later, stanley fischer speaking in washington.of germany and italy, capturing divergence. joining us is bloomberg fx credit strategists. let's break down some of the data. we're not used to seeing german gdp underperform italy, but the spread story is curious. the yields blowout over german yield and political risk factor into europe in a big way. but do you make of this, rich? rich: a bit like the u.s., we look at macroeconomic indicators we like, but political risk trumps everything. true in the u.s., u.k. and continental europe. i think that will be the key focus going into 2017 and the tail end of this year. a lot of political risk in europe and that has not properly been priced. as a result, political risk would be the driver for european yields and the currency. jonathan: simon, look at next income, spreads blowing out a bit but the euro weaker. president mario draghi has to think about this and has credit house that while it has bubbled doing the background? simon: credit has proved resilient. we have the corporate sector o

stanley fischer says he is not concerned about a lack of liquidity in u.s. commented on the recent yields -- recent bond yields. >> it is a question of when you are going to change policy and if i did know i would not tell you. what you say to something we obviously have to look at at the yetnt, i do not see it as something that is terribly worrying. yousef: let's bring in our guest. great to have you on the show. let's pick up on what stanley fischer just said in terms of possible concerns around yield, he says not at the moment it is not on their radar. where do the treasury yields go from here, we're seeing the market consolidate and take a breather. guest: the first thing that is interesting to observe is we had a very significant movement at the long and but if we look at the pricing of the fed funds, when we look at what is priced into the market, yes, a december rate set -- rate hike scenes in your certainty but beyond that the market is still pricing relatively little in terms of actual tightening. there does seem to be a bit of a question mark over

at 8:30 a.m., stanley fischer will speak on the economy.the data front, the first read on consumer sentiment is out at 10:00 a.m. retail earnings, jcpenney reports third quarter results before the opening bell. this is a big one to watch in a slew of retail earnings this week. >> landon dowdy has lee thing toss watch from jcp. >> the street is looking for jcpenney to report an earnings loss of 21 cents a share. here are three thing toss watch. sales, jcp has missed analyst sales estimates in the first two quarters of the fiscal year. sales fell in the first quarter but slightly recovered in q2 despite an uncertain retail environment. analysts expect sales to rise 2.3% in this report thanks to management's strategic initiative. second is sephora. the beauty shops within jcpenney stores are helping to increase foot traffic. and jcp plans to add 60 new sephora locations this year. and the revival of brands like liz claiborne and st. john's bay. you want to listen for more details on that. if its enhanced digital presence is boosting sales. loo

at 1:30 eastern we'll hear from stanley fischer. >>> few earnings reports to watch. home depot posting quarterly results. watch for dick's sporting goods and tjx the parent of tj maxx. >>> the street is looking for home depotato post earnings on revenue of $23 billion. beyond those numbers here are the three things to watch. first big ticket item data from the association of home appliance manufacturers suggest appliance sales softened in the quarter, second weather, higher temperatures throughout the quarter stifled home improvement projects especially in august. however prep regulates for hurricane matthew as well as post-storm recovery helped same store sales. and listen for management's projection on outlook. they expect a stronger finish to the quarter but mixed macro signals and uncertain consumer following the presidential election could lead to slower growth ahead. shares from home depot are down 6% in the past three months. back to you. >>> still to come, the dow on a six day winning streak. insight and analysis from our chief market strategist. that comes n

the vice president of the federal reserve, stanley fischer, explained the u.s.omy could benefit from some new fiscal policies. he said that could easily burden the burdenould ease of the fed supporting the economy. >> some combination of improved infrastructure, better into -- better education, more encouragement for private investment, and more effective regulation, all likely have a role to play in promoting growth and productivity and faster growth of living standards. has causedrump uncertainty with his protectionist take on international trade. this could open the door for china to step in as a free-trade hero in the pacific rim. in peru, at the meeting of the asia-pacific economic corporation, outgoing president obama defended his partnership, which could be threatened by trump's administration. president obama -- reporter: it could be an opportunity for china. barack obama defended the transpacific partnership agreement he brokered. as he prepares to hand the reins to donald trump. believe theama: i tpp is a plus for america's economy, american workers, a

