>> i think the inaugural speech was essentially an advertisement for investing in america. >> u.s. labor market has been the most resilient labor market in the world. >> seeing a lot of merit in build baby build. >> we will have to see what the year brings because there are still more unknowns than knowns in the equation. >> this is bloomberg surveillance live from davos with jonathan ferro and lisa abramowicz. >> live this morning, good morning good morning. from her audience worldwide it's day three at the world economic forum. once again equity futures doing ok over in europe all-time highs on the stoxx 600 which is quite remarkable given the diplomacy we are seeing.

europe could be getting some tariffs. china may be getting 10%. this changers from one day to the next. the rhetoric has softened at least that is the perception and people are looking for areas that are overbid. that's why you are hearing an increasing number of corporate executives and banker singers or new interest just because the bar is so low for his success. jonathan: what do we hear from brian moynihan at bank of america yesterday, some optimism out there. tons of optimism here in davos, we need to be specific as we were yesterday, tons of optimism from american executives. everyone else there still a big question mark. lisa: that is to be clear public conversations is a lot of optimism. a bit more skepticism in private conversations about tariffs and how they will be implemented and which regions are going to be affected most and then just about interest rates and the debt and question about whether we are entering a new more

inflationary time and how much that could stymie some optimism. but on the surface, happy valley. lisa: anne-marie doesn't sleep anymore, she's moved, stuck in the nation's capital following every single headline that comes through the president donald trump. another news conference i think we've heard more from this president in two days speaking to reporters then we heard from joe biden in the last year. >> it is certainly close given the fact that this president held an off-the-cuff news conference on his first day in office a hind the resolute desk and then yesterday when he was announcing this ai initiative flanked by some executives including sam altman he then started riffing once again with the press taking questions and that's where we heard more about tariffs and this is keeping financial markets and investors on edge. what day one of the office he went after mexico and canada. day two he was back talking about china. take a listen. >> talking about a tariff of 10%

on china. in the countries are big abusers. it's not just china. china is an abuser but the european union is very bad to us. >> so tomorrow you may hear more about the european union when donald trump is set to address the world economic forum that's taking place where you guys are. when it comes to china though so interesting is donald trump talked about 60% tariffs on the campaign trail. so potentially this is potentially donald trump with the negotiator, the deal man is back. talking about 10%. one thing we know is there is been no executive order on tariffs specifically. there is just been an executive order on making sure there is a review on unfair trade practices. donald trump is putting in place the pretext for him to go after some of these countries without review. day one he said february 1 but

in the text it's april 1 so i guess the next few weeks it will be quite volatile. jonathan: as we have seen in foreign exchange the past two days. we will catch up with amh in about 30 minutes time just to confirm she is coming back. plenty of visits to washington dc. lisa: i do think it is interesting that donald trump will be speaking to happy valley where a lot of people are paying attention to him, he is giving them some love. jonathan: i'm not sure how happy they will be after that address print joining us is j.p. morgan chase president. >> then you for inviting me. jonathan: do you feel lighter now you know you're stepping down. >> i've been with the company for more than four years. i add my contribution to the success of the company. it's in amazing place at the moment it is the right time to embrace and prepare the company for the future. i feel good about the

opportunities with my contribution and looking forward to a better balanced life going forward. lisa: why now? and what do you expect in the next 12 to 18 months to look like. annmarie: this -- daniel: this is planned for a long amount of time. this is time for me to transition. this will go over a couple of years. my job will be to help the management team to continue advising jamie and the issues of strategic importance for jp morgan and for the future of the company so it is the right time, it is the right group that helped jamie to build up to. i think that i feel good about where the company is. >> you've been a jp morgan its affiliate banks for decades paid it's a long time. you've been to a lot of davos is an seen a lot of different cycles of enthusiasm.

how enthusiastic is the optimism of the dealmaking and some of the mergers and acquisitions they could come down the pike. >> it is quite enthusiastic. so you think about the historical average in 23, it was around 3.2 now you get 3.5. this year could be to around 4 trillion just a historical average and most important we hope that the timing in the u.s. to approve transactions is not as long, it's more than six months in the past, around 18 months so we can go back. it's not just to announce in the environment for now. >> is it just the regulatory shift we need or do you find the 4% and 5% interest rates help people -- held people back as well. daniel: if you think about the u.s. economy it is done very well in 24, it's likely to grow

over 2% this year. so the environment is good. i think even that is an economy that you don't see imbalances that tell you it's in an economy about to go into recession bring this cycle could continue for time. there's plenty of monetization that needs to be done in this space that is essentially in the u.s. that are much higher than other places. it's also incentivizing merging into u.s. companies. so i think it will be a good environment. >> one bank yesterday said maybe these banks could go on a shopping spree in places like europe where valuations are depressed. you've engaged in active conversations of companies looking to do those. daniel: we always engage with clients all over the world and there's a lot of optimism everywhere so therefore yes,

there is dialogue everywhere. lisa: you go to some of the soirees in the evening and people say this a lot of enthusiasm. what will actually get done, we are less clear on simply because there is that? to john's point about benchmark rates. so why would they go any lower and what happens if they go higher still because of debt and deficit. >> i tell you how i think about it. when you thing about the u.s. economy balancing to consumers in a good place, the corporate sector is in a good place. inflation hasn't yet gotten to the levels it should be and the deficit is high. then you have policies, in fiscal policies and others. so at the end, this government is about growth. so therefore they will balance the input mentation of those policies in a way that it doesn't need it over the economy

or recession. i think that the hope is because of that because economies and certain things like rational revelation in our sector could be good for growth. but if things go too far than the fed may have to hike rates and deal with inflation rate hopefully it doesn't happen. >> some people are asking what could potentially derail this optimism. is there anything you could see derailing this optimism this year at a time when people are basically counting on this sort of rational regulation or some of the other progrowth measures. >> it could be the economy goes a bit too fast and doesn't allow inflation to come down. the geopolitical space is still in a challenging place. there is some signs of potential

improvement there. and at the end you can do the right amount, hopefully the right amount is not in a way that doesn't really derail an economy that is not really for recession. that is not ready to continue to grow at a decent pace. >> a lot changed your banking career. and now bunch of alternative asset managers are looking for activity on a bank balance sheet. can you walk us through how different banking might look in the years ahead compared to when you first started. >> it is very different. i think it is in a better place with more scale, better quality of service. and a safer industry that probably has ever been. i think referring to private credit, i think that banks lending for 200 years in private credit is not more than normal

loan. so i think we feel very good in order to compete in that space and at the end, so what is our objective. to be able to provide the best possible service to a client. so therefore what is it. we will be able to offer the facility, being able to offer that lending facility. those markets will tend to converge some way or the other and we are in an amazing position because we do have a relationship with all of those clients. not just the loan we offer a bunch of activities. jonathan: we saw a relationship developed between apollo and citi at the end of the last year. are you asked boring -- are you exploring partnerships. daniel: we have several with other asset managers and they want to participate. the issue for all of these at the moment is they are getting a

huge amount of influence. so therefore, to have a partnership with someone like us to be able to participate is a good thing. not just with one. >> that kind of dynamic and gets people worried. for going forward. i realism sounding pretty negative but given how much the flows have come in to the private credit sphere and they've been searching for ways to be deployed, is there anything that makes you nervous within this ecosystem that's grown up very quickly. daniel: at the moment now. when you look at these funds, they don't have too much leverage. so from that point of view particularly in the bigger

space, the only thing that made me pause and think about it is there is a lot of direct lending going into small business, a lot of that going into the smaller side of middle markets. and this industry in the current form hasn't been tested through the downturn cycle because when this happened this was all subsidized by the different governments. so how these are going to behave in a downturn with a small business is something you want to be concerned about it. i don't think there is a systemic issue in this space in the short term. the components are not there for that to happen. jonathan: how is the golf game? daniel: it is ok. jonathan: what's the handicap now. daniel: it's gone from five to eight. jonathan: appreciate your time. congratulations on a fantastic career.

looking forward to covering next 12 months with you. daniel pinto, the president of jpmorgan chase. get an update on stories elsewhere with your bloomberg brief let's crossover to dani burger. >> president trump says he's likely to impose sanctions on russia fly reboot doesn't go on -- go to the table. putin says russia was right for talks with the u.s. emphasizing the need for long-term peace plan based on respect for all nations interest. trump said during his campaign he could end the conflict in one day once back in office. netflix shares are soaring in the premarket session more than 15.5%, of the streaming giant added 18 point 9 million subscribers in the fourth quarter. easily its biggest quarterly subscriber gain in its history thanks in part a live sports and the return of squid game. neff was also announced it's raising the price for its popular u.s. plan by $2.50. it's also increasing the cost of

its cheaper add supported plan. on the other side of things apple has lost its crown as the world's most valuable company after closing at its lowest price since november yesterday. the job erased more than $110 billion of market value sending it below that of nvidia. apple was hit by two broker downgrades as well .2 week sales in china and tepid consumer interest in its smartphone ai. jonathan: more from her in about 30 minutes time. up next, gutting the red tape. >> the biggest complaint last time last year. if we talk to the administration that was the biggest complaint was you are in my pocket, slowing me down paid i can get things done. -- cannot get things done. ♪

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jonathan: stocks are doing pretty well stateside. equity futures up on the s&p 500. even better in europe on the stoxx 600, all-time highs a little bit earlier in the session which is amazing given some of the headlines we saw overnight. lisa: less amazing when you hear the conversations we've been having about people looking potentially to europe for an opportunity at a time when essentially if it is cheap it is better simply because people are worried about overvaluation. jonathan: cutting the red tape. >> medium small sized businesses the biggest complaint last summer we talked to them about this, the biggest complete was here -- you are in my pocket slowing me down. i want -- all of the stuff just going on. small and medium-size business don't have the thousands of people big companies have to figure it out.

