brendan greeley from paris. us. ♪ tom: gunfire, dead and wounded , fullys this morning circled. a terrorist tourist. german yields continue to dissent. copper and sync and iron ore signal a slowdown. -- let'se new normal call it cross-asset volatility. good morning, everyone. this is "bloomberg surveillance ." i'm tom keene. term "terrorist tourist" is off the facebook page. someone is o at large right now. francine: we do not know if the operation or the investigation has finished. it has implication for the fed. we will focus on the geopolitics and the raid, and we are focusing on fed. germanydlines out of and france, we will give those to you through the hours. we begin in paris where officials say there is a raid that targeted an apartment building in the paris suburbs. police were hunting for the mastermind of the attack but do not know if he is among the suspects being held. two people were killed during the raid, a woman wearing an explosive vest triggered it and killed herself as officers closed in. ther

we have to go to brendan greeley for an update. the news flow extraordinary out of paris. north of paris, the stadium. rented really, good morning. brendan: good morning, tom. seven people are being arrested, --d in city hall in sand any in a working-class neighborhood. 23% of the people who live here come from outside the e.u. people are surprised to discover, this morning at 4:25 they heard shots. they were told by police to stay

thanks to brendan greeley.ing up next, the european close, airline and transport stocks are taking a hit today in the wake of attacks in paris. they ramped up security around the region. what is next for the industry is next. ♪ mark: you're watching bloomberg markets. the european close, hello to you in the wake of the paris attacks. an impact on the industry as security wraps up. bloomberg's u.k. and aviation and transport first london carry out joins us from london. thank you for joining us. the impact is being clear. can they withstand another terrorists attack question mark carey: -- attack? -- carrie: -- kari: paris is an important destination. it is one of many destinations for these airlines. the airline's most impacted are the likes of air france, easyjet, about 11% of their total capacity. is definitely something to keep in mind tomorrow when they report their results. what are that point, the airlines saying about beefing up security. are they doing anything special in the wake of the attacks? kari: t

brendan greeley on the ground in paris. let's look at the geopolitics of all this as we mourn the tragic loss of life. russia and france, long opposed in their approach to the war in syria, have a united military front. this is in response to the attacks in paris, and the downed plane in egypt. barack obama said that russia may be a more constructive partner in the middle east. >> if we get a better understanding with russia about the process for bringing an end to the syrian civil war, that obviously opens up more opportunities for coordination with respect to isil. the two things can be completely separated, -- can't be can really separated, but we won't look if russia devotes more attention to targets that are isil targets, and if it does so, that is something we welcome. francine: let's bring in andrew barden, a managing editor for international government. we have had diverging views on syria for five years. what is new this time? do we really believe in the west and russia rapprochement? >> well, as you pointed out, t

brendan greeley is in paris. early and rode with commuters, spending the day talking to them. now it is nighttime, the eiffel tower eliminated. what have you heard from parisians today? brendan: parisians are going back to work. i rode the train with some commuters. said what people said after september 11 in new york, we are because weto work have to. there were fewer people than normal, but people are going back to work, but their world has changed. what you see behind you is the plaza de republique. hebdothe charlie massacre, there were huge demonstrations, candlelight vigils, and that you have smaller groups of people. out inare afraid to be small groups and they really want change. president francois hollande spoke to the national assembly. day and the congress need to get together to change the constitution of france. he wants to make changes in the way the state approaches its citizens. people are ready for it. about what have they set some of the proposals he has made today, such as heightening the amount of counterterrorism money, the amount of defense money in the bud

brendan greeley is on the ground in paris. ident all on speaking forcefully to both houses of parliament and what has the reaction been today, as you talk to people on the street? brendan: i think you saw shock over the weekend -- people stayed home, so much less foot traffic than normal on a fall we can you saw anger in the speech yesterday, and you are starting to see grief now. i spoke to someone who said this is the end of indifference, the apart fromce being the rest of the world. list was sobering victims, of all of the and the anger is not gone. that is informing politics here, absolutely, david. david: there is been a push for unity. we will have resident hollande traveling to washington and moscow as well. how are people receiving his push to unite europe and the western world? brendan: i think there are more focused on what is going on inside of france. so many people on the street say this is a domestic album. there was, of course, coordination with someone in syria, but that was with a belgian. involved,two belgians

