tv Bloomberg Markets European Close Bloomberg February 19, 2018 11:00am-12:00pm EST
"bloomberg markets." ♪ nejra: here is a top stories we're covering from the bloomberg and around the world . deutsche bank has started cutting 250 jobs globally and germany's largest lender may accelerate cuts. that next vote in the ecb is voted on today. we examined the top candidate. ahead of the italian election, you will hear from the country's former prime minister, mary of io monte. let's see where european equities are trading right after yo now. you can look at this on wm go. overall we are seeing the stoxx 600 lower after it had its best week since 2016 last week.
the european equities failing to .arry on that rally you are seeing france down 6/10 of a percent and the dax in germany down 6/10 of a percent. the ftse 100 down 7/10 of a percent. you are seeing some broad-based losses, but also if you look across the industry groups, most industry groups losing on the stoxx 600. the biggest losses coming from carmakers and household good companies. you are seeing dollar strength with a little bit of a bounce back from that three-year low. cable on the back foot at 1.3992. euro strength against the pound is what we are seeing, but a bit of euro weakness against the dollar. look at what is happening in fixed income and you can see yields moving higher in the core and the periphery. the 10-year bund yield up. yields moving higher. also, oil moving higher.
wti above $62 a barrel. some of that might have been down to the dollar weakness. let's check in the bloomberg first word news. jessica summers has more in new york. jessica: president trump is open to improving background checks for gun purchases. according to the white house, the president spoke to republican senator john cornyn about a compliance with criminal background checks and supports efforts. president trump has been criticized for not doing anything about gun control following last week's school shooting. meanwhile, present trump spent the weekend criticizing everyone but russia for meddling during the 2016 presidential campaign. he tweeted 14 times over 24 hours, criticizing democrats and robert mueller's special counsel investigation. that came after the indictments of people leading efforts to attack rival hillary clinton.
russia is warning the u.s. to not play with fire in the syria conflict coul the. they lashed out at the trump administration. syria airstrikes may have killed more than 200 russian mercenaries. for millennials living in advanced economies, the boom has turned to bust. 30'snnials in their early have household incomes 4% lower than members of the preceding generation of the same age. they are saying the financial crisis has held millennials back. global news 24 hours a day powered by 27 journalists and analysts in more than 120 countries, this is bloomberg. nejra: european stocks struggling to make headway today after three days of gains and the best week since twice 16 last week. traders were searching for a catalyst on what was a fairly quiet day with equity markets in
the u.s. and china closed for holiday. here with insight into what investors will be looking for is stephen isaacs, the head of the investment committee for alpine capital management. i want to take you to a chart first and it shows the rebound that we have seen since the selloff in european equities that has been lagging the rebound that we saw in the u.s.. you could answer the question if it's down to a stronger euro. is that why we have seen european stocks not rebound as forcefully? stephen: the selloff was not quite as much. there was an explosion of the bubble particularly in the short vix trade. it was very much a u.s. trade and that is where we have seen the biggest action since year d. the markets are moving more or less in tandem. it ran through the first week of february and now we are seeing a reasonable recovery from very oversold conditions about 10 days ago.
i'm now of the view that the selloff is going to resume. nejra: it already seems to be in europe today with u.s. futures pointing lower as well. stephen: we will see. there's a couple of problems here. first of all, how much speculative excess, how expensive are traditional asset markets at the moment? i should point at bitcoin and say we saw an explosion of value at bitcoin and other cryptocurrencies through 2017. that bubble burst in december. in many cases, cryptocurrency fell by more than a half. that's an example of the speculative blowoff that we were living through. i think now equities are starting to follow suit. i do not see a one-week wonder if you i see a. i see several months of quite serious falls from here. nejra: bitcoin broke above 11,000 and most of the
investment in bitcoin is retail investors. it's not necessarily institutional. are you saying bitcoin is a sign of our times when basically people are looking for risk and places for people to put their money? stephen: i'm saying it's of sheer speculation. it can go up or bounce back, but bitcoin still most half of what it was at the high. i'm not a believer at all. i think it is a speculative bubble. i'm 20 to the reality that speculation warmly and badly -- normally ends badly. speculation is a great thing. is's try and talk through there a trigger hear from changing direction of asset markets? i think there is. i'm pointed to changes in central bank to personnel and ultimately behavior. first of all, your point in the story before -- the decision
will be made next week on who will be the deputy ecb director. i think that decision looks more and more likely to go to the spanish central banker. that requires the dax for a big this i decision. who will replace mario draghi? there's on kind of eu decision-making driven by all sorts of political calculation. if a southern european takes the deputy's role and its seeming much more likely that the new president will be a north european and you have a very helpful feature on your website -- nejra: you say they might be german and that might be a faster pace tightening? stephen: i think a bit more than that. i think it's a complete change in style and direction if we have the very hot favorite. mario draghi is an italian. he is a goldman sachs alumni. he's a believer in intervention and he's created a narrative
