the u.k.nd global economies, large falls in asset prices, and a large stress misconduct cost. the economic scenario in the 2017 test is more severe than the ape recession that followed the global financial crisis. vulnerabilities in the economy triggered a 2.4% fall in rural gdp and a 4.7% fall in u.k. gdp. there is a sudden reduction investor appetite for u.k. and sterling falls sharply. as vulnerabilities associated with the large current account deficit crystallized. to bank rate rises sharply to 4% and unemployment doubled to 9.5%. u.k. residential and real estate prices fall by 33 point -- 33% and 40%. in line with the banks concerns of the consumer credit the tests incorporated a credit impairment rate of 20% over the three years across the banking system as a whole. the resulting sector wide loss of 30 billion is 10 billion pounds higher than implied by the 2016 test. the stress leads to total losses for u.k. banks of around 50 billion pounds during the first two years am a losses that

the u.k. high court ruled just five months ago in favor of these arms sales or years in the we are in the process of appealing that there it we believe if out there it is up held when it will be regarded by green regarded by the government as a green light to continue arming and supporting some of the most brutal repressive regimes and what old and to continue feeling human rights abuses are in for world however people who we do know if you keep public agrees of us because poll after poll has shown that people for helming majority of people in beauty oppose arms exports not just a savior but tougher human rights abusing regimes fact most recent poll i saw which was done last month by opinion fine but only nine percent of the public think it's acceptable to sell weapons to say duty there and yet despite that despite the overwhelming public opposition buke is sold five billion dollars worth of arms to this soviet regime since it began its middle compartment of yemen we want the u.k. government t

citizens in the u.k. or u.k. citizens in the you could be discussed because the european union always was very clear if we don't have an agreement on the brics a real those talks are not going to continue you are from a correspondent in frankfurt thank you. the bosses of foreign businesses operating a joiner complain the communist party is trying to infiltrate their boardrooms to gain control over management decisions a german industry body wants the chinese government is increasing its influence through party councils set up inside those companies are required by law were previously seen as solely symbolic we'll talk about that with an industry representative in a moment first a look at what's at stake for german firms china being a huge market for them which is critical for many of the best multinationals for for example employs ninety five thousand workers at its factories in china bosch the engineering company is also a major force with sixty thousand people on its payroll there zeman says just over half that

when the u.k. is selling arms to say duty but we believe it isn't violation of u.k. arms export trade here we don't leave the problems legislative is about political will is about the fact that government after government of all political colors have been more than happy to peut arms exports and arms company profits ahead of human rights than it of democracy so we want to see a cultural change as we want to see cultural change we do want to see stronger legislation internationally but we also want government to actually bite by the legislation that's already in place to not just follow the letter of it but also a spirit of it because there's absolutely no model defense for these arms exports whatsoever the gabriel doesn't the case in greece prove point exactly that there's very little political will to abide by these regulations because greece signed this arms trade treaty just last year. yes of course the government actually rectified i said i think that i've already mentioned the red five arms trade treaty in march thirty first of. two thousand and sixteen next it'

citizens in the u.k. or u.k. citizens in the you could be discussed because the european union always was very clear if we don't have an agreement on the brics a real those talks are not going to continue you quoted from the financial correspondent in frankfurt thank you. and if there really is a break as a breakthrough you'll hear it here on lasting business. entering the conflict zone a new president has taken the oath of office in zimbabwe but you see any different from the old one my guest here in london is nick by one of the u.k. representative of the country's ruling zanu p.f. party with thirty five years of bloodshed on the house and an economy it really has no business to they have continuing to adopt a. new deal. every journey begins with the first step and every language with the first word published in the. eco is in germany to learn german why not learn a simple online on your mobile and free shop from d w z e learning course he can speak german made easy. sustainable protection for the earth ideas de

the u.k. could be about to improve its financial offer to the european union ahead of a crucial meeting next month. members of theresa may's divided cabinet will consider how much money they are willing to offer if britain divorces the eu. yesterday, philip hammond suggested that a proposal would come soon. >> it is not about demand, it is about what is properly due from the u.k. to the european union under international law, in accordance with the european treaties. we have always been clear that it might be easy to work out that number, but whatever is due, we will pay. we are a nation that honors our debts. ed: global news, 24 hours a day, powered by over 2700 journalists and analysts in more than 120 countries. you can find more stories on the bloomberg at top . let's check in on the markets in asia, here's david ingles. david: thanks. it's not the best start to the trading week. as you can see, it is pretty much red across the board. there are a few exceptions, but if you look at the

