♪♪ ♪♪ >> good morning from dubai. it's day break, here are the stories that set your agenda. ever grand investors exhale, but just a little. the indebted developer will pay bond interests due tomorrow but there is a dollar coupon to pay, too. most asian stocks fall as china plays catch-up, u.s. fluctuates

ahead of the decision, expected to signal a reduction in stimulus later this year. climb and covid dominate the first day. promise to boost their efforts to help the nations. good morning, investors will get stung, where are you in the credit structure to get stung, the system, the system will be protected, we understand there will be an interest payment tomorrow, there is a long way to go, tom mackenzie, the up side is a lot of debt is in yuan, not dollars, good morning. tom: absolutely, when i was beijing speaking to people on the ground, the view it was domestic bond holders protected above and beyond those u.s. dollar bond holders. it's also the reaction we're discussing, $14 billion injected into china's financial system,

you can wager this will not be the last time from the team, manus. manus: i like that, tom mackenzie. might take some of the emotions out of it. maybe on pen -- oppenheimer and rates will remain low. tom: where are we in this cycle, the economic cycle, the other side, the mirror side, the flip side of this debate saying, the monday selloff in the u.s. was a clear crack in these markets of the you could see the s&p fall as much as 20%. he is flagging the risk around

the economic data. let's check in on how the markets are playing out. the asian session, china is back after the three-day holiday. csi 300 lower, not as much as the future suggested in terms of the futures u.s. side after a mix close on wall street yesterday, bitcoin is a story today, falling below 40,000, it is back above 41,000, the pressure from the regulatory front in focus again for the crypto currency space, manus. manus: you're on fire today, you really are. let's talk about the pressure ever so slightly, the developer says it will repay nearly $36 million in interest due tomorrow on the domestic bond, let's bring in the greater china editor. john, so let's see what you make of tom mackenzie's view which is that the domestic bond holder will be grand, to use a pun and everybody else will just have to fight for scraps, good morning.

john: good morning, i think we have seen a bit of that today with evergrande coming to a negotiated agreement for bonds on shore that are due on thursday. we have not gotten word yet what they will do with the interest payment for the offshore bonds also due on thursday. obviously there is also a large amount of money that is coming due the rest of the year, more than $119 million, and next year $7.5 billion of bonds maturing. plenty of money needs to be paid. evergrande is trying to pay down that debt. there is some concern that will cause other property developers to also cut the prices of their apartments pulling the broader market down, there is a lot of concern there. the pboc is providing more liquidity to help relieve some of that stress, much uncertainty

still remains. manus: john with the latest there on that indebted developer and its travails. how are asian markets reacting to the latest on evergrande, let's go to singapore to break it down for us, jules. >> we also see a weakness coming through in asian stocks in china coming back after that two-day holiday, the index falling through its 50-day moving average lower for a third session, it's longest losing streak in about a move. we look at how chinese assets are doing in general, we were expecting a bigger drop than what we're seeing, down 1% on and dropped 1.9%. the injection of liquidity calming things somewhat. it seemed like the pboc wanted a

weaker yuan, you see the yield on the 10-year 3.86%. what next for evergrande and will china step in to try to manage a debt restructure. morgan stanley certainly thinks so if you look at the morning call of the day. this could come in the coming week and would be coming with policy easing, if it's delayed according to morgan stanley, one percentage point impact on china's gdp in the fourth quarter and that would lead to the need for more stimulus in 2022. manus. manus: low rates forever, juliette, thank you very much. let's pivot to france and the government there. gather going to present the 2022 budget later this morning, the last that president macron did before election in seven months time, we have been following the geopolitical story today, caroline what are the highlights of the french budget, does he have room for a little bit of a

giveaway, good morning. caroline: good morning, back to square one for president emanuel macron, it is the end of whatever was in place since the beginning of the pandemic. for this 2022 budget, the goal is really to reduce the deficit, curb public spending, very few sectors will actually have their budget increased such as the army or education, but the goal for 2022 is to bring the deficit back below 5% compared to 8% this year. the problem is that the debt level in france remains at historical highs. you see the latest reading, 118% for the french debt, to see who is controlling the budget and the proposals for emanuel macron said we cannot put the dust

under the carpet. the problem, of course, is the re-election in seven months time, so it's very hard for him to raise taxes. they will actually decrease some taxes next year and finally be able to deliver on the corporate tax going from 33% at the beginning of 2017 to 25% at the end of his mandate. manus: bloomberg's caroline connan on the importance of the french budget ahead of the elections. let's get back to juliette. juliette: president biden has used his first general assembly speech to more than $11 billion by 2024. the pledge comes as covid and climate dominate the meeting ahead of the summit in scotland next month. the u.k. government is to

