marilyn, the front end has been a big story for the team of blackrock.e getting to the point where we are seeing that move now that we could be close to the peak? >> we still really like the front end of the curve. we think that it might be from here pretty well anchored but actually, if you continue to hold that, then we think it is very reasonably priced. but actually next move you could see is more of a steepening. particularly if the fed does indicate the rate hiking cycle. i you still have a lot of cushion and get some very good income even if we see rights rise a little bit. further up the curve if you go to the tens or 30's, there's just no cushion. >> can you walk me through that, why the next big move could be so big? >> if the fed announces that is going to pause at some point, the market is not yet retired for that. we have seen a few signs that the market is concerned but it is not yet priced in that the fed might false in a rather than later. next year, i think the market will really start to reassess. it's going to reassess the view of the

does blackrock like it now? bob: we are approaching levels we have set for a year were kind of fair. 3.25% target. 2.25% break. 3.25% is a reasonable expectation for the long end of the next six months. jonathan: i am trying to understand where the biases around the table, when sellers start to become buyers, when you start to like the price at the long end, do you like it more or -- do you like it now or do you need to see more? victoria: i know no one wants to talk about the neutral rate. jonathan: carry on. victoria: all day, we have been talking about how there is not really a neutral rate. but i think you're getting close. 01% level that was a benchmark you want to bypass and you have to look at the range of where you were before that move that much higher to where your limit should be. if our range was about 20 basis points, we move about that, we are right where we should be. i think we also have to look and see the move we saw this week was mainly due to term premium moves, not necessarily to growth expe

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hildebrand of blackrock.don't think so. instill have decent growth europe with expansion. we have big problems in italy, where you saw the latest gdp numbers, poor economic policy reduces poor results. concerned,ermany is a year ago we were waiting for the election to form a government. now there is limbo until december when it becomes clear whether she will continue or not. she is a formidable politician and a great leader and should certainly not be underestimated. i would be careful when i look at all the pundits who are saying she will also step down as chancellor. the sooner we get clarity on that beyond the party congress and collections and leadership, the better for the german economy in europe. nejra: you don't see angela merkel's influence waning in the near term, what about any sort of questions over someone filling the void, not necessarily in germany but the rest of europe. is emmanuel macron that person? philipp: it has always been between the countries and the chancellor. that will be important

scott teal from blackrock saying he favors the five-year curve. blackrock has been pushing a lot. 326dy tell me has gone to in the bond market? that was the yield we saw, the high this year. play, a hugecs and dislocation between money flow into the bond market. .e are also seeing block trades block trades are traded on the futures exchange. the bottom line is the market disbelieves the fed is really there to get suckered to these markets. existed in these markets are under pressure. btp's off. scott maynard would maintain you're going to need an awfully to even to get the fed remotely stop. fed a futures are repricing the trajectory of the federal reserve 2019 to verily over to hikes next year. asia is where the crux of the meltdown is taking place. juliette saly is an hour singapore studio. how did the numbers back up? extending beare market territory on the msci asia-pacific index down 22% from its peak. things in asia could get worse before they get better. you've got this dollar play in factor. india down over 1%. the nikkei down by 3.7%. that is its lowest level since march.

me is rachel cohead of yield and high loans at goldman sachs asset management, marilyn watson of blackrockand robert tipp of pgm fixed income. rachel, i want to begin with you. and ask you the question of the central of that piece. equity markets all over the place. yet, the junkiest part of junk is doing ok. leveraged loans are doing ok. why? rachel: you could either assume that equity is the beginning of the end and credit would catch down with it, or this is a flash in the pan and there will be a recovery in equity. we believe there will be a recovery, that actually the fundamentals of the credit market and the economy are still very, very strong. you look at the underlying default rate, very benign and likely to be so for years to come. one of our strongest convictions is that the energy recession of 2015, 2016 really hit the reset button for corporate behavior for how the market was being addressed, and it really gave the market a chance to heal. so the quality of the market is not as dire as a lot of people have suggested. jonathan: you're not alone in making that point, that high-yi