it went from regulation inflation. inflation is come down. what's interesting is there going back to labor shortages. >> strongly held view from the u.s. executives that things are about to get a whole lot better. joining us to discuss is the guggenheim ceo and walsh. welcome to the studio let's talk about of salespeople running around davos trying to sell saying things are really good in america and they could get even better. you have to put money to work and we are priced for a lot of that. how challenging is it for you and the team. >> it is an interesting time. you've got rates that are range bound, of the 10 year trading between 375 and 475. you have credit spreads that are tight relative to history and you have stocks that are stretched and valuation. relative to expectations and a risk premium that is less than zero. so it can be very trickery at

this -- tricky at this particular juncture but fundamentals remain strong so there is opportunity for investment in may be a wide array of exceptions and sectors. there are things to invest in. >> i remember the sort of pendulum switching from bonds to stocks. people saying stocks really seem like the dynamic place to be in a progrowth administration at a time where inflation hasn't completely gone down. do you agree with that that stocks are preferable to bonds at a time when really growth is the main theme. anne: i think that does give a lift to stocks and as long as the earnings-per-share projections turn out to be accurate i think there is still room for opportunity in equities. we also have to remember that not all markets are exactly the same. so if you look at the russell 2000 you still a very high percentage around 40% that are non-earners and the mag seven of course is well below risk

premium levels that we have seen not since the late 1990's where we had negative risk premiums. so i think we have some risk associated with the market. that it is priced for perfection. so i would be cautious -- cautiously optimistic. we still see earnings-per-share rising. maybe not at the level that is priced into the s&p earnings-per-share growth but nonetheless still a fairly positive environment. >> stocks are priced to protection in your view. >> i think there are some real opportunities in fixed income still paid we've a risk premium that's positive relative to certainly relative to equities and you're getting a real rate of return that is much better than we had pre-covid and you are getting a nominal rate of return in any number of areas that make a lot of sense so we like all sorts of credit stories, structured credit, corporate credit even high yield and particularly the

high-quality portion of the high-yield market. there is still some real fundamental value that can be found in fixed income. jonathan: can you say something about treasuries. anne: we are range bound and treasuries pray there is a trade that is actionable. up towards the top end of the range, 475 you can extend duration. you can also as we move back after all we saw 120 basis point rise in the 10 year and we were able to play that trajectory really quite nimbly if you will during that window of time. >> the incoming government might have to look at extending duration as well. how do you think about the deficit concerns of the moment and you think that's been responsible for the pickup and yields through december into the new year. >> there's a couple of things that really influence the rise in rates. one is the deficit and it's a real concern. who is going to buy all of these bonds that we have to issue in the u.s.. right now we are still being able to be financed through both

u.s. investors and international investors so that story is still playing out pretty well. but at the same time you also have the fed that is sending mixed signals with regards to the rate trajectory. our belief is rates are still going to be moving down over the course of 2025. and we will move towards a neutral rate and i think it will be tricky for the room -- fed to find that neutral rate. at the same time they are still slowly reducing their balance sheet. they are sending mixed messages and acting in mixed ways. lisa: john alluded to this idea the uss to finance this. where will that money come from. we've talked about that sucking sound of cash going in to the united states crowding out some of the debt issuance and other assets in other regions. how destabilizing is it to have one economy accelerating so quickly and diverging from the

rest of the world. >> it is unusual, but what i would also say is because of the strength of the u.s. economy has definitely been there. we continue to see an inflow of capital and we will see that. the opportunity for investment will go beyond the markets necessarily into infrastructure investment, manufacturing buildout. for the u.s.. not for the rest of the world. and so there's going to have to be some real balance there but for the meantime, the russell will continue to attract capital. jonathan: can we get you excited about europe in any way shape or form. anne: it is beautiful. jonathan: a lot of people say it's a great place for vacation. can we get you excited about europe? anne: i think europe has some real opportunity but they have to really make some structural changes. and we will see if europe is able to do that. one of the areas of maybe concern or caution is previously

very stable governments are seeing some turmoil. france, germany, elections coming up. i think as we come through those and we see more evidence of the trajectory and if we see a real desire for europe to engage in structural reforms then we might be able to see and investable opportunity. jonathan: guggenheim cio, a great to see you. a lot -- we could sit here and list the reasons people are down on europe. at the same time we have an equity market in europe today that is an all-time highs on the stoxx 600. lisa: how many of those companies making all-time highs are related to u.s. sales pride they are doing better because they are hitching their line to the wagon that is the united states of america and the growth there. that is the big question. how much is the u.s. wrapped in the european basket and looking pretty good. >> wasn't at all just u.s.

picking up doing better. lisa: remember when that was the china story? china consumer was buying everything now it's the wealthy u.s. consumer. with euro-dollar around 104. coming up, the rbc ceo to explore the tension that's emerging not at the border between canada and the united states, that's next. ♪

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>> doesn't always happen. jonathan: equity futures hi gher. a little bit of a lift on both sides of the atlantic. equity benchmark. s&p 500 posited by .4%. the bond market has really settled down in the past few days. we can cross over to manus cranny. manus: good morning to you and davos. -- in davos. nearly 19 million signed for a netflix account of the fourth quarter. not only did that beat by nearly 50% the estimate, but more price rises to come through and netflix, that is what you call elasticity of pricing. was it squid game's, carrie on,

or live football on christmas day that you and the crowds? this is where netflix is going. it is more about the live event and will you spend extra. they will spend $18 billion on content this year. that is a vacuum cleaner being switched on in terms of competition. oracle, the personification not just of the deal in ai, it is called stargate, and the trifecta between softbank and larry ellison and oracle and sam altman. access to the deal, access to power, access to being in the room and access means everything. being one of the protagonists they get your hands on tiktok usa. that is what you call access to power and $48 billion of market cap added to the company in the past we four hours. we were up 10% at run point. united air.

premium international travel. international trans atlantic travel is a core component of the beat here. 20% comes in that transatlantic lineup. profits of 24% in the last year. they are guiding for a good first quarter. $.75 to $1.25. jonathan: thank you, sir. squid game's. did you watch it? lisa: my kids did. jonathan: it's pretty dark. i have never watched squid games. lisa: the first one was better. jonathan: this one got worse? lisa: just a little more formulaic. jonathan: netflix is higher. over to anne-marie for more in washington. annmarie: trade is starting to become the focus in washington after we heard from president-elect -- president donald trump yesterday. day 2, focusing again on tariffs. when asked what is going to be

the tactic, on the campaign trail he said day 1, the walls are going up. we have seen a little bit more of a negotiating tactic. what we have seen from the likes of china, canada or mexico, the leaders are starting to talk about what their plans are to combat what is coming out of this white house. we heard from justin trudeau of canada yesterday saying this is what trump likes to do. he's a skilled negotiator. he wants to keep you off balance. what trudeau says is the canadian government has a plethora of what they can do to combat these tariffs. if the u.s. comes in at something lower and not as grand, they can also come back a tit-for-tat dollar for dollar. if the united states goes to 25% on canadian imports and tariffs on that much, they are looking at maybe aluminum. we do see trading partners

preparing for trump to point out -- trump 2.0. we do know that he wants to have a review until april 1. i like with the mexican president said. we all need to take a deep breath and keep our heads cool when dealing with this new administration and this new world. jonathan: we will take a deep breath right now. dave mckay, good to see you. dave: great to see you and davos. jonathan: i don't understand this spat. i remember when you joined us month ago. 34 states running surplus with canada. if we strip out energy, united states runs a surplus except america needs the energy because the way the refineries are set up. can you claim to me with this tension is all about? -- explained to me with this tension is all about? dave: the supply chain

integration, the energy integration. the u.s. imports six billion barrels a year. 60% of that comes from canada. it is upgraded in the midwest at a significant profit. upgraded, make $10 billion, $20 billion of profit. a very strong alliance. there is a lot of signaling going on in the queue medication signaling the importance of energy and defend in the borders. the importance. of the arctic that's a strong communication there's more we can do together.

there is more energy we can produce. particularly lng. asia needs lng. we have multiple pipelines we can export to asia. we have been able to build the pipelines and export lng. we can leverage resources but also rare earth minimal's -- minerals. when you think about the production of germanium necessary for fighter jets and military equipment, china was a supplier before. there are opportunities to build supply chain integration on rare earth minerals. 70% of ours goes to american farmers -- pot ash goes to american farmers. you look at uranium needed for nuclear power to drive all that power needs from an ai strategy. 30% of uranium into the u.s. comes from canada. when you look at the ability to export, it is in sync with the president strategy. -- president's strategy. we failed to develop our resources in an expedited manner.

therefore the message is strongly canada. you have the assets. they are an important part of the overall relationship. you need to change or policy, your communication, and get the project done. you need to get the mines developed into the marketplace. is required for national security, future energy issues. we have to get going on it. lisa: one of the obstacles for a lot of places his leadership. we have seen the collapse of the government, the question around who will negotiate with donald trump. there is what you want to see happen and then there is dealing with reality now. dave: you are so right. capital flows when there is certainty. when there's uncertainty about rules and regulations, it is harder to invest capital. you are seeing this in the

american exceptionalism. tone at the top matters on national issues. you call it animal spirits. when you have messaging from the top around pro business removing red tape, leveraging talent, that causes investment. the belief in the future opportunity. whoever leads canada will go through democratic process. tone at the top is something we are missing again. lisa: in the united states, as a bank expected -- executive, oil and gas. there's a time when you have drill, baby drill an increasing amount of energy needs with artificial intelligence. focusing on that area to expand or broadly in the united states. dave: as we look at our markets face business account, we've had opportunity to serve clients. we are a leading energy bank but

we focus on balancing the overall missions in that portfolio as we committed to an overall journey towards net zero in 2050. we are being challenged on all fronts to maintain prosperity, to maintain growth and equality. we have to make tough decisions as a society how we will balance all those and maintain our competitiveness. we are carrying significant amount of debt. you hear the themes at davos. we have growth and competitiveness. it is the theme. you have to think about your rules and regulations, attracting capital into your marketplace. 40% of global capital flow when into the united states last year. to your question. that tone, the ability to be successful, the rules, that is driven strong growth in the united states.

you are seeing european leaders mimic that. you will see that mimicked in canada as well. jonathan: ai and growth of infrastructure. a big push overnight from the u.s. administration. could you describe the opportunity to do some thing similar to what's happening in america? dave: you need ai and data and platforms. pd clean power and cost of power is important. if you look at the struggles of some of the countries around building secure power, the cost is made them uncompetitive. you look at germany. what canada has to offer with such large power needs to store the data and process the data, you need a colder climate to keep the circuits cool. you need abundant and cheap electricity. when you look at canada's ability for not only hydroelectric but from gas powered energy and more nuclear energy in the future, it is a great place to put your data. better to move the bits and bytes and it is to move the

natural gas and pipelines. therefore huge opportunity for canada for cheap energy to power those data centers. we are pitching that and you are seeing a lot of interest from u.s. platforms and data centers. lisa: i feel the tension between increasing energy abilities, energy production and reducing emissions. having some kind of clean goal. it's been a vibe shift we have seen dramatically. rbc is the only large canadian bank that is not exited the net zero banking alliance. are you inspecting that to change? dave: as i communicated before, we have a process we are going through to evaluate that. it served a purpose early on in its incarnation to get banks together to talk about their journey to create a scenario that's becoming increasingly improbable in the world. i have to agree. when we think about how we take the journey, it served a purpose going forward. i'm not sure u.s. and canadian

banks are signaling it has served its purpose already. stay tuned. we are going through a review process and we will make the announcement and due course. jonathan: have you spoken to the conservative leader? dave: i have. jonathan: what are you hearing? dave: he has got a lot of experience in our country. he has a hunger to lead the country and he will go through an election process likely this year to convince canadians he's the right person to lead us. i come back to my message. tone at the top is so important. you are seeing a change in the tone at the top and europe. pro-business, pro-growth, less relations. we just need that leadership. jonathan: good to see you. great to catch up. see back in new york. dave mckay, rbc ceo. let's cross over to new york and catch up with dani burger.