brendan greeley is in paris and joins us live.e of emergency that has been imposed -- president to changes seeking some of the laws involving a state of emergency. how would that impact the search right now? what you have now is a state of emergency that allows searches without a warrant, without approval by a judge. he's looking to do something proposed by the farther right government of nicolas sarkozy, which was to combine what they call a state of siege, where there is military control, and a state of emergency. basically expanded hours to fight what they call a new kind of war. is news ofve seen small acts of courage across the city -- parisians defiantly sitting in cafes tonight, precisely what they were doing on friday night when the attacks began. you're seeing effects on commerce. the blur going to work. larger events have been canceled. airbnb and amro have canceled event in the city, but we are understanding the longer-term effects the attacks will have on the city. mark: talk about the longer-term's affect these would

brendan greeley is in paris. and former offense secretary joining.n is ryan, you heard the president asked for humanity and some measure of distinction among those who want to retaliate against islamic terrorists, saying that we cannot equate all refugees with terrorism, and he also continues to defend putting troops on the ground in syria. how has all this been received at the g-20? ryan: i think the most important point that president obama made early had to do with what he is prepared to do and what he is not prepared to do good not prepared to send ground troops, but yes to increase intelligence and target sharing with france. yes, preparing to take up airstrikes and increase airstrikes. what most people want to see here at the g-20, what the french president himself talked about, was more unity among inse entities striking isis syria, specifically the french president said he would call a president obama and the russian president to join forces to seek a solution. it is interesting that of the three leaders

guy johnson and hans nichols and brendan greeley are in paris.antic american hotel deals today. billion deal with starwood hotels and marriott. the shareholders of starwood .92 dollars and -- tom: it speaks to what we are seeing with struggling economies, including in europe, of consolidating businesses. it is not a surprise, industry to industry. and we arectly, seeing it in the pharmaceutical industry. now in the tourism industry, a $12.2 billion deal. sorenson is going to remain on as the ceo of marriott international. this is marriott buying starwood. tom: there we are with the transaction of the day. german yields are in like they were two hours ago, and copper continues the imploding that we saw over the last number of days. copper has really been something and signals the weaknesses in the commodities. he is in paris, guy johnson at our news bureau near the opera house. as you came in to paris, what did you observe? y: heightened levels of security. hans nichols and i walked around the public square last night. we saw people trying their b

betty: for perspective on the ground in paris, i want to go to brendan greeley.ande just wrapped up his talks inside unesco. heard fromat we just neil ferguson was the extent to mixh this -- it is a unique of both foreign terror and domestic terror, elements from belgium and syria, elements that grew up right here. what we heard yesterday from francois hollande, which got a lot of support here in france, was to make a constitutional change to the way they handle emergencies. he wants to combine estate of urgency with a state of siege am elements of military control and civil law that requires a constitutional change to how they approach things. this is what he said yesterday. it has gotten a good reception. even the far right did not say much more than, well, this is an acceptable change that you have made, mr. president. what you have seen is that the entire country has shifted just a little bit to the right. that francois hollande proposed yesterday was a plant -- i think i am losing you. i will throw it back to you. betty: ok. i know that it is quite noisy the

and here joining us this hour is our friend, brendan greeley. brendan: i was running.he full miles. stephanie: he has for children under the age of five doing trick-or-treating. brendan: that was one long sugar hangover. david: let's go to the first work. isid: a russian airline failing suggestions that one of its engines failed. they have ruled out pilot error and so that external impact caused the plane to crash. how far thethat on plane has scattered that the plane of his stuff broken up in flight. in turkey, the polls got it wrong as erdogan re-control parliament. afterab to control months of turmoil. erdogan has been taking a tougher line with kurdish nationalist and he criticized opponents as terrorists and traders. the vulcan presidential candidate jeb helping to jumpstart his campaign this week. today, the starts of three-day tour wrapped around the release of his new book detailing his eight years as florida governor. once considered a front-runner, now he is far behind in the polls. matt: i want to look at the futures and you can see that s&p teachers and man