that was stanley fischer talking in washington, d.c.se headlines and bring you the relevant points of his speech. let's get to first word news. mark: thank you. at a capitol hill press conference today, house speaker paul ryan says he is speaking frequently with president-elect will trump and his top officials and is still formulating strategies to get the new administration off to a quick start. >> we are working hand in glove from the start. we want to make sure we hit the ground running in january so we can deliver on the new president's agenda, better days lie ahead for our country. he declined to reveal the agenda of the lame-duck session of congress. the man reported to be resident electrons choice for secretary of state may face potential conflict of interest. rudy giuliani has made millions as a lawyer and consultant representing clients at odds with u.s. foreign policy. he reportedly took money from clients that include qatar venezuela and iranian and styles. the chair of the house committee is looking to oversee the agency he

the fed vice chair stanley fischer is speaking at the council on foreign relations.t growth has picked up and inflation is firming toward 2%. he says there is no sign that u.s. financial positions are not being eroded. this is continuing the conversation of fed officials saying a certain type of stimulus may impact how we manage. david: if you get to 100% on w.a.r. p, do they have no meeting? alix: wouldn't that be nice. [laughter] jonathan: the words economic potential play into the chart earlier. this is something that stanley fischer has beaten the drum about a couple of times. the debateto be happening between the central banks not only in the united states, but also in the eurozone. if you ask john cryan what this means for deutsche bank, he will to you one thing, and that he will tell you another. david: that is exactly my question. is he really think the big banks? you need to have strong banks to have a strong economy and they have not seen evidence that it is hurting them. alix: the question in the short-term basis, what does that do to monetary conditions?

stanley fischer hasn't repeated the central bank toss advice to president-elect trump -- use public money to make american workers more productive. fisher says that stimulus should be developed so that it gives the economy more than a short-term boost. >> fiscal measures which increase growth over a sustained time would be terrific. others would have short-term require further actions down the road. courtney: he has said the a, has moved into the vicinity with employment and inflation. in france, police say they have stored in a potential terrorist attack and arrested several people in strasburg and marseille. the rest comes five days before the opening of the famous christmas market in strasburg. at least bomber killed 20 people inside a shiite mosque. like thesunni muslims taliban considered shiites to be apostates. global news 24 hours a day powered by our 2600 journalists and analysts in more than 120 countries. donohoe.ney this is bloomberg. mark: let's turn to emerging markets. our next guest says we need to pay attention to transition, transition is the most important. talk us thro

federal reserve vice chair stanley fischer says the economy has moved back to the vicinity of the central bank's targets on unemployment and inflation. we'll get a market strategist's take. mark: paul: prime minister theresa may hence the government will seek a transitional brexit deal when negotiations with the eu begin to avoid the "cliff edge that businesses fear. vonnie: incoming senate minority leader chuck schumer says he has donald trumpstop from repealing the dodd frank act. hammering home that these rules were put in place to limit wall street. about 30 minutes into trading day in the u.s.. julie hyman has the latest on some records. ramy: records for all three major averages on closing basis. the dow hit that milestone last week but the s&p has gotten there. the nasdaq up 7/10 of 1% leading gains. something of a commodity led rally we are seeing in today's session. if you look at the imap of the groups on the move energy is in the top spot. it is up by 2%. that energy index trading at its highest since july of last year. a broad-based rally. not much read on the screen. heck is

janet yellen said it could lead to inflation and higher interest rates, but stanley fischer was more welcoming. >> certain fiscal policies, particularly those that increase productivity could increase the potential of the economy and help confront some of our longer term economic challenges. >> the fed could put the brakes on the economy if it feels the president is moving too fast and stoking inflation. markets have driven up treasury yields in anticipation of more inflation, more growth and bigger deficits from the president. markets have a way of letting presidents know when they've gone too far on the debt. that is deficits, they often don't matter until markets say they do. steve liesman, cnbc business news. >> let's continue the discussion around the fed and further rate hikes with the macro fund manager at mag investments. the december rate hike is baked into the cake. how many hikes will we see next year? >> i think more than priced into the fed funs futures. the market has the fed going to 1% by the end of next year, that's conservative. >> that would be two hikes? one to tw