that because inflation was undershot in the eurozone, then we will allow to do all sorts of unconventional policies. i think they will completely reject that in my opinion. nejra: overall you are seeing declines in your hanging that largely on this withdrawal a stimulus globally or something else? stephen: i'm saying there's a trigger. jay powell is now the chairman. we have a new personality. what do we know about jay powell? we know very little. he has risen to the top of the world's most powerful central bank really effort silly -- effortlessly and playing a centrist role. when bernanke took the job, we were able to go back and look at the academic papers he had written 10 or 15 years ago and we were able to create a narrative. once some interesting information was divulged last week, there's a whole load of detail about some of the fed minutes of 2012. during that time, there was
discussion about the next phase of qe. there were one or two dissenters. guess who one of them was? mr. powell. i'm starting to put together a narrative here that we have a different person here. he's the first person who is not an economist. he's investment banker by background and also an industrialist. when he was at carlisle, he ran the industrial group. as a consequence, he was actually running the whole load of u.s. companies. the little bit speculating here, but i'm starting to feel that he is going to be a different personality in a different direction of travel to the previous three fed chairman. howa: how would that change you would advise clients to invest in u.s. assets whether bonds or equities? stephen: i'm taking a very cautious view here. most equities, particularly u.s., are expensive by any measure. maybe there was a momentum trade through 2017. unless we see fresh highs in the market in the next couple weeks,
and other words it really gather steam, i'm saying very clearly hear there's an awful lot of reasons to say these are spence of assets. -- expensive assets. they may come from the ecb and the bank of england where carney will also go next year. in that environment where we see perhaps a normalization, that's all we're talking about. we are not talking about serious tightening. we're talking about normalizing. interest rates in the eurozone are -.4%. this is an anomaly. nejra: stephen isaacs, thank you so much for joining us, head of the investment committee. coming up, the latest in the race for president at the ecb. we will have all the details next. this is bloomberg. ♪
nejra: live from london, i'm nejra cehic and this is the european close on "bloomberg markets." just got some breaking news on the bloomberg, the your group has nominated lewis stick and offer the ecb's vice president role. this is according to an official. we have officials meeting in brussels. joining us now is alessandra special from bloomberg and maria taddeo from brussels. he has got news that been nominated for the ecb vice president role in this is an according to an official. is this the final decision or are we still waiting? fora: we are still waiting the formal confirmation, but this is someone who clearly has knowledge of the decision and it's no surprise.
we knew he was the front runner and ireland taking the crucial step to pull out their candidate from the race. we are waiting for that final announcement. this looks like a done deal now. nejra: and maria, you have been speaking to a lot of people on the ground. what have they been saying about this vote? indeed it's a controversial decision because it's very unusual to see politicians making this transition from government and to th into the central bank coul that's the whol. that's the whole point of a central bank is that it has that the independent -- to be independent from politics. the significance is not just him being appointed vice president of the ecb but what will happen in 2019 when mario draghi were retires? let's take a look. >> if you want nuts to fall in
your way forward, you have to go step-by-step. decide the vice president of the ecb. we think luis de guindos is a very good candidate. in 2019, we will choose the president of the ecb, but it will be another story. maria: that was bruno le maire. nejra: in terms of luis de guindos being nominated for vice whatent of the ecb, indications might this have for policy down the line, if any? tried too: he has portray himself as a hawk so to speak. you spoken in favor of austerity and a strong supporter of the
policies taken in the euro the past two years. economic performance has rebounded dramatically since the crisis. they have been taking the merit for liberalizing the job market and imposing austerity and shoring up public finances and so on. at the same time, spain, from which luis de guindos comes, is a southern european country, which has benefited from the ecb's current policies of qe. he does not have much of a track record when it comes to monetary policy. he's coming straight from politics to the central bank. nejra: that will be an interesting angle to watch here for sure. to a separate story that we have been looking at closely today. this is to do with a corruption probe of an ecb governing council member. what do we know so far? alessandro: from what we
understand, the governor of the central bank of latvia should be released right now in this minutes after a friend of his from what we understand paid bail of 100,000 euros for him. he is a suspect of corruption of taking a bribe. we don't know how this will continue. probably he will eventually be charged if the investigation is continuing. the real question is whether he will remain in his seat as governing council member. so far, the central bank has said his deputy will take his place in frankfurt. the prime minister has asked him to step down and says that it is untenable that he will continue to his current role. we will see if he wants to step down or not. nejra: does this make banks anymore difficult for the ecb?
what broader implications does this have for the central bank if he were to step down? alessandro: if he were to step down, it would be a matter of a lack of authorities. it would be more and more embarrassing for the ecb if you wanted to stay in his place while at the same time the suspicion under him is known where it can be corroborated or eventually convicted. given the european law prevent the banks from interference, it's very difficult to remove the central bank governor from his office unless he steps down. al a: thank you so much to essandro and maria. still had, we will hear from mario monti. why he says campaign promises can't be broken. ♪
nejra: live from london, i am nejra cehic. this is the european close on "bloomberg markets." former prime minister mario monti joined bloomberg surveillance this morning where he discussed the italian elections