still with me, rachel golder, from goldman sachs asset management, marilyn watson from blackrock, andt tipp. robert, to come to you, i raised that quote because i am wondering whether former fed officials and current fed officials are trying to tell us something. the guiding light at the moment seems to be worries about financial assets and financial wobbles. robert: they are operating in a world of uncertainty. but they do know that what has ultimately cost the average american, and even more than that, are the big downturns. the crashes, and the crashes have been caused by the bubbles. those are the ones where the bulk of society recovers slowly. instead of being very cautious. i think it was probably five years ago she was warning on biotech, right? so i think it behooves them to kick the tires and see if anything rattles. but that is ultimately what i think what is going to extend this expansion, not seeing the widespread excesses of aggressive lending versus appreciated assets, the real estate bubble, or any gigantic single sector bubble, you are not seeing that but they continue

bar where we are back with blackrock's rick rieder. you still own equities and you are change your allocations in bonds, but you are have much in the short-term duration. let me ask you about equities. some of these high fliers, trillion dollar valuation for amazon and apple.

>> playing the markets, they're not going to be using blackrock.oing to the trading platforms. look i believe the biggest problem we have in the world -- i've talked about this for years -- is financial literacy i think one of the great worries is people are frightened of their future and retirement. we need to use technology to embrace financial literacy we need to create -- maybe we have to gameify investing. using a mobility and we need to get the next generation up to speed in terms of what it means to invest in their future i think this is one of the fundamental problems the central bank's response to the financial crisis, they only have those tools those are generally tools that will strengthen financial markets. if you look at where housing is -- housing's up but not nearly as much those who add equities did much better than those who were just having their equity in their home >> larry, just to recap your thoughts about the market. because we have a lot of people who are sitting at home, they want to hear what you're thinking about what's j

we'll talk markets the big guest of the morning, larry fink of blackrock will be here at 6:30 a.m theing its earnings larry fink also one of the figures in the decision to step away from saudi arabia and this conference taking place next week that's an issue we'll talk about. we'll have the cfo of johnson & johnson on later and we'll have the hhs secretary with us, alex azar big morning. >> we'll tune in in about eight minutes for "squawk box..." >>> netflix set to report quarterly resultses at the end of today it's been a rough month. shares down 10% since the start of october it's flirting with correction and bear market territory. netflix and other big names about be front and center for investors. we're joined by cyrus mayawala this morning how important is netflix for setting the tone for this earnings season? >> i think netflix is incredibly important. it's the number one reporter last quarter they missed numbers by 1 million subscribers if they hit numbers this time, there's a question of what the guidance is for next time. is netflix still a growth stock or is the competition

wei li is with us, the head of ishares at blackrock.k at the minutes, let's see what we get coming through in terms of the told. -- the toll. we have taken quite a bashing in the past number of weeks. in terms of the flow of money, do you think it was a rerun of february where we see equity markets draw down but then adjust themselves the echo -- themselves? >> if you look at market volatility, it would appear that investors are not -- they are sitting tight. we have not seen significant outflow in comparison with the increase of trading activity in the secondary markets. it would appear that investors do not think of what's happening right now as an end of cycle correction. fleet. late cycle to clients and investors, people are asking when to enter rather than if to enter at all. the has been the -- has been underpinning the outflow. interesting, people are asking when to enter. it is happening with the backdrop of rising rates. you talked about curve steepening earlier. does that mean that blackrock you prefer the front end of the u.s

rupert harrison of blackrock still with us.talked about some of his policies and the targets he was having in place. you are bullish on japan and japanese equities. rupert: if you look around the world at developed markets, japan stands out. we do not see fundamentals changing. vulnerable, toe the nsa risk off haven. world,u look across the that can remain the case for a long time. i think the domestic nominal demand seems robust. that thisot a bank yield targeting is in place. the adjustment was in order to keep the basic strategy in place against critics. combine that with corporate governor's reforms. this looks like a positive story. francine: when you look at tensions on the market and the equity selloff and the fact that got a bid, and yen does this mean the dollar is no longer a haven? it will act as a haven in extreme risk off scenarios. and dollar safe haven assets are 85% of global safe haven assets. the dollar will benefit. on a medium-term, i find it her do see the dollar getting stronger because the growth momentum