. >> brendan greeley joins us live. state of emergency imposed, francois hollande seeking to change laws governing states of emergency. what you have now is a state of emergency that allows searches without a warrant, without approval from a judge. what he is looking to do is something proposed by the last combine a state of siege, where there is military control and a state of the, expanded powers to fight a new kind of war. what you have seen tonight is current all acts of over the city. parisians have agreed to sit in they tonight, exactly what were doing friday night when the attacks began. you see some effects on commerce. people are going to work. lindsay of traffic around me. larger events have been canceled. sony, airbnb, they have canceled events in the city. >> the former u.k. minister of state security joins us on set. >> the french government has declared and the parliament has agreed to three months state of emergency. two things are happening. one, they will go after all of the people as they and cover evi

brendan greeley joins us from france. going on with this 90-day emergency order he has in place. me?dan, can you hear ok. i am afraid we have lost brendan greeley. theere going to talk about 90-day emergency orders and what is going on inside of rats as they try to clamp down security insidet it means for -- france, as they try to clamp down security and what it means for francois hollande. ♪ erik: welcome back, everyone. this is "bloomberg ." alternative lending keeps getting hotter. one company uses a unique algorithm that includes academic performance to determine which borrowers should receive loans, so if you got a c-, no one is lending to you. here to tell us how it works is upstart cofounder and ceo, dave. welcome. tell us about your business, how it works, how is it different from banks? are you a lender, and originator -- who ends up leaving the loans, stuff like that? help get money from investors, retail investors, we are a platform middlemen. a talent sheetot lender. market david: we are a lender. -- fight

for theank you so much senior economic correspondent, brendan greeley with this week's big idea. ♪ alix bloomberg markets. ♪ scarlet: from bloomberg world headquarters in new york, good afternoon. i'm scarlet fu. alix: i'm alix steel. with the december rate hike, change comes to the investment landscape. we tell you what the bond market is indicating. david: -- scarlet: what is driving consumer demand. alix: activision makes a deal worth nearly $6 billion. will it mean gaming gold? scarlet: first let's check on what's happening in the markets. julie hyman is looking at some of the action. we're off the highs the session. julie: off the highs this section, actually -- alix: we're going to come back to later. scarlet: your computer going. alix: we're going to check in on the bloomberg first word news. next.nocencio has ramy: american satellites detected heat around the plane that went to ground. it could mean anything from a fire to a bomb blast. died.4 people aboard in texas, voters are considering seven proposed a moment to the state constitution. ohio voters must decide whether to lega

inndan greeley is saint-denis and joins us live. give us the update. brendan: this morning, several residents were broken with explosives and told to remain in their homes. that order has been lifted. they've been moving the police cordon in. we are now about 600 meters from the address where the attack took place. what we know so far is there have been explosions, and gunfire, all morning sporadically. three people have been killed. one woman killed herself with a suicide vest. we do not know whether any of those were abdelhamid abaaoud, who is suspected of planning the attacks from brussels in belgium. jonathan: as you see the level of security around you, over the last few days, we've seen crowds emerge. butow this is a suburb, talk about what is going on around you. this is a city that is still very much nervous. paris, we here, in saw people being pulled over by police. this morning, what you see around you are the police of the raid unit. this is the french antiterrorist unit. a very militarized police presence. what's gone now are several military style

brendan greeley joining us from saint-denis. that wrap things up for us.pean equity markets open in five minutes. that will do it for "countdown." the "on the move" seen will take you through the day. geopolitical concerns are back into the psychology of the ma rkets. ♪ jonathan: good morning. welcome to "on the move." i'm jonathan ferro in the city of london. moments away from the start of european trading. the dollar climbs to a seven-month high against the euro. investors await more rate hike clues. president xi says china's economy faces downward pressure. lowest since may 2009. shots fired in paris. three are killed as french authorities raid an address in a northern suburb in connection to the terror attacks on friday. much more on that story when they come. ahead of the market open, ftse futures that little bit lower. the dollar is stronger, making more headlines. let's get your morning market open with nejra cehic. nejra: it is all about the world's two biggest economies. investors looking ahead two minutes from the fed's october meeting. at the mo