provide limited financial support to restart production of the company's biggest plants to ease the shortage crucial to the food industry. the soaring costs of natural gas. the government has met with domestic gas and power splierdz as several stopped accepting new customers as the u.k.'s energy crisis escalates. the democratic controlled house has passed a bill to suspend the u.s. debt ceiling into december 2022 and provide the government funding to operate past the end of this month. the republicans plan to block the measure off the provision. it raises the chances of both a government shutdown and a default which could have devastating consequences to the u.s. economy. the u.k. is said to be exploring joining the free trade agreement between the u.s., mexico, and canada. it is a recognition that the biden administration won't start

negotiations on a bilateral deal anytime soon. ahead of a meeting at the oval office, prime minister boris johnson down played expectations of progress hinting to sky news an agreement was unlikely before the election in 2024. global news 24 hours a day on the air and on "bloomberg quicktake" powered by 2,700 journalists and analysts. this is bloomberg, manus. manus: thank you, breaking news coming in, red hotheadline, i.p.o.s, they were going to issue 7.5%, that rises to 11% of the capital, again, giving everyone an opportunity to get in on this market, oversubscription on all, the upper price is 230 and this is what has driven the decision, the oversubscription due to retail investors and institutional ambassadors being so strong. this is going to be the largest

ever i.p.o. on the abu dhabi exchange. it's all about trying to draw liquidity, tom, into this abu dhabi market. let's take a look at some of the key events that are taking place across the markets today. of course, it's just a few days ago until the german election, we're going to be speaking to the executives from the region, some of the biggest businesses, on the final day, 3:00 p.m. we'll get the eurozone figures, the gas prices seep into that. the economists are expecting the third month of decline. inflation is the big concerns, tom. tom: we can't forget about the main event, the fed, the central bank's latest rate decision, officials are expected to signal scaling back asset purchases later this year.

the consensus seems to be november is the month to watch. coming up, we'll get more on the evergrande story and what is said about the indebted property developer, does he think that this is a lehman moment. that is next.

>> the lehman moment produced pervasive structural damage through the system that wasn't rectified until the treasury came across in terms of its borrowing and the fed came across with easing. this is not that kind of a shake-up type of thing. this is $300 billion is what they owe and this is all manageable.

>> i think they don't really know what they are going to do right now. it may be a little bit lying what we were trying to figure out prior to the lehman crisis and that is do we step back and let it go and take our chances, or do we intervene. my best is they're ultimately going to intervene but it hasn't played itself out yet. there is a lot of politics still that goes on in china. manus: that was ray talking about the evergrande crisis. this is not a lehman moment and the china government will ultimately intervene. joining us now is anna, global macro economist at fidelity international investment management. thank you for joining us this morning. what signal do you take from the bond repayment, a domestic one, we're waiting for clarity as to exactly what it means, combined with the action from the pboc that maybe things will be

managed when it comes to evergrande. >> i agree, this is a signal that they are on the case and it also tells us that this problem is not going to be resolved in that one big bank solution. it's going to be very piecemeal and very managed and it's not an isolated development. it's an event in syria, a different event we have seen so far which is in line to relative the type of policy that moves towards the common goal. i do think it has not played out and really remain cautious, even if policies become a bit later this year, it will still take a few months for that to feed into the real economy. the combination of the growing slowdown with this market

stress, some stress in the market means that we are overall cautious in china and on the global economy as well. manus: anna, good to speak with you this morning. in terms of a response, a shakedown, we see these liquidity flows come in, $120 billion. when you see continuous moves of policy like that, does that keep the contagion story at bay, this is asian credit and you can see that asian credit per se is not materially blowing at the moment. as long as it remains stable, does that, is that a good signal? anna: well, it is a good signal. clearly they are supporting liquidity, again, we still need to see what happens and we also

do expect managed structuring will come over the next few weeks potentially. again, it's a signal that the government is looking to limit that out there, but at the same time of course trying to protect that systemic contagion even if evergrande is not systemic potentially, other developers can see the issues that can effect, i don't think we're out of the woods at all. there are signs, we still need to see how it reacts. manus: anna, you need to look through some of the moist and events that are unfold there in terms of the regulations and what is happening with evergrande, is that an argument that you align with? is there anything that you are adding at this point? anna: i think in the longer

term, china remains a good growth story and good investment, so for sure, that is something that we think investors should be exposed to, but i think caution is warranted because of the issues that we just talked about and generally when we think about china exposure, we think it might make sense to think about it as a separate exposure from the markets universe. separating china out in a separate allocation makes sense given the potential risks arising or actually, now higher and some of the regulation and et cetera that we're seeing, so we're having china exposure separated from the rest of the

emerging markets doing what we think makes sense. manus: anna from fidelity, more work to do coming up on the show. traders are watching fed policy for any signals, anything in the signal after purchases. that's next. the fed decides.