as the u.k.nd eu wrap their greatest -- latest rounds of brexit, concerns over the future of the irish border have interrupted. circulatedment wednesday calls for northern ireland to maintain the rule of the customs union and single market after brexit. this added to pressure on u.k. prime minister theresa may, gloucester second avenue minister in a week -- who lost her second cabinet minister in a week. joining us is emma ross thomas, and dara doyle, bloomberg's dublin bureau chief. in, the eu is floating the prospect of no deal. ian: it looks that way. today marks exactly halfway between the u.k. referendum last year and the day they're going to leave the eu in 2019. i think you came down from the moon and hadn't been following any of this, you would be wondering what they have in doing. and they are talking about progress in any of the three main separation issues, citizens rights and the irish border. every time we think we are getting closer to a breakthrough, the eu says you're not very clo

he joins us at 7:00 u.k. time. u.s.asury secretary steven mnuchin says he cannot rule out a delayed tax rate cut for corporations. the senate is said to be considering waiting up to year to lower the rates. manus: mnuchin warned it may hurt the economy. he spoke exclusively to bloomberg. >> the presidents strong preference, he wants to start this right away. having said that, we have to look at the entire senate package. i assume it is really just a money issue as to how they are moving the different pieces around. it's not a philosophical issue. sure they would like to start this as soon as they can. >> they gutted the excess tax revision leaving another hole in the package. how do you feel that? >> were going through a healthy process which we started getting the house and senate and the administration on the same page. so the fundamental goals and parts of the bill we have all agreed to. now they are going through a detailed process. talking about very technical issues on everything from the international side to pas

anna: the u.k.nd eu are said to have reached an outline deal for the divorce bill leaving the irish border the last major obstacle. $10,000 asoin tops the bubble warnings multiply. ♪ anna: good morning, everybody. "bloomberg daybreak: europe." our minds back to what happened in the united states yesterday. we are perhaps drawing a line in the sand in today's trading. u.s. stocks touching new highs. it's the everything is awesome rally. focus on the things that are good. tax progress. positive data. the senate budget committee has advanced the republican tax bill. see the index is pretty flat. we had powell testifying in front of the committee. he talked about the december hike. he also signaled he was on the same page as janet yellen. the pound is up again. could we have a deal in brussels? it looks as if we have a preliminary agreement on the financials. it's a long way to go into actually get to brexit. you've mention what's happening in north korea. japan aims to get north korea to abandon the nu

training and u.k. arms sales to saudi arabia to kill the people of yemen isn't it about time this government suspended its arms sales to saudi arabia the u.k. prime minister responded almost exactly the same way as the saudi government that britain gives aid to yemen and this all cooperation with the saudis cooperation with us has helped save lives in the u.k. but you can be sure that the issue of curbing arms sales to saudi arabia which killed civilians in yemen won't be in today's british autumn budget joining me now is britain's former u.k. chief of intelligence and u.k. security and counter-terror minister of the lord west thanks so much for being on the program just before we get to the budget briefly on yemen is our security relationship with saudi arabia so important we can't really stop talking about color epidemics in yemen well i put a different way i mean saudi arabia are clearly very very important to us and to the united states on to the region for stability and security in a way that a co

well first we have to see you know how much the u.k. actually has to pay for the brics that will there have been numbers in the room of up to one hundred billion euros and that would be also already something very expensive even for a strong country like the u.k. and there's still so many unanswered questions at the moment also we have to take into consideration that so many companies have already announced to leave the u.k. if we are really going to see a break said so at the end i do at the feeling of course this is not going to diss troy the u.k. but of course starting with you know a real record at least at the beginning it's going to be turbulent and a little bit bumpy for the country it's going to be a bumpy road for sure thank you very much. u.s. president donald trump is in vietnam at the apec summit of asia pacific leaders where he's been stressing his american first message she said he's open to bilateral free trade talks with all of the apec members but he said the u.s. would not tolerate what he called chronic trade abuses w

u.k. time.an has reportedly received radio sickness -- radio signals suggesting that north korea may be preparing for a missile launch test. the type of missile was not specified and the radio signals could be from winter training by the north korean military. the bank of japan's governors says asian economies are more resilient against economic shock. he was speaking at an event that marks the 20th anniversary of the asian financial crisis. capitalization of asian local bond markets is trillion, to $3.7 more than 100 times bigger than before the crisis. we have certainly made progress. economies have become more in the financial sector has developed significantly. ireland, the controversy threatening the government and the brexit talks has escalated. the deputy prime minister, frances fitzgerald, aces a cop -- a no-confidence vote. it could pull down the minority government. says theof england uk's biggest lenders emerged from the latest stress test with the strength to keep lending even with a