dani: president trump says he's open to oracle chairman larry ellison or elon musk purchasing tiktok as part of a joint venture with the u.s. government. trump signed an executive order on his first day accepting -- extending the sale deadline by 75 days. frank mccourt and kevin o'leary made a formal offer to buy tiktok earlier this month. shares of united are rising in the premarket. more than 3.5%. they reported fourth quarter earnings that beat estimates and projected first quarter profit well ahead of wall street expectations. the airline attributed the strong outlook to unusually high demand for premium and international travel. meta is working on upgrades to smart glasses and wearable devices like watches and camera equipped earbuds. people familiar say meta is working to create smart glasses for athletes this year. they aim to release their first true augmented reality product around 2027.

that is your brief. jonathan: thank you. flew over here with united to list talk about united. everyone seems to have global services and premier 1k. i'm standing there and it's like can we have global services? top-tier. then it is premier 1k, the other quarter of the plane goes on. lisa: what would they have to pay you to go on united? jonathan: constant thoughts. up next, u.s. exceptionalism. >> it's the epicenter of all discussions. folks want to go. there's a ton of liquidity out there. there's a lot of pent-up excitement. let's wait and see. ♪

jonathan: equity futures up nicely this morning on the s&p 500, elevated by a few tense of 1%. nasdaq higher by .8%. bond yields stable around 460. under surveillance, u.s. exceptionalism. >> the u.s. is the epicenter of all discussions. folks want to go. there's a ton of liquidity out there. a lot of pent-up excitement. let's wait and see. you are seeing the biggest pools of liquidity in the united states. you have the building blocks of valuation arbitrage. corporate versus europe and the rest of the world. there is a massive potential. jonathan: we heard this from citigroup, from jp morgan earlier this morning.

you are hearing it across the board. lisa: how much is that optimism going to translate into deals getting done and a pipeline building back up and with a pipeline looks like? where it is getting financed when the market looks different today than five years ago? jonathan: let's extend the conversation. perfect guests for it, lynn martin. jonathan: everybody is so upbeat. you met with the president recently at the new york stock exchange. what did he say? lynn: it really put a fine point on his focus on highlighting the u.s. economy and the strength of the u.s. economy. it feels as though the progrowth agenda is going to be something that is front and center for his entire cabinet. jonathan: i can feel that in the confidence levels. are you seeing that in activity levels? lynn: we are seeing it in the activity levels.

the ipo market is starting to open up. last year was not a bad year when you look at the first half of the year. got quite a few deals out. then you had a bunch of volatility set in because of the election. you were not sure what the outcome was going to be. those deals are now getting on the road. they are making plans to ipo either in the coming days and weeks or quarters or second half of the year. now that the activity is real. lisa: we are getting buffeted around by different headlines and potential policies and tariffs that may or may not come. it seems like people are saying things that they don't really understand or believe because they don't have any of the facts. how much are people waiting for the shakeout? lynn: people are waiting to see some deals go, quite honestly, and to do well in the environment. if i look at last year though, of all the ipos that listed on the new york stock exchange last year, in aggregate they were up

58% versus their ipo price. to me that is the sign that the market is really open. once you remove the uncertainty around the election, now is the time to go. lisa: i was speaking with a bank executive who said the market has been open. there have been a lot of companies that don't like the price that they get when they go out there, especially if they've been hiding in the private markets and elevated in terms of their valuations. is there were growing disconnect about the need for going public at a time where companies can remain private and be highly valued as private companies? lynn: liquidity. that is the one thing you don't get in the private markets. consistent, sustained, deep liquidity. nothing beats the liquidity of the public markets. private markets played important role. not only do they feel the next great idea when it is in its infancy, but also it's able to take a company to the point

where it is public market ready. what you saw were companies rushing out five years ago. even in 2021 when we saw the height of ipo's. they rushed out to take advantage of those valuations. a lot of the morn ready to be a public company. i think as a result of what we have seen over the last three years you are going to see the companies that come to market be higher-quality, know how execute on strategy, profitability, capital returns. all the fundamentals that make public companies successful. jonathan: when you say not public park it ready, what do you mean by that? lynn: clear strategy on where you are going with your business as opposed to throwing a bunch of spaghetti against the wall with a variety of ideas. by the way, that is super important when you are a company in its infancy. you are not sure which direction you are going to take. jonathan: do you feel like your business is challenged by what

is developing in private markets? what explains the decline we have seen in public that publicly listed companies? -- in publicly listed companies? lynn: our job is to ensure when a company goes public it is ready. it is able to take advantage of the depth and breath of the quiddity in the u.s. markets -- liquidity in the u.s. markets. lisa: how much easing foreign entities looking to list in the united states at a time when there is an increasing feeling you have a leg up if you have a more physical presence in the united states? lynn: we have executed i variety of transitions -- on a variety of nondomestic markets to the u.s.. they have seen a marked valuation appreciation. lisa: there's one country this probably absent in that were at least will be going forward or could be, which is china. i wonder how much we see adr's and depositary receipts from chinese companies in the u.s.

do you expect that to fade given the tensions? lynn: there have been some deals that have come to the u.s. market but they are fewer and further between. because of geopolitical policy between the two countries it is still very early. let's see how things progress in the next few months between the u.s. and china. they will be additional clarity on that topic. jonathan: are you confident there could be a resolution? donald trump has not been as aggressive as some people thought he might be in his first two days. lynn: i think he is very pragmatic when it comes to considering the ramifications of geopolitical tensions. lisa: do you feel if people are being careful of this particular davos? yeah, we are excited. there's a lot of optimism. or, do people have a concrete sense of what the next year is going to look like? lynn: people are optimistic in

pockets. there is questions around, you know, the geopolitical landscape. it is probably the biggest one. tariffs in particular. the knock on effect of questions around tariffs will be inflation. those two really do work hand-in-hand. i say people are pretty optimistic though. even on the geopolitical side, if you look at the deal that was done last week to release the hostages and the cease-fire in israel between israel and gaza, there is reason for optimism. there are green shoots people are able to point to. there are data points. jonathan: i hope we see more. it is good to see you. lynn martin. lisa with an aversion to happiness and optimism. lisa: pulled on a second. no. happiness is a good thing. we need to celebrate happiness more.

there's a feeling of what exactly am i missing. in the past davos messages have not necessarily been borne out. it's important to question a consensus at a time when there is a lot of uncertainty. jonathan: i agree with you. gary said you have to take everything at davos with a grain of salt. ken was with us from the imf. this time around he has doubts around whether we see that. lisa: we need more grains of salt on the sidewalk. jonathan: that is a different complaint. up next, former secretary of state john kerry, speaker the house paul ryan, the coca-cola coo. from davos, switzerland, this is bloomberg. ♪

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.

>> they are not getting the economy to slow. >> they are improving in valuations. >> i would not say recession is around the corner but is not as many miles away as it was at one time. >> we are more concerned about the debt and deficit today then we have been in a while. >> it is hard to have a crystal ball about inflation right now. it's a much less certain picture. >> this is "bloomberg surveillance" live from davos with jonathan ferro and lisa abramowicz. jonathan: shall we do this now? i know it is beautiful but it is possibly one of the worst cap ski towns in europe. -- worst kept ski towns in

europe. lisa: a lot of slippage. we can get into that later. jonathan: secretary kerry wants to weigh in. not with you. i'm always happy to see you. we have to get through some stuff first. difficulties. we could have a lovely conversation in a moment about those things. let's head over to washington, d.c. with annmarie. annmarie, another busy 24 hours and lots of changes from the incoming president. annmarie: an incredibly busy 24 hours. i agree. they should move it to sandra writz. -- san maritz. good luck on the sidewalks. in washington, d.c., it has been incredibly busy. we got another announcement from president trump flanked by tech executives talking about this ai initiative.

we were talking about a terminus of out of money the president wants to put towards this and the deregulation process he wants to see to make sure we can have ai data centers and america is leading the way for this. take a listen to a little bit of what he had to say yesterday about this new initiative which is called stargate. president trump: announcing the formation of stargate. put that name down in your books. you will hear a lot about it in the future. a new american company that will invest $500 billion at least in ai infrastructure in the united states and move quickly, creating over 100,000 american jobs almost immediately. annmarie: we still need to know more about the scope and details when it comes to stargate. the chairman of softbank will take the lead on this and potentially other companies will also be working with the new joint venture, including the likes of nvidia, microsoft and

arm holdings. jonathan: appreciate it. now i can do a more formal introduction to john kerry, co-executor of galvanize climate solutions. secretary kerry, good to see you again. i'm happy to see you. sec. kerry: thank you, sir. jonathan: the new president says drill, baby drill. what kind of trajectory do you think we might be going on in the next four years? sec. kerry: the president is correct that we need an abundance of what we call firm energy. we need to make sure america is leading in the technologies of this transition to new energy, clean energy. i would say that drill, baby drill ought to be replaced by build, baby build. that is what we need to do. in all aspects of energy.

there will be higher demand. he's correct. i'm glad to see a $500 billion infrastructure announced. that will be the key to are doing it. the key to leading in ai, but there's a huge but. data centers demand a massive amount of energy. that will become very competitive. will the energy be provided by clean energy or just add to the problem we have of a warming planet with increased intensity to of storms and more damage all around the world? we have not suddenly lost the connection between the choices we make about how we provide energy and its impact just because we elected a new president. we have to stay tuned into the science. we have to stay tuned into the marketplace. the marketplace is going to move predominantly in the direction of this new energy. last year almost $2 trillion

went into venture capital for new energy, clean energy systems, $1 trillion in the fossil fuel. that's a first time shift in the marketplace. other technologies are coming online. texas, the home of fossil fuels in america. that is now the leading state for the deployment of wind turbines. i think the marketplace is going to continue to invest and move in this direction on a global basis will jonathan: is that the market place or government intervention? sec. kerry: that's the marketplace. it's happening all around the world. i was in the far east, in singapore. also in the middle east. everyone is engaged in this transition. the uae, major producer of oil and gas, is also a major producer of new nuclear plants. they have four new nuclear

plants. they have a vast array of solar. one of the largest fields in the world. they are determined to have a higher level of energy produced by renewable energy. lisa: i'm thinking about the electric vehicle credits. the idea that we would really transition people to vehicles that were considered cleaner. yet china did it successful because they have the resources to do that. the united states doesn't. they need to import them and it makes the u.s. more dependent on other places. were some government policies misguided and what was necessarily to tackle the problem from an economic perspective? sec. kerry: i think we worked very hard to open up new supply chains. we did open up new supply chains. india is an example. we invested about $500 million in trying to -- in building the largest production plant in the world. yes, china has in fact captured much of that market.