>> the selloff yesterday was a clear crack in the uptrend. a lot of people talking about it's not that big of a deal, it's a buying opportunity. actually when you look at the techs, you look at the charts, you look at, you know, the prospects that we're going to disappoint on the earnings front because of the covid slowdown,

we're ripe for a correction. manus: scott minerd on the selloff, watching the fed's decision later today for any signs of a taper timeline. the u.s. economic recovery will also be in focus, but the current and domestic and international shocks that force a course correction with deadlock. the extension of the covid lockdown measure may push the fed into straight increase back to 2024 or even later. how long is anna's view on rates, anna, some say we're getting a hawkish tilt tonight, three dots to move to put a 2022 rate hike on the table. are you in the 2024 camp? we saw a ramp in volumes in the past 10 days.

anna: i think that the fed will stay the course for the time being, the course they have laid out and that is to signal the tapering at some point of the next few months. i don't think there will be a great timeline or much information on the pace of tapering, but i do think that there is a risk that we might get little bit earlier, 2022, even though ultimately i think it will be hard for the fed to do. it's a difficult balancing act, something for the doves, something for the hawks. i do agree that the head winds are really furious. the best feeling, the china concerns, inflation spiking and we believe that inflation will be consistent and stay well above the target throughout 2022. a really, really tricky few

months for the fed. manus: those are the challenges, despite the challenges, you see a more hawkish, the plots moving closer in terms of 2022. what is the market reaction to that if we do get that? anna: i think there is a rift because the feds say, this is a continuing theme. the labor market progress, there is no need for them to become dovish at this point, but if they shift is much more hawkishly, the market will be worried. equities in particular, i do think that going forward, beyond this meeting, we might see a more cautious fed given all of

the headwind coming together this winter. manus: that's a voice of caution really that could run into a road block. anna, let's get your take. we got a tip from goldman sachs, 10% deep, scott worried about a 10%, 20% correction? the 10% dip is nothing more than a flip. you say pete polack days and the dime side risks is growing, could you see a 10% correction and if so when and do you take precautionary action on your u.s. exposure or anywhere? anna: it's hard to time the correction, but, again, because we're cautious, by the way, the energy in europe driven by the

spike and national guard crisis, it's not denying either. we think this might lead to a serious slowdown in europe and the growing investors. this is exacerbated by the supply chain. we'll continue for the next few months so this means that a correction might come, it's really hard to time, but i think we are looking to a really challenging winter. that's why caution, mutual inequities will remain under the duration, a position that is under review. clearly we might be challenged if we are moving the most over the next two months. manus: appreciate your time, anna at fidelity international joining us for a look ahead to the fed. bringing you live coverage from

the decision live right here on bloomberg. that's 6:30 london time. stay with us. plenty more ahead. this is bloomberg. and there you have it— -woah. wireless on the most reliable network nationwide. wow! -big deal! ...we get unlimited for just $30 bucks. sweet, but mine has 5g included. relax people, my wireless is crushing it. that's because you all have xfinity mobile with your internet. it's wireless so good, it keeps one upping itself. switch to xfinity mobile and save hundreds on your wireless bill. plus, save up to $400 when you purchase a new samsung phone or upgrade your existing phone. learn more at your local xfinity store today. it's moving day. and while her friends are doing the heavy lifting, jess is busy moving her xfinity internet and tv services. it only takes about a minute. wait, a minute? but what have you been doing for the last two hours?

