we have stephen gallo with us.or your political fix tonight, i urge you to listen to the "with all duef -- respect." withcular the conversation donald trump tonight at 5:00 p.m. ♪ francine: this is "bloomberg surveillance." we were talking about it but about the impact of negative rates, the u.s. election and deutsche bank and european banks. this is the picture we are looking at now. nothing good about it. let's get the thoughts of ian bremmer and stephen gallo. andou go around the world you look at various regions and countries, it is very clear that europe is moving to new politicians. that is one leader untainted? or who is doing the job of sticking to globalization but also keeping their people happy? ian: renzi is showing leadership. on the lineis job and basically said, if i don't done.is, i of course, he's now trying to walk that back. we could easily see the back of him very soon. you have to focus on asia. the three big economies in asia. so in the world's largest regional economy, -- if that weren't true

let's bring back stephen gallo and david kohl.tinue bond selloff, at some point, re-rate yen need to lower? mr. kohl: yes, at some point the yen could profit, but if you look at rate differentials between the u.s. and japan, we should -- we should adjust for inflation differentials. that means real interest rates are going down. is going inflation down, so real interest rate are actually rising. on the real side, the picture is not as cap symmetry as on the nominal side. this has to change. when the bank of japan acts more forcibly and can revise inflation again, this might weaken the yen again, and this is what we expect in the coming weeks. alix: it is a great distinction -- real rates versus total yield. when we look at the market selloff, one dramatic application has been a pickup in market volatility. emerging market volatility in fx has been much stronger then developed market fx. do you expect this to continue, and what is the big loser in that? mr. gallo: well, we really are very much sidelined until the fed decision is ou