. >>> the fed vice chair, stanley fischer admitted he was surprised by the outcome of the presidential elections. he said the world now was not where he thought it would have been last wednesday. as for implications the monetary policymaker said it was too early to assess the market impact of a trump presidency. >>> st. louis' fed president, james bullard what been speaking in the last hour. he's been saying one interest rate increase possibly in december could be sufficient to bring u.s. monetary policy to a neutral setting. he went on to say the u.s. monetary policy outlook has not changed after the election. and that from the fed's point of view, a rise in inflation expectations is a good thing. >> busy day of fed speeches yesterday with boston fed president also weighing in saying he thinks a december rate hike is plausible barring any significant negative news. in september the historic dove joined the minority of policymakers calling for a rate hike. mr. rosengren said he is sticking with his hawkish predictions until year end. >> i'm looking forward that the economy continues to

stanley fischer is the vice chairman. he is very close to chair yellen.etiring president of the atlanta fed scene as the middle of the pack in terms of where the balance of views are. >> going back with all brought us. >> danny blanchflower joins the conversation. ♪ scarlet: this is the fed decides. i am scarlet fu with tom keene and joe weisenthal. also joining us is dartmouth economics professor danny blanchflower. one of of the reasons the fed did not move is the cousin of the election on november 8. we will likely see more fiscal spending. >> i would say we have seen doubt on that. can we affect fiscal spending? >> my theory is we would see fiscal spend doing -- fiscal spending with trap cuts. if clinton wins and you do not get the democratic congress, it may be gridlock. do we need more fiscal stimulus? unemployment around 5%. is this a solution that has a selling point? >> i don't know. i think the reality is the business cycle rolls. nine years after the recession started another one is headed our way to preempt that. probably we will need fiscal s

bit too aggressive in terms of the language as we came into 2016, talking about four hikes from stanley fischerdon't think he wishes to repeat that. i think we are talking about two rate hikes at most. i think we are ultimately on a path where we are trying to get neutral rates to somewhere in the region of 2% on a nominal basis. in terms of real rates, if you are trying to target 2% cpi, almost at 0%. yousef: what could become a headache for the fed are the risks outside u.s. borders. on paper, the fed is only supposed to look at domestic variables, but the complexity of the global economy means you have to keep that in mind. what could derail the fed's decision-making here? >> of course the fed has a twin mandate, but it cannot ignore what is going on globally. we saw that in september of last year when the federal reserve looked at external factors, resisting from a rate hike. clearly, in terms of the external risks, if the chinese recovery story is not as durable the brexits, or story, could make it much more difficult for the federal reserve to continue to tighten policy. yes, we are cauti

that's the message i got from stanley fischer is speech, the vice chair at the fed. think we are expecting janet yellen to say business is on track and providing the incoming data holds up as we expect it will, we ain't interest rates , if rise in december and anything, the likelihood of lookingt-elect trump through a big fiscal stimulus means there's a greater chance interest-rate swap to come to pace. pendingiven the stimulus to come, something name investors have been coming out in recent days saying that now we know who is going to be in the white house, there is a peak with some of the investments that have worked really well and one of them is tech shares. he was saying those so-called fang stocks -- facebook, apple, and licks and google, those are at the peak and they are about to pop. would you agree with that? i would go deep into that. i think the one thing that is relevant here for technology shares his trump's potential the tax oner repatriation of profits overseas. a lot of u.s. companies are holding profits overseas and they are mostly held by health ca

