♪ >> brca 2 bloomberg markets. it is noon here in new york and traders are digesting the latest inflation data plus keeping an eye on the trump trade at the president-elect is in d.c. today on a massive day. let's take a look at the markets are doing. we are flying just under that 6000 level that we had earlier this week on the s&p 500. it is now up about two tens of 1%. in week starting today, you are

looking at the two year yield of 4.27 on the day, a move of about six basis points in the 10 year hanging out at 4.41. a lesser move there, but of course you seen a move downward image yields here after we saw that inflation data at least initially. bitcoin now at 92,000. flying higher by almost 5%. this is stunning because just a couple of hours we were still at 90,000. so that move has just been accelerating even throughout the day. let's take a look here at some eye-popping movers on the equity side as well. let's take a look at the shares of rivian. they are surging after volkswagen weight -- raised investment plans by $800 million. the move is signaling a commitment even as ev demand softens and the incoming trump administration threatens to curtail its parlors -- policies. still out more than 16.9%. rocket lab also simply blasting off.

the space launch company seeing its biggest gain ever after providing revenue forecasts that beat estimates. they also signed a service agreement for multiple launches and rocket now up over two days 42.5%. seeing a surge since the u.s. election. down a bit today. this is a mining company, by and large. down about 6%. the quarter revenue missed expectations. the stock that would likely to be crawled up -- caught up in this crypto stock boom. we are going to turn now to the economy because we did have those cpi numbers out earlier today as we were talking about with u.s. and they should remaining term in october. earlier today bloomberg surveillance caught up at minneapolis that president neel kashkari. he gave his take on what the fresh data means to the fed. >> if i'm not seeing a lot of upside risk yet. i'm not seeing a lot of upside risk that inflation is going to take off from here. the bigger risk i would be concerned about is just if we landing arrive 2.5% instead of

down to 2%. i think those risks existed before the election and i think there continues to be uncertainty now and we need to just take our time, with the data come to us and let that guide us. >> we're joined now by michael mckee who conducted the interview. it's fascinating. he and confident on the inflation front. the bond market at least at the short end of the curve is down quite meaningfully as well. what do you make of it all? dark out that officials can't come out and say we avoided at inflation because the markets would go crazy. i think what he is saying is we have seen this over the last couple of months. but it doesn't mean we are going to go significantly higher. there is a bit of a seasonal aspect to it and we also saw this happen at the first of the year, and the fed kind of had to look beyond that. they are saying we are not seeing anything at this point

that is going to make us change our policy path. that doesn't mean they can't for december because there is still another cpi report, pce report. but for that meeting. >> it's interesting when you are looking at the implied overnight rate. you don't even drop below 3.60 really. you don't drop below 368 over the next two years. and he did talk to you a little bit about that neutral rate. >> this is the answer that they all give. we don't know what the neutral rate is, but we think it might have gone up. that is what they are going to be trying to divide over the next couple of months, is where they would stop. it depends on the overall progress on inflation. i wouldn't put a whole lot of stock in what the markets are saying right now about a future policy path because when donald trump comes to office, all that is going to change. what you end up with is sort of

all forecasting is valid until january 20. >> it interesting, you are hearing more and more people talk about the push and pull between the policies. what did the cop -- top economists say, because they have been so strongly warning that the terror policies to the inflationary, and then you have others, the ceo of citigroup saying productivity could still be induced to the economy. what are the tensions? >> neel kashkari talked about the productivity aspect. if productivity is rising that absorbs some of the inflationary pressure because they are getting more for the money that there's ending. the problem is going to be if tariffs come in on a broad basis as the president is talking about, then the price level is going to go up, and then it becomes a matter of how consumers and businesses react. to consumers say inflation is higher again so now i have to ask for an additional raised? the dollar will get stronger. does that mean that businesses are going to be suffering in

terms of currency transition? the questions are yet to be answered. >> we thank you so very much for your time. we want to move over now to washington. not only is president-elect trump meeting at the white house with president biden, but let's listen first and then give you that update on what is happening over at the senate. take a listen. trump: thank you very much. politics is tough, in many cases it's not a very nice world, but it is a nice world today and i appreciate it very much. a tradition that is so smooth, it will be as smooth as they can get and i very much appreciate it. >> the president-elect also of course meeting with members of congress and multiple lose points now saying that junkfood is elected to the senate republican leader. we are going to bring in bloomberg balance anchor kailey leinz to join us live on the white house north lawn in washington, bring us the drama.

