meredith: in terms of capex shell is ahead of its peers.is important to note that there have been some big announcements from large independent oil companies in europe. bp has been involved in some pretty large acquisitions recently, specifically thinking of total's acquisition of direct energy, one of the largest deals in 2018 it took. that is a sizable french utility. also, $1.2 billion by 2021 in clean energy, which puts it in line with the others. alix: walk it through for me. how much of the going to need to be spending and give me your timeframe? 2030, 2040? meredith: i think ecuanor is a good example of this. ecuanor says it is going to spend 20%, 30% of the capex on clean energy. but today they are at about $0.5 billion. you're going to see a significant redistribution of capex and at the moment, it's not clear the oil companies will get the returns they want from power to actually incentivize the move. alix: great point. meredith of bloomberg nef, thank you. i now turn to commodity in chief. we focus on one executive in commodity w

they'll be focused on capex, any kind of capex information or estimates. >> guys, thanks for joiningill to come, what to watch in apple results this week in the company's first earnings report since ceo tim cook's warning on revenue and tesla falling slightly a story that saudi arabia slashed exposure to tesla cites four people with direct knowledge of the matter. more "squawk alley" after this break. ♪hold on, i'm comin' ♪hold on, i'm comin' ♪hold on don't you worry,♪ ♪i'm comin' ♪here we come, hold on♪ ♪we're about to save you i'm comin', yeah♪ ♪hold on don't you worry,♪ ♪i'm comin' i'm brad castillo. did you know that americans who bought gold in the year 2005 quadrupled their money by 2012? even now experts all across america predict the real gold rush is just beginning. u.s. money reserve is the only precious metals company led by a former director of the united states mint, and is one of the largest u.s. gold coin distributors in the country, u.s. money reserve has proudly served hundreds of thousands of clients worldwide. there may have never been a better time to start divers

a recession that looks a lot like a one which was capex. >> i don't think even the bares are saying tax cuts are earth or they're spent. now you're lapping a year of them in effect it's harder for companies to impress. now it's a different story >> the biggest debate -- i think the fed has taken risk off the table. is apple an apple story or a much bigger story that affects earnings it affects profits >> stephanie is right. you can't extrapolate that and say it's someone else's problem. i do think there are specific things that don't deserve us to look at the whole market they do business everywhere. it's a consumer story. it's a luxury goods story. it's a little bit of both. >> i was going to ask liesman about the upcoming meetings. >> go to sleep. >> we'll do that after the break. he'll stick around and we'll continue the conversation. stocks are at the highs of the day. here is what else is coming up >>> straight ahead, one analyst's bold call on the semi sector highlighting one stock in particular the note says get ready for react sell racial. "the call of the day" is next. our

the company also wants to increase capex spending while in bankruptcy as high as almost $7 billion in one big effect of political upheaval in venezuela. this chart right here, this is a type of oil you get on the wti, thatxico versus spread rallying to the highest in five years. it is heavier, sour, a type of oil venezuela sends to the u.s. and the type of oil at risk if there are sanctions or asset freezes. it also winds up hurting refiners and their margins. let's dig even deeper into this agribusiness. the company warned because of the trade war. the company is not alone. cargill's ceo spoke to bloomberg in davos about the future of u.s. soybean farmers. david: we are sending some american beans to china with this 90 day cooling off period. but it certainly isn't anywhere near the volumes they were before. they are being supplemented with south american beans. remember, there were 30 million metric tons coming out of the country going into china. certainly we are not back to those volumes. what concerns me is even with we went back to normal, what has happened in china in terms of

dividends and buybacks, cutting debt, production growth, and capex.more of a priority for you? am i hearing it wrong when i hear the biggest priority is the investment? >> we are going to do it all. we need to do it all. to objective is to be able -- into achieve that we need to have a strong balance sheet that is resilient through the cycle and we need to increase shareholder distributions. that is what we are going to do. our priority is generating the right level of cash so we can achieve all of those objectives. finally, we want to squeeze something in about global demand. where i'm sitting geographically, everybody is rushing. what is the demand cycle like? is there a tapering demand? give us the insight. >> we've got a big portfolio. lng, oil, lubricants, and of course 70 countries around the world, it is hard to have one answer. overall, oil demands globally have continued to increase. that has been driven by growth in demand particularly in places like china, india, et cetera. markets like mexico. it is market specific. on the whole, we see st