u.k.orkers coul. also the broader market this year. consumer behavior is "subdued." this is the bloomberg greed indicator. not enough to keep investors .ptimistic on the pound pi this is our indicator of momentum in market sentiment, dropping below zero after they raised rates for the first time in a decade, without saying a plan to tighten in the future. you have got some breaking news. vonnie: robert mercer, the hedge fund titan that helped to elect donald trump come has been pushed out of renaissance technologies amid intense criticism. the founder of the tech fund was worried that mercer was hurting morale as political projects dragged the investment firm into the spotlight. this is more detailed for the story could joinin. joining us now for more explanation is that green light i zachary minor. tells exactly what going on here. >> the news today is that we learned last week that robert mercer come to co-chief executive officer at renaissance technologies was stepping down as co-ceo. w

and u.k. and so on so in its essence there is a big battle for control of this huge amount of money there's international national dopping organization this grouping this kind of like groups from your side of america. from the u.k. and cabins on there fighting to control this part in the meantime water trying to stay relevant and he pulled this part russia on fortune's been caught in the middle however. if these revelations are complete completely brought him to the open a lot of these people including probably story very very nervous because a lot of revelations could be coming out of this. thread's being told you would know how things were. came in here he saw the leader of china and the president of russia. somewhere in the expecting i can tell you that an american about the possibly happen maybe some other time. yes with anything that happens now so we and there can be repercussions. yes in fact you. know those who were on the on the podium for the you know when there's a march past who wo

u.k. officials have tried to accelerate brexit negotiations , ireland could hold fire and block a final call if it wished. avoiding a hard border in ireland is one of the key issues requiring sufficient progress for the eu will allow the future relationship with the block -- with the bloc cured in the u.s., the legal team for former national security adviser, michael flynn, has stopped sharing information with donald trump's lawyers. that is according to two people familiar with the probe. the move signals that flynn who was fired in february may be in discussions with robert mueller. the u.s. navy has abandoned the search for sailors missing after -- the plane came down southeast of okinawa but a search involving uss ronald reagan, three helicopter squadrons and other aircraft failed to find them. eight of the colleagues were found soon after the crash. president is due to be sworn in later. the ceremony takes place after a dramatic 10 days before the military seizing harare. mcgarvey's r

the u.k. has signaled it is prepared to compromise in its standoff with the eu over the brexit bill. yesterday, it was said the financial settlement on divorce thes will be but better for remaining 27 companies for brick -- than for britain. >> in the infamous words of the european union, nothing is agreed and everything is agreed. we see these linked to each other. we draw the agreement on balance , probably favoring the union in things like money and so on. the future relationship will favor both sides. the robotic dog comes with a powerful computer ship. and the ability to connect to mobile devices. shipments start on january 11. shares have climbed to their highest level since 2008 as the annual profit outlook has increased. global news, 24 hours a day, powered by 2700 journalists and analysts in more than 120 countries. much.hank you very let's talk about the markets. it has been a solid session overnight for asia. the metals market on the move. what should we read into all of this? let's

the u.k.'s brexit negotiator confirmed the u.k. will not create a border between northern ireland and republic to the south as part of a deal with the eu. let's listen to what david davis said about the progress made at these talks. >> there's no doubt that we have made and continue to make significant progress across our whole range of issues. across the board, we have made progress towards resolving different questions. that will continue at pace between now and december. >> we can go to brussels, to dw's gehrke. you are at the briefing, is this bring it an ultimatum? >> it was groundhog day in brussels. a polite and very experienced diplomat, but he has seemed to grown tired of repeating that some progress has been made, but not -- not sufficient progress. one of the journalists asked the question if only two weeks are left, his answer was very short and concise, yes. >> is a preparatory hard exit -- are they prepared for a hard exit? >> you can see they are preparing for such a scenario, seeing how they may be affected. a great

training and u.k. arms sales to saudi arabia to kill the people of yemen isn't it about time this government suspended its arms. to saudi arabia the u.k. prime minister responded almost exactly the same way as the saudi government that britain gives aid to yemen and this our cooperation that this cooperation with us has helped save lives in the u.k. but you can be sure that the issue of curbing arms sales to saudi arabia which killed civilians in yemen want to be in today's british autumn budget joining me now is britain's former u.k. chief of intelligence and u.k. security and counter-terror minister admiral lord west thanks so much for being on the program just before we get to the budget briefly on yemen is our security relationship with saudi arabia so important we can't really start talking about cholera epidemics in yemen well i'd put a different way i mean saudi arabia are clearly very very important to us and to the united states and to the region for stability and security in a way they're a c