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>> from bloomberg's european headquarters, it is 6:30. i am tom mackenzie with manus cranny from dubai. "bloomberg daybreak: europe this is." and here is what you need -- this is "bloomberg daybreak: europe." and here is what you need to know. there is a dollar -- to pay, too. asian stocks fall as china place

catch up. futures fluctuate ahead of today's fed decision. the fomc is expected to signal a reduction in stimulus later this year. plus, the climate and cobit dominant the first day of the u.n. general facility biden and xi promised to boost their efforts to help other nations. a sigh of relief to some extent when it comes to the question of evergrande at least for 12 hours to 24 hours. possibly if the focus shifts to the fomc. it is november still in play and what are the dot plots going to tell us about the trajectory, the timeframe for those rate hikes? manus: we have just spoken to fidelity. there is a more than marginal risk that a rate hike could come into play at the end of 2022 but there will be things. ray dalio says investors will be stunned but it is a manageable situation in regards to

evergrande. they just heard from fidelity. it will not be one big bang solution. it will be a bit like the road to hell, paved with good intentions, and it will be long and hard in terms of chinese debt. tom: also highlighting our previous guest from fidelity, the pressures from energy prices on the industrial sector here in europe. a question mark for earnings as well, manus. manus: we have a question for ihs and will continue with that discussion about the prices. homes will be heated and getting electricity but it will be industry which steps back and that is a demand disruption prospect on the table, tom. i think it is all about the measures for the external debt on evergrande which will drive the market sentiment. let's have a look at that. you noted this, the bounceback we have had in some of those

numbers from the lows this morning which is we are going to get an interest-rate payment tomorrow but there are more to come as the weeks and months roll on. asia down .5%. immediate reaction from a postholiday so repricing and playing catch-up. s&p 500 up .3%. a whole host of voices comes to bear. goldman say you want to buy the dip, if the 10% drop comes. they say 10% drop in equities is nothing more than a blip. they are braver than most people but then we have had such a stupendous run. what is 10%? on one platform, it went down to $5,400. somebody pressed the wrong button. 7.6% drawdown. a little bit of a shakedown and global equities, global risk. that is the state of play on the market.

bitcoin bounces back. i would not like to be long bitcoin. would you? tom: that is a bit of a shocker for that platform. the algorithm is being blamed for that when it deems. let's switch focus on the crypto space to what is happening in commodities. we have seen a bit of strength. $9.5 billion deal as well for its assets in the permian basin. that is the story that broke yesterday. he told bloomberg that his company is bullish on oil. >> we think the supply and the balance in the market, the opec-plus group is putting in the system, recovering demand that we see coming out of the world today post-covid pandemic, we see the demand improving. we see it probably getting back to pre-pandemic levels by the end of the fourth quarter into the first quarter of next year. manus: the chairman and ceo, ryan lance.

they remain bullish on oil. for more on oil and gas in market, we have the senior research scholar at the center of global energy policy at columbia university. welcome to the show. good morning. we caught up for a coffee and a drink the other day and you warned me, you said we are all a little bit deluded about getting back to pre-covid demand levels in oil. why? why are you doubting that? >> because we will get back eventually but it will take longer than people think. there is this big debate as why demand has come out. we are in the year 2021 and we know the fourth quarter of 2021, global gdp will be back at 2019 levels but the oil level is why not? the answer is simple because of the relentless improvements in the way we use oil every year by the latest numbers. you need to .2 million barrels per day less oils than a year ago to generate the same level of global gdp.

we will be back 2021 to 2019 gdp levels and that means we can do that if the past is any guide with 4.3 billion roles -- barrels per day for the same gdp level. it comes back later and the efficiency improvements in oil, like labor and everywhere else, are continuing to be with us. tom: to what extent are opec-plus and the grouping of opec-plus understanding those dynamics and their response as they look ahead to the october 4 meeting? christof: no. -- i don't know. this is a very strange thing. oil efficiency has improved. it declined year after year after year by the same amount. the rise of china and the collapse of the soviet union, it's very strong regulatory and there's reasons for that.

but they are aware of one of the possible consequences, which is if this continues, we will see oil demand peaking before the decade is over. that is going to be consequence of for oil market -- consequential for oil markets. as they have done over the last decades. manus: you are here for gas tax, the great and the good. are we in a gas prices? are these going to ratchet higher? asian and european prices are spiking higher, $26 to $27. are we in crisis? christof: i would not say it is a life-threatening crisis. are we facing gas supply disruptions? very unlikely. probably not in europe at least. only with a confluence of a very cold winter. are we in a situation where we see sky high prices continuing?