they capture differently with unfair trade practices, which is one of the reasons that is a legitimate issue between us and them. we have to work that out. solar was really worked on and developed by the united states and germany. then china stepped in. there was a massive bent of dumping into our country. -- massive amount of dumping into our country and the production gravitated towards china. china is now -- the president said china is not doing what it should be doing. china is the largest producer of renewable energy and deployer of renewable energy anywhere in the world, including more than all the rest of the world put together. china is now committing the market by virtue of its production bubble. we need to get into that and compete. lisa: it raises the question, national security versus cleaner

energy. it pits two of your babies together. it raises the question of which do you prioritize? sec. kerry: the climate crisis is a national security crisis. there are about 39 million people wandering around africa and elsewhere trying to knock on the door of places where they think they can live because they cannot live there anymore. they cannot produce food anymore. it is too hot. you can't work outdoors. level increase. we had about a million people come in from the desert into damascus, which changed the dynamic of the arab spring end of the war in syria. there is a linkage. what happens when water starts being reduced? what happens when the food basket of africa implodes because they cannot grow it anymore? these are real threats that smart people are spending a lot of time analyzing and understanding. within the pentagon, they have

called the climate crisis a threat multiplier. it present serious challenges to all of us. we need to treat it like the security issue that it really is. jonathan: you understand we have become more dependent on an adversary, on china, for all the reasons you described. yet we have some of these critical minerals and resources within the united states. i'm sure you are familiar with the resolution copper deposit that rio explored. it can support 25% of the copper demand of the united states, yet for some reason it's been dragging along it has not been green lit and the way it should be. sec. kerry: we have a problem in the u.s. which i hope will be cured. it is a bipartisan challenge. 20 republicans and democrats to come together -- we need republicans and democrats to come together to do permitting reform. we have 2000 gigawatts, a huge amount of energy, all much as much as -- almost as much as china backed up at the federal energy regulatory commission. that has not been improved over

the years. why? politics. i hope we will get the politics out of the way. i think president trump understands that. that's a way to accelerate the deployment of the energy he has now said -- jonathan: why did not happen under a democratic president and congress? sec. kerry: politics. why did the immigration bill that had been put together with, you know, senator langford from oklahoma -- he worked hard at that. it was bipartisan. it was ready to be passed and president trump then -- former president trump called up and said don't pass this. it will help the democrats. it will help the biden administration look good. jonathan: do you think they hurt themselves in the last four years, the democrats? sec. kerry: there were serious questions about the message and so forth but i'm not here to be political.

i'm here to talk about the energy crisis. jonathan: isn't there something political about this crisis though? sec. kerry: it seems to have been weaponized. unfortunately that is a loss for all of america. if you decide to pull out of paris, we are not at the table. we lose the leverage of being at the table. we lose the protection of our country in terms of something that might be passed were not passed by not being at the table. moreover, last time he pulled out there was only one person in the entire world, of all the leaders in the world, that pulled out of the paris agreement. the paris agreement was still implemented in the united states because we had 37 governors who implement renewable portfolio laws. they did that. we had over 1000 mayors join into something called the we're still in movement. bloomberg understands better

than anybody the power of the marketplace is what will make determinations. oil is a commodity. it has not changed much in price for over 100 years. the technology is what is really driving these changes that are taking place. i think rather than being driven by commodity prices, this revolution is going to be driven by technology prices are now lower than the prices of fossil fuels. lisa: you have been a proponent of not exceeding the 1.5 degree increase in the global climate. you said you think we will blow past it. you are working with tom steyer to try to raise money. there's been a huge five shift away from esg were people are saying we can't solve it, whatever. how do you see the enthusiasm to invest in things that have been highly politicized? sec. kerry: great question. i'm glad you asked it. it is central to what we are doing. nothing we are doing is based on

reliance on the government to do something or reliance on subsidy of some kind. we are not in their defined -- there to be the source of concessionary funding or find concessionary funding. we are investing in portfolio companies that have the ability to affect this transition just on basic fund minerals of business. just looking at the -- basic fundamentals of business. just looking at the marketplace. how this transition will allow you to invest and make money. you will be able to make better returns than other things that are out there today. that is the basis of this investing. when the market sees the way that a bunch of people are in fact turning this around and making money, ai will be a big part of this. geothermal may be a part of it. you need and all of the above investment effort now because the silence -- science is

telling us we have to move faster. that demand is going to change people's attitude about this with electric vehicles grew by five last year in sales. solar grew by about fourfold last year. solar now had a 6% reduction in price -- 60% reduction in price. oil is affected by the economy. the renewable for folios are going to be affected -- portfolios are going to be affected by the technology change that is lowering costs. right now there is no question that the reduction in price of wind and solar and the new fibers available to transmit higher levels of energy at much lower cost, all these things are coming together to say it is cheaper. 1.7 cents per kilowatt hour in some contracts being let on solar.

i think the market place is going to make this decision. no one person-- jonathan: we are up against the clock but i wanted to fit in a final question because you are important on this issue. are you encouraged by developments in the middle east and the agreement struck between hamas and israel? sec. kerry: i think it's great that we have an agreement. a lot of people work externally hard on it for some period of time. things are always tentative and difficult and that part of the world. a lot will depend on the government of israel and how it approaches the future. i saw debate this morning on tv about the meaning of the west bank. if efforts are made to move to the philosophy, we are resolving what will happen in the long-term governance. it will be a real problem. hopefully wiser heads will prevail and people will move forward.

it is building blocks. this is the first step. build a little confidence. make some things happen. then hopefully have a shared vision of the long-term future of gaza and of the west bank. obviously, for israel's security which is paramount. you have to be able to resolve that as you move forward. jonathan: i think we all share that hope. appreciate your time is always with john kerry, former u.s. secretary of state. here is annmarie. annmarie: in washington president trump has widened his terror threats to now include china and the european union. on his second day, he vowed to hit the eu with tariffs and said his administration is discussing a 10% duty on chinese imports. china's ministry spokeswoman said there are no winners, trade war, adding china would safeguard its national interests. these threats come a day after trump threatened to impose tariffs on canada and mexico.

fire crews are continuing to battle the ongoing blazes in and around los angeles with the palisades fire reaching 65% containment. there's been encouraging progress with the eaton fire, nearly 90% contained. evacuation orders lifted for altadena. 10 million people remain under red flag warnings through thursday with gusty winds and ongoing is truly dry air conditions. locals are hopeful the first rainfall of the year is coming this weekend. johnson & johnson shares are little changed in premarket trading after the former -- pharma giant sales increased, marking a 20% increase from a year ago and offsetting the declining demand for other products. the company is continuing to invest in new medicines, including his $15 billion acquisition of intracellular therapies. it's optimistic about the future under the trump administration.

a lot more news from washington. jon, back to you. jonathan: up next, paul ryan around the corner. from davos, this is bloomberg. ♪

jonathan: live from davos in the world economic forum, equity futures now positive on the s&p 500 by close to .5%. lots of changes on the trade front once again. lots of threats to explode with the former u.s. house speaker paul ryan. speaker ryan, good to see you. let's think about the ideology of the sitting president? what is your familiar audi -- familiarity, things like trade? -- around things like trade? speaker ryan: america first is

the quickest way of describing it. a lot of good fiscal policy. there's a lot of optimism. on trade, you have an international audience. they will be some trade friction. jonathan: howdy feel about them taking over the republican party? speaker ryan:, classic free-trade republican. i'm a different breed. his breed of populist trump republicanism is a different breed. they are the dominant force. donald trump is the dominant force of the party. we have a coalition that is playing nice with each other right now. i'm optimistic on a lot of policies coming together. all those policies will not happen if you have disunity. it's important that republicans stay unified. the executive branch has a normal somatic power when it comes to trade policy -- an enormous amount of power when it comes to trade policy. congress has a huge role to play.

it's really important republicans stay unified with these razor thin majorities. lisa: one initiative they need to deal with is the deficit. i'm focused on the bond markets. i'm sure you are as a free-market republican. i wonder how much conviction you see in both camps of the republican party to truly combat some of the deficit concerns we feel here at davos. speaker ryan: there are definitely deficit hawks and congress -- in congress. you can't do well on your debt servicing if you don't have nominal gdp growth outpacing your debt servicing costs. fast economic growth is paramount. that is why this deregulation is necessary. that is why extending tax reform is necessary. we don't to hit the economy with the wet blanket like biden did. really important. the other way to get the debt under control is due at title reform -- entitlement reform. that is what i spent my time working on.

there is a way to do it. the most bipartisan solution out there now are these physical commissions. a lot -- physical commissions --fiscal commissions. one with teeth that requires action. that is the biggest talk in town right now about real debt reduction. on reconciliation, who knows? lisa: we have heard from this administration. they will not cut cut the entitlements they want to cut. speaker ryan: that is not the way to say it. everyone who ran for president lately has been saying we are not touching these things. i don't agree with that. i'm a different breed of republican. lisa: there will be a real challenge that undermined some of the optimism we are hearing here. speaker ryan: within a decade you have the part a trust fund and social security trust fund going bankrupt and insolvent. you have to step in front of that. you don't need to cut these programs to fix this.

you can grow them slowly come over for the programs and do it on a prospective way so that you don't affect people in or near retirement but do it for the younger generation. there are good reforms that i think are politically palatable that move the needle on the debt tremendously. the question is whether or not -- by the way, if it was easy we would have already done it. hi pa -- i passed four budgets but they went nowhere in the senate. jonathan: when you vote for an extension of the tax cuts and jobs act? speaker ryan: absolutely. we want growth. the kind of tax increases that will hit the economy -- r&d, amortization, these are business tax reliefs. more than two thirds of our businesses are not c corporations. they pay their taxes as individuals. there's a massive tax increase

on this businesses. the engine of job creation in america if you let those things expire. it's a section 109a. i don't want to get too deep in the details. it will be bad if you let the tax cuts expire. jonathan: scott bessent said it could be a calamity. just how bad? speaker ryan: 80% of small businesses would have a massive tax increase, over 20% tax increase. you will put them in a massive competitive disadvantage against corporations. most jobs come from small and medium businesses. you cannot hit them with a big tax increase. jonathan: that's only one piece of the tax effort. speaker ryan: i wrote the last one. i had a 22 state margin. jonathan: how difficult is it going to be to do anything above and beyond extending? speaker ryan: that is why republicans need to stay unified. all of us agree on this type of fiscal policy. we may have disagreements on

trade but not on this. really important that republican factionalism does not occur, that they stay unified and get this done. donald trump promised it. one reason why people are so optimistic is because they believe this is going to happen. we pulled 700 ceos averaging $10 trillion of wealth. there's a 32 point swing in optimism from last year to this year. that has to be translated into policy for it to be realized. jonathan: speaker ryan, thank you, sir. ♪ what does a good investment opportunity look like?