speaking of brexit, we have been talking with the u.k. opposition leader about the u.k.'departure from the e.u. >> we have not considered a second referendum. we want to negotiate this process through. we don't know when the next general election will be so we do not know what might it would be in government. i would want parliament to be able to hold the government to account on what it is doing, challenge the bill as it goes through. this ill is everything i disagree with about the way in which parliament should be run. parliament should be there to hold government to account. the spill hands enormous powers over to the secretary state where he can override parliament. >> this is a big change in public opinion? >> we are not contemplating a second referendum. do you see a transition as something that can be achieved now or will take time to negotiate? >> there is going to be a transition. otherwise, we are less than a year and a half away from the date of leaving the european union. there's no transition agreed until march of 2019. which business will be investing? ther

u.k.onsumer confidence tempered -- confidence tumbled in november. optimism suffered its biggest monthly decline since the month , with allreferendum its measures that make up the index falling. ireland political forces have set up pressure on the government as they have called on the deputy prime minister to resign over a whistleblower controversy. it has raised the possibility of election within months. the ruling party has said the prime minister will refuse to fire his deputy. him on course for -- has stop sharing information with donald trump's lawyers about the special counsel the investigation into russian interference and the 2016 election. -- in the 2016 election. michael flynn, who was fired, maybe in discussions with robert mueller. is due to begagwa sworn in later this morning. the ceremony takes place after a dramatic 10 days with the military seizing control and robert mugabe relinquishing his presidency. resignation-- his sparked jubilation on the streets. global news 24 hou

in terms of the u.k.ific ones, the short-term impact means this is all about skills on the long-term. >> carney may have to use this as justification. we have done a poll with analysts, whether you go with a with a dover -- hike or not? >> i would do none. the bank will go for dovish. >> augest -- a guest from jp morgan said the u.k. is not immune to the global story, which can carry us through. the economy hasn't some specific factors. things thateries of are going to impact the u.k. consumers. the bank may go on a tightening cycle. >> would you call this a policy mistake? emergency stimulus can be removed from august 20 -- august 2015. >> simon, thank you so much. >> we will be speaking to the former bank of england. -- two the former head of the bank of england. gasolineand inventories have declined last week. yousef, explain. metric it is the key when it comes to the understanding of this global rebalancing process, and whether it is healthy. data, thek at the api bloomberg survey is looking at more c

you look at the u.k.ou look at high levels come you , youat the brexit risk anticipate the u.k. economy set to be relatively weak in the context of the economy. how do you draw a line between what seems to be some level of chaos and government and a new election? it's quite difficult to get there, isn't it? james: it is, and the important thing in investment terms is step back. i think our global quality , it'sies, for investors an excellent long-term buying opportunity on what the future .ooks like i would say the stock market last year is quite cruel to performance relative to its underlying long-term potential. thinking about interest point on multiyear view. anna: is there word for activists in the dream sector? maybe that is one of the reasons. james: i would say the drivers are rather different. the luxury goods manufacturers face pressures on global trade and pricing. balancesitioning of sheets in china met a lot of them are buying handbags as a proxy to -- manus: look at louis vuitton and gucci. j

u.k. 10..m., the confederation of british industry's, carolyn, will join the libertine for an exclusive interview. manus: softbank and a group of purchase are trying to a stake in uber at a major discount. there is the punchline. they are offering to spend more than $6 billion for the stock atch would value the company $40 billion, 30% lower than its most recent evaluation. what a punch up if it is true? bloomberg's managing editor for technology in asia joins us now from asia. peter, your take on this? this has opportunism written all over this. it is an opportunity, isn't it? couple oftbank and a other investors are coming in and looking for quite a discount. were going tohey ask for a discount from the last fundraising that uber did run the $69 billion figure that we talked about. but the 30% discount is substantial. they are putting this offer on the table. the need existing investors to accept that your nation. they need another for them to get to 14% of the stock. they do not want a subs