what is so important here is where we are from stanley fischer. we are still ultra accommodative.ember hike. what are we waiting for for 2017? why isn't the fed pausing? >> if the question is why doesn't the fed hike by 75 basis points, they could. i don't think they would. i think they prefer increasing it in stages. the answer to your question is 25 is going to do enough damage to the global markets. are rumblings in the malaysian market. the emerging markets have been beat up pretty bad. it's going to get worse if you have a 50 basis point hike. tom: let me bring up this chart. ?ow cool is it we can instantly bring up a snapshot of the malaysian ringgit's. 98, we are back there right now. francine: i love that. let me bring you over to my chart. this is like the battle of the charts. we never do this. this is basically how much the u.s. has exported to the other 11 tpp countries. we heard from donald trump yesterday that he would rip this agreement trump. you can see the exports have been solid. the reversal is true. they can't sell to the u.s., what does it mean for a lot of t

stanley fischer said it is all about growth, growth, growth.tion is that as long as growth is sluggish, it is hard to close out the gaps. it is hard to type the labor market and hard to get a sustained pulse in inflation. in matters for growth going forward. the q3 gdp number is probably not going to be repeated going forward. we are looking for something lower on growth and productivity. the bond market for the month of october was ugly, ugly, ugly. what does this mean for the bond market going forward from here? >> at the end of the day, it comes down to how much this reflation will cycle. in reality, governments want more growth. central banks want more growth. the bond markets are sucking it up. market inenormous bonds. let's think about where the terminal rate is. rate sensitivity in the united states is way higher than it has been in previous cycles. potential growth is way lower. range. at a the destination is clearer than the journey. the journey is bumpy because of the positioning. jon: let's talk about the destination and the u.k. qui

fies chairman stanley fischer calling the case for a rate hike quite strong saying the fed is, quote, reasonably close to achieving its employment and inflation goals. no real direct comment, jim, on the election per se, but nudging further along the argument he's made for a long time. >> given the run in the j.p. morgan and bank of america stocks, thank heavens he said that. i mean, this thing -- a lot of this rally involves again today with the treasuries. people are just saying, okay, look, we've been waiting for this treasury dive for rates to go higher for a long time. and we have got to switch every penny out of -- you pick your stock. proctor & gamble, let's use that. a great quarter. but you got to sell every share of proctor & gamble and we got to buy every share of bank of america because the fed is going to raise rates. so he's on script. dr. fischer's on script. that money ain't going back to proctor any time soon. as good as proctor is and i think it should be bought, i recognize you're in front of freight train and you're a bus in front of a freight train and it's "the f

more significant thing is that during his term, he will also be able to replace janet yellen and stanley fischertentially he could change for seats on the fed board of governors which is a massive change for the fed. this comes at a time when central banks were under pressure that their independence is being challenged. particularly important because donald trump's economic plan will make the fed incredibly important. he is calling for a massive tax cut. infrastructure spending. that is expected to send inflation up. francine: what profiles are we looking at? people that are very anti-austerity or that would really bring back rates higher? how much sway can he have with those votes? >> once he has appointed for fed governors who are beholden -- four that governors who are beholden to him, there is a question whether they will be as independent as the previous governors. he has attacked janet yellen repeatedly. how will those governors respond to a spike in inflation and an increase in the deficit? francine: he gave this interview to the new york times. we followed it through his tweets. he had i

. >>> stanley fischer about to deliver a speech.s with some of the highlights. >> good morning. stan fischer is making positive comments about the potential for fiscal policy changes coming out of washington and points the federal reserve is close to being the only game in town when it helps to helping the economy, and it can help confront some of i think so's challenges and fiscal policies can promote faster growth and he mentioned infrastructure spending and better education and looser regulations. he said by raising equilibrium interest rates, the economy and the federal reserve will have to contend more than is necessary with the effective lauer bound on interest rates and that means the fed can raise rates more than people expect right now and get all of the zero lower bound, and he said lower rates make the economy more vulnerable to shocks and can threaten financial stability, and he points out the reach for a yield. on the broader economy, he says it's performing, quote, reasonably well and points out the job gains from been

