets hands on the vaccine quicker and the $1.420 gets put on the market, how long does it take for the u.s. not to grow in gdp but recover the ground? lost because of the pandemic? ? erik: on our present forecast, lower the consensus, we have reached prepared to mid-level and early 2022, but before we put this $1.9 trillion in. we assume he gets less, i think

-- i new york you have a fantastic connotation with a commissioner yesterday and the u.s. discussing 9% of gdp, percent or 2% in europe. -- 1% or 2% in europe. i think biden is right to hit puddled to the metal. francine: why are we doing it in europe? is a simple fear of squandering the money? carico good question. i don't know. to be honest, there are two sides. the european package is very big. we are talking about national. if i had to guess, i don't know why they're so timid, enormous

amount last year and tens of credit and a complete u-turn from the thinking in europe before. there is still a lot being done, just less than last year. well, the forecast the second half so it should be ok. maybe it is ok. i just think the risk profile is so skewed there's no damage to doing too much and lots of damage if you do too little. tom: erik nielsen, looking at bitcoin, nothing more than a facilitator of criminal activity according to our next two guests. do you link it to money laundering and crime or can it actually collegiate? erik: thank you for that question. i am completely -- it is a horrible thing. it uses energy like thursday or tomorrow.

we are polluting the solution, polluting the environment with this thing and the only useful thing if it is useful is for criminal activity. i can see no other reason to use it. it is nothing. a lot of people, well this isolated it if you people -- a few people in that problems investing. tom: i don't want to get you in trouble with the general counsel at unicredit, but major banks are climbing -- i'm going to keep unicredit out of it. major banks, i fact, there climbing on board cryptocurrencies and bitcoin. are they making the mistake? erik: absolutely. if i bank or to do it, i would be very vocal about my opposition to this. it has not been discussed -- i do not understand why they would do it. a bank is not in the business of

selling government tickets. it is absurd. how would a safe person comply with the regulatory environment of explaining to the buyer what it is you're selling them? it is nothing. there is no underlying asset. it has no social use. i am shocked if european banks would start to trade in it. tom: erik nielsen, thank you for your candid crime -- your candid comments. without first word news in new york city, karina mitchell. karina: president biden plans to issue a set of executive orders today and the fighting the virus. those orders will reverse many of donald trump's was criticized policies. the president will overhaul testing and stabilize supply chain for critical medical.

provide rapid and for vaccine distribution. the administration is mending fences with the world health organization, infectious diseases chief anthony fauci pledged the country's commitment today. seeking to deploy virus vaccines around the world. former president donald trump has had the u.s. would exit the who. mr. trump second impeachment trial is to log hold. house speaker nancy pelosi has not triggered a proceeding that could slow down the senate democratic majority and delay confirmation. -- confirmation of key biden administration officials. global news 20 frozen day and at luber quick take, powered by more than 2700 journalists and analysts in more than 120 countries. francine: coming up next, the inauguration, the u.s.-u.k. relationship with former british

impassioned or to the united states. this is bloomberg. ♪

>> we as the european union know what side of the table we are sitting, we are sitting on the side of the democracies next to our american friends. indeed, china is a systemic rival when it comes to the way they look at the individual and human rights, and this is a very clear point here that we joined

forces with our american friends concerning china. but if we look at our competitor china, the access to the market for example, the americans have an economic agreement, the phase one agreement with china. china has with the asian area its economic agreement, but also with other democracies like australia, canada, switzerland. therefore, i think it is self explaining the european union negotiated a new economic investment agreement because it is a matter for our investors to have a level playing field and access to the chinese market. francine: that was the european commission president on the investment deal with china and the eu u.k. prime minister force johnson was among many world leaders to congratulate biden on his inauguration. speaking in parliament yesterday, he said he looks

forward to working closely with him unshared ponies like climate change and transatlantic security. i have to say the interview that stole the day was with a reporter asked boris johnson whether the new president was woke and it was quite a fun exchange as we were not sure whether boris johnson understood what it meant. joining us now not to talk about that, but to talk about policies, nigel sheinwald. ambassador, thank you for joining us. when you look at the new world, it seems it is more polarized or bipolar u.s.-china world. how should he engage with u.k. and the eu in the midst of this? >> it is a disorderly friend rented -- fragmented world, you're right on that.

not all of it is from trump that some of it certainly is. i think he is right to put his priority on rebuilding america domestically. most countries in the world because of the pandemic or other reasons are domestically inwardly focus. we all know america can't reinstall itself in the global leadership. the confidence at home does not exist at the moment. i think around the world and here in europe, i think there will be enormous relief and welcome for what he said yesterday, rejoining paris, prepared to look again at the iran nuclear deal if that conditions are right, rejoining the world health organization. i think all of these things are important but i think allies have to step up to the plate as well.