the u.k. is so low. is it easier to retrain in this society or not? minouche: u.k.'e of manufacturing has been on the decline for the long time. the u.k. is a service economy. retraining, i say it doesn't make a huge difference. there will be retraining in manufacturing as well as in the service sectors. we will see automation transforming both areas. bad.'t think it is good or people tend to glorify the manufacturing sector. service sectors can produce very high income, high levels of productivity, and high levels of well-being. i think the issue around skills and retraining is not sector specific. francine: is there one common misconception or something that companies get wrong? i don't know, whether it is how they look at the longer term, is there something our viewers and listeners should think about? minouche: what is striking is how firms' investments in training workers have declined sharply. in the u.k., research and development investment by the private sector is very low. francine: why is that? minouche: good question. francine: short-term is him? think the

training and u.k. arms sales to saudi arabia to kill the people of yemen isn't it about time this government suspended its arms sales to saudi arabia the u.k. prime minister responded almost exactly the same way as the saudi government that britain gives aid to yemen and this all cooperation with the saudis cooperation with us has help save lives in the u.k. but you can be sure that the issue of curbing arms sales to saudi arabia which killed civilians in yemen won't be in today's british autumn budget but joining me now is britain's former u.k. chief of intelligence and u.k. security and.

the u.k.ould be about to improve its financial offer to the your in union ahead of ritual meeting next month. they are considering how much money they are willing to offer. the suggestion is a settlement proposal will come soon. global news 24 hours a day. more than a hundred 20 countries. this is bloomberg. angela merkel attempts to form a new government have collapsed. the breakdown in discussion throws the future of merkel's term into doubt and raises the possibility of new elections here in germany. which would be completely uncharted territory in the post or. . merkel says she will consult with the company's president later today. day of deep reflection. i will have to move forward. i will have to do everything possible to ensure the country will be well run. to our government reporter. glad to see you got some sleep. these to at collapse? >> it happened pretty late in the evening when the ftp decided to pull the plug. was clear in the end of the whole package of things that they had nego

u.k.as a week to find compromise on the irish order. this is a political scandal threatens dublin. manus: republican lawmakers scramble to lock up votes analyze their dollar -- tax bill. anna: oil trade near the highest level in two years. manus: another day, another record. bitcoin shows velocity. ♪ anna: very warm welcome everybody to our new headquarters in london. the confirmation of jerome powell there this week and u.s. tax. on the risk radar, we've looked at the political story in the u.k.. .he pound down what can be done to enable progress to move on to the tray conversation? on the oil price, we are down by .41%, but not high -- not far from the highs. abouting coming to talk output cuts. and next the tea, what is xp t, it's that coin. rally of 17%. of 40% in the past two weeks. up 800% year to date. is the cryptocurrencies going mainstream? is it covers investors or fear of missing out? manus: breaking news. there is a new ceo at julian bear. julius bar -- julius baer. holder is

that is the u.k. 10 year yield, 1.277%.nnouncements for bond investors, the debt management office says the gilt issuance would increase marginally from its previous figure will behe the lowest issuance since 2007 and 2008. that is the news bond investors want to hear on budget day. let's toss it to anna edwards who is at westminster to bring us up to speed on the news today. >> thank you. i am joined by nicky morgan. chair of the treasury select committee. welcome to bloomberg. the forecast presented to the government, you are gifted those. at no point in the next four years does the u.k. economy expected to grow past 2%, does that not suggest that maybe the government should be doing more to stimulate? >> that is probably what the budgetary was about, a reason why our economy is not growing as quickly as we would like is because of a lack of productivity. the chancellor talked about investing in infrastructure and skills, and also housing. there is also brexit. we will be leaving the market where many of our businesses ar

it is budget day in the u.k. u.k. can watch chancellor hammond's statement from 12:30 london time. dollar weakening a touch against major currencies after we heard from janet yellen, warning about rapid rate rises. let's bring that up for you. looking at what europe is doing, stocks seemed to the struggling to follow a global rally. this is bloomberg. ♪ is this a phone? or a little internet machine? it makes you wonder: shouldn't we get our phones and internet from the same company? that's why xfinity mobile comes with your internet. you get up to 5 lines of talk and text at no extra cost. so all you pay for is data. see how much you can save. choose by the gig or unlimited. xfinity mobile. a new kind of network designed to save you money. call, visit, or go to xfinitymobile.com. francine: brexit breakdown. it is the make or break budget for philip hammond as government infighting continues. to the ballot box. angela merkel's party is betting on a revived alliance with the social democrats. and uber hacked, the ride h