scarlet: brendan greeley reporting live in paris. alix: for more on the attacks in paris, we want to go to patrick skinner, a former cia officer and at a group that provides security intelligence services to governments and multinational organizations. scarlet: he joins us now from savannah, georgia. thanks for joining us. extremist about how have one to of more attacks to come. how does french intelligence pursue real leads from noise? how do they go about doing that? patrick: that's always a problem even in lower threat environments. impossible to accurately cut the signals from the noise. now the chatter is through the roof. all the various ways that they are communicating, they are probably on fire with all these talks. there's want to be a lot of talking and a lot of threats and boasting. hidden among those posts are some real threats. obviously this threat happen. it is devastating. they're going to be overwhelmed for a while. it's not just an issue of surveillance as it is understanding what you are surveilling could alix. ali

. >> brendan greeley is in paris and he joins us now live. state of emergency that has been imposed. president francois hollande is seeking to change some of the laws governing the state of emergency. tell us how those would impact the search right now. >> what you have right now is a state of emergency that allows searches without a warrant and approval from a judge. what he is looking to do is something that was proposed my the last government, the father nicolasvernment of mccolliste sarkozy, combining a state of siege and a state of emergency. fight extended powers to what he calls a new kind of war. what you have seen tonight's news of small acts encourage all over the city. parisians have agreed to defiantly sit and cafes tonight -- exactly what they were doing on friday night when the attacks began. you are seeing effects on commerce. people are going to work. it is funny of traffic around me. you heard and amulets moving by. larger events have been canceled. sony and airbnb have all canceled events in the city. we are just beginning t

we are joined by our economics correspondent brendan greeley.t, the lands and ceo. ceo.nds end the retail landscape is all over the place but it is 8:30. o data onreaking ec retail. we go to matt miller. matt: it does not look good. very disappointing. retail sales, the headlight number is a gain of .1%. we were looking for a gain of .3%. we got 10 basis points. as far as the number x auto sales, .2%. we were looking for .4%. half of what we were expecting. x auto and gas, it is not fair to add them in. a 10 day moving average to show you the trend, it does not look good. it is down and it will be worse after you put this print in there. along with the numbers we got macy's, theom and outlook from jcpenney, things don't look so hot going into this holiday quarter. stephanie: that is not a positive for retailers. we are looking at these retail numbers, you just joined lands end in february. tell us about the retail landscape. : it is very challenging. in have to be even better doing your job, have to be even more creative, faster than every time.

david: thank you, brendan greeley, live in chicago.square sets its ipo price and cuts its violation by $2 billion. we will bring you that story next. ♪ david: welcome back to "bloomberg markets." i am david groep. let's go to abigail talking about facebook after it announced earnings. facebook is on track to be the best-performing stock this week at the nasdaq. ironically, it is one of the worst performers today at the nasdaq down 1.5%, reclaiming losses earlier. the reason it is the best performer of the week is the stellar quarter, they beat estimates, surpassed many metrics. they said they have more than one million viewers -- users coming to their site daily. the monthly user rate increased by 14% to 1.5 5 billion. there is a street high price of 155 at piper jaffray. that suggests facebook could score higher from 40% from here. david: appreciate it, abigail doolittle at the mastec. where -- square values the company at $2 billion less than its previous valuation of six point dollars. joining us from san francisco is emily chang. w

brendan greeley is here. the president of the united states chiming in. k he gets three dollars a word. this is a big one. brendan: on november 5 -- this was last thursday. he had to release the agreement. he notified congress to let them know -- the tpp agreement. he's going to sign. here is his argument for the partnership at a time when 95% of our potential customers live outside our borders. this agreement will open up new markets to american goods and services. export support 11.7 million american jobs. exports support of to 18% of jobs. what i hear there is not a new argument. hardly. >> the piece reads very defensive to me. don't worry, jobs will be ok. stephanie: it's also about strategy. if you remember 10 months ago when he was first presenting, before a word you got out of his we alreadyding tpp, heard from bernie sanders, op-ed, open letters attacking it they what it would do to the american people. president obama's problem was not getting his message out early. >> we have to remember how central he has made this is part of his economic progra