joining us from blackrock. vonnie: first word news now with courtney donohoe.ourtney: the secret service found potential explosive devices in mail sent to president obama and clinton. the devices were discovered a routine screening. evacuated-- cnn suspecting explosive devices in the mailroom. throne inbehind the saudi arabia calls the murder of jamaal kush og a heinous crime. he says the criminals responsible for the killing would be presented to the court. the crown prince said no wedge will that between the saudi's and the turks. tax cut for the middle class, kevin brady says if republicans retain the house and senate, they will move forward on the plan. the tax overall is not proving as popular as publicans hope. global news on-air and on twitter powered by 2700 journalists in 120 countries. this is bloomberg. >> coming up, one of the worst s&p ising her's and the one of the important ones in the economy. and entering a bear market as borrowing cost rises. in top of the hour, tune york,ble, lives in new starting your commute home, well worth a listen, i can

lago fromateos y blackrock will stick around.ad, how the chinese economy is really performing. professoro business li wei. yuan is moving closer to the key level of seven. isabelle mateos y lago will be back with us and we will also be joined by mizuho banks can chum. what comes next for the chinese currency? this is bloomberg. ♪ >> this is daybreak asia. the chinese yuan is inching closer to the psychologically important level of seven to the dollar. hec governor told bloomberg thinks the currency is at a reasonable and equilibrium level but he is still preparing for the worse. for more on this, we are joined by ken cheung in hong kong. also still with us is isabelle mateos y lago from blackrock investment. let me start with you. we have seen the chinese yuan move largely in line with u.s. differentials. we have this chart showing the differential in blue and the dollar-yuan rate in white. this is mostly in line. and you take a look at the direction of the yuan, how much of the weakness that we see now --we continuetion to see t

steven cohen from blackrock. karen, after 3 1/2 hours you're heading out as well for a documentary. >> i'm handing it over to you, but i also think i'm handing it over to erdogan. >> it's a green market moving to a red market >>> coming up on the show, a preelection sweetener. donald trump says a tax cut announcement is coming before the midterms can be relentless. tremfya® is for adults with moderate to severe plaque psoriasis. with tremfya®, you can get clearer. and stay clearer. in fact, most patients who saw 90% clearer skin at 28 weeks stayed clearer through 48 weeks. tremfya® works better than humira® at providing clearer skin, and more patients were symptom free with tremfya®. tremfya® may lower your ability to fight infections and may increase your risk of infections. before treatment, your doctor should check you for infections and tuberculosis. tell your doctor if you have an infection or have symptoms such as: fever, sweats, chills, muscle aches or cough. before starting tremfya® tell your doctor if yo

♪ be after reporting earnings blackrock sinking.t stock down 31% from the 52-week high underscoring a tee krend trend in the market. mike santelli for a rare "fast money" appearance in the flesh. >> why do we deserve this. >> don't you get voted onto the desk. >> like survivor. >> yeah. >> but the paradox in the market the assets market stocks haven't been great i know larry feng even for a dominant franchise was talking about the chals this morning >> we saw huge movement from clients, a lot of churn. and it was just i think the markets are showing that that investors are confused. but overall because expense discipline, because of how we navigated, our revenues up 18% in our aladen business and technology business. overall it was a good quarter. but what i was disappointed in the net flows. but very explainable by some large derisking. >> yeah, and floats are not frustrate across the industry. that's one of the foovgts that has been hurting the group obviously the global markets have been weak it's not as if everybody is at record

