. >> well, that's the reason why we are cautious at bnp paribas. many countries are excluded from the agreement. iraq complains about the number and think they can produce a higher level. so if opec uses a lower number, the cut could be far greater. just to hit the target of 33 million barrels a day is something like 670,000 barrels a day. but that will be done just by four countries within the center of opec. and then you need far more cuts from the four counties because the other members are likely to increase production. and that is why we feel that you have to remain very cautious. if some agreement comes, members won't make the necessary cuts. so it is all down to wait and see. and that is leading to price volatility at the moment. >> thank you very much. gareth is a senior strategist at bnp paribas. >> that's it for the show. "worldwide exchange" is up next. see you tomorrow, bye-bye. >>> good morning. the president-elect is meeting with a long list of advisers and potential cabinet members over the weekend. the round-up of the names is comin

let's get back to steven saywell, the head of fx strategy at bnp paribas.e going to talk a lot about risk on and risk off, these macro moves. i find it hard to believe it is actually going to be that simple. we have already discussed the equity markets, the fact that there will be the potential for buybacks. equities are going to be a much more nuanced story. who is going to be setting the pace? where is that lead going to be coming from? >> that is a good question. from our perspective, we think the overall risk theme is going to drive things. we think equities are going to be the driver. it could be we saw the response yesterday. if that is the big move we had, if we are going to see the status quo, that could have been the move. however, if we get back to our currency pairs that caroline just book about comedy euro-dollar, the dollar-yen, and the dollar-swiss, these could be interesting because once we get beyond the election and talk about congress, we have the fed to talk about as well. i think that is where you could see the dollar start to rally agai

well.b trying to help as you assume at bnp paribas that these bond expansions are in perpetuity?nce: you left off the bank of england, by the way. i think the answer is if they are not in perpetuity, they well beyond the horizon that we can see in terms of return to normalization. the central banks are not going to sell bonds back. in anything like the current economic relations. francine: your take? urence madeink law a good point. getting back to the question. fromnk we have had qe central banks. it is like we need a regime shift. a shock. it has to be a positive shock that something different is happening. the past, governance have dabbled with helicopter money, it has to vaguely ended in tears. when it is associated with a big regime shift, like off of the in 1930's japan, that is when it changed things. it is more likely that we stay in the weak structural period for the foreseeable future. francine: you talk about regime shift. chinaould have to involve on a global level. also, because central banks realize what they are doing is not working, they hike. the in europe, to sh

voss -- bnp paribas -- spurred by monetary policies in the ecb.e relative strength index, which is still below 30, telling us the euro is still oversold. this is one i haven't talked about, the baltic index. this is a measure of surging to, a two year high. infrastructure, it would be a boon for owners of vessels, fairies, and other -- others, ferries, and commodities. it would see a big boost in infrastructure spending, which would benefit companies carrying raw material. that is the reason for this two year high. big news in germany that merkel will run for fourth time -- for a fourth time as chancellor. surprise, former prime minister won by 16 percentage points. alainl face off against juppe. 47 basis points on friday. now we are awaiting the runoff next week. many say the winner of that could go on to win the presidency next year. one of many elections we are looking forward to. upset ford one more the books. a lot of what you have said is reflected in -- you have the nasdaq rebounding and hitting earlier records. next to technology shares, t

joining us is edmund shing at bnp paribas.ow much do the overnight gyrations have to do with liquidity and how much were positioning of traders trying to wee a quick buck given that had 5-1 odds? i am sorry, we have to go straight to live speaker paul ryan. i spoke with presidential elect donald trump and congratulated him on his great victory. we talked about the work ahead of us and bringing this great country together. let me just say, this is the most incredible political feet i have seen in my lifetime. this is something you have heard me say time and again. seven out of 10 americans do not like the direction our country is going. many of our fellow citizens feel alienated and have lost faith in our core institutions. they do not feel hurt and they do not feel -- kurd and they do not feel represent -- heard and they do not feel represented but donald trump heard a voice nobody else did. he connected with people nobody else did. he turned politics on its head and now donald trump will lead a unified republican government.

. >> shares of bnp paribas and lloyds all falling after announcing cost cuts.hy did the shares beat? >> it was a tale of lowered expectations and they beat slightly against the lowered expectations but there are still issues across the board. credit suisse 1% and lloyd's under 10%. deutschebank won't pay the $14 billion sought by the justice department to settle a investigation into mortgage backed securities more than triple what was estimated could be a worst case. the 14 billion they have been asked we are not going to be certain of an outcome until we are there. >> if the settlement ends up anywhere close to the 14 billion that is not great for deutsch's capital position. jpmorgan had a note yesterday anything over 4 billion would need additional litigation reserves and additional capital. >> the european central bank went through an eventful year as the economies were sluggish despite a program launched in 2015. in 2016 the e.c.b. continued to refine policies to get growth going. >> the e.c.b. has cut one of its interest rates, q.e. boosted to 80 billion e