>> certainly there is no shortage of that in washington today. bloomberg has not yet verify this but according to the fox news and punishable lose, senator john food, the republican from south dakota will be the next republican leader in the senate. that of course will be majority leader as a be a senate and republican control in january after the electoral victory we just witnessed last week. this of course in some ways isn't that surprising. he's been the number two republican in the senate for some time. he had a close relationship with the outgoing leader mitch mcconnell who he of course is now succeeding, though he was in a tight contest between himself and another john, senator john cornyn of texas and a third as well, senator rick scott of florida who understand based on reporting was eliminated in the first round of secret ballots when it moved to the second round in which reports say that senator fetterman won. -- senator thune won. a number of senators had

endorsed him, said they would vote for him as well including those we understand have been floated for a potential cabinet position like senator haggerty, for example as well as senator rubio who spoke on rick scott behalf at the beginning of this process. the secret ballot the senators have decided that senator john food will be next majority leader. dark help you mentioned the rick scott element of this and a closeness to the president-elect. what does this mean about the forces of power that are underpinning the senate, as they move into next year and move forward into decision-making? >> senator thune has had a bit of a rocky relationship with donald trump. he's actually had to go down to mar-a-lago to try to make nice with him after they had a bit of difficulty in their relationship in the years since president trump left office the first time. that said, it does seem they have been able to patch things up to a certain degree. he may not be as close in terms of alignment with agenda as rick scott may have been to incoming administration, but clearly that is not with the senators have

chosen here. i would point out as well that because this is a secret ballot, the senators are not necessarily going to be held accountable for their votes. it's not going to be publicly voted for and that makes it potentially a little easier to vote against with those close to donald trump had been advocating for as you are not going to be on the record having cast that vote in the same way you see for house leadership, for example. in a one on that point say that house leadership elections are having today and it is likely that pretty much everyone is going to stay in place as donald trump earlier at the republican conference meeting did endorse that speaker mike johnson to stay in that role. >> at the end of the day this all comes down to policy, and policy that is not only dictated by cabinet members, but also in congress. when it comes to the officials the president-elect has been putting up for his cabinet positions, now that we have more information about the composition of the senate and even the house, who will have

the most difficulty when it comes to those confirmations? >> that is difficult to say. you seem donald trump appointing people who don't need senate confirmation when they are more controversial. we've seen that with stephen miller being tapped at the deby chief of staff for policy, someone who would probably struggle through a senate confirmation if he was tapped for a post require that. as for the cabinet level positions that will need to be confirmed, this point we haven't seen too much backlash for the pix which include the department of homeland security secretary governor kristi noem, and potentially there could be some difficulty just given the surprise over the pick of the fox to was a national veteran as well who has been tapped to lead the department of defense but by and large we haven't seen much formal outspoken pushback to those who have been selected so far knowing that this transition, while it is moving quickly, we are still waiting on a number of names including official appointments or selections for the treasury

secretary role in the secretary of state role. we will see if we get any light on that from donald trump as he emerges from the still ongoing meeting here at the white house with president joe biden. >> we thank you so much for your time. that is bloomberg balance of power cohoes kailey leinz, wanting to restate the latest news, bloomberg can now also confirm that south dakota senator john food, who has been a longtime deputy of mitch mcconnell and also an advocate of free trade has won the election to lead the republican senate jordi next year. it will certainly be an interesting year. more markets ahead. we will bring you more news out of pc as we get it. this is bloomberg.