absolutely. price volatility will be with us. they are familiar with a host of factors on the supply and demand side causing that. what is behind it is two interesting big developments. gas markets are globalizing. just like oil, we can direct it anywhere. in oil, these markets have huge capital requirements which are causing cyclical fluctuations of demand and supply. we are seeing a link to the energy transition. it has become increasingly obvious that all this policy talk about decarbonizing for free and all of this will generate green jobs and will not cost anything. the fact is, in order to decarbonize the large global system will be very expensive. somebody has to foot the bill. we are seeing that these price increases of course are supported by carbon prices. they are taking place in areas

where markets -- and are supported by the fact that you have those problems. you need to throw in something else into the mix. it becomes increasingly obvious that the energy transition will be a heck of an undertaking and political support for it may vanish very fast. that is the last point i want to make. high energy prices are like a regressive tax. if you have low incomes, the tripling of electricity prices is something which is very important. if you are in a big villa in the burbs come up probably not. we will see something i do that again. tom: highlighting the importance of the transition needed. before we get to that point, the reliance on gas remains. we have the iea calling on russia to increase supplies to europe. can they whilst they meet those domestic demand? christof: they can because we

have nord stream 2. this is right after the german elections next monday from russia and from germany saying we told you so. as you know, this plan which the americans threatened with sanctions, for once europe took a stand doing it anyway, russia was in favor of it anyway, and that has potential -- it has to be passed some approvals and it has the potential to relieve the situation to some extent but it just goes to show that in energy generally, the security of supply lines and diversity. somebody more famous than me said diversity among so you have an additional pipeline as good news. additional energy terminals will also be good news so that is the road we have to take. tom: important insights from christof ruehl, senior research scholar at columbia university. thank you for joining us. manus: archive, coming up,

surging energy crisis across europe and the world dominate the conversation on the bloomberg airways. he is in a car. he is yet to land. the managing director of the national petroleum company on the way. this is bloomberg. ♪

>> this is a moment when the world has to decide whether it wants to grow up or not and to make a crucial change or not. pres. biden: the united states will double our international public financing to help developing nations tackle the climate crisis, and today, i am proud to announce we will work with the congress to double that number again >>.

-- it will act as-- -- -- double that number again. >> our goal of achieving climate neutrality. >> korea will scale up its climate. set up a green no-deal trust fund with a view to supporting the work of global green growth institute. >> peak carbon dioxide emissions before 2030. and achieve carbon neutrality before 2060. tom: world leaders and the president speaking about the climate crisis on the first day of the un's general assembly in new york. joe biden and xi jinping promising to boost their efforts to help other nations address climate change. switching focus to the politics of germany, four days to go until that country's general election. angela merkel has joined the campaign to give the cdu candidate a last-minute boost. that is the hope after a

disaster campaign. the german conservatives are betting they can narrow the gap with the social democrats to win the election. joining us now is maria tadeo, who has been covering this from the beginning and will continue to until and through the elections pick can angela merkel do anything to swing undecided voters at this point? maria: you know, at the beginning of the campaign, angela merkel was very clear that she did not want to have an active role in the election, that there needs to be a very serious separation between angela merkel, the chancellor of germany, and angela merkel of the cdu. yesterday, she was in her home district on the campaign and that tells you everything you need to know about the disastrous campaign this has been for the cdu. the goal is to inject new life into the final momentum going into the election. she was clear yesterday saying that this is the second time she does this in two weeks, saying

he will fight for every single drop in germany. angela merkel is a highly valued, highly regarded politician by germans but many germans are now beginning to think, well, angela merkel is an individual but should -- she may not be the cdu -- that is a clear distinction. secondly of course, you know, she is leaving politics a lot of voters are thinking of the future. will she be someone who can take on that baton from angela merkel? this was someone that worked closely with angela merkel. the irony of this whole thing is that he is presenting himself as the natural successor to angela merkel. manus: good to see you this morning. the cdu seems to be narrowing the gap. is there a path to victory? is there still a path to victory?

maria: we talked about the mess of this election. we talked about the bad polling numbers as a weak candidate on the campaign trail but the cdu says we are seeing polls that show that we are narrowing the gap with the spd, still leading. we are cutting that gap with the social democrats. come sunday, and you can argue this is their political spin, and to some extent, wishful thinking, they believe the average german will have to make a decision. and the average german, in their eyes, continues to be traditional, very proud of the made in germany industry, and also a christian country, and that will come to resonate with the cdu credentials going into this. this could be the wishful thinking but they still believe that a lot of voters will decide. ultimately, they want to stay with a government and coalition that they know so they believe

that there is still a path to victory. come sunday, having said that, the polls are clear. if there was to be an election today, it would be the social democrats and the spd that would win the vote. manus: never mind the politics you have the winning shot of europe behind you. that is for sure. you leave me in the best quite literally. stunning. maria tadeo, there you go. the winning combination. we will see you a little bit later on. coming up on the show, it is more on the evergrande story. we will hear from ray dalio. is he going to say about the indebted property developer? does he think it is a lehman's moment? no, not for him. this is bloomberg. ♪ let's get a quick check of the --- this is bloomberg. ♪

manus: it is "bloomberg daybreak: europe."