while vaden brendan greeley is there with more. eidmann is going to lose. -- brendan: jens weidmann is going to lose. the bond buying program in december, jens weidmann has always been saying what europe needs is more structural policy. he says it as loud as he can, as often as he can, even when it looks like he is about to lose. it is clear when you look at core inflation at 1.1%, it is nowhere near their target of 2%. david: brendan, from over on the side of the atlantic, it looks like draghi has been trying to do this for some time but has not made much progress. what can he do to actually change things? we know what he wants to do but it does not look like he can get there. brendan: jens weidmann's argument is, we need to let it run out a little bit longer before we add to it. i think what is worrying people is inflation is not where it needs to be. it is higher in the u.s. but in a lot of economies in the world it is not showing up. what they have, been consistently seeing as with every new release of economic data their target

stephanie: joined by our coanchor, brendan greeley. brendan: good morning. else we have with us? david from goldman sachs. we have been talking about the fed in the green room and there is more to come. david: offside all the time. -- all fed all the time. stephanie: a developing story we are following this morning, vladimir putin says there will be "serious consequences in turkey." that is in response to turkish forces shooting down a russian warplane earlier today. vladimir putin says he will not tolerate such crimes. i would like to bring back ryan chilcote joining us from london. trying to get our heads around the ramifications of a statement like this from vladimir putin. what this means for turkey. ryan: i think the ramifications are to fall. i wouldn't be surprised if the russian president on the back of this one after turkey's economic interests. -- they are two fold. there were some suggestions immediately after the russian jet was down by the senators and russian politicians that russia should cut off airlines with turkey. that would hurt turkey. r

brendan greeley is there live with the latest. brendan, tell us first the latest play after these arrests. brendan: we do not know whether abaaoud washamid arrested. if you press conference this morning right after the raid, saying we are at war, foreign and domestic. they see this as a war at home as well. the interior minister also went on tv and said there will be more rates but this is not the end of it and 118 people are now under house arrest in addition to the seven detained for questioning. it is still a state of emergency in france and very much something the administration considers a war. he: -- betty: tell us about the area and where the raids took place. brendan: it is a suburb within walking distance of the stadium where the suicide -- where the suicide bombing took place on friday. it is 23% of the people who live here born outside the eu, very much mixed, north african and sub-saharan african. the crime rate here is 50% more than the average city. it is not a desperately poor place, not 400% more. i spoke with sever

david: let's go back to paris with brendan greeley. talked about the french economy. s businesslike there today? it'it looks like the stores are all empty. our people shopping? brendan: that is just a video you are seeing. people have had a weekend to react and there has been a huge difference in traffic from saturday until sunday and a huge difference from sunday until today. i went out this morning and the commute was packed and everyone said there is less traffic than normal but no matter where you are in the city, people are going back to cafes. people are going to shops. a district that has relaxed the blue laws and is open on sundays, there was less conference -- there was less commerce. i think the president announced a 90 day state of emergency. what practical effect is that have? what does that do? brendan: it has allowed a lot of the raids you see going on. the sense is that everyone is waiting to see what france walk holland can do -- france walk -- hollande will do. when you look politically at what's going on, there were some shows of solidarity. we are co

i want to bring in brendan greeley. he sat down on the topic of banks with the chair of the fdic. what did he have to say about this? brendan: he was of the banking conference last week and the from he has been banging a long time is equity capital. it is equity capital that is lost the first, the quickest, before anybody has to step in. and they laid out. about the hugeo growth in convertible bonds. this is debt that magically becomes equity in the event of a crisis. i brought this up with and this is what he said. the think you can write bond to where it is a convertible instrument. the problem is, or the issue is, let's say you are the it's is a signal to the market, all sorts of things. of will do a great deal effort to avoid that. one of the things that you have is pressure to move earnings up and serve those funds. that puts earnings pressure on the subsidiaries, sometimes at the most inopportune times. it is how it affects decision-making by management, how it affects behavior, and whether it is useful on an ongoing basis. once you fail and you are sorting things out, it doe