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>> this is bloomberg markets. new york city renters may no longer be on the hook for costly broker fees when signing a new lease. the city council was poised to pass the fair act which requires landlords who hire real estate agent to pay the agent fees themselves instead of passing the monte tenants. it has widespread support from the affordable housing advocates , but those from the real estate industry argue that it wouldn't address a main reason why living in the city is so expensive. during is now with her insight, the ceo of luxury real estate company brown harris stephens, and also without abigail doolittle who has been all over the real estate for us here at bloomberg television. when you think about what is trying to be done here in new york city, do you think it will fix the problem? >> i don't think it will fix the problem. there's going to be unintended

consequences for this legislation, and i think they are not thinking about the long-term because what is going to happen is that landlords are going to have to raise rent. if they are going to pay brokers fees there's going to be a lack of transparency for consumers, and it's going to be a lot of red lock and problems. the long-termers going to be higher rents. i don't think this was well thought out legislation and just to unpack it a little bit, i testified in june at the city council, spoke to them we were expecting a collaboration, a discussion to create thing that made sense, and instead of that a few weeks ago we get this legislation and we are just stuck with that without a discussion. one other thing i will say, i don't want to jeopardize this, is that the sponsor of the bill, what he was quoted as saying yesterday is that this is the reason why the democrats lost the election last week, is because mayor adams has been critical of this as well, that

we are not supporting pocketbook issues like this. he needs to take a look in the mirror because the reason the dems lost is because they are stuck on identity politics and messaging and supporting the left vs. commonsense legislation, things that help the city. so i think that is like blaming heloise for getting fat. he needs to really take a look in the mirror. >> it sounds like there's a lot of emotion here, on the surface to be rent in the city down very appealing but at the end of the day, pass along the incentive, you thought there were ways that collaboration can happen where brokers and real estate agents wouldn't be blindsided. but with the solution have been? >> you don't make a hard and fast rule that says if you advertise a listing then it has to be paid by the landlord. have discussions about what would make sense. maybe create something that would be working together vs. the sort of things that they

think are going to fix this with won't fix the market at all. i think it is just shortsighted. i always say good politics requires compromise. don't we all have to come together and work together? especially based on what happened last week, we all have to work together. the city council should want to work with the industry, with real estate professionals, with everyone. they do not have a monopoly on caring about their communities. we care about our communities. let's work together, that's what i would say to them. >> the boat is today and if it does go through, the average fee to my understanding is anywhere between 5% to 12%. the average rent in new york on a one bedroom is 4200, 40 three dollars. does this mean that a year from now the average rent could be closer to $5,000? that seems crazy. >> it's going to take some time but it could have an impact. that is what mayor adams was talking about yesterday, that

the city council probably has good intentions but he thinks that the unintended consequences of this are going to end up hurting the people that they are trying to protect, and i think we have to get away from selling our narratives and identity politics and focus on solving challenges, making the city safe, doing those sorts of things vs. selling this position. >> aside because to your point, $4200 for a one bedroom apartment? at the end of the day, if not the fair act, then what? how do you diagnose that problem? >> this is what we have to do, work with people who are working to build affordable housing which very much the city needs. i'm involved with an organization which we build affordable housing for people who are on the streets, who suffer from mental illness, who have drug addiction. they need to work collaboratively with organizations like that. there's plenty about to go around and people want to roll

up their sleeves and work together. but just creating this sort of legislation that is damaging does not help our city. >> what is the fallout going to be to brokers and agents? there are somebody brokers focused on rentals and all of a sudden there is not the payday because maybe people are going to be reluctant to pay those fees or it is going to be a different situation. do you think that is going to be fewer brokers and do you think the government will in some way compensate them, help them? >> i do think this will have a negative impact on real estate professionals who do rentals and there's a lot of them in new york city in particular. look, i a lot of real estate professionals that i know are single moms who are feeding their families. and so it will really hurt them greatly. it is a lot of work. member, in the real estate business you only get paid for results. so i think it could be greatly damaging, but we plan to fight this. we are working together with them.

we are not going to just sit by and let this irresponsible legislation passed. agents shouldn't collect a fee for just turning a key and opening a door. he says he didn't say that but we have it on tape. i think he has impeached himself and hurt himself with credibility and i think instead of that, we need to work together and have discussions. >> we've got to leave it there. certainly the next mayoral race is going to get interesting. i want to bring you back to that breaking news here because of course we have some changes, big ones in the senate. of course we have thune being senator john cornyn by a vote of 29-24 to be the next senate republican leader. this is according to a number of sources familiar with the vote. remember that there was also a lot of discussion here about rick scott. of course, he was passed over in

this silent vote. south dakota senator john food will be that next -- john thune will be that next senate republican leader. bitcoin booming since the trump election win, but it is not just bitcoin. pretty much everything connected to crypto has been soaring in that postelection rally. we are going to talk about it with the ceo of 21 shares next in our weekly etf report. this is bloomberg.