u.k.ou've got inflation, you've got uncertainties coming from brexit, a government that doesn't have a majority. all of those things are significant headwinds for u.k. retail, the one area we are worried. we think there's no getting around the problems i just mentioned. the next few years, u.k. retail is going to be difficult. francine: >> up next, and kim theresa may's government overcome political turmoil at home and get a breakthrough in brexit talks?of that coming up on brexit show . all of talk about -- that coming up on the brexit show. we also talk about price comparisons. i'm looking at what else they are talking about for brexit talks.the irish border is erecting unexpectedly into brexit talks this week, along with advances in britain to deal with the border. that's next. this is bloomberg. ♪ is this a phone? or a little internet machine? it makes you wonder: shouldn't we get our phones and internet from the same company? that's why xfinity mobile comes with your internet. you get

the u.k.'s prime minister treason may as again label russia a threat to europe and call for a unified action to counter the perceived menace she made the comment in brussels ahead of the eastern partnership summit on initiative focused on bringing together countries across europe we must be open eyes to find the actions of states like russia russia and the potential presence of the east maybe hoods and trying to. connect to strength. and i'm looking forward to today to new commitments from european countries working together to tackle these challenges and security on different. ok that's what was said let's join holy book alive now for a little bit more bach trying to on this probably what we have been here before not so long ago with the u.k. pm similar statements as well tell us more about what was said today. well it varies a maze in brussels for a summit that's all about eastern europe they're talking about things like security cooperation and shared challenges and in fact it's not just sta

as the u.k. and eu wrap their greatest -- latest rounds of brexit, concerns over the future of the irish border have interrupted. circulatedment wednesday calls for northern ireland to maintain the rule of the customs union and single market after brexit. this added to pressure on u.k. prime minister theresa may, gloucester second avenue minister in a week -- who lost her second cabinet minister in a week. joining us is emma ross thomas, and dara doyle, bloomberg's dublin bureau chief. in, the eu is floating the prospect of no deal. ian: it looks that way. today marks exactly halfway between the u.k. referendum last year and the day they're going to leave the eu in 2019. i think you came down from the

the u.k.s about to improve its financial offer ahead of a european union meeting next month. areers of mays cabinet considering how much their offer in the divorce bill. the suggestions are a settlement will come soon. global news 24 hours a day. i'm sebastian salek. this is bloomberg. francine: angela merkel's attempts to form a new government have collapsed. the euro has bounced back from earlier losses following the german chancellor's admission that coalition talks have failed. it puts europe's longest-serving leader in doubt and means germany could head towards elections. merkel promised to make states ability -- to maintain stability. >> i will do everything possible as transitional chancellor to make sure the countries led through the difficult weeks. francine: our german government reporter is in berlin. why did the talks collapsed? -- fdp thate sdp pulled out. they wanted a turnaround denver -- turnaround in german politics and would not produce of a it in the government unless they g

u.k., conservative party makers are delighted with a by hammond, who targeted younger voters with tax biggestand promised the home-building program in almost five decades. conservatives lost over brexit. in germany, chancellor angela merkel make it a partial lifeline from democrats. social democrat leader martin schultz is prepared to offer a limited support for a fourth term. according to people familiar with this plan, schultz could back merkel in a minority government, but ruled that repeating the grand coalition. global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. i'm taylor riggs, this is bloomberg. jonathan? jonathan: thank you. for the latest out of germany, let's head to berlin with matt miller. are we closer to breaking the deadlock? uncertainty in germany? matt: it seems like there is movement in that direction, at least ahead of the csu. angela merkel's sister party in bavaria that is. they think they're making progress as we

or u.k. international department a minister a pre-teen patel has just quit it comes right after an official talks with key israeli officials in a letter to the prime minister patel apologize for what had happened and offer her resignation it has been revealed that she held twelve meetings while on holiday in august including with the head of the israeli foreign ministry but patel failed to inform the foreign office about it she is the second cabinet minister to fall in the u.k. in just a matter of days if you're going to report now from a lot of. this has led to lots of accusations of rebellious behavior acting in defiance with existing process as well as calls to not just sack her but also u.k. foreign secretary boris johnson and we shouldn't be applying a special standard. and if if if. if particular terrell has to go i find it difficult to see how he can stay you know the old adage that you know careless. cost lives supplies above zero true britain's chief diplomat. i find it difficult to