we're just further in the hole than we were otherwise. >> you need to get a significant pick up in capex to pay back the bill s >> you do. >> by the way, you raise taxes by a trillion and a half as well don't forget that. you spend a trillion and a half deficit spending that's all well and good if you get some pay back to the economy. >> there's no correlation between the tax cut and capex. it's unlikely given where the environment is that we'll see that >> we did have a pop the second quarter was pretty strong the third quarter was okay it fell off in the fourth quarter. let's be careful >> we don't know if that came from the tax cut or it came from the direction of the economy was heading in >> oil and gas as well >> by the way, oil and gas is what's -- energy is what's driven the earnings so far >> i want to go back to the point that jim was making. this notion that now we're too negative you take cat, nvidia and the world is ending again. maybe it's just too negative >> technically if you think about can waexpectation, we're o where we were before the tax cut. all of us would sit aro

the rise of wells that are filled but not completed. 53% of companies have reduced their planned capexthis is particularly in the permian, the yellow line, and the eagle, the blue line, they balkan has-- the seen a reduction of them. cargill had a disappointing quarter, but rain volatility has increased. the last few months, it is come -- it has come down, but best on a year ago, it is had a big andt has had a big rally , that means they can exploit some volatile markets despite trade wars. staying with gold and the safe haven appeal, a company started trading this year as a new company. the stock has 26% more upside, a new era. the ceo says he is committed to a disciplined approach, while improving shareholder return. >> we are a standout performer in the ftse 100 over the last two decades. we have demonstrated that if you focus on quality, no matter what jurisdiction you are in, you can deliver real value for stakeholders, which we have done. there is no doubt in my mind that we have world class assets, the majority of the top 10 gold assets in this industry. alix: you have to love t

capex andte effect on it might affect 2020.e are above breakeven for most areas in the permian basin. ♪ ♪ alix: an alix steel, and this is bloomberg "commodities edge." time now for the data dig. we will delve deep into the market trends of this month. first up, ducts. the rise of wells that are filled but not completed. a dallas fed survey said 53 percent of companies have reduced their planned capex. this is particularly in the permian, the yellow line, and the eagle, the blue line, they have seen a reduction of them. gill had a -- car disappointing quarter, but rain volatility has increased. the last few months, it is come down, but based on a year ago, it had a big rally, and that means they can exploit some volatile markets despite trade wars. staying with gold and the safe haven appeal, a company started trading this year as a new company. the stock has 26% more upside, a new era for barrick. the ceo says he is committed to a disciplined approach, while improving shareholder return. >> randgold, we are a standout performe

don't get it the administration has built the entirety of their growth model into a big pick up in capex. >> capital spending is important. it's what drives productivity and real gdp growth. not a boost or a stimulus in a single year but a sustained period of elevated capital spending and investment. that will be a result of lower corporate tax rate, higher after tax. more than the gimmicks i think it will have a multi-year supply side positive effect on the u.s. economy you're seeing other countries around the world we responds by cutting their own corporate tax rates. we'll be in race to the bottom that will be very good for the gl global economy >> i want to debunk some of the negatives. you asked what happened to retail in december i think it's obvious you had a bare market in three months the s&p was down 19.8. i'll call it 20% in terms of corporate confidence, you don't think they saw the stocks going down. the point being is you're not in that situation anymore that in and of itself is a positive this isn't 35 years ago where 20% of the population pays attention to the stock marke

it hurt overall capex for industrial companies. it is very interesting what they are going to say about capex inflation in terms of longer-term prices. that could be one of a few sectors we are really looking at. valuation is very attractive is commodity prices stabilize, if we see chinese demand coming through. course, playing into these risks is the political risk, the continuing shutdown in the u.s., brexit. we will talk about brexit in a second. have seen the shutdown feeding into the davos discussion. i know you can handle the mliv question. what from davos could move market? forhe markets were hoping something on trade, but that was before trump said he wasn't going to go. it seems a month or so ago trump could be positioning himself for some sort of an answer. i think the likely answer is far more limited. something on trade, perhaps from the treasury secretary, but i don't think quite such a big bang announcement is there anymore. stay with us. up next as promised we will talk brexit. big trendsw you breaking through the ma