i am manus cranny in dubai. evergrande's debt crisis is manageable according to ray dalio so investors will be stumped -- we spoke to bloomberg at the greenwich economic forum. >> there is a tendency, understandable tendency, to think, because they are malware and communists, that they are going to go back to that kind of thing and they are not. xi jinping just, for example, introduced the newest stock market in beijing. he made a point of being the one who introduced the market in beijing to these small and medium-sized enterprises. they know that it catches nice. the issue is that the capitalist is not in control. the issue is that there is a system for the whole system and then what they want to do is make sure that it is not a capitalist driven system. and then there is data control, and then you have to understand,

there's micromanagement. it's like the kids -- there is a top-down versus bottom-up. whether you like it or not, that is what it is. >> how can our viewers prosper from there micromanagement of the real estate debt collapse we are beginning to see in china? what is the opportunity if we see their dominant investor position domestically go down in price? how do you play that? ray: the mechanics are the same that the united states and everyone else went through so it would be very similar to our 2008 mechanics. so what we do -- it has happened over and over again. the central bank makes a decision, it a moral hazard. never used to have moral hazards. >> you believe that after what we have seen in the market? ray: we knew that this was happening and there was preparation for this and there was more. that's a good thing, not a bad

thing, because in the past, it used to be that they would guarantee it. five major banks with state owned enterprises and local governments with implied government guarantees, and it was bad, so the process is the same. expect the exact same type of process that we would go through, which is to say that there will be more -- investors will be stung. that is how it works. the system will be protected because it is denominated in their own currency. >> i want to get this on the record, ray dalio. everyone is saying this is not a lehman moment. what we witnessed today -- explain why this is not a lehman moment to ray dalio? ray: a lehman moment produced structural damage through the system that was not rectified until the treasury came across in terms of its borrowing that came across for quantitative easing, but this is not that kind of a shakeup type of thing. this is -- $300 billion is what

they owe and this is all manageable. the basic economics is for all countries in all time is if your debt is in your own currency, you can deal with it. you can work it out. we have seen it happen over and over again. it is a good that vendors get stung or that the borrowers get stung. that is how the system works. >> i want to go to my number one question for ray dalio. i'm fascinated by this. you and i said -- we look at that spectacular experiment. the day of the hong kong collapse, a change essentially. how should our western banks, the people you know, change diamonds, moynihan of a reinvigorated bank of america? how should the western banks adapt and adjust to new china realities? >> very simple, you have to decide whether the rules is a

place you are comfortable with. they will set the rules and you go in there and decide if you are going to be part of that as a good citizen or you are not. what you do not jump in and out. in other words, china is a strategic play. you will not jump in and out. the amount you are in should be that which you are comfortable with. it is the same as an investor. it is not smart to sell on the break or to buy. it is a strategic play. tom: that was bridgewater associates founder ray dalio speaking to bloomberg tom keene. a bit of context for ray dalio and his experience for the best in that country. we should listen to him on this question. he has visited china many, many times. there's also the other part of the context. he has skin in the game, manus. manus: he absolutely has. you are either in with a

reasonable view and this depends on what your view is. they knew it was coming and there's more of it. i think it is a regime change in terms of how they deal with the interest payments to the external and in -- internal bondholders. 53 billion dollars is onshore and therein lies the point. who takes the pain and who takes the haircut? investors will be stung. tom: absolutely and to what extent will the pboc continue to come in and add liquidity to ensure that this does not become that systemic risk that s&p and others have pointed to? that is the bottom line for china's regulators. a systemic risk that feeds into the rest of the economy. the pboc injecting $14 billion today. some of these concerns reflected in these market, manus. manus: a backstop until we see what the real interests are. a quick snapshot on gas prices. it is not a systemic threat.

ihs with me a little bit earlier, talking about this spike will rollover, but the risks are very real at the moment. no blackouts in europe or the u.k.. this is bloomberg. ♪

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>> live in london, alongside mark cudmore, joining us from singapore, to take us through the market action this hour. cash trade is less than an hour away. ever grand investors exhale, but just a little. the developer will repay interest due tomorrow, but