>> welcome to bloomberg markets. 24 hours since president trump was sworn in for a second term and market responding to a number of developments. for now, it's a little bit of everything rally although the gain in the dollar has faded a bit. s&p 500 reclaiming 6000 which it had shortly given up after christmas. small caps are leading the gains with 10 out of 11 groups advancing. the exception is energy stocks overall. the 10-year yield now down five basis points to 4.57%. the dollar, i mentioned was higher, but has given up that

ground, now little change to last month's low. hovering around a 1-1 low at the moment. i want to talk about how the dollar is strengthening the most against certain currencies, the mexican peso and canadian loonie. you can see a big shift here after donald trump told reporters that he plans to impose 25% tariffs on both countries as soon as february 1. not everyone thinks trumps tariff plans are set in stone and will take place on february 1. his read on what president trump will actually do. >> and that executive order that outlined the trade policies of the president, china was in every area where canada and mexico was mentioned, you just didn't mention it. most of the deadlines in that executive order are april 1. i would expect that to be the

deadline. that is classic donald trump. he is going to move the goalposts. he is going to tell you it is happening sooner so that we all have to wait to see what is happening next. i don't anticipate tariffs coming on february 1. scarlet: for more on the currency picture and trade with president trump, we are thrilled to welcome kate jukes of societe generale in london. good evening to you and thank you for staying late with us. it sounds like we're in for a volatile 10 days before february 1. how bumpy do you see things getting? kit: possibly chaotic, possibly bumpy in the sense that people say things, we move, someone says something different, and then we move back. this is a game, negotiation, these trade talks. i will do this, it doesn't mean anything until you say what you

will do. we end up down the road at a position that we are comfortable with. we shouldn't take any of the opening rounds as gospel in that sense. scarlet: we shouldn't, but the currency markets will move on it. at what point, as we get closer to february 1, will this noise died down or it will it reach a fever pitch by february 1? kit: i think it will continue beyond february 1 in practice. by february 1, we will have made some progress and the goalposts would have moved a little bit but i'll think we have solved the whole issue. someone comes in with a hard and fast tariff move, 25% tariff, the person who takes that tariff either raises prices to compensate for it, or comes back with their own tariff. tit-for-tat sort of move.

the first country that has to react or we sit down and have a conversation. the whole process can get very long, very drawnout, complicated. there are two things we have to remember. firstly, by and large, tariffs are something that nobody wins from. maybe three things. secondly, if you impose tariffs on me, i'm not going to cut the price of whatever i'm exporting to you. prices go up a little or a lot. it is not disinflationary. the third thing to remember, the united states is doing this against a backdrop of very nearly full employment. if the idea is to get jobs, most people who want a job in the states have got one. we have to find people in the u.s. to benefit. scarlet: the latest cftc data on fx shows a huge net long

position in the u.s. dollar. to what extent does that reflect the dollar strength versus drive the dollar strength? kit: reflects the dollar strength, a decade of u.s. exceptionalism, strong u.s. growth, less regulation and a bunch of ways. you should not discount how good the last decade has been for the u.s. dollar. but we have now is a long position, even bigger position in terms of that foreign positions into the united states. the biggest savers, the germans, japanese, norwegians, sweden's, they have been buying u.s. equities, u.s. everything for the last few years, because they are doing better than any investment they could make it home. scarlet: that is that u.s. exceptionalism you are talking about. that and monetary divergence is reflected in the dollar.

still, we know that markets tend to overshoot. how much stronger can the u.s. dollar get from here? kit: my first job in 1985, i asked the head of the bundesbank , how high can the dollar get under that run up under president reagan? he said i do not have a clue. we intervene every day and it goes up every day. i learned not to try to be too clever on this. i think we are nearer to the top than to the bottom or the middle. there might be a little bit more. the danger is, u.s. assets have done so well, so much money flooded in, when it turns, soft landing the dollar will not be that easy. if people start pulling money out, that could easily become a flood. scarlet: as we look ahead to the end of the week, the boj holding its meeting, all kinds of signals that they will hike by 25 basis points, after not doing anything in december, choosing

to wait and see what the trump administration does. what do you think the boj has seen now in day one and a two that makes it comfortable hiking now? kit: they are not seeing the yen strength and to quickly. moving from 100 into a dollar to 165, when they started moving rates, we came back to 140 quickly, and that is really uncomfortable because that is disinflationary. now they have confused the market enough that the yen is moving slowly stronger at best, and the dollar is quite strong still. that gives them room to act. the yen might not really too much particularly if u.s. treasury yields start to move higher again. scarlet: certainly the bigger driver once the fed and boj are done for a while. kate jukes, thank you so much for joining us. the head of fx strategy at