whether this is something that will be a reality for the next of -- rest of 2019 and still delays capexe u.k. or if we get a resolution one way or the other. >> i hope it is the latter. thank you very much. >> it is time to check in on the first word news. sign the president trump may be willing to negotiate to end the shutdown. he has invited leaders from both parties to a white house briefing on border security. he said he would not sign a spending bill without money for the wall but on twitter he says he wants to make a deal to end the stalemate. benjamin netanyahu has enlisted the u.s. and his campaign to get latin american leaders to move embassies to jerusalem. they tried to coax the president of honduras to coax -- move his embassy. jong-un has issued a warning to president trump. he says he will take what's called a nupathe to nuclear talks of the u.s. does not relax economic sanctions. dealso signaled that any would require weakening the military deal. he affirmed that he wants a second meeting with president trump. the uk's foreign secretary has said he thinks theresa may will

ity are cutting capex to alleviate concerns about oversupply in memory.did get it when he 7% cut in 2018 from samsung. we expect them to also address the issues in overcapacity going forward. haidi: an interesting take on bloomberg intelligence saying forstors may be forgiving samsung this quarter. what is the logic behind that? bloombergo into the terminal and you can follow that why investors have been a little bit optimistic after what was a ski slope downward in 2018 that coincided with the dram price fall. the msci asia-pacific index rallying as well as samsung rally on optimism that they are addressing those oversupply concerns. shery: we have breaking news, the musk just announcing tesla cfo will be retiring. after hours, tesla stock is really taken a hit right now. ofhad seen a mixed bag out fourth-quarter earnings for tesla, missing on eps estimates. now the biggest news of the day right now, elon musk saying the cfo is retiring. he has not been in the job that long, he was cfo as of 2018. now hearing that their cfo is retiring. the stock after h

capex has been one of our longest themes.ctory automation, have been crushed for the past 12 months. their exposure is quite high to markets like china. analysts recently upgraded some of those names. their valuations have come up a on and the growth prospects a 1-3-year horizon. things look strong. that is an area we are fond of now. we like service consumption. not so much goods or retail, but service consumption does tend to drive small caps domestic plays. ,anging from tourism related leisure related, health care, educational services. that is where the pricing power will be seen and the demand will grow long-term. we think there are interesting themes again at the micro level. imy: before we let you go, want to ask about the interplay between the fed rate path. we know what is happening with the fed in its pace of tightening. the purple is the boj. how does what might play out boj?in january help the think it will presumably help in so far as the doj may feel less compelled to taper. at the end of the day, the issue -- t

corporate being much more conservative about capex. we will probably have less buyback announcements coming through, which are going to be less supportive of the u.s. index. so earnings on a whole look set to broadly we converge, and given valuations, i think something more regionally diversified make a little more sense right now. and with pressure on the dollar, maybe that helps in the short term. vonnie: i want to ask about the dollar. do you anticipate it stays pretty stable, or heads downward? guest: over the long-term i think i'd be comfortable with the view that the outlook for the dollar looks fairly weak, whether we look at the fundamentals on trade or at ever rising u.s. government debt. that would suggest you need this long-term downward pressure in the dollar. obviously the cyclicals held it up last year, and that was the outperformance of growth and interest rate . i don't think there's much downside for the dollar near-term, but broadly stable therefore in the interim. guy: karen ward of jpmorgan asset management is going

2014 oil downturn, which forced to these companies to make swift and difficult decisions on cost, on capex to shore up their balance sheets. these companies are arguably in one of the best positions possible, given the current macro environment. they bogged down there breakeven costs and are still investing, and they are using a more disciplined investment criteria for new project approvals. we continue to see positive free cash flow generation at $60 per barrel. we see dividend programs as safe, and even share buybacks are rolling in for many of these companies. ♪ of thepean banks are one worst performing sectors in the stoxx 600 this year. deutsche bank and danske bank are among the biggest losers, each grappling with legal troubles and changing management. we are focused on deutsche, the new lows, the scandals. are they at all better off now that we have had this year of new lows and legal fees and turning revenues, etc.? startingms of our point, it's a much better place to be. we are trading one year forward, at the beginning of this year we were trading 10 to 11 times. a lot of litiga

that's a lot of capex but they have a billion in cash >> would you want to own the knicks >> no commentof course, id'd like to own the knicks, the giants and the liberty. come on. >> yankees >> i would want to be on television and watch a guy make two lousy calls because they missed it against new orleans. come on, you know that that's what i worryabout every day in the markets what am i missing that's so obvious? >> would you be a prospective buyer? >> i can't it's a violation of the -- even thinking about something like this is basically a violation of the rules because we own over 5% of the company >> i think we all see where you stand on that. however -- all right do you have a question for mario gabelli and the traders? send them in we're answering them next. first kelly evans has a look at what's coming up on "the exchange." >> we're talking about investors getting whiplash about the u.s./china trade talks we'll talk to one of the president's key advisers on china about what might be happening next >>> also, home prices rising we'll talk about the unconventional mortgages making a