♪ >> time now for our weekly etf report where we are going to check in on the latest news tied to exchange traded funds and of course, last week's election signaling a possible seismic change for the crypto industry and this week we are joined by cofounder and ceo of 21 shares. bloomberg intelligence, we were just talking about it, record flows.

of course, bitcoin etf has been the beloved ones that have really forced themselves into the way of the top flows in the top set of etf's by assets in some regards as well. i actually want to go one step further. if you are sitting here and anticipating a large-scale regulatory change under president-elect trump and a potential new sec chair, how many more etf's tied to crypto do start to put out? >> we have 53 globally, for what we can possibly do with friendly crypto regulations. i think there is a story with bitcoin they probably talked about over the last week. i think there are a number of headwinds that ethereum was facing. it launched in the summer, activity depleted, a lot of macro issues.

were going into a darker place, but maybe what is happening and what we are seeing on a macro economic basis with potentially very friendly crypto regulations on the horizon is way more than enough to start a lot of --. >> humor me, what has been the conversation around doge after the news last night around the government? >> we have the ticker reserved a number of places, please consider doing a number of times because of client requests, but it has never really been a serious asset that has passed regulatory scrutiny and things like that. i think we take very serious care thinking about the roughly $10 billion or so that we have right now. we have a responsibility to be good stewards and give good,

reliable access to the ecosystem. i don't think we are going to list that anytime soon. but it is good to see people excited. >> i think we have to leave it there, we are up against a hard clock here. i also want to talk a little bit about the comments coming out of the senate. you have john thune commenting after winning that senate gop leadership vote. he is saying that the republican team is united behind the trump agenda. member, we had mentioned that senator thune had beaten senator john cornyn 29-24 to be the next senate republican leader. you have the next government of the united states taking shape, and there is a live shot of were all the decisions of course are being made. we are going to bring you some more of that later in the hour. bond markets pricing and all that news from washington. we are covering both with live coverage in d.c. and we will have the latest perspective from robert tipp.

this is bloomberg. ♪ ♪ ♪

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sonali: this is bloomberg markets and i'm sonali basak. let's get a check on these markets. he had the s&p having gained some steam, up almost .3%. the nasdaq still roughly flat. that bid in the bond market has been waning. earlier you saw the 2-year yield closer to six basis points lower. now just over five basis points. you have the 10 essentially flat on the day. of course, we have had a lot of

news coming out of the senate. before we get there let's bring you some of those mid-day movers on the equity side. abigail doolittle is back with us. abigail: when you have some outsized movers on the day, although, it had been up, now up 6.3%. still a healthy gain, but definitely off of the highs. they beat on all metrics and the forecast for the current quarter was strong. j.p. morgan was pointing out that anyway you slice and dice this company evaluation is high. maybe that is what some investors have on their mind. a neutral rating but long-term like the prospects of the country -- the company. a good quarter and outlook. if we flip up the board and take a look at rocket labs, here is a very significant gain. up 40.4%. they put up a good quarter, plus more launches than anticipated. the view, goad, and investors were ordering -- investors

rewarding. spirit down 57% at this point. we have shares down sharply after the peak basically being down more than 95% on the bankruptcy announcement. the potential deal with frontier did not go through and now it is a matter of bankruptcy. sonali: thank you so very much. we are looking under the hood. we are not going to go back to washington where "balance of power" coanchor kailey leinz joins us from the white house north lawn where there has been going along -- has been a lot going on with the president-elect. let's go back to the news of the hour, which is senate republicans lifting up senator john thain to be the next public and senate majority leader. what else do we know right now? kailey: we have heard from senator thune himself, saying he is honored to serve in this role. he will be the one that succeeds