societe generale in london. a number of executive orders that president trump has signed since being sworn in yesterday. more action expected today. for more, let's bring in kailey leinz. a flurry of executive orders signed yesterday. give us some of the highlights that we need to be on top of right now. kailey: 24 executive orders and four miranda the have the same effect. he came out addressing these things, rescinding 78 executive action from the body administration and that enforcing a lot of executive actions of his own, one being to an emergency at the border which will allow more resources there. he is entering birthright citizenship as well as reinstating the remain in mexico policy. he also declared an energy emergency. the opened up more land to oil and gas development. ending what he calls biden's ev mandate and offshore wind

farming leasing. he also pulled out of the paris climate accord and w.h.o.. in the federal workforce, and dig dei, saying that the federal government only recognizes two genders, male and female, making official this department of efficiency actually inside the executive office, renaming what was the digital service to now the u.s. doge service, which gives elon musk an executive office, email address. he will have a lot of power inside the u.s. government. he is giving tiktok 75 extra days to find a deal not to be banned if they can reach a divestment. then there are the january 6 pardons. he is making good on a promise to part in nearly all of the 1500 people convicted of crimes related to the riots. scarlet: a busy day and some of

the executive orders he sighed have already drawn lawsuits. democratic-led states and cities are launching their first court fights against the new administration, suing to block his attempt to end citizenship for children born in the u.s. whose parents are in the country unlawfully. in terms of what is on the agenda today, are we likely to see cabinet members confirmed? kailey: we could. marco rubio was sworn into be confirmed today after the senate unanimously voted for him last night. john ratliff cleared the committee hurdle he needed to. now it is just a question of whether unanimous consent can be reached to move things forward quickly. we just listed everything that donald trump has tried to do at the executive level which draws legal scrutiny. in some ways, it is getting around the law. he has to speak with lawmakers about the actual legislative agenda as he moves forward.

he will be meeting at the white house this afternoon with mike johnson and john thune and later with republican congressional leadership to talk about the budget reconciliation package or packages you want to see put forward to enact the other parts of his agenda that he needs congress to come along with him in order to achieve like tax policy. in addition to things like raising the debt ceiling and keeping the government open past mid-march. there is a laundry list of things where he needs the cooperation of others in washington to achieve. the other thing i would mention, late afternoon, caroline levitt, white house press secretary, says we should watch out for what is being billed as a massive infrastructure plan from the president. no signal about what that will be. scarlet: when those comments are made, we will bring them to you live. thank you, kailey leinz. joining us in washington. you can catch "balance of power" in the next hour of bloomberg television and radio.

netflix reports after earnings after the bell today. we will have insight in a moment. we will see which metrics investors are tuning into now that netflix is no longer reporting subscriber numbers. this is bloomberg. ♪

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scarlet: this is bloomberg markets. i'm scarlet fu. the s&p 500 and dow are at session highs as we build on last week's rallies. let's look at some individual movers and bring into emily graffeo with more. emily: charles schwab had a pretty good earnings beat. the stock was up as much as 8%. the biggest jump since november after the company attracted record inflows into its retail

brokerage business, adding 1.2 million new brokerage accounts in the fourth quarter, beating estimates. revenue also beat estimates, coming in 20% growth year over year, five .3 billion. over all results showing positive trends of you where, according to an analyst at jefferies. a different story for shares of walgreens. that stock tumbling today after the u.s. department of justice claimed walgreens distributed controlled substances like opioids in pharmacies across the u.s. while ignoring red flags that the prescription were probably illegal. walgreens had denied the allegations and actually sued the usda over requirements on pharmacists. finally, looking at shares of netflix. the stock is reporting after the bell. although this is a streaming company, it's becoming increasingly more to analyst

that they need to focus on live events and sports. that is where the advertising revenue is coming from. wall street will be looking for any kind of positive announcements on their increasing foray into live events. of course, the screaming match between jay powell and mike tyson attracted 65 million viewers a couple months ago. if they make any announcements like that, that is one to watch. scarlet: emily graffeo, thank you. which sets us up for our next conversation, netflix, our stock of the hour. she the rock and not then covers --- that boxing match, the christmas day games as well. what is the specific narrative on live events that netflix was to push on investors? >> live events not only drives subscriber growth but also

starts driving advertising revenue in a huge way. as you had mentioned, subscriber metrics are going to go away after the report today. they will no longer disclose subscriber metrics, so we need new metrics to focus on. a big part of that will be double-digit revenue growth which is going to be bolstered by advertising. they have to find some way to find the next big thing which will be advertising and live sports is the perfect set up for driving that revenue. scarlet:d-based revenue is critical here. they plan to double their revenue in 2025. what can they offer their customers something different from what traditional media has offered, or does it do a better job of monetizing its customer base than traditional media? >> it will do a better job of monetizing because digital in general offers better targeting. netflix had a slow start when it comes to advertising with those