>> quarterly profits capex is still up. high if you're pessimistic you're looking for a problem. obviously there's more risk to the down side with the geopolitical issues but the underlying economic factors are still very strong. >> does that mean there's potential for upside, too, if these deals come to fruition you'll see more enthusiasm from ceos more money poured back into hiring, to investment. >> i think yes, they'll be cautious because of these risks on the outside we talk about the tax bill a lot. there would be more money going back into capex and more supply chain changes if it wasn't for all the uncertainty around the trade issues and everything else so decision making is slower businesses have slowed down in moving forward with things they otherwise would have maybe if these logjams get cleared you'll see more of that. i don't think there will be a flood but i don't see people stopping investment or stopping hiring because of these geopolitical issues. >> mark, thank you, always great to see you mark weinberger.

they are still investing, with much leaner capex.ing a more disciplined investment criteria for new project approvals. see positive free cash flow generation at $60 per barrel. we see dividend programs as safe and even share buybacks are ruling in for many of these companies. of thepean banks are one worst performing sectors in the stoxx 600 this year. deutsche bank is among the biggest losers and each has grappled with legal troubles and changing management. we are focused on deutsche's here. the new low. are they at all better off now that we have had this year of new lows and legal fees and turning revenues? >> i think, i mean, in terms of starting 2019, this is trading eight times one your forward, at the beginning of this year, 10 to 11 times. a lot of the instigation has been settled. the moneyn scott and laundering is a big one overhanging that. the banks more generally. as a position to start the year, i would much rather be where we are. revenue expectations have fallen quite rightly and will keep falling. valuations are som

you have three types of recession, capex and consumer.sumer remains strong with gas prices under $2 a gallon on average, consumer spending from personal consumption basis looks strong we haven't had cap ex. credit spreads expanded but nowhere near 2008 and 2009 that's well below the long term average. we don't think recession for several more quarters. again, people are trying to will the market lower because they missed the rally again on the recovery and they're bitter. >> beyond just wishing for lower prices, brian, i think the question is what have we proven in january except that panic was so extreme in december, right? you reversed that. i don't think it is easy to make the case, is it right now, that the market is priced for any significant decline in corporate earnings what do you think for 2019 is built into u.s. stock prices >> well, mike, that's a really good question. here is what we would say. we just put out a note minutes before we came on the broadcast. you look at not only valuation and data, it is interesting, not just s

stimulus at the same time and you and i both they that corporations, a, take a long time do their capex plan companies can't decide today that they will go buy 100 acre piece of land and go build a factory. they need to buy the land, design the factory, get the permits. that itself will take a year or two. and that is why we made the investment window a five year investment window. and if you see the price of steel and man machinery goes up makes it less compelling to build those factories. so we need to keep people investing in the businesses. so my view is that investment will come when there is more and more clarity in what our trade relationships are with countries around the world >> is there a risk that it is too late, that the benefit of that stimulus will come to pass by the time the government figures out its way on trade and figures its way out with regard to the shutdown? >> there is risk to everything when you are dealing with corporate decision making, you are dealing with economic growth, are you dealing with jobs, there is always risks. things happen that you can never fo

>> i still think a fairly strong driver, but we would like to see corporates we would like to see capex pick up we would like to see a lot of the folks that have been more or less either sitting on their hands -- >> give me a sector. >> or in cash. >> give me -- if you're going to try and make an optimistic thesis, what confirms it >> i think it goes back to the faangs tell me what's going on with the chinese and rates has to do with amazon or alphabet's business model. if the market will come back in the capacity it did six months ago, the faangs and technology will be a part of it >> i don't disagree with you financials and energy need to start performing here. i know that goes back, theory that goes back 20, 30 years. you want to see more lending despite and, look, you can't have energy, oil prices -- joe, you've been on this for a long time -- going down 30%, 40%, 50% and think you have economic growth coming. >> the last i checked the ten year was 2.65. >> here is the tail and here is the dog. the dog is the economy if you get u.s. gdp growth, if you get it approaching that in 2019