mitch mcconnell and becomes the senate majority leader of the senate that will sit in january. he did so defeating two others, senator jon cornyn and senator rick scott of florida, who was the favorite of many close to donald trump. the mag are right -- maga wright had been advocating for him, but he was taken out in the first secret ballot. that is pivotal because members are not necessarily going to be held accountable for the person that they voted for. it is not public record who they cast their ballot for and that may give more cover to those who chose to go against the wishes of many close to donald trump and not vote for senator scott. the president-elect himself is still in this meeting in the oval office with joe biden, as well as the chief of staff and his incoming chief of staff. all still in that meeting and it is not clear whether or not the news of senator thune's

appointment -- election -- has reached the ears of the president-elect. we are still waiting to see when he emerges from this meeting. sonali: i want to bring more headlines. senator tim scott elected as senate republican campaign chair. and senator james lankford elected the next policy vice chair. he also had earlier cited the conversation that senator thune has been having on x, this idea that the republican team is united behind the trump agenda. how united? sonali: right now they are looking pretty united, especially considering they are coming off of victories of not just his election, but becoming the senate majority rather than the minority and having the house along them. it seems a republican sweep of washington, so it will make unification around trump's agenda more likely. that they will be able to pass these policy objectives. as you point out, senator scott

is going to be charged with getting more republicans elected to the senate. he is also expected to serve as the chairman of the banking committee now that sharad brown has been dispensed in his own race and democrats will be the minority. we are looking for more news as to what they would like to tackle first. donald trump met with house republicans before coming here to the white house and told them effectively, cheered on the fact that they will maintain a majority. he encouraged them to support the current speaker, mike johnson, because house leaders are also holding leadership elections today and those in leadership will be critical in trying to get over the finish line everything donald trump wants to get done. sonali: there is also another set of situations going on when it comes to president joe biden, and of course we know now that he is going to meet china's xi jinping in peru on saturday on the sidelines of the asia-pacific cooperation

meetings. what do we know about the message in the middle of the transition of power here in the united states that will be projected to president biden chinese counterpart? kailey: this will be the third meeting but -- between biden and xi, and they have emphasized the fact that they are meeting at all, much like the meeting between biden and trump, is the important part. that they are maintaining dialogue and having communication. you are right, it is going to be different as it will happen knowing that joe biden only has two months left of his presidency and that donald trump will be coming in, and that could change the nature of the u.s.-china relationship. president biden might want to underscore that the lines of communication should stay open even as a new administration takes over. we do expect, although it has not been outlined, what is happening behind closed doors at the oval office, that foreign

policy could be featuring heavily into the discussion that trump and biden are having, and china could be a part of that. sonali: the u.s. is watching, and certainly the world is watching as well. kailey leinz, we thank you so much. stay warm outside of the white house. back to the markets and the economy. apollo asset management copresident scott klein spoke to bloomberg yesterday ahead of the latest cpi report, but he sees persistent price prescience -- pressures. >> i think rates are going to be higher for longer because inflation is not tamed. the fed can say what it wants. you just have to look around. we see inflation not as beaten, but suppressed. and the more the fed cuts the more you are lifting your hand off of that lever to hold inflation down. nobody has a crystal ball, but we live in a world that is -- the mega-trends driving the world today are pretty inflationary. sonali: for more on the new u.s.

economic data, markets are still processing, of course, and we are going to bring in the chief investment strategist at pgim, robert tipp. something that fascinated me was the move in the 10 year. you did see a dip lower, a steepening of the yield curve for a moment. the 10-year is flat now. why is that? robert: markets are anxious. we don't know anything about forward-looking policy and the underlying economic data has been very noisy. in the meantime policy is in motion on the way from its high rates on the way down, but there is always the possibility for that to change. the markets are extremely anxious and we are seeing a lot of jerky movements as they try to sort through. i think the fact that the numbers came in more or less as expected, at first took a fear factor out of the market and there was a rally, but as

investors began to mull over what we know and don't know and some of the underlying trends and let the anxiety settle in and the market begin to sell off at the back end of the curve, i think that is what is going on as investors try to get the big picture in focus. sonali: there are so many concerns about sticky elements of inflation under the surface. to the extent you are still concerned about it at all where are you most concerned? what will keep prices higher? robert: so, prices are important, and your underlying service inflation, the deceleration, may have stopped above target but there has been so much variability in the numbers quarter to quarter you cannot be sure of that. and more or less you are pretty close to target and the reason why it is not worth splitting hairs about is the fact that the unemployment rate has been going up. from around 3.4% last year we