blackrock.bloc rock and other investors or big passive investors that loan out the shares to shortsellers in addition to all of this. that's a whole other separate piece of this. >>> we are tracking the fallout in the stock market from yesterday's report that the data center equipment may have been hacked and chinese surveillance may have gotten through through a tiny microchip this is a bloomberg report that was in business week nonetheless, shares of computer maker lenovo, they did fall as much as 23% before closing down at 15% they said they aren't supplied by that hardware maker and it takes extreme steps in security. but analysts said that those in the u.s. might be using a pc maker instead. meantime shares of apple suppliers also falling on that chinese surveillance story as well you're looking at those companies. semiconductor down 10% largan precision down 7% this is making waves no matter who you believe. >>> it is jobs friday. we're awaiting the jobs numbers coming up in about 24 minut

kate moore of blackrock with us.iefing on radio. karen moskow and nathan hager. look for that on bloomberg radio. stay with us worldwide. this is "bloomberg." ♪ kailey: this is bloomberg surveillance. i'm kailey leinz. let us get the business flash. more upheaval at cbs. parsons has resigned less than one month after being named interim chairman. he was appointed after the department -- departure of les moonves. he is leaving because of complications from cancer. it is another setback for this week's saudi investment conference. softbank's chief operating officer will not attend in the wake of the death of jamal khashoggi. one possible reason may be concern over u.s. regulatory approval over the pending sale backed sprint to t-mobile. ryanair is putting lands for future share buybacks on hold because of uncertainty over brexit. the largest airline just completed an $863 billion buyback this month. the ceo said starting a similar program makes no sense. the airline also was predicting more european airlines will go bu

jamie dimon has 80 employees in that country currently blackrock manages an enormous amount of money for the country, the same thing with these stones some people say this whole thing is hypocritical. clearly u.s. companies have, done business before >> this is so overt ly obvious in turkey we know what goes on we understand. if you saw the interview last night, lesley stahl read a complete list of things kim jong-un has done in the last five years for the gotcha part of that interview with how you could say that you love kim jong-un. she was very effective >> i apologize sources telling us that steven schwartzman has now officially canceled his trip. steven schwartzman, jamie dimon. >> when i look to see the market implications i went to market watch. first i thought, okay, let's hype this. call of the day, don't rule out $400 a barrel oil. i looked to see if this was a journalist saying it it's not they're citing the general manager. don't rule out 1 to 200, then they doubled it to put 400 so it could be in the headline for market watch which is the way things work. where are we to

still with us is jean from blackrock.look at euro policies, is it italy or what the ecb does in terms of unwinding its policies? jean: and is more important for the european outlook. both are important, but i think the ecb is not likely to provide news.e or we just heard they were in no rush. i don't think this is so much about providing signals i think the current environment doesn't justify an adjustment to the policy stance. it is not about being quiet in terms of communication. i wouldn't expect that to change until well into next year. i think the outlook is in-line with the stance we are seeing. as a result, don't expect the ecb to be an important driver of markets. we have been survived by have a tendency of markets to try and see a hawk's desire of the ecb to move early, don't think that is going to happen. what is more likely to be a driver or news element in europe, i think italy is more important. this has been since the election, a factor that has driven to more uncertainty in european outlook. francine: when

the board of governors for several companies including the world's largest asset management firm blackrock so far is one of three contenders for the party leadership he's considered the most conservative among them and would represent a clear break with merkel style of politics. although he's been a critic of the chancellor and her government since she took power in two thousand and five he says now they could work together he's been. convinced that angle america and i will get along under these changed circumstances. and in a way that we both see fit. mass is a business friendly conservative has close ties to the private sector are controversial and has made him a target for criticism the christian democrats will decide who will succeed chancellor merkel as their leader at a party conference in december if matz gets the job germany's conservatives will have to brace themselves for drastic change not least because of his rise could spell the end of on the america as chancellor given their differences she may not want to stay in office much longer. well i'm joined now by our chief political