the capex this year will be 10-11,000,000,000 dollars. to track everything, we are on the tliv. she says the company can continue to set new revenue words -- records. reach but trillion dollars thanks to strong demand. that is all set. got?politics, what have we >> absolutely. taiwan semi conductor matters to global investors. it holds 13% of equity portfolios. it is the most widely held stock in asia. coming up as well, american authorities said to be investigating huawei for allegedly stealing trade secrets. we will bring you the story. this is bloomberg. ♪ frenchking news from the banking giant in regards to the fourth quarter. a stable dividend. marketre messages to the risk they were hurt in the fourth quarter. socgen, fourth quarter. we have seen this in some of the american trading numbers. termsening the horses in of the horses away from the market. in line with the guidance. this is up date on the challenges of the fourth quarter. the dividend looks to be safe. mood.e a risk off it is about dollar-yen as well. >> it is also concerned about trade, a bit of a mixed sessio

the 2014 oil downturn, these companies had to respond swiftly capex, and divesting non-core assets to up balance sheets. we look at the european oil space as relatively well positioned. they have a lot of tools in the toolbox to manage their balance sheets. positiveee cash flow outlook at about $60 a barrel next year. it is important to keep in mind these companies have been through the wringer from the 2014 oil downturn, and they are about as best positioned as you can be are the current price environment we are witnessing now. i will start the process of chasing people for oil comments over the next 10 days. hostess lena komileva, managing partner/chief economist, g plus economics, battered and bruised it was a torture year on oil. the question to you is, what does it take to get an emergency meeting, or something more from opec on the 1.2 million barrels they promised a couple weeks ago? much this is very expectations management for opec at the moment. is in unstable equilibrium, and it has been like that for a number of quarters. out of the fact that the big oil producers are misa

. >> some of the biggest capex numbers in the world, but some studies done recently that says capex hasased depreciatably year over year -- from the result now a year in roughly almost from tax reform, which was expected to -- >> and china, slow this is about how there is a refresh, microsoft coming on with azure, doing a great job. >> see that? >> yeah, it is a compendium. >> wow. >> i know. >> you're going to read that >> am i going to read it i have no life, why not. no monday night football you're seeing a lot of companies that -- look, texas instrument stock. i read that conference call, it was downbeat the stock was up i'm not buying that. it was down because it was downbeat nvidia is downbeat, nvidia is more than downbeat >> people running for the hills. >> they are. where is the bird box there? >> doesn't seem to be having -- on a percentage basis, not nearly as bad. intel not -- >> intel prepped by saying indigestion in the data center no one took that as a read people thought amd is taking share. but i think it is absolutely -- got to look at caterpillar and the reed reaad thr

capex 5 reporter melissa kane says some california congress members beg to differ. >> we can call a national security of our country. we can do it. i haven't done it. i may do it. >> reporter: the president has said on multiple occasions he doesn't need congress to fund his border wall and can get the money by declaring a national emergency. he repeated that claim today. >> i may declare a national emergency depending on what happens in the next few days. >> reporter: nancy pelosi sit down with jane pauley. >> the impression you would like to get is that the president would like to not only close government, build a wall but also abolish congress so the only voice that mattered was his own. >> reporter: california congressman adam shift is the new lead of the intelligence committee and says the president cannot get a wall by declaring an emergency. >> harry truman could nationalize the steel industry during wartime and this president doesn't have the power to declare an emergency and built a multi-will million- dollar wall on the border. it is a nonstarter. >> reporter: a number of laws have

.> to reduce are -- our capex. let's talk about oil price volatility.rom fair market back to full market. -- bull market. how hard does that make it this year? >> it is not good for the industry in general. from our side, we have our low.egy very growth, somenic restoration. respond also with a very low price. we want to look at the price, we want to be eight very cheap and to be able to grow. is there a bottom price you would need to review the echo >> no -- review? >> and no. no. company, other activities, at this price, we without.dent we can go what does it take to keep that $50 level this year? >> i think from that point of demand, maybend it can be also higher than $60. ,ur scenario for our investment we consider about $60. seeing --t are you -- for some time, and it would be lower. looking at the country where we are, i do not see lower demand. still growing.d 1.2, 1.4 billion -- 1.4 million barrels a day, that is still there. manus: caludio descalzi is the ceo of eni speaking exclusively to bloomberg. nejra: joining us now is the chief investmen