what was said was welcome but i wonder if europe really has thought through whether it is going to be an active partner for the united states or not. there is talk of strategic autonomy. some in france and elsewhere talk about a europe that was equidistant stew america and china. -- equidistant's from america to china. another u.k., there is a bit of a hangover from brexit. americans like president biden think it was a big mistake. i don't think will bear a grudge against boris johnson or for johnson's closest to president trump. a brit has to show it can cooperate. that was a gap in the due before christmas, and start having an a more practically cooperative way with its partners both in the united states and in europe and elsewhere. francine: in four years time,

how will you judge or decide on -- how will you measure success of joe biden? >> well, primarily, if he has been able to restore a sense of confidence in america and a practical politics and rebuild the center in american public life, that is a huge challenge and i would question whether he can get all the way in a presidential term. you can certainly reverse the slide into violence and extremism. internationally, i think things can't return to a straightforward world of 30 years ago, but if there is for international movement agreed on climate change, huge transformation of the global economy -- which will take decades -- but if you can start

in a more concerted way after the trump live, then that will be a significant achievement and i'm sure john kerry will be committed to that. looking around the world, restoring balance into the relationship with china, with the rest of the world wants is predictability and combining that sense of competition and cooperation in a smart way with china rather than this oscillation between a love affair and a trade war, which -- i think the allies can cooperate in that and help with that because it is a shared burden but you need to find that middle ground which can able to building to begin. selectively looking at the problems like iran and yemen around the world, i think there is a real chance to restore some sense of practical work on those

issues to take us away from the confrontations of recent times. francine: how will force johnson work with joe biden? >> i would hope fine. it does not look on the surface like in personal terms a match made in heaven. they are very, very different in personalities and outlooks, but it is in the job description of a british prime minister to get on with an bond as much as possible with an american president, whoever they are. it is unlikely bonds and links that have been created. it was not written in the stars with george w. bush, but it happen. i think he can be done. biden, over four decades in the senate, knows about the u.k., knows about europe, knows the contribution the u.k. makes, knows our economy and the

example of our armed forces and so on, so i think the foundations are there. but as i say, we have to get over this inconvenience over brexit, proved we have it behind us and that we are interested in getting back to the britain that biden will remember of working issues smartly and actively and in cooperation with all our partners and not getting bogged down in the debates over brexit, which we have the past for years. francine: nigel sheinwald, thank you for joining us, former british ambassador to the u.s. make sure you pick up the latest issue of bloomberg businessweek featuring 50 companies to watch out for, the 50 best. we will be speaking to the chief executives of one of those companies a little later on today. capitol this is "bloomberg." ♪

pres. trump: i wish the new administration great success.

i think they will have great success. they have the foundation to do something really spectacular. goodbye. we love you stop we will be back in some form. have a good life. we will see you soon. tom: the former president of the united states beacon on the way to florida and the symbolism of the flags not only sing yesterday but in recent days really speaks volumes about these two administrations. one, red, white, and blue and the other more stark and some plastic, mentalist -- simplistic, minimalist. written a jewel looking back at trump economics, trump performance. the muscular results president trump. it makes for careful reading not only about president trump and president biden, but going back to james o'connor -- james earl

carter. matthew winkler, the relationship with china. how did president trump do in narrowing the trade deficit? matthew: it is good to be with you. for all of the bombast against globalization, during his first three years as president, the trade deficit climbed to record 1.67 trillion dollars. that surpasses a similar period deficits for obama, george w. bush, and also clinton. our data is u.s. census data that goes back to 1992. by the end of the trump era, if you will, we have a really dubious outcome which is he has nothing to show for the policies that he engendered. at this point, worse than

everybody except george w. bush, who you know presided over the worst recession since the great depression. yeah, i mean, yes definition for what he is still with china. tom: with the wonderful work that you do, completely unfair question this morning, we assume that president biden will raise taxes. can he plays those tax increases all on business and corporations or does he have to bring it over to the so-called wealthy? matthew: really great question. something that is only touched upon recently and a lot of commentary, including ours, which is the last time clearly a u.s. president raised taxes significantly was bill clinton in the 1990's. and you could say that was the best economy in the united

states in the 20th century. because in that period, of course we had the peace dividend, but the divide between the have-nots and the haves, the inequality gap we call it, narrowed significantly for the first time. that was because bill clinton, under a lot of pressure, it would balance the budget, would create a surplus. he did it by raising taxes. by the end of the decade, the u.s. was in an enviable position economically, aside from the dot-com bubble bursting. if you recall the election of 2000, everybody was arguing about what to do with the social se sur, if you can believe it. francine: what about the midwest manufacturing? this was a linchpin of what donald trump tried to do. did he revive it at all?

matthew: that is going to be difficult because that was a long-term trend. that had less to do really with per se anything in the u.s. and more to do with the fact that globalization was a force and companies were allowed to pursue labor wherever they can get it that was cheaper. it was not just the u.s., it was everywhere. that was a long-term trend. you can do things to invest in clean energy, and that will create high-paying jobs. tom: match, we have to leave it there. we are out of time. we will continue this important discussion. mr. winkler, editor-in-chief emeritus of bloomberg. stay with us. this is "bloomberg." ♪

pres. biden: i do solemnly swear i will faithfully execute i will faithfully execute the office of the president of the united states and will to the best of my ability conserve, protect, defend the constitution of the united states, so help me god. >> congratulations, mr. president. tom: this morning, and early morning, president biden starts the day at 5:00 a.m. what is that about? the virus has prevailed. record debts in germany and mexico. new york city is your out of vaccine. biden will "convert vaccines into vaccinations." the bulls have prevailed. yields stable. poetry prevails. the dawn is