the special relationship we have with the u.k. and the united states is strained because of his actions yesterday. his darkest day in the administration. laura: those are strong words coming from you. we also learn from the white house that the president didn't actually know he was retweeting a far-right activist in britain. what do you make of that? ron: that is perhaps the most troubling aspect of this. the most critical thing the president has is the platform, the bully pulpit to tell allies around the world as well as american citizens what our government is up to. if he is sending out material that he is not sure of its authenticity, where it came from, and more importantly to me, laura, why is he doing this? what is the purpose of this? laura: i guess that is the question. we know the president space -- we know that the president's base like this kind of stuff, that he was elected because he can say the politically incorrect and call for a muslim ban, but when you are in office, you risk transatlantic rift. what is the calcu

the u.k.pay between 45 billion euros and 55 billion euros in a brexit bill with the eu. the payment is a sticking point in the recently stalled negotiations, led by british minister david davis on the british side. the eu was demanding 60 billion euros from the u.k., as a tab for brexit. promises expected from the u.k. for the you -- from the u.k. through the year 2020. the eu has vowed not to move forward until the bill is settled. the u.k. needs to move beyond the divorce phase of talks before it can negotiate a future trade pact with the block him a a critical issue for its post-brexit at economy. the possibility of leaving withoua deal is widely viewed as an economic worst-case scenario. the eu chief negotiator, michelle bonnier, said he was hopeful that you could be reached before a december council meeting. >> we are working hard on these issues, so that i can say to the european council, on behalf of the european commission, that in a few days time we have reached a sufficient level of

wiki leaks founder julian assange says that u.k. prosecutors have admitted deleting e-mail exchanges concerning his case. german police or thora to investigate allegations that matthew gangs have infiltrated its ranks and other state services. are getting me to manage the harvey this is art the international. purses are three people have been injured in southwest france after a car rammed into a crowd the incident happened near a school in the community of blood and yak the driver of the car has reportedly been detained the reason behind the incident is still at this point unclear ringgit dates on that developing story as soon as they come in. another major story today a ballistic missile fired by yemeni rebels in targeting the saudi capital last saturday bore raimi and markings now that's according to a senior u.s. air force official authorities are now investigating how the missile was smuggled into yemen which is under an extensive arms embargo saudi arabia's crown prince has accused iran of direct military aggression by supplyin

u.k. meeting at time. matt? matt: we're less than half an hour away from the start of european trading. happy thanksgiving by the way to you as well. because the u.s. markets are closed you may see a little bit less volume today and tomorrow nobody in his right mind is coming to work either in america. be prepared for light volume that could mean a lot of -- more volatility than we typically expect. here you see futures pointing down across the board. take a look at bonds here. a three day chart of bonds on my screen. the yield on the german debt shot up yesterday to 38. it is back down now to 34. we're looking at bonds, bond buyers that are sellers again today in the german and european market. guy? guy: let's talk about the big story over the last few hours. the cross alselloff we have seen coming -- colossal selloff coming through in china. i think the c.s.i. could be 17 months. the china c.s.i. 300 is closing down around 3%. shanghai a little less. aggressive selling in the chinese mar

and the u.k. are going to widen.e expecting another three potentially next year, and we are not expecting much movement, if any, in terms of u.k. interest rate. the risk to the pound is on the downside. seem like the u.k. economy has picked up a little bit, thanks to the pound. if you look at industrial production data, that is very strong. -- people have been quite pessimistic about the u.k. economy since brexit. it hasn't come through. >> the manufacturing sector has benefited from the weak sterling. months,ook forward 12 it is hard to see where you will get further stability. inflation is high, wage growth is not. the employment data we saw last week was 14,000 drop in employment for the month of september. we haven't seen that drop in employment in a very long time. havees suggest events that been pushing the u.k. growth is starting to wane. >> looking broadly at the european region, draghi said they will get that wage inflation they have been looking for. do you buy it? the employment data in europe shows relati

the u.k. pm said corbin copied his questions from the british liberal party something those on the radical left may well be worrying about given his m.p.'s don't seem very socialist i'm very interested to the right honorable gentleman has found his appearance as a prime is this question's been going so well he's had to borrow a question from the leader of the liberal democrats corbin not predicting the teresa mayes chancellor was about to dispense with near liberal talk of balancing the books wanted to know where britain's wealth has disappeared to he asked about all the billions in cash stored away in tax savings that could be used to pay for basic social services in a country where perhaps one hundred twenty thousand children will be homeless this christmas would britain seek to emulate the poverty stricken caribbean she still threatening to turn britain into a tax haven. may said she wouldn't take lessons from labor surely a fair point given tony blair's party appeared infamous the relaxed