capex down 13 points to the lowest level since the second quarter of '17 in fact, plans for capital spendinghe level where they were before the tax cuts were enacted. fully 84% of firms up from 81 in the last survey say the tax cuts had no effect on hiring or spending plans it is hire for goods producers, however, which is good news. and some other good news in the survey, 77% say tariffs have not affected higher spending plans prices were well under control and the firms control to have trouble finding skilled workers which is good news if you're a worker, not necessarily a higher 64% see growth 2.1 and 3% this year that is down from the last survey and third see it at 2% or below. this is one of the first business surveyors since the shutdown we'll see if it's confirmed by other surveys. and if the government, brian, can remain open, we'll see if sentiment rebounds >> what is the most surprising thing that stuck out to you? you always i love about you, steve, aside from your mad music skills, is that you're able to dig into something and pull out something that is a little bit surprising >

. $1.2are going to invest billion in capex. it is all about the smartphones. get your wallet out. nejra: it was interesting having that conversation yesterday. we talked about the semiconductor industry coming under pressure. some good news from st micro. if this had come through as bad news, there would have been questions about the supply chain. a little but of good news. let's turn to the world economic forum. policy chiefs and business leaders gather. we are live at the meeting all week. haslinda ahmed is there for us. great to have you with us again. it seems as if a lot of the leaders trying to defend the global order, we particularly heard from the china vice president in what seems like a thinly veiled rebuke of president trump. right.are he referred to trump's america first policy, he said the strong must start ruling the week. imbalance is unavoidable. in the absence of u.s.-china in focus. globalization must stay. that came across from the likes of merkel. said we must rebuild trust and free trade. we must not let that go. they also hope the u.s. and china will resolve

stimulus, which we are not seeing coming out of europe, any monetary , failing any massive boost in capex or any ,ajor jump in labor supply europe is not going to have a higher potential growth rate. we should expect europe to be converging with 1.5% growth. nejra: i would like to continue talking about europe, but as we are gearing up for this brexit vote, i want to put a question to you on sterling. i have a chart showing the forecast has been revised upward for cable. strategists predicting the pound will be one of the best-performing major currencies this year. delusional? >> it all depends on choreography. brexit is truly a choose euro and venture story. it is quite possible if there is some kind of deal or brexit does not happen, certainly. if there is a no deal brexit, it is probably delusional. a lot of u.k. assets are cheap right now. investors are not willing to jump in because there is so much uncertainty about the outcome. manus: we have just got to see the details in terms of what happens next. megan greene stays with me. coming up, crude climbs to three-week highs driven by

for the industry, we will want to ask you about the trade wars, but first, let me ask you about the capexnounced by samsung your big two of customers. are you having to do anything to upset that right now? peter: first of all, also good morning to you. the announcement of our major customers is a reflection of where the industry is today. we are seen a softening of the industry starting in the second half of last year, and it is continuing, and i think it is clearly a result of the uncertainties we are seeing today, which basically are calling the trade were between the u.s. and china -- it is definitely not helping. manus: peter, very good morning to you. it is manus in dubai. you set our customers responded late in the fourth quarter to slowing demand in there and markets. where are the markets that are most under pressure at this stage as you look at the world? is clearlyink it most of the softness we are seeing is in the so-called memory chip market, which are the memory chips that you have in your phone to store data. it is also the memory chips that have helped microprocessors to wo

there is some impact of the threat of trade war on capex decisions but for us, the most important driverbeen the credit deceleration and the concerns about financial imbalances on the part of the policy makers. to us that is the main kind of swing factor in the negative direction in 2018, maybe in a slightly more positive direction in 2019. rishaad: making a trade deal with the u.s. is going to be very important here. not just to provide clarity. with clarity comes confidence. >> that's right. i think the outlook has improved a little bit. so our baseline scenario is now one in which we're going to be in more of an extended pause without an escalation after this grace period ends in early march. but that is all baseline. there is definitely still risk to that. we have gone from thinking it was a little more likely that you would get an escalation a couple of months ago to thinking it is more likely that you don't. it is not that far either side of 50%. rishaad: looking ahead though. when jinping talks about serious threats to the economy, who could be the most serious threat to the econo