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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.

jonathan: a not so warm welcome from davos, switzerland. freezing on the east coast. i'll bring you a brief market check with equity futures on the s&p 500 up .5%. nice rally on the nasdaq. big ai theme. on the nasdaq higher .9%. let's cross over to manus cranny for more. manus: at the epicenter of this new ai trade, start date is what it is called announced by the president of the united states. you have softbank, openai, and oracle. oracle will provide the cloud-based infrastructure. bloomberg intelligence says this gives them a nice leg higher. at one juncture we put on $48

billion in market cap. this is being part of the deal. larry ellison may be in the running to pick up tiktok. this is about building data centers. it is all about delivery. nvidia. it is all part of this. it is about the ecosystem benefiting from the top line growth in data centers and ai. nvidia just trumped apple in terms of market cap. it takes the crown as part of the supernova in ai. the narrative about what they are building. i will leave you with a view on netflix. in debate over whether you watched some of the leading parts of this. the size of the subscriber growth is gargantuan. 19 million people signed on to netflix in the fourth quarter and they put through price rises globally.

usa, canada, portugal, argentina. do you notice the price go up? this is about live programming. sports on christmas day. the tyson paul fighting match. you pay. that is about squeezing the average revenue per user. if you have deep pockets and cash to spend you win. jonathan? jonathan: you need deep pockets to pay for netflix. when was last time we tallied it all up. hundreds of dollars. lisa: i do not tally it up. jonathan: hulu, netflix, peacock. lisa: do really have all of those? jonathan: yes. italian football and paramount. british football and peacock. netflix just kind of exists. lisa: in case you want to watch squid game's. jonathan: netflix would be one of the first things we cut at my house. i'm throwing this out.

i am clearly alone on this issue because the stock is up double figures. we need to talk about branding and the future of consumer companies. we could do this with the coca-cola ceo. >> thank you for having me. jonathan: i want to focus on branding. we can already feel the tension of certain companies set a finding a progressive consumer and at the same time a more activist conservative consumer and where they have not been traditionally. how are you never getting those waters? >> when you operate in 200 plus countries you need to adapt to local needs and consumer trends you have at the global scale but also granular at the local level. what we have been doing recently is looking at marketing transformation around our transition to digital, to live experiences that they are

connecting to our portfolio of brands and packaging pricing in a way that connects with the consumer at the local level but also at the global basis developing global brands. jonathan: does it change how you operate as a business? we have seen many companies pull back from de i initiatives, esg commented zero, where are you as a team? henrique: being a global company, part of that is embedded into our business the way we work in parts of the world. looking at the marketplaces that encompasses more than 200 countries we have a place we want them to do and work on a very collaborative way and that is what we focus on. lisa: how much do you lead into these american branding of coca-cola at a time we were talking about american exceptionalism and frankly america first, the policy paul ryan was just talking about. how much do you think about

other brands that sound local? that remove themselves from that story? henrique: we are very proud to have started a business in the united states and coca-cola is an iconic brand all over the world. you have to remember one thing. over the years we developed other brands in other parts of the world. today we have more than 20 brands that are more than $1 billion brands and they range from places that started in north america but also across the globe. that is how we play that. the massive penetration we have across the world. driving the global brand scale to benefit our consumers. lisa: i look forward to coca-cola results for a lot of reasons but in particular because you break out foreign-exchange implications at a time we are talking about the strong dollar and how long the u.s. can diverge before it starts to hit back on companies. at one point you see the strong dollar as a real liability? henrique: look in our history.

138 years. we have seen it all. all the different political environments and macro economics. you look at the pandemic days how it shifted and we had to adapt. one of the key thins we arned as a system working with the company together is to develop the strategy we call the weather strategy. we will have tailwinds and headwinds coming our ways in different markets but the way we look at our plans is how we can build flexibility on that so when we have these variances on fx that they do not hit us heavily over time. jonathan: do just day unhinged and say -- unhedged and say some days the dollar is strong and summit is weak? henrique: we play the portfolio. dollar strength in the united states is good for north america.

a great part of our business come from north america. other parts we can hedge because of the availability. others we cannot but the way we play is a long-term investment. usually what happens come if you have these long-term view and the right foundations you go through these whether we have and we capture the balance of that an aggregated basis. jonathan: one difficult moment was the pandemic. working through the pandemic we did have a big bout of inflation. at the time companies were working to pass on higher prices. we saw that from company to company across sectors and geographies. you think the consumer price tolerance is there in the same way? are we reaching the upper limit? henrique: we want to look at inflation and pricing. it will be more moderate.

i want to see that is more normalizing as it was prior to the covid epidemic days when we just got out of the pandemic and then we had the inflationary markets. it is an adaptation. having a game where you play affordability for the consumers but also consumers want to pay for innovation, for accessibility of convenience. that is how we balance it out. lisa: we have been talking a lot about vibe shifts and the new administration. rfk junior is among the fibe shift and then you have the vibe shift of donald at his inauguration. i am wondering which will win out. will there be a renewed focus on healthy drinks and expanding the suite of healthier offerings? henrique: the way you will win is following the consumer. over time we expanded our

portfolio choices to different categories, different colorings, and allow the consumer to be empowered to have the choice they want for the occasion they want to have during the day. that is the way will continue to play. lisa: is there a bigger emphasis by the consumer on a certain one of those trends? which are they leading into? diet coke or sparkling water with a twist of lime? henrique: if you look at our results of q3 last year we continue to do pretty well across the different categories. we see an opportunity to continue -- different locations and different segmentation's that is addressed by our brands. all of them. jonathan: that is the drink i order. sparkling water, little bit of lime. lisa: i was catering to you.

jonathan: never drink at work events. just a sparkling water and a little but of lime. the producer on my end is a big diet coke drinker. good to see you. henrique: good to see you. jonathan: let's get you an update on stories elsewhere. we can cross over to new york and get you your bloomberg brief with annmarie hordern. annmarie: migrant communities across the country are on edge as president trump vows to start mass deportations. the president has issued new orders, including giving immigration agents the power to enter churches and schools. trump has also reinstated the remain in mexico policy and announced plans to restrict birthright citizenship. israelis top general and its gaza commander resigned over the failure to prevent the october some of them also attack. the move may add pressure on benjamin netanyahu's government to take responsibility. lieutenant general will take -- will step down as chief of staff

at the same time the current cease fire is set to end. large parts of the united states are facing powerful winter storms. amateurs are in the single digits across much of the northeast and mid-atlantic regions and several southern states declared states of emergency with record amounts of snowfall in new orleans and parts of alabama and florida. that is your bloomberg brief. it is about 11 degrees in washington. i think it is a sunny 35 degrees where you are in switzerland. jonathan: i don't know who that was? who was that the just crossed us. lisa: it sunny and beautiful. jonathan: you cannot just walk through. up next, striking the right balance. >> at the end of this government is about growth. therefore i hope they will balance the implementation of those policies in a way that does not overheat the economy or triggers a recession.

jonathan: it is remarkable to see the headlines out of the united states. then to see the european equity market at all-time highs. more weight to the equity benchmark. s&p up nicely by a few tenths of 1%. bond market stable on the 10 year. under surveillance, striking the right balance. >> when you think about the u.s. economy is it a good place and then you have policies coming from immigration policies, fiscal policies, and others. at the end this government is about growth. i hope they will balance the

implementation of those policies in a way that does not overheat the economy or triggers a recession. i think the hope is because of that. jonathan: let's talk to a man who is seadrill growth. joining us -- who has seen real growth. joining us is richard dixon. you look the part. you are so upbeat. this is what the cap ceo should be like. what are you dressed in? richard: today is banana republic. underneath we have gap and old navy. i love our brands. jonathan: whatever you're doing is working. how often do you check that stock? richard: it is thrilling to see the progress. on behalf of our entire team to see the investor community react the way they have for the fundamentals we have been working on fixing is very

rewarding. in the context of checking i look at the morning and i look at night and the rest of my day is spent driving the business and executing our strategy. the better we do and the more we do what we say the more exciting it becomes for our shareholders. jonathan: when you came on board, what did you identify that needed to change in the beginning and how far along in the process are week? richard: the gap portfolio, amazing brands, these are legacy brands. they are storytelling brands, brands that have incredible recognition around the world. they were brands built on great merchandise and merchandising and great execution and along the way we became a retailer that sold stuff. we had brand familiarity and we had fans but we lost the storytelling part of our brands and arguably our brands became less relevant.

we needed to go back to the roots of each of our brands and talk about the brand purpose. why are we here? how did we get here? each of our brands follows a playbook and it starts with the purpose of every brand. then we study the consumers and trends in create amazing product at distinct value and we connect that product to great storytelling through marketing that is culturally relevant and last but not least as a retailer , retail is detail and execution matters above everything else. that is a combination of a lot of sequencing that takes time and diligence. the proof is in the metrics and we are making a lot of progress. annmarie: there is a lot to -- lisa: there is a lot to unpack including marketing that is culturally relevant. i am thinking influencers and how you've tapped into different voices other than nontraditional advertisers. how big of a shift was that work with individual people? richard: it was a shift.

with our brands that are legacy brands we went back to the origin story of how these brands begin? although marketing has evolved in the media landscape has evolved today it is important to be where your consumers are and they are everywhere. when you have a clear purpose and precise brand values and great product with great perspective, you can drive a lot of synergy across multiple platforms and feel like it is one voice. a lot of the work we have been doing has created that brand personification, whether it is through influencers, social media, digital dialogue. you need to be there with creative that is precise and need to be interesting to get people interested. lisa: there is both a shift away from fast fashion than then there is uber fast fashion coming off some of the social media trends people hop onto and want to buy through social media networks. what is the complication in

dealing with the rapid fashion, especially at a time where there is some uncertainty about supply chains as well as the international relationships? richard: we are not fast fashion. we are generational brands, legacy brands. we have incredible items people depend on. khakis and denim with key concepts. we are certainly fashionable. we are also very reliable for great product a great value. we then have a layer of fashion that follows and in some cases defines trend but you never want to be too trendy. we want to be on trend but never too trendy and that is the balance of the art and science that goes into our brands and any brand. fast fashion tends to be faster with trends. we are getting faster at creating new product in our stores. we have reliable basics with great storytelling, great value, great value come in great style.