frank's largest bank, bnp paribas, has had the most u.k. business among european banks this year. the bundesliga reviews risks to germany's financial system. we are possibly talking deutsche bank and commerzbank. a campaign launched by the leader of the french national front. andill talk marine le pen what that means, investing in the world of political risk. first, here is nejra cehic. trump isnald considering nominating texas senator ted cruz to serve as u.s. attorney general, according to a person familiar with the matter. speaking to reporters at from towers in new york yesterday, he said the election was a mandate for change, but did not confirm he was under consideration for a job. cruz unsuccessfully sought the republican presidential nomination, and exchanged a vicious attack with trump during the campaign. and but his bank executive board member says germany will walk away from talks on revamping global capital rules unless key demands are met. bundesbank executive board member says germany will walk away from talks unless key demands are met. they meet in the basel commi

bnp paribas u.s.the most profitable in the first nine months of the year according to the first ever filings required by american regulators. the u.s. unit made a three tax profit of $958 million on revenue of 3.8 7 billion. in contrast, credit suisse lost money in the states because of restructuring costs. company has parent filed for a public offering. it filed papers before the u.s. election and it is targeting evaluation as -- a valuation as much as $25 billion. it could come as early as march although no final decision has been made on the timing of the ipo. a representative declined to comment. that is your bloomberg business flash. anna: thank you. let's talk about europe. we are two weeks away from the referendum on constitutional reform. economic development minister calenda. year foran important us because we are going through a process of economic recovery. we have good figures for this year, wei think next can do even better. the point is that we also have a lot of turmoil around europe an

that is the political risk index from bnp paribas.erpricing political risk in europe -- are we underpricing political risk in europe? and is italy the focus? >> i am confident they will be another existential crisis to the euro. commentatorsy talking about the italian referendum as a trigger point. but actually, the referendum is about the italian constitution. i think it would be good because it would break this balanced house problem that italy has that makes it difficult for them to reach decisions. mr. renzi remains in charge of the largest political party. and they will not be a political general election for 2018. there is not even a vote on the euro. guy: across the channel, we are very good at picking each other's unsustainabilities. we can see the euro is unsustainable. do you share that view? >> it is not sustainable as it is currently structured. if you were to say to me, what would be required to make sure the euro lasts, it would be the fiscal policy. guy: james, stay with us. we will carry on this conversation. this is t

cozad being world police, when i first started, the department was negotiating a resolution with bnp paribas. they were very local to the degree of taking at these , about therticles fact that we're practicing the mtp. i believe there is some french .egislation germany may think they are doing the same thing. .i the volkswagen case the w sent cars to the united states knowing that they put them out on the road. should we be looking at that? ideally -- dealing with iranian and these clients, they have a very large business line. and that we are not dealing with those'countries not just up high on the borders, but it -- compliance people would write e-mails. they saw opinions from two of .wo w and they decided it was to get that money from the business and .hey viewed as a political what it really does is it affects our system. we don't want our system to be used for dirty money, as a haven for dirty money. we don't want our companies to be disparaged when other companies hang bribes alone the world. i don't think we are out there prosecuting things we barely have jurisdiction on. we kind of h

bnp paribas, citigroup, credit suisse.d over to ubs wealth management and the note to them is that we are overestimating the potential for u.s. growth, underestimating eurozone growth and they are taking the other side of the trade. david: that is interesting. alix: coming up, what president-elect trump means for the fed and its plans to raise rates. this is bloomberg. ♪ alix: part of what we have seen in the market has been a re-rating of fed hike expectations. the markets see the like of 2017 aste hikes to late higher than ever. the purple line is the fed futures implied yield curve. the white line is what it was on november 9. a huge re-rating very quickly. you see a 100 basis point increase through the end of 2009. you see the markets pricing in a faster rate hike schedule from the fed. five-year treasury yields. you can see that jumped to over 100 basis points over the last few days as the short end starts to price in the fed rate hike. the deeper question is what happens when the neutral rate? do we see in neutral --

with us now is daniel katzive with bnp paribas. daniel: i think it could have further to run.he market is looking at the proposals of donald trump and the thing is emphasizing with infrastructure spending. significantly more fiscal stimulus in the u.s.. that means higher longer yields. that is a challenge for emerging market currencies. jonathan: as opposed to talking about trade protectionism. is this the driving seat? daniel: they don't seem to be suggesting that is a big fear right now. the trick is it the m unwind goes far enough and starts to lead to a broader risk off environment, that could slow down the fed's ability to tighten. we are not there yet. alix: the other side of the equation is when do you look at it and say we are overdone. certain countries you will see value. that economy is still going to grow. the peso does not look that bad. mexican economy is going to be ok. where do you say that? daniel: that discussion will happen over the next few weeks as investors see value in some of these currencies and opportunity. if the route went too far, it would actually

other services according to a french labor group that has had discussions with top management at bnp paribassay the bank is considering new tools for serving clients. retailers in the u.s. are thrilled election tuesday is over. -- they hope on black friday. 137 million consumers will buy in stores or online over the four-day weekend. a -- the amount americans spend over the kickoff to the holiday season has dropped. some believe consumers held onto their money during the election campaign. froma is under pressure opec to make a significant cut in oil production. the russians are not willing to do that, but they have repeated the stance that freezing production at current levels is likely -- is like a cut to next year's plan. that is your bloomberg business flash. let's stick with the oil theme and talk about opec. the cartel meets indiana. for next week -- in vienna. let's bring in how your boss. blas.ier we have had this discussion on a cut or a freeze. fill us in on the details. opec is trying to reach their own agreement when they meet in vienna. we do not have the details of the agreemen