-- as far as capex. do you see that continuing? andrew: there is a lot of uncertainty. to their downstream industry, the smartphone industry, automotive, general industrial. we saw a company yesterday really talk to a slowdown they saw in december, the worst in years. the highest quality company in its space, if it is seeing back, that is something you have to listen to. there's more earnings and revenue softness that could be there. stephen: for how long? andrew: it's interesting. what we have to watch is industry. got hammered. washen: yesterday, it it up. 's hitnalysts think it bottom. andrew: we are seeing that for the factory automation, and i talked about that in precision motors, and that speaks to a general industrial slowdown, lower than expected demand downstreamthese industries i just mentioned, so you've got bad and the secondary impacts of the trade war, which is still coming through. and the trade data definitely suggest we are looking to q1, q2. a lot of demand going forward. we will be watching very closely during the reporting season the industry levels

they are resizing the cost structure, the capex, and supply chains to embrace the new reality.ut the debt as well and the impact of the bbb.rade in q4 from a to i want to talk about the debt. debtholders look like they are seeing a little bit of an improvement here, certainly leading the rebound relative to the equity bondholders. they've talked about leverage and that net debt ratio about three times on the call. that clearly is a focus for them. david: thanks so much, taylor. taylor: and if you want to clear the debt, what do you do? you spin off things. we are going to stick with ge today. our focus today is on ge earnings. we want to delve into ge's health care unit, long seen as the company cash cow. >> we basically admitted the x-ray tube 100 years ago. all of the life sciences we do come out of the research center. we see health care as part of the package. betters also one of ge's businesses, making $19 million a year. it is stable. it is also low growth. lifesciences is the growth crown jewel. therapies,gs and imaging and enhancing procedures. now it is just a small pa

plans for capex the next three months have fallen below the level where they were before the cuts wereews in the survey, 77% say tariffs have not affected hiring or spending plans, prices, or under control. and firms continue to have trouble finding skilled workers. and 64% of respondents that's pretty good it's down a little bit at about a third seeing it below 2% this year this is one of the first business surveys we've see since the shutdown we will see if it is confirmed by other surveys once the government opens today and if it remains open, perhaps we get a rebound in the outlook. that's my hope >> some of those numbers -- i mean, i always try to look at the positive, but some of those numbers seem -- you'd be viscerally affected by all the -- what we heard about the government slowdown. but where the rubber meets the road is employment >> yeah. that's one place it meets the road also in capital spending as well. >> they don't know it could change on a dime whether they do end up spending if the demand was there. that's more of a -- sort of a feeling. just i don't feel good about

earnings with .alliburton and we have been seeing with a lot of ceos, they are coming out and slashing capexing because they don't believe in the crude rally. a got hurt in the crude slowdown in 2018. lisa, when we talk about oil, we have to talk about the airline as well. we are in the middle of the shutdown. for thet travel at all holiday weekend due to the tsa shutdown. lisa: and 10% of tsa employees stayed home, saying that they were financially not in a position to come to work. it was pretty rough. taylor: we are busy at work, indeed. lisa: we have more coming up from davos. anti-of people got on airplanes to go to switzerland. up,ave an interview coming don't miss it. ♪ ♪ good morning, everyone. this is "bloomberg surveillance." a perfect day in davos. sun, beautiful switzerland. on radio, just imagine. -- i'm not going to sing for you. know lot of people don't that we are just above italy. going from southeastern switzerland over to austria, is that ok? now joining us is erik schatzker. in conversation with mr. schwartzman. i am here with chairman and ceo of the black stone group. th

capex is a little more effective by sentiment and really how the economy is moving.nies aren't going to spend if they don't feel like the economy is moving in a strong direction. lisa: again and again, china is proving to be the weak spot. we see that was caterpillar and apple. what other companies could there be out there who are seeing an unexpectedly big decline in business from china that are set to report this week. there's companies across the board that could suffer from this trade issue, keeping in mind that china is the second-largest economy in the world. this is going to have tentacles all over the place. tech has taken a little bit of a beating because of that. that was the original goal with china. we don't see tech leading the market. there's been a lot of conversation about if the market goes up this year, what is faang stocks don't participate in that? can we still get there? i think we can, and i don't think a lot of people are calling for double-digit rallies in the s&p this year. most people are calling for low single digits. right now we still lik