rendon greeley -- brendan greeley come our senior correspondent. much more ahead in the next two hours. we will be sitting down with three heavyweights. a corporate litigator, legal mind. a former pimco ceo. and a legendary investor. all of them on bloomberg markets in the next two hours. >> wall street regulators have been stepping up their scrutiny. andrgan, deutsche bank, credit squeeze are having their leverage practices examined. reuters says walmart expanded floor by about 45%. said the service definitely needs improvement. facebook is breaking up a little bit easier. memoriest to block after the likes turn to something else. you can always get more business news at bloomberg. sinces first studio album 2012 -- for studio album since 2012 drops today. adele and sony are betting big that this business move is going to pay off. joining us now is entertainment .eporter lukas shaw didn't taylor swift do the same thing? >> she did it with 1980 nine, beyonce did with her previous album. dell -- and adele did not put it on spot of five for a while. s

brendan greeley. across from that q&a with dudley, and he says if you wait for lift up, that could boost a hard landing scenario. he said yeah, but something interesting. he's sort of punk'd us. atsays we are looking inflation. we are going to lose control of inflation. this is a familiar story for him. he looks at the dallas trend mean -- i will not go into the details of how it is cultivated, but it happens to be showing much higher inflation than core pce, which is what janet yellen looks at. measure,your inflation you are closer to the target all of a sudden. here is how bullard kind of pun k'd us. he made another case, an academic case for why we might be stuck as zero for a while, why interest rates are going down. let me walk you over to the board and explain what is going on. he pulled research by someone cochrane. these are very hawkish institutions. this is what he is looking at. this is the nominal interest rate for the g7. he is pulling data from everywhere. this is the crisis. here is wha

alix: brendan greeley is in chicago attending the annual federal reserve banking conference. would find that awesome and interesting. what is the big idea out of the conference now? brendan: and only you two would have me on to talk about a big idea. i wanted to learn about the deutsche bank syndrome. international banks shrinking their footprint. it is a european phenomenon. european banks are falling back, but that is not all over the world. since 2006, european banks operating abroad has declined. there has been steady growth in regional banks from developing growings that has been the entire time and unabated during the crisis. you have a russian bank that has bought all of the eastern european assets of austria's bank. this is happening all over the world. latin america, hsbc sold some of its assets. by locale bought banks. this is not the end of internationalization, it is the beginning of reasonable as asian ionalization. scarlet: the deutsche bank return on equity has been shrinking. in the last quarter it turned negative. i contrast you have pnt still higher. is a eur

brendan greeley is in chicago attending a federal reserve international banking conference. g now about the future of cross-border banking? brendan: if you don't like capital buffers, you will be annoyed. one of my takeaways from yesterday is daniel tarullo spoke who was a member of the federal reserve governors board who was responsible for stability policy. he said it's very likely that board iscial standards going to request that ranks that are international holding companies carry an extra buffer of capital at the international holding company level. that will make things more expensive. this is something banks talk about a lot which is that they claim they are being forced by every individual country to hold country and they say it makes it more expensive if there is another buffer layer that will make it more expensive. governor brought that up in a speech yesterday. he said something interesting web -- about the way it's happening. >> when i hear complaints of the emphasis on financial stability will result on the vulcanization of international banking, i think it's no

alix: that is brendan greeley, economics -- senior correspondent. it's interesting.pital is a simpler way and that is what he is a proponent off. scarlet: all right, the prospect of a fed rate increase. we will discuss the possibility of volatility ahead. ♪ we live in a pick and choose world. love or like? naughty or nice? calm or bright? but at bedtime ...why settle for this? enter sleep number. don't miss the semiannual sale going on now! sleepiq technology tells you how you slept and what adjustments you can make. she likes the bed soft. he's more hardcore. so your sleep goes from good to great to wow! gift the best sleep only at a sleep number store. save $500 on the veteran's day special edition mattress with sleepiq technology, plus 36- month special financing. hurry, ends wednesday! know better sleep with sleep number. scarlet: welcome to bloomberg markets. ♪ scarlet: from bloomberg world headquarters in new york for good afternoon. i'm scarlet fu. alix: and i'm alix steel. a rate hike is dragging down stocks today. aarlet: one college gets failing grade with