average mortgage around two hundred thousand pounds which is about the average mortgage here in the u.k. you'd be looking at twenty five basis points out and about thirty pounds to your monthly repayments so in the grand scheme of things that doesn't sound like doesn't sound like much but if you're if the bank of england is looking at not just one interest rate hike in maybe two or three over the course the next couple years obviously three will take it closer to one hundred pounds if you get to about one hundred pounds that's about five percent of the average take home wage now here in the u.k. . the majority of our economy is based around consumption is based around spending it's based around the high street and why why people going out there and flashing the cash so if people are having to spend more money on servicing debts be that credit card debt house debt card debt there's less for them to spend elsewhere and you mentioned in. place in earlier as a concern so is consumer debt that's on the rise again the bank of england. also expressing concern about that how how does that figur

and the u.k. in negotiations i'm joined by big mass we're standing by for us in london becky so what exactly did those business leaders tell theresa may. well we can only speculate that what they wanted was to find out what the reason may is thinking what she's planning because similar to british businesses here in the u.k. you really want to make sure that the prime minister listens to them and really press to hard to have an ear out to business and see what they want also european business of course want to have as much clarity as possible and the clarity as you've already said which is not present at the moment business leaders would be scared of the talk that there might be no deal would be scared of the deadlock in the negotiations that we are observing at the moment so they of course want to see how how sure they best plan and press the government and say well you know as much clarity for business as possible is what they want well and one of the main reasons for the deadlock of course is th

needs to -- the u.k.at germany would help out at the last minute and i think merkel, in the october summit, merkel came up with these encouraging words. he think about german businesses and their interest in having open access to u.k. markets. coalition talks continue in germany. we probably won't have a government when it comes to the december summit. .hat probably is a risk factor francine: we also heard from mccafferty of bank of england -- do we's worried have a timeline problem? emma: i think that's happening already. to waits are not going around. transition was never going to be good enough for them anyway. they've been scoping out office space in frankfurt for months. tom: thank you so much. we will continue with mr. nordvig. we hope you are getting briefed on economics. on the politics we see. on radio, coast-to-coast and across canada. bloomberg daybreak. this is bloomberg. ♪ taylor: let's get to bloomberg's business flash. investors are showing disappointment in burberry. new ceo marco gobbetti

same in the u.k..perhaps with something like stamp duty -- guy: isn't the danger with that story, if they were to reduce stance, that would be seen as regressive, i.e., what not favor the portions of society which the politicians are most focused on right now? those are younger people and those that are struggling financially. >> he can be quite and limited here. i think it's relatively easy to -- quite easy. when people -- one thing you can do is go after people of a certain age group. up to a certain age -- you don't need this. >> yes. >> i think we can increase to a significantly higher level we have now. >> this so this would all be kind of progressive. the back end of the market, i.e. the higher value properties -- billing >> we are making this work. this is raising revenue. actually, the market is clogging up. -- t raising more revenue >> what would be the impact for the u.k. economy, the average consumer? 50% are on variable rates, if we got a hiking cycle, rather than a one and done. >> that's

u.k. prime minister hits out of russia in a speech her critics say a design to deflect attention from stalled negotiations. rather welcomes the live from moscow. for the next half an hour spain's prime minister has said there is no evidence the russian government interfered in catalonia independence referendum that's the spy delegations in the media and this report. as if we haven't seen enough attempts recently to try to drag russia and certain events unraveling in the west lately we've seen attempts to try to implicate russian activity even in the catchline crisis despite this year's long standoff between barcelona and madrid really newspaper headlines from around the world have seen galore excitement about potential russian meddling yet again for instance a big spanish newspaper el pais certainly seem to have dedicated lots of attention to russia despite this being obviously a national crisis we've seen also this week in brussels some spanish officials trying to talk to their e.u. partn

jeremy corbyn becoming u.k.rime minister, talking about more fiscal stimulus into the medium-term, more borrowing and pushing up interest rate. slightly aside from the brexit conversation, but is that something you are thinking about? kokou: clearly, this will create more volatility. it's something we have been considering under that scenario but it's also an interesting trade that could be around dispersion. some will benefit and others will suffer. we suspect why the key series will be relevant. in a nutshell, it's fine volatility on single stock options matt:. matt:which sectors to you think will benefit, pros -- post-brexit? kokou: if we see a brexit lower currency, exporters will benefit. importers who rely on goods and services out of the eurozone will suffer because of the important inflation and the pressure it will have on their margin. you can obviously think about financials and what it means in terms of the yield curve, whether will have a negative impact on interest margins. so there's a whole host