revenue numbers, so we think they can get to $2 billion or $3 billion in ad revenue by 2025. next couple of years time, expected to become 10 to 15% of total revenue. in terms of how they do better than traditional media, a targeting will be better. add loads are going to be better, so that makes the ad not so annoying. with tv you have about 15 minutes of ads per hour. with netflix, it is four minutes. they are trying to make it much more palatable to the viewer. scarlet: merged with the content as well. thanks for joining us. we will be breaking down netflix earnings with geetha ranganathan on bloomberg radio and television throughout the afternoon. i want to mention oracle. oracle executives, as well as

executives from softbank and openai are expected at the white house. expected at the white house. currently looking at shares of oracle up about 4.5% at the moment.

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9 out of 10 couples sleep better. and now, save 40% on our new special edition smart bed. shop a sleep number store near you. scarlet: this is bloomberg markets. i'm scarlet fu. it is day two at the world economic forum in davos with the global elite is gathering. jonathan ferro and lisa abramovitz are there and they sat down with the ceo of bank of america brian moynihan. he anticipates enthusiasm for deals to get done. >> what you are hearing is enthusiasm in the investment banking side particularly transactions.

the last couple of years, it's been hard to get a transaction through. what stops a seller from selling or buyer from buying, i'm exposed. so they will push it through. a lot of enthusiasm there will be better growth in the united states, bankers saying that these deals can be done so they can have these strategic conversations. now it can be a great idea, let's do it. it is more of a substance base, more than a worry about the environment. >> basically you are saying there is more conviction and will to get stuff done? >> you will see more deals getting announced. in the banking sector especially in the united states, consolidation is still far away from being done. there will always be big banks, small banks. i will let people make a decision on what they need to do, but there have not been a lot of deals done. as investment banking, we can help other people do that that

there has been uncertainty of getting caught in a transaction. the belief that they should promote the banks, getting more efficient, passing on to customers will be a change. >> there is the banking sector specifically, deregulation, whether these mergers and consolidations will be allowed. then there is the part of the corporate sector. we have heard from the head of citi, jp morgan. how much of that is premature based on some of the policies coming down the pike, uncertainty around debt, deficit, rates? >> you have to divorce a little bit from the fiscal work that has to be done. the incoming treasury secretary has to take seriously the question of how we manage the revenue stream, expense stream, get it all to work out. that becomes easier if you have more activity, more things going on. enthusiasm from the bankers is more structurally, they believe,

even starting yesterday, you don't have the constraint that you had. if there is more that enables more, that is good stuff. right now it will stop it going from the wrong direction. our medium and small size businesses, their biggest complaint last summer, and we talked to the administration about it, you are in my pocket, i cannot get things done. i want permits to do something. it takes forever. labor rules, all of this stuff. small businesses don't have the people to figure that out. the same person running the business is sitting there at night saying what is this new taxation on social security? how does it apply to me? they are just saying, if you just stop, things will get better. >> you are the number one lending to small businesses in the united states. are they already make those

decisions to make those investments that were on hold over the last four years? >> over the last eight months, it went from regulation and inflation. the inflation has come down as their worry right now. what is interesting is they are going back to labor shortages. the interesting thing about that, there is a question about immigration and all of that, but what they are feeling is demand. scarlet: stay tuned all before bloomberg covered from the world economic forum in davos. let's revisit oracle shares. they are higher, at session highs, after cbs reported that president trump will announce billions of dollars of investment in the private sector to build ai infrastructure. it will be called stargate. sam altman, larry ellison, and masayoshi son will be expected at the white house this afternoon.

that does it for bloomberg markets. "balance of power" is next. the way i approach work post fatherhood, has really trying to understand the generation that we're building devices for. here in the comcast family, we're building an integrated in-home wifi solution for millions of families like my own. in the average household, there are dozens of connected devices. connectivity is a big part of my boys' lives. it brings people together in meaningful ways.

>> from the world of politics to the world of business, this is "balance of power." live from washington, d.c. joe: the rates have begun.

welcome to the faster show it in politics as a trump administration announces the start of targeted raids on the president's first full day in office, following signing thousands of executive orders on day one. i'm joe mathieu alongside kailey leinz. we are back here to stay after the inaugural. the orders we saw a range from climate to energy to the border. kailey: and the federal government as well. you could add tiktok, january 6 pardoned. it was a busy first day in office for president trump. 26 executive orders aside, four memorandum. that is a modern record. he seemed to be focusing on these big buckets. of course, he still has to date ahead of him as he is getting ready to meet with republican leadership at the white house, and then this afternoon, and event dubbed by the white house press secretary as a massive infrastructure announcement. cvs is reporting that is a joint venture for artificial intelligence infrastructure by