lisa: during the first trump presidency there was a question around retailers and how much they would get hit from tariffs. how are you immunizing your supply chains from tariff uncertainty let alone the actual tariffs? richard: i would give credit to our supply chain team who have done an excellent job diversifying our footprint. our manufacturing footprint is fully diversified. less than 10% of our product is coming out of china. we have a fantastic global supply chain driving to element all over the world. tariffs will be able to navigate and deal with it. we are not in isolation. it is our job to create a great value and execute with excellence and our job to figure out the rim of that but make sure our consumer proposition stays intact and that is how businesses get through these scenarios. jonathan: could you give us a sense of where you diversified

to? richard: southeast asia, central america, india. vietnam is one of our great sourcing countries. we have a diversified footprint and we expand and explore. in some cases going to developed markets and developing markets using our platform to bridge opportunities. one of the points of pride of the heritage of our company's we bridge gaps to create a better world and much of the work we are doing in davos is learning, connecting, listening, living our purpose to bridge gaps to create a better world and in some cases bridging the opportunity gap is going up and developing product in places that need that work any that company to grow that market. jonathan: one place a lot of people want to was mexico and we could sit on central america for a moment. if tariffs hit your costs and you have to pass on those costs to consumers, one thing we are trying to gauge in davos is how much consumer price tolerance there is for your business

specifically. how do you gauge that at the moment? richard: we are in a business where we need to create once. in the context of our business, fashion is about emotion, it is about storytelling. we are all consumers and we all have different thresholds for what we will pay for that value proposition. in our case we rely on a great product, great value, and great style and we will figure out the right value proposition along the way no matter what the tariffs are. that is for us to figure out and us to figure out to have the consumer for our brands. jonathan: started the conversation with coca-cola on the challenges of engaging a progressive consumer and making sure you do not isolate a conservative consumer. is that balance getting harder in 2025? richard: from our perspective we have a wide range of consumers. we have value propositions, we

have limited distribution concepts, we have a righty of different products and programs that address all consumers and that is the beauty of our brands. as we migrate into another chapter and another year with lots of challenging conversations and business dynamics, we are very focused on our strategic priorities. very focused on creating great product and great value and executing with excellence and we will continue to deliver those metrics and do what we say. lisa: who is your biggest competitor going forward? richard: i think you're competing for consumers interest. i think we have to be better storytellers. to the extent we would target one or another, i do not think in that regard. i think about who we are and how to identify our brands with meaning and matter and substance. the consumer will choose. as long as we do what we say until great stories and present

our products the way we have been so, i believe we will continue to win. jonathan: this was a pleasure. fantastic to catch up with you. richard dickson, gap, inc. ceo on the success they have. lisa: they go back to their roots while using modern technology to disseminate their ideas. the idea of what modern marketing looks like has been fascinating at a time there different generations absorbing information in different ways. jonathan: i need richard stylist. next year we do this i want to be sitting here and it -- i won't be sitting here just a suit and tie. richard: i can take care of that for you. jonathan: up next we will catch up with the nasdaq ceo. the former u.s. ambassador to switzerland. the cisco ceo joining us next hour. and the bridgewater co-cio.

do not miss that. from dabo's, switzerland, good morning. your equity market rallying. we are higher on the s&p 500 by .5%. here in europe the stoxx 600 all-time highs. lisa: definitely getting a push from the belief that a lot of european companies have more and more exposure to the united states. jonathan: is amazing we are shaking off these tariff headlines. lisa: they could have been worse and that is what a lot of people are leading into. jonathan: the third hour of bloomberg surveillance is up 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.

>> i think the inaugural speech was essentially an advertisement for invest in america. >> the u.s. labor market has been the most resilient labor market in the world. >> i don't see a lot of american drill baby drill, i seem build

baby build. >> there are still more unknowns then knowns in the equation. >> this is bloomberg surveillance live from davos with jonathan ferro and lisa abramowicz. jonathan: to those of you stateside waking up, good morning to you all. the third hour of bloomberg surveillance starts now. this market has taken a lot in its stride particularly in the last 24 hours. equity features elevated on the s&p so far, record highs on the stock 600 and the gains continue. lisa: a lot of people optimistic about the flows in the u.s. and other parts of the world which is ironic considering some of the tariff highlights we have gotten. brush it the ongoing conflict and europe and china. a real question, should it have been worse given the rhetoric? maybe that is feeding into the

optimism. jonathan: i think it is a lesson of the repeat that we learned with trump 1.0, just wait and it will change. lisa: at the same time maybe not as extreme as people thought and looking between the tea leaves and trying to understand where the optimism will be. there are two things, a sense that there will be less regulation around companies and corporate tieups and that alone is giving a lot of optimism to people regardless of the other potential options and there is a sense, we have been to the pandemic, we can't adjust and adapt. and i know i am repeating a line tom keene is to say it, the companies feel more resilient than they have in the past. jonathan: the balance sheets have been strong for the pandemic and the other side. let's catch up with anne-marie.

there will be an address tomorrow from the sitting president to happy valley. how happy will they be once the address is finished? annmarie: i am not quite sure they will be happy. i was looking back at president trump's remarks when he was the 45th president in 2020 and went to davos and gave a speech. he said while many european shein -- european countries struggle, he talked about how america no longer needs to import from hostile nations and with an abundance of american natural gas available, our european allies no longer have to be vulnerable to unfriendly energy suppliers. i think that is something that as the 47th president of the united states the fact that we sell russia invade ukraine and russa has been -- russia has been a massive supplier that he might remind them that it is time to buy more u.s. liquefied

natural gas. i expect he is going to give a warm welcome that he is back to some of the distinguished members of the world economic forum but will also need of the european countries and remind them of some of the words and warnings he had the last go around. jonathan: the sitting president feels vindicated. some of the warnings that he had for the europeans over the first administration the first term. he was left out of the room and some of those places. i remember afterwards when he said that nato wasn't spending enough and it didn't make sense to provide military to places like germany when they had a multibillion dollar gas deal with russia. we saw all of that break down over the past four years. lisa: there is the sense that here in davos there is a very different tone with respect to

how europeans and others and other non-us countries are treating donald trump because they are taking what he says seriously and looking at what they can do to boost their own competitiveness rather than just say, this is wrong and against what we have known in terms of the western order. jonathan: europe has a growth problem and that is why they have to be progrowth the way the u.s. administration is being. the leaders in europe are increasingly vulnerable to movements on the right of where they are politically in those nations. that is another wrinkle in all of this for them with a new president. lisa: which maybe is the reason why there are fewer highfalutin statements at davos. it is much more let's get the deal done and let's talk about what i am doing and you are doing which is what we used to hear much more in happy valley's. jonathan: let's look at the nasdaq chair ceo, adena friedman

. as an american executive in davos, how upbeat is the mood? adena: as you talked about, it is focused on pragmatism and how can we learn from of the u.s. is doing and how can we make sure we are being competitive ourselves in the european nations or other countries in the world and how can we continue to work collectively and productively with the u.s. and mostly come how can we follow some of it the u.s. is thinking. deregulation or what we like to call smart regulation, thinking differently about regulation in the areas where it is effective and not effective and how can we ensure we are driving growth, productive, long-term growth. others can learn from that as well as we go through that process and we are excited to engage with the new administration to think about regulation differently. regulation is very important in the financial industry but there

is input oriented regulation that can be inefficient and we have done some work on that to understand what the difference is and how can we engage with the administration to make sure we make it more productive. jonathan: could you describe some of these specific changes you would like to see and what outcomes they would develop. adena: without about the outlook for the year. it is going to be a very constructive year for new ipo's and assurance and around companies and what they go through. we think there is opportunity to work with the administration to rethink some levels of regulation and requirements for the companies themselves and make sure it is more balanced between public and private. on the financial system itself, we have done a big study in partnership on what we call complexity versus complicated

mess. -- complicatedness. there has been a 35 times increase in complicatedness. you take a crisis situation and you regulate behind that and suddenly you've got all this complicated work you have to do and you are racing to get it done and not optimizing for the outcome. as a result, you have layers of regulation. we think there are new technologies and way of sunsetting regulations and thinking about regulations in a different way. with think there is a real opportunity to make sure the industry can be more efficient. lisa: the idea that if you strip away regulations it would make it easier and maybe even out the disparity between private and public companies. you think that is the reason why we have seen a drop off in ipo's because of the extra regulation and how easy it is to get

financing in the private markets? adena: it is an ingredient. there are probably several factors driving the balance in the swings that can happen. one is monetary policy. big swings in monetary policy make public investors more cautious and change the way they model companies. that can make it so you just don't have as many companies coming out. i think the last two or three years has been more around monetary policy. longer term, the balance between public and private has been heavily impacted by regulation. you go public and suddenly you have enormous amounts of disclosure obligations with the proxy and accounting obligations. there is a lot of felicity around what you do and a lot of public scrutiny around everything you do. and that have the quarterly earnings process which is difficult to navigate if you have a long-term strategy but short-term that you have to describe. all of that makes it a more complicated existence. i think some of that is just

part of being a public company but some of it in terms of proxy, there is a lot we can do in proxy reform and accounting reforms and also litigation reform that could really make the nature of the public more attractive. lisa: we hear a lot about how deals are going to explode and optimism. are they going to be ipo's for a structurally lower volume type of market because there are so many other options? adena: they are complementary to each other. if you are a private equity firm or venture capital firm and you're making an investment in a company, the most important thing you can think about is he like to have a couple different options on how to exit, through an acquisition, or sell it for into public markets. because of the fact that there has been very little m&a, that

has been closed. it makes it so people don't choose to exit. they want to have optionality. if they only have one door to get out, they will wait until the other door is reopening and that is preopening now. so we have much more accommodative environment for everyday and i think it will result in a lot more ipo's. lisa: how much do rates need to go down? adena: i do not anticipate rates will decline much this year and i don't think we should expect that. we have a more resilient economy and inflation is back to a relatively normalized state between 2% and 3% and we have a lot of new economic policies coming out in a progrowth agenda. the rate is very normalized to operate. in the rational process to make rational decisions. we can operate in that world and grow nicely for years. we want it to be something in that range because that is we

are growing as an economy. jonathan: have you spoken to any business is here that would like to list in the united states? are you seeing that as a growth opportunity and if you take some of that business away from foreign financial capital? adena: we do have conversations about that. we have them here and elsewhere. jonathan: have they picked up? adena: we have 4000 listed companies on nasdaq and we might have 158 to 200 ipo's a year and we have had 500 companies switch from new york to nasdaq. we were talking about having conversations about companies in europe coming to the u.s., maybe five or 10, is not like 100. we own and operate the markets in sweden and they are incredible ecosystem. i think market share in europe have a lot of work to do to create a better union and capital markets but i think

there are three listings here and will stay here. jonathan: i think i can speak for the companies across europe, they love the american valuations. lisa: absolutely. jonathan: wonderful to see you. thank you for dropping by. adena: thank you. jonathan: let's get your bloomberg brief. annmarie: president trump has announced the formation of a new company that will invest $500 billion in ai infrastructure and create more than 100 thousand jobs. the company is called stargate and will come together as a hundred billion dollars joint venture between softbank, openai and oracle. goldman sachs and jp morgan are the latest from scott in the anti-ddi crosshairs. activist groups are actively pushing banks to abandon or shrink dei say it and saying it leads them to costly legal

challenges. baseball his join the hall of fame, it euro, sabbath and billy wegner were voted into the baseball -- ichiro sabbath and billy wegner were voted into the baseball hall of fame. that is your bloomberg brief. jonathan: up next, america first. the best way -- >> tax policy, regulatory policy, entree, you have an international option and it will be some friction, no two ways about it.