janet yellen and stanley fischer's terms are both up in 2018, and the president normally reappoint themin 2017. this could quickly become an issue because donald trump does not like either and would probably replace both. the clinton administration would probably look to keep both so we will have to see what happens. there are two open seats on the fed. president obama has nominated two people who have not been able to get a hearing. we will see if president clinton or president trump would keep them or appoint somebody new. elected and takes brainard off to be her treasury secretary then there are three openings and it would be a question of the senate and who is in charge. the banking committee has not approved any nominees as they do not like democrats and they have tried to force the president to nominate a new chairman for regulation which he has not done. there will be a new chairman in either case so it will be interesting to see. francine: we are focusing so much on the presidential race, it is crucial on who gets congress. sharon: what is -- what it is looking like is that the

at 8:00 eastern this morning, boston fed president eric rosengren then at 1:30 we'll hear from stanley fischert how they are reacting to the election. >> as the trump cabinet begins to take shape bring in wilbur ross chairman and chief strategy officer for wl ross and company served as a senior policy adviser to the trump campaign. he co-authored trump's contract with the american voter widely believed tube blueprint for trump's first 100 days in office. wilbur, thanks for being with us. good to see you. >> thank you. good to be on. >> quite a sea change in tone maybe not with everyone but people like paul ryan and other republicans. there's nothing like winning to get people to suddenly say wow what a great candidate you were. remember the downstream worries. >> right. remember they used to say appearance becomes reality. now reality is becoming appearance. >> remember the down ballot worries. instead of being a head wind it was trump coattails. >> remember the sweep was not just the presidency or the house or senate but governorships and state legislatures. this was an enormous tsunami that

on today's economic calendar, federal reserve vice chair stanley fischer will speak on the economy at:30 a.m. eastern time. the first read on november consumer sentiment at 10:00. >> george soros and moveon.org inspired demonstrations and financed demonstrations do not make for a completely divided country, andrew, just because of what you see -- check out the headline -- >> no. no i'm not going to debate this issue, because you're right. the republicans clearly own and control now all of washington, d.c. >> that's not my point. >> i'm just saying if you look at the popular vote, i'm saying there is a -- there's still a divided country. what about the popular vote? >> it was higher -- >> cnn is projecting trump will win the popular vote now. >> when they finish counting? >> yes. >> holy smokes. >> you were aware of that tidbit? >> i'm suggesting to you even if -- whether you think that he won the popular vote or she won the popular vote, it is that piece in this country that was so close there is still a divided country. >> so like all elections, some people wanted clinton, some peopl

and the people who matter the most, chair janet yellen, vice chair stanley fischer, bill daley, president of the new york fed, they have all pretty much indicated that december is it. they wanted to see confirmation that they were not wrong in what they thought was going on, which was a trend rate of about 160,000 jobs a month and a gradual reduction in the unemployment rate and a gradual improvement in wages indicating that the economy has enough strength to sustain an extra quarter point in interest rates. we sell 161,000 new jobs yesterday and strong growth in wages. those two things appeared to be exactly what the fed's central members have told us they are looking for before they raise interest rates. i would expect them to raise rates at the meeting in december. host: we're talking with tim mullaney, economics columnist at thestreet.com. a call from new york city on our employed line. good morning. caller: good morning. it is a pleasure to hear this gentleman shut down the naysayer, the gentleman before me. how dangerous do you think that these people have to dispel the idea that th

fischer cites surge in soybeans. >> appreciate it. >> i think it should be stanley cites surge in soybeans. he sort of is under scoring what we knew from morning's employment report. labor has been the area if you are looking for strength in the economy. i don't think it changes the story but interestingly he wants to get out there and say it was a pretty good year and not declare victory but say things are moving in the direction that the fed wants tosee. >> evan, what about this nine-day streak that we are on? >> i think it's largely a function of political uncertainty. i think if the jobs report as good as it was, it was good, largely irrelevant has been irrelevant to the markets. i think barring -- i think we are in a binary mode. i think if hillary clinton wins and the republicans keep the house and the senate you have rally time in the stock market. trump comes in i would not put money into the market for quite some time. it's not because of trump's policies per se although i don't agree with a lot of it. it is not really policy issue. i view it as a temperament issue. when you have s