brendan greeley is here. for christmas, i will have to get you a blazer. a woman

brendan greeley is in chicago attending the federal reserves banking conference. ying about regulation? brendan: a couple things going on, antidotes to constitute a trend. we are seeing a global pullback, they are pulling out of foreign markets and a couple things driving that. there was research i saw yesterday that banks make funding choices based on conditions in the home market and not what they do blend in. if you have a problem at home, you pull back a brought even if there are good opportunities. different countries are requiring that their banks fund subsidiaries locally and that they be locally capitalized and that makes it more difficult to move capital around. daniel is at the conference and he spoke yesterday, a member of the governor's board of the federal reserve and he said, first, he pointed out it is likely that international banks to holdg to be forced the capital buffer above and beyond local subsidiaries, just for being an international holding company and you might have to hold the next of buffer which exit harder to move abroad. take a look at

brendan greeley is here. for christmas, i will have to get you a blazer. a woman who knows retail very well. in the former ceo a brooks brother. joe grow back is -- gromack is here. joe, welcome. i know everyone's name, just not my own. vonnie quinn. vonnie: that's me. thank you. good morning. dish forces have launched a major offensive in northern iraq . they are attacking isil fighters. they are led by us-led airstrikes and iraqi forces. they capture the city last year. that prompted the u.s. to begin air rates. the next round of talks on serious civil war resumes saturday in vienna. russia is proposing a political transition that will last 18 months. according to a draft proposal obtained by bloomberg, russia also wants u.n. becky to carry out -- backing to carry out airstrikes. the u.s. and allies says russia is aimed at shop -- propping up syria's president assad. the same unions that brought alexis tsipras to power are on the other side today. they have called a general strike. from port workers to doctors, they are protesting pay cuts. pras said he

david: meantime, brendan greeley is with us. welcome.plexed by this when they first phrased it, but explain it. i will walk you through it. i found a paper being presented at the european central bank this week. basically, it is once again shocking to discover how the economists know about how businesses actually make decisions. economists look at the business data sets. the data sets we're looking at our surveys from new zealand. wyatt new zealand? new zealand used to have crazy inflation and then they set up inflation target machine of 2% in 1990, so this has been a model for the rest of the banks. with is a data set interviews with 3000 businesses of what they think inflation expectations are going to be. when they discovered when they looked at this is that there were two basic set of inflation expectations. there were some companies that understood what was happening. there is a nice distribution to look at inflation under 5% and this is pretty much how it behaves. as nurses understand what is happening with inflation, only half. th

let's go with brendan greeley, just back from paris. give us the latest. -- dan: >> the latest here is the prosecutor in brussels is going to issue a statement sometime soon. we expected anytime now. this should be an update on the raid carried out last night shortly before midnight. there was a major raid across the downtown brussels area. it was several districts. they did house searches and arrested 16 suspects. in a little bit, the prosecutor should tell us how many of those have been charged and how many have been let go. we are poised for that. in the meantime, everything stays locked down. the subways are on lockdown. stephanie: i hate to interrupt you because we have some m&a news breaking right now. i want to take you to d.c. where drew armstrong is. pfizer-allergan deal, over $160 billion. drew? to create is going the largest pharmaceutical company in the world. will getshareholders 11.3 pfizer shares for every share that they hold. pfizer is moving to dublin are the only thing that is changing letters of theee name. it will b

brendan greeley stock -- said that with the ice chairman of fdic at the federal reserve bank of chicago keep banks safe. we have also talked about how you define total loss observing capacity. how it is that you define everything that a bank can lose in the event of a catastrophe. i started by asking him what we set out on friday about convertible bonds. these are debt that become equity in a time of a crisis. this is what he said. >> you can write the bond to where it is convertible. the problem is, or the issue is, let's say you are the dilution,n and it is a signal to the market, all sorts of things. what you do is a great deal of effort to avoid that. one of the things you have is pressure to move earnings up to conserve those bonds. that puts earnings pressure on the subsidiaries, sometimes at the most inopportune times. it is how it affects decision-making by management, behavior, whether it in fact is useful. and are fill -- fail sorting things out, it doesn't matter if it is debt or equity, you take your losses. it is a little late for him to be helpful in the financial stabilit