jonathan: equities doing nicely so far this morning going into the opening bell. very much america first. >> the best way to describe is america first. on trades, america first is the quickest way of describing it. a lot of good fiscal policy, regulatory policy, tax policy, a lot of options. on trade and you have an intentional is -- audience, there will be some friction, no two ways about it. jonathan: paul ryan making the same argument that we have heard on the need to pass the tax cuts and jobs act extension. we heard something very similar moments ago. lisa: that basically you need a growth environment if you want to have something that really matches the deficit we have

going forward and that seems to be what people are looking for. jonathan: the equity market doing quite nicely come up on the s&p, more than the nasdaq. let's go to manus cranny for more. >> netflix, 19 million people signed up, upgrading the stock to equal weight saying if it sustains the current operating momentum, that can certainly drive the upside. wells fargo comes in on 3m come over weight saying the earning days and the stock is up 1%. morgan stanley cutting the price target on microsoft citing investor sentiment shifting negative around its gross margins. jonathan: thank you, appreciate it. very pleased to say we can pick up where we left off, the composition on america first. joining us as a former u.s.

ambassador to switzerland and good friend to the so do show, -- show, edward mcmullen. jonathan: what is your advice to things -- two people on trade? edward: this is it new. the trade terrorism going on right now, the idea that the media, not you of course, but others in the media are trying to tear this up and make it look like there is something devastating coming. the president has become president and has an president for years before and has used tariffs effectively. we think it is going to be very clear, if you are a traitor and looking for reciprocity with the united states, bottom line you'll have a good environment. if you are looking to take advantage of the united states through tariffs which many countries do, you are in for a rude awakening. the president has been clear

that it is not a threat, a reality. jonathan: a lot of people who follow the program agree with that, particularly with china. they might struggle more and probably will struggle more with places like canada. where is the tension coming from? ed: the fear is unfounded. what happened in the first term is the president has given us our great roadmap. canada basically dealt with the paperwork issues and other problems they had in the first term but the president came to the table and all came to the table and came up with solutions and we had a good agreement that fixed many of those problems. it is a conversation and dialogue that it is clear that the united states are done being taken advantage with others tariffs. lisa: is it a negotiation with europe and china? ed: i think europe is one thing. we are not negotiating with the

eu but individual countries, working with sovereign nations and bilateral agreements that they have on trade. that is the bottom line. working closely with countries who want to do trade. if you have reciprocity and willing to trade without tariffs on our country than you are in a good position to have a conversation and agreement. lisa: there are some other parameters around terror threats and we are talking about europe maybe buying more lng which is basically opening a door that is already opening but there is this idea that with mexico and canada it has to do more with border control and other potential issues. at how quickly do you see that getting resolved? ed: what are the great assets and i'm hearing this all over davos, there is a optimism. we read all the media how terrible things are and how the new york times has the dark speech. i've been more people tell me, business and ceos say it is a

time for optimism. there is an amazing advocate in the treasury and a close friend of the president and he trusts him. he has a vision of the economy that janet yellen never understood. i think the excitement and even and optimism to have agreements in trade conversations in the way we have never had them before is extremely strong and it is going to be an exciting and optimistic time. lisa: everyone we have talked to, optimism is prevailing. jonathan: if they come from america. ed: i am also hearing that from europeans. jonathan: what are they saying? ed: they are saying great speech and we are looking forward to the term we had the first term. there are no surprises. the president has not changed his you on tariffs and when they came to the cable and negotiated and did what needed to be done. jonathan: we were speaking want to anne-marie about her -- the address to the economic forum.

perhaps he feels vindicated from some of the warnings he made to the europeans in the first term that maybe went unheard and turned out to be right with things like foreign policy, the relationship between germany and what was going to happen with energy. why do you believe as a conservative the conservative argument is winning? not just in the united states but elsewhere. ed: i was ambassador to switzerland and the president came to davos on his first trip. he came because the fear mongering that was going on for so long had europeans in uncertainty. the president came here into the belly of the beast in davos and said, america first does not mean america alone. that gave people the confidence and understanding that our foreign policy that this president understands america first is critical. we have things that need to be fixed, things that he has talked about, immigration tax policy but as america goes, so goes the world. we have a responsibility and the

president takes it seriously to fix the problems in the united states and it is what he is intending to do. the europeans and the business world knows this and that is why the markets are doing so well. a lot of confidence in this town and in the united states. i hear people day in and day out talking about how wonderful things look going forward. we finally have certainty. the one thing you will know that you don't have to guess work is coming from. jonathan: i have to guess where he is going with the tariffs. i understand it is a negotiation but in the meantime if i am company, i have to operate with the backdrop of not really knowing what things will look like going forward. how quickly will we get that clarity? ed: there is clarity for those countries where there is it extensive investment in the united states. switzerland has 450 companies operating in the u.s.. her goal is to make sure that continued flow of trade works on

feathered. it did in the first term and it will in the second term. manufacturing, there are areas in a steel and other areas where we have pharmaceutical issues but there will be a discussion and dialogue. business is business. things are going to do well under a man who is a businessman and understands it better than anyone. lisa: you mentioned president trump has been to davos before it will become again? ed: he has been twice, exciting times because he can do the speed bilateral meetings where he had 12 or 15 meetings a day and rather than flying around the world he got substantive work done and gave confidence to the world global economic message which is the united states is open for business, excited about the business and we are the superpower that we should be. jonathan: i am not and win any friends in the world economic forum by saying this, if you wanted to set up a conference business in mar-a-lago and the president wanted efflandt to come to him, i'm fairly

confident not many would come to davos anymore. ed: i think the president's got a message that the people in davos understand, you have to sift through the nonsense and get to the facts. the first term was a clear roadmap of where we are going and a great future for america and the world for peace, prosperity and liberty to thrive. jonathan: good to see you. the to switzerland, edward mcmullen. up next, chuck robbins of cisco. ♪

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.

jonathan: 60 minutes away from the opening bell in new york city and equity features doing nicely on the s&p 500, higher by 0.6%. netflix absolutely flying. the story gets another pump of competence overnight from the president, donald trump. manus cranny has more on that and other stories right now. >> article pumped up -- oracle pumped up launching a new ai initiative. this is not america first, america alone, this is a trifecta of softbank, openai and oracle, a combination and a

coalition in terms of tech and building data centers and chat gtp -- chatgpt. the trickle-down effect goes to nvidia and takes the crown away from apple is being the most valuable company in the united states if you believe in the supernova of ai traded in moving the differential between the united states and the rest of the world and you believe in nvidia. new data centers, scaling up and spending but when is the unknown. 90 million people signed up to netflix and they have raised prices. 19 million subscribers in the fourth quarter and paying more in the canada, u.s., portugal, argentina. did you notice and pay the extra to watch the football game on christmas day? did you pay the extra to watch

the fight? those are the incremental add-ons that will boost and continue to boost and they have deep pockets to spend on content and spending $18 billion, a vacuum cleaner in terms of taking content for them away from someone else. jonathan: thanks for that, phenomenal performance out of netflix. i had no idea they would put up prices. lisa: you just don't pay attention. you don't like netflix. jonathan: i am desensitized for the emails i get from hulu almost monthly saying there are increasing the prices. let's join the cisco ceo chuck robbins. good to see you. chuck: and i probably also don't notice when they raise. jonathan: competence is sky high particularly among the american

executives at the world economic forum this year. you are picking up on the increasing confidence because you raised your outlook. what underpinned that and makes it sustainable for you? chuck: thanks for having me. we are in the last week or quarter so this is backward looking at the prior quarter results. in the first quarter we had a strong performance across the board. we talked a lot about a target we put in place for networking infrastructure underneath the ai clusters in the web scale cloud providers. that was the first quarter of the year and we were ahead against that target so we talk a lot about that. we are beginning to see the enterprise customers spending on infrastructure to support ai and or modernizing their infrastructure in preparation for ai. overall things are going pretty well. jonathan: how much of a growth story is that and what will it look like in the years to come

on ai specifically? chuck: if we do our jobs right, it should be a tailwind for us for quite a while. we are designing for the next generation now and parallel pathing so we used to be a three year cycle trying to shrink it to 12-18 by designing the next chip before the current one is out paid we are rolling that out across the portfolio. the enterprise customers are really looking for partners to help them understand how to navigate this and deploy the stuff and we are going to play a big role. lisa: there is a sense that companies don't understand how to use ai and how to implement programs to make people more efficient. how much are you seeing people spending versus asking questions, figuring out what they want to do? chuck: we did an ai survey of our customers recently and you have all of them saying 85% to