were off the better part of 1% until a couple of months ago. job growth has slowed down, and even though people have been getting new jobs there has not -- that has not been fast enough to fully keep up with the growth in the labor supply, so the unemployment rate has been going up. i think central bankers are pretty optimistic that moderate growth, growing workforce, moderation in wages, that inflation will come down that last mile, but the fact that the job market is soft is critical for the fed. the notion that they think they are restrictive, critical, and keeping them on a path to continue dropping rates. at least for the near term. sonali: for the people concerned about inflation, particularly on the heels of a tariff policy, there is this other argument that productivity can fill some of that cap. what do you buy about that argument? robert: i mean, that is absolutely possible.

it is also possible you could get more rapid growth from productivity enhancing tools like ai, if that is what the driver is. and those can create more demand that can be easily satisfied, especially if you are in a contentious trade environment. i think big picture we are in a world that seems to be more biased toward excess capacity. when you look at the excess capacity in china, when you look at the sluggish growth across europe, you know, there are not a lot of places that are overheating from excess demand. i think the notion that there are a lot of moving parts with those underlying trends are moderating, and therefore the overall path, exactly when the fed is going to be cutting rates, by how much, that they get interrupted briefly, is less important than where they are going to be two to five years down the road. sonali: when you look at all of the headlines coming out of washington, on one hand there is

a generally-clerestory when you think about the way that the president-elect has talked about tariff policy, and then you see, for example, the republican leader in the senate having traditionally been more of a free-trade advocate. how do you digest that? do you take into account what has been happening and the history of what has been said? or do you wait for the policies to come out before you make a decision on how you are going to express a view in the market? robert: sure. in terms of the long-term outlook i think we are in a good spot but you have to look at the near term on the potential variations here and run the scenarios. and if you do get an extreme tariff scenario there are a lot of countervailing forces there. so, on the face of it prices are going to go up. but to the extent that that saps

real income, it hurts people's purchasing power, that could dampen growth. the other thing to keep in mind is that an increase in tariffs, it is going to be a one time factor. so, once you get six months, 12 months down the road that is going to fade. i think there is going to be a lot of motivation for people, including central bankers, to look through and sort out those effects. so, you need to think about the scenarios and what can happen but what we are seeing in the senate is also indicative of the kind of balance and frictions that are inherent in the u.s. government. the balance, if you will, it is hard to do things in a precipitous fashion. i think there is a lot of reason to, yes, think about the extremes, but also ink about more moderate scenarios and, what is the ultimate outcome that the president is likely to be shooting for?

which is, more fair trade, which ultimately would be a positive. so, a lot of different ways this could go. sonali: robert, we thank you so much for your time and helping us digest it all. that is the head of global bonds at pgim fixed income, robert tipp. a reminder, south dakota senator jon thune has won the election to lead the republican senate majority next year. it could set up potential conflicts with donald trump over tariffs and ukraine aid. he has been voicing that they are behind trump's agenda, the republican team is united, according to thune. we are going to bring you more where that came from coming next. this is bloomberg. ♪

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sonali: this is bloomberg markets. it is time now for the stock of the hour. we are looking at tesla. shares are rising since donald trump has won the presidential election and last night the trump transition team announced elon musk will co-lead a new department of government efficiency. we are more -- from oneness we are joined by max chafkin. i thought it was interesting to see tesla rising this morning because wouldn't doge mean he is just more distracted? max: tesla investors have made the calculation that donald trump is going to be a game changer for the company. you look at that stock, they clearly think that trump is

somehow going to take this robotaxi project from basically a hypothetical, maybe they had a demo earlier this year, to something real. i think there are reasons to doubt that, but that is the calculation being made at the moment. sonali: is that really the calculation or is the calculation that elon musk is close to the white house, let's bet on it anyways? max: there is a meme stock quality to this. it is trump vibes. when you look at what analysts are saying, if they are trying to come up with an explanation, it is hard. sonali: how much does elon musk have in terms of teeth with this new post he has been put in at the government? max: important to say one thing, which is this is not a job. he is not going to be senate confirmed. that said, he could be a really important advisor.