i's lead concerns the asset manager blackrock.cpartlin cited adultery as the reason for the couple's divorce. the metro leads with the trial of russel bishop, who is accused it felt really warm in south east anglia. but from the blue skies to the grey skies, this was argyle imbued in scotland earlier on, where we had a week whether front producing rain and drizzle. the main driving load is heading up towards it also pictures booker prize winner anna burns. and the times reports that a worldwide register of suspected sexual predators working in the aid sector is to be pioneered by britain. clever variety of front—page news for us to digest. kick us off with what mr hammond is saying about a very large bill? european negotiators like to talk about how within the brexit negotiations, there has been quite a lot of magical thinking. some of that magical thinking. some of that magical thinking. some of that magical thinking has basically been if there is no deal, we will not have to pay the eu anything. and here his film is philip hammo

the chief executives of uber, hsbc and blackrock are among the many to have pulled out of it amid concernsver mr khashoggi's death. meanwhile foreign investors pulled about $1.1bn out of saudi arabian shares last week. that's more than any other week since the stock market was opened to them in 2015. many governments are coming under pressure to reassess their trade ties with saudi arabia including the uk which is the kingdom's second biggest supplier of weapons but the foreign secretary says more clarity is needed. we have an important strategic partnership with saudi arabia involving defence and security cooperation which has saved lives on the streets of britain. we also have a trading partnership that supports thousands of jobs. but a trading partnership that supports thousands ofjobs. but while we want to be thoughtful and consider it our response i have also been clear that if the stories we are reading turn out to be true they are fundamentally incompatible with our values and we will act accordingly. stuart thomson is head of public affairs at the law firm bircham dyson bell. thank

same as blackrock. >>> the oil markets closing for today.o to jackie deangeles. >> crude prices cautious for a second day in a row. not spiking on concerns about u.s./saudi relations and told there's more information or more reason to worry. meantime, a big move higher today in stocks not influencing oil. remember, the equity markets have lately been a directional force in this trade. not right now. tomorrow the eia says the crude inventory build has been strong. u.s. production to rise. that could be a bearish factor to watch for 71.02. >> jackie, thank you >>> well, housing stocks may be sitting near 52-week lows. new data out this morning showing improvement for the month be of october. blackrock ceo larry fink sounding the alarm on housing on "squawk box" saying the biggest risk that no one wants to talk about is the tax laws and how they changed housing affordability. fink went on to say that a rise in interest rates will impact the desirability of housing. here now to weigh in on all of this is glen with redfin always great to see you.

one bank particular came under pressure, that is blackrock.e've seen blackrock to the downside, hitting a new low after seeing net outflow. but goldman sachs and morgan stanley and have been real winners after quarterly numbers. profit beat handily on both. helped by growth and equity trading and underwriting. goldman sachs up 1.3%. morgan stanley has been to the upside after its quarterly report after it beat on all three, equities investment banking and fixed income. if you look at broader market, up arrows across the board. with only verizon in the red today. the optimism is here, neil. as i'm speaking to different traders i heard all kind of phrases, the bottom is in. earnings optimism, long term projected growth, economic growth. only one actually said pulling out some money putting some cash on the sidelines but the rest seemed very optimistic, particularly on the banks in this higher rate environment but they do seem optimistic overall as i have been speaking to each of them, neil. so you can see today we're having our best rally in a c

he is also thee: chairman of blackrock germany. of the cdu now, how would you change it? what are the policies that would make them reconnect with voters? michael: one of the problems is the immigration situation. we do have a lot of migrants and the laws are not adjusted. if somebody has to leave, it takes about two or three years, even if he is doing bad things, which has happened in the past. we have to these laws and rapidly. only just us, not but it is the socialist. we are having a grand coalition in berlin. both parties have to see this is , this the reasons the afd new party, is picking up so much of the votes. it is both parties leading -- losing to afd. that is something we have to look into. tom, it is telling that my tail salvini had just started talking to italian --izens saying votes want show the people want changes. thank you so much, the former deputy leader of the cdu. a will move forward with terrific news flow on monday, including the ibm red hat transaction. joel greenblatt to join later in the 11:00 hour. this