90% saying i have to have something done in the next 18 months and only 13% say i know what to do and are ready to go. there is a lot of discussion going on. we had a product launch last week called ai defense allowing our customers to put guardrails around their own models they are running on their own data to protect their data and it is the first one that has come out and does this and we had customers in the crowd and governors -- governments in the crowd and everyone said we want to go now. they are looking for what to do and i think the more innovation we can bring hopes and see how this will come to life and that is what they are looking for. lisa: a lot of times your revenues are representative of competence in companies and if they invest more in the infrastructure, that means they have confidence that companies will grow. is it saying something slightly

different because people are worried about being left behind if they don't get ahead? chuck: i think there is an overarching characteristic of the current ceo where they don't think about what normal is anymore because there hasn't been there for a long time. we have all become ceos in times of crisis going on around the world. 15 years ago you would hear we are just going to pause until things get back to normal. the current group of ceos saying this is normal and then it kicks in where i think particularly with the speed at which ai is moving, a lot of the ceo community believe that if we are not doing it, my competitors are and what is going to happen to me in six months that i don't know about. there is a fear but also a healthy concern around making sure you do it right. jonathan: as we develop technologies, how do you see it country versus country, do you

think the technology will be kept between borders or shared internationally? will it be difficult to become a multinational selling this around the world? how do you think about that future? chuck: that is a good question. friendly allies will show this technology. when you get to the data, that is a different discussion. we have already seen sovereignty of data and cloud nodes and that is emerging. if the world continues to get splintered through geopolitical tension, then you may see more and more of that. the reality is, there is not a lot of companies around the world that can build a lot of technology that can be delivered now so we have to navigate that. jonathan: have you spoken to the president about this? chuck: no. jonathan: never in the past? chuck: in a first administration we did. chuck robbins what advice would you give -- jonathan: what

advice would you give? chuck: the thing about this administration is there will be a lot of opportunity for us to have these discussions. i was in discussions back then about how we should be thinking about chips and things like that. i think he has a lot of smart people around him and i think they will do the right thing. jonathan: we saw a lot of that in the last 24 hours. there is a big celebration taking place this summer. i hope we are invited to the party. a lot has changed since then and we had talked a lot about your strategy and the shift to software and revenue and subscriptions. are you happy with the strategic shift and how far you are in the process? chuck: we had 57% recurring come which 10 years ago we were too close to that. there is a cap at some point and to be honest with you, this ai explosion in infrastructure we are pushing out has most of our attention relative to where we are investing in cybersecurity.

we never intended to get to 100 and we never will, we are on a good path and right now we are almost unilaterally focused on building the ai infrastructure and security. lisa: how much will you have to focus on one country or another, going back to what sean was talking about -- what jonathan was talking about. if you create in one area but using chips that might have national security overlay on that, how much do you see this fundamentally changing the way you do business? chuck: one of the things we have done is try to build great relationships with governments around the world. there are multiple companies that build the technology that we deliver but not as well as we do. i think the bigger issue we are going to have to deal with is every country will have a certain set of requirements they want you to meet to operate there, and they are not the

same. one country wants manufacturing, one wants to launch a public cloud and another one wants you to never let data leave the borders. it has made business more complicated dealing with those issues but it is what it is and we have to deal with it. lisa: one thing we have heard increasingly from shareholders particularly of the big tech companies is concerns about how much they are spending on their infrastructure. do you start feeling customers pushing back on price more and more, or is that basically, we will want this at any price so you will be left behind. chuck: they won't say that. we tend to be able to get to prices that work for them and us. the great news about designing a real silken is we don't have to buy it -- silicone is we don't have to buy it from a third party. jonathan: one said the biggest

risk is not over investing, it is under investing. lisa: that is what a lot of them are saying that it will miss more being behind the trend that their peers are ahead of it. chuck: conversation i'm having is they are asking can you please deliver more shark they want more capacity and supply of these silken -- silicone. jonathan: do you have a slight issue? chuck: we just can't build it fast enough. we are making progress. jonathan: it is good to see you. thank you for dropping by. with an update on stories elsewhere, let's get back to the bloomberg brief. annmarie: the trump administration put federal employees and diversity, equity and inclusion roles on leave and ordered them shut down. they move to limit diversity preferences in federal contracting.

the internet' is most followed creator is entering the race to buy tiktok. mr. beast is part of an american investor group assembled by tech entrepreneur jesse tinsley vying to buy the social media platforms for a's -- before a possible ban takes effect. champagne shipments dropped for the second year in 2024 amid a broad slow in luxury spending. according to data, shipments were down more than 9% to the lowest since 2001, excluding the pandemic. that is your bloomberg brief. jonathan: thank you. up next, regulation in review. >> regulation is very important in the financial industry but there is outcome that is effective and can be efficient and there is in point -- input orientation that can be very ineffective.

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jonathan: it is a major theme for the incoming administration, regulation in review. >> regulation is very important in the financial industry but there are outperform -- outcome regulation that can be efficient and input that can be inefficient. we have done work on that to understand what is the difference and how can we engage with the administration to make sure we make it more productive. jonathan: we had a guest who said i don't like toward the regulation. they sent sensible. lisa: it is rational regulation. jonathan: the changes that a lot of people are looking forward to and expecting it to transform business leading to better growth and better outcomes for

the u.s. economy. lisa: it is the d regulation and the sense that they know what regulation they are following. the tax cuts are also something giving a tail wind. how much of that is baked in and that is what a lot of people are getting anxious about. it is all really great but it is in the price and that is what we are getting the sense of from investors. jonathan: we have the bridgewater associates cio karen karniol-tambour. good to see you. karen: great to be here. . before we talk about 2025 -- jonathan: before we talk about 2025, double-digit gains. what strategies were successful and where found success in the market. karen: there is never one market that is the driver of success. we are highly disparate -- diversified. it will surprise you that our single best performer by far was

in china because the chinese stock market was a disaster. china is going to a very painful deleveraging and not handling it well. you don't want to rely on estimating the policymakers will get it right. you want to make a set of investments in china that can do well even if they stay in poor deleveraging. so real excess in china we buy commodities in the chinese yuan. currencies that worry ignored for a long time were a big win for us. jonathan: chinese bond yields have rolled over aggressively. is this a position you are keeping going into 2025? karen: we are but we are looking carefully to see at what point can the bond yields not fall anymore. everybody estimated this wrong

when the united states, europe, when we all went through our deleveraging, everybody said, bond yields can't go lower and there is no point in holding them and cut too soon. they are a nice diversifier to hold. they may not be a huge return or like 2024 but nice hold and the more westerners went out of china, it is like investing in mars. every other market has the same investors so if something happens, the same pull in and out. we like the diversification. lisa: when everybody is leaning one way, you try to leave the other way and that has been definitely the china bat and you are sticking with the idea that chinese has more potential room to run. how much good news is baked into the u.s. market? karen: i think it is a good but not amazing time to be taking risk in the market. if you look at the measure of how risk on an risk off you want to be, you would think it was a

great time because growth is rolling and momentum and inflation is at least low enough it is not a major problem for most central banks at the moment. there is a desire to keep easing and if that is all you heard you would think it is a great time to be an investor. but if you look at what has happened to risk premiums and how much is baked in, you have to say it can't be great but the hurl is much higher. you look at the united states as an example because it is the most invested but we are like you need nine .5%, 10% growth to be on par for holding bonds. that is not impossible and could definitely happen. it just tells you there is room for disappointment and he had a great year for the u.s. economy and you could have u.s. companies keeping productive and returning money to shareholders and not be an amazing time to be an investor because it was baked in. lisa: what is more priced to perfection, stocks are u.s.

government bonds? karen: i would say both are kind of priced for things working out well but bonds may be priced even more to perfection because if you think about things really going poorly, you are going to get a big bond rally. if you think about inflation problems, there is not a big inflation problem baked in at this point and if you think about what it takes to buy government bonds, which extra yields are you getting relative to cash. it is not that much. it wouldn't take that much of a dramatic turn to get a little more of the yield curve there and more for you to hold the bonds. jonathan: what do you think is behind the recent backup we have seen in yields? karen: you have an administration that wants to use fiscal policy and not worried about running to slightly bigger deficits. when you are the trump team getting the tax cuts extended and larger is a high priority. it is top of their list.

and you are starting with a bond market that already has priced in very small carries. it doesn't take a lot. that said, every time the yield rises a little, that does its job to so the economy a little and you get a little rally. jonathan: with high yields, we had a stronger dollar, key problem is how to manage the fx risk. what is your best advice? karen: one of the big things structurally that happened is a lot of people forgot about currency management as an important issue here for many years, currency didn't do as much as underlying assets and it did not seem to matter. if you look at 2024, 20 23, if you bought european, japanese stocks in america it was dominated by the currency as a huge issue. so saying what is neutral to me and in my view when you are taking foreign currency risk, that is uncompensated risk. you start out saying, i think

the dollar has probably more room to run but you have stronger economy structurally, trump policies very likely to be dollar bullish and you want to close the trade deficit and it is a good time for many to keep coming into the u.s.. if we close the trade deficit but tempered on the desire to invest in the united states in the financial assets, he had to push the dollar up. my second favorite currency is the yen but any foreign investment you have could be hedging back into the dollar today because unless you have some view that you like the euro or the u.k. pound, why are you holding this uncompensated risk. for people outside of the united states, you can get u.s. assets and you don't need to hedge as much. lisa: at what point does the strength of the dollar become destabilizing and undermine other assets? i say this at a time where the

u.s. is still borrowing a lot, still sucking a lot of cash in and you have a strong dollar that makes countries with external debt that much more expensive to pay back. does it become a significant problem? karen: the first people who will say this is a problem and be able to maybe or maybe not do something about are the trump folks. they are going to say they don't think it is aligned with where they wanted to go. i don't know what tools they will use. i think they are likely to be the first people to say, has this gone too far? lisa: before we let you go back to the festivities and discussions come one thing you have been big on is gold and the question of what is the inflation hedge that becomes most relevant at a time when it seems like we are in a new regime and inflation is going to be more prevalent especially with a pro growth policy. are you still in that place? karen: i like gold because i like the inflation hedge in the

geopolitical hedge. if you look at who is buying gold, a lot of the gold buyers have been those economies that feel most that the dollar is a political issue for them and they don't have a lot of choices . it is very hard to move the supply demand for dollars. even if a lot of country say, the dollar, that's politicized, there are so many buyers and sellers it is easy to move the goal markets. a small number of buyers saying i need a geopolitical edge, they don't have a lot of options. gold is one of the only you can say there is nothing politicized, i have a physical bar and it piles on here and so central banks do it and it goes up and then you get retail investors and all sorts of emerging markets thinking i needed gold and it doesn't take a lot to move such a small market. i like the geopolitical hedge along with the inflation hedge. i think in general there are not a lot of great inflation hedges around and it is a great

question to ask, what do i believe is a inflation hedge in which companies could withstand inflation? these are tough questions that are worth grappling about. jonathan: it is very important. lisa: ramping up to record levels and there is a lead time. so that is one of the reasons why people are leaning into the gold bars that you can buy at costco. is that what you did? jonathan: there and other retailers. as we come you don't the opening bell, a look at the calendar, thursday, the president speaking remotely to davos. we will get another round of jobless claims. and friday, the bank of japan rate decision, another fantastic lineup of guests tomorrow morning. we will catch up with ted pickett of morgan stanley and many more from davos, switzerland, this is bloomberg. ♪

matt: energy demand set to soar. katie: bloomberg open interest starts right now. sonali: netflix closed out 2024 with a bang. delivering record quarter thanks to live sports. matt: all in on artificial intelligence. president trump announces a $100 billion a idea was softbank, openai and oracle. katie: trump said he would be open to billionaires buying