could be the last person donald trump is going to on many issues, and he has lots to gain. elon musk is a defense contractor, and there are all sorts of ways a new trump administration could mean dollars for his companies, in particular spacex. the rest of the empire is heavily regulated. so, lots of ways trump could help by giving money directly to elon musk or his companies, or slowing down competitors, or making things easier on elon himself. sonali: max chafkin, bloomberg news reporter and cohost of "elon inc." mitch you catch that wherever you listen to podcasts. coming up, we are going to look at how fund managers plan to navigate those changes in d.c. we will bring you more on that next. this is bloomberg. ♪

sonali: joining us now for a macro look at the current environment we are going to talk to arjun raghavan, the ceo at partners capital, a firm that oversees $60 billion of assets globally. this business has become popular in recent years because people want to hand you the keys. we still have interest rates higher for longer. we have markets may be whipped sawing a bit, but near record highs. when you're investors are making decisions between public and private, why go private, i suppose? you do still have such an increase in asset valuations in plug -- public markets. arjun: i would point to two key reasons. the first one is access. let's take the u.s. as an example. i think the stat's 1996 you had

8000 listed companies, and today that number is 4500. if you want access to interesting companies, of course you can go to public markets, but to get access to a range of different companies on the private sphere as well. number one is access. the other key stat i would like to mention is the fact that in certain parts of the private market -- so, let's take the lower-midmarket. the statistics show that in the private sphere earnings growth tends to be 3% to 4% higher in the underlying companies owned by public equity -- private equity firms. you get a return premium by investing in private markets. you don't have to make assumptions in terms of leverage in multiples going up. the earnings tend to be better. sonali: i'm glad you brought up the small and medium-size companies, because there is conversation about the idea that now there is uncertainty around

politics, -- is more certainty around politics that the ipo market would open back up. would that be true for everybody? the set of companies you are talking about seem to stay private for longer anyways. arjun: i think for the bigger private equity firms it is critically important that the ipo market opens, right? we are talking about large-cap companies, etc., because that is the main exit mechanism. it tends to happen less in that part of the market. in the lower-midmarket i don't think the ipo market matters usually. what really matters there is capital being available through other private sources, right? sonali: say that the ipo market does not open as widely as expected. what does it mean in terms of new capital that investors are willing to give to private equity and even private credit firms when they have had so much of their capital tied up in liquid markets anyways? arjun: really good question, and i think it becomes tricky.

because you have to show exits, you have to distribute cash back to investors. otherwise you are not going to have capital flowing in, because people end up being over-allocated. i think it is a difficult environment if the ipo market does not open up. sonali: about 30 seconds here. are the markets opening back up? do people feel stuck in their ill liquid holdings? arjun: i think it is starting to. the u.s. election tends to be a little bit of a -- until there was more clarity in terms of what was going to happen i think things have been held back. but now with there being more clarity i think the markets are going to open up again. sonali: arjun raghavan, cio at partners capital, who manages, helps clients through public and private markets here. want to look at the markets, because there is more certainty. there is more certainty at the white house, more certainty in

the senate as well. and the markets reacting positively. the nasdaq now positive, up almost .2%. i'm sonali basak. stick with us through the close. this is bloomberg. ♪ drop everything and get some magic of your own during the xfinity black friday sale. xfinity internet customers, our best deals of the year are back! switch to xfinity mobile and get your choice of a free 5g phone, plus your next unlimited line free for a year. get amazing savings and connect to wifi speeds up to a gig on the go with xfinity mobile. fly don't walk to get our best deals of the year. connect to the world of wicked this holiday, only in theaters november 22nd. dad: hey boss. you okay?

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announcer: from the world of politics to the world of business, this is "balance of power."

live from washington, d.c. joe: donald trump visits joe biden at the white house as senate republicans pick jon soon as their new leader -- jon thune as their new leader. the president-elect makes some waves, touching both ends of pennsylvania avenue. and we have news. i'm joe mathieu alongside kailey leinz in washington. thank you for joining us for the wednesday edition of "balance of power." kailey, this has been a lengthy meeting. still have not seen donald trump since they went behind closed doors. kailey: we are going on two hours now. only briefly did they speak publicly to the press, effectively died in congratulating trump on his victory, pledging to help him with this tradition -- this transition. while donald trump said, politics is