we'll see you soon >> blackrock's rick rieder for more on what rising rates mean for stocks, let's go to another expert, professor jeremy siegel from the wharton school >> happy to be here. >> rick rieder says stocks can handle this move in rates. do you agree >> well, i was on cnbc thursday and said this is a major impediment for stocks. two things make up stock prices -- earnings and interest rates. and all of the good news on earnings is basically out there. i mean, this has been a super year, far better than expectation. but it's already in those prices what's not in the prices is a sudden movement upward in the long bond. the fed saying, again, that it's going to be very, very aggressive another hike in december they say three hikes again in 2019. this is competition for stocks the yield is 1.8 we're going to be almost double that if we move into the 3s. you've got to get capital gains. i think it will be an impediment for the fourth quarter i said it's s&p and maybe i was too cautious i will stick to that i think the fourth quarter will be challenged. >> it sounds like you're ha

joe: talks between blackrock and tesla to acquire a minority stake have cooled.t is unclear whether talks will resume, but it is negative the talks aren't going forward. blackrock declined to do comment -- to comment, but it should be taken as a negative this morning for shares. anna: another banking stock to focus on this morning. >> the ceo's comments said it all. he is not satisfied with revenue in the third quarter and most of that is because of weak income from trading in the period. however, the bank has put a lot of focus on trimming costs. they are slightly ahead of plans and cutting about 6000 jobs as it goes down the path of automation. on the money laundering front, a big story in terms of nordic banks, the latest is -- of hermitage capital says he has rdea was used to launder money. brussels says the figure won't grow. anna: thank you all. matt has been keeping on the deutsche bank story because you will be speaking to the cfo. i'll be asking him how he expects to achieve his cost-cutting targets in the fourth quarter. it looks like they will have big

speaking of blackrock, the front end has been a story, the repricing on treasuries.ing to the point where we could be close to the peak? marliyn: we still like the front end of the curve. it might be from here well anchored. if you continue to hold that, we think it is reasonably priced in now the number of hikes you , might have. the next move could be more of a steepening if the fed does indicate it will pull its rate hiking cycle. even if yields go up more, you are still cushioned. further up the curve, there is no cushion. jon: walk us through why the next move could be a steep one. and what the catalyst will be for it. marliyn: if the fed announces it will pull, the market is not prepared for that. we have seen some movement and a few signs the market is concerned, but it is not yet priced in the fed might act sooner rather than later. willa -- that potentially raise rates in december but i think next year, the market will start to reassess its view of the rate hiking cycle. it will reassess its view of the u.s. relative to europe and japan. you have seen the cu

the blackrock's revenue totaled 3.ion for the quarter, less than wall street expected. the company said that the missu was in to an acceleration in investor outflows. h>> we sawe movement from clients, a lot of children. it was just i think the markets are showing that. but investors are confused. but overall because of expense i disc, how we navigated our revenues were up 18% in the aden business and the technology business. overall it was a good quarter. but i was disappointed in our nett flows. very explainable by some large derisking. >> bckrock shares fell 4% today to $408 even. and morgan stanley a profit rose 20% in the recent quarter, easily topping analyst estimates. result were helped by a strong economy and revenue gains across its major business units including investment banking. morgan stanley shares mosee tan 5% today to 45.94. and sales tommen os weaker than expected underscoring increased competition for food delivery these days. the company has stepped up its efrts to better compete with third party delivery companies like grub hub and uber eats. and d

the board of governors for several companies, including the world's largest asset management firm, blackrockso far, merz is one of three contenders for the party leadership. he is considered the most conservative among them and would represent a clear break with merkel's style of politics. although he hahas been a criticf the chancellor and h her govevernment since she took powr in 2005, he says now they could work together. >> i am convinced that angela merkel and i will get along under these changed circumstances. and d in a way that we both see fit. reporter: merz is a business-friendly conservative. his close ties to ththe private sector are c controversial andnd have madade him a target for criticism. the christian democrats will decide who will succeed chancellor merkel as their leader at a party conference in december. if merz gets the job, germany's conservatives will have to brace themselves for drastic change, not least because friedrich merz's ririse could spell thehed of angela merkel as chancellor. given their differences, she may not want to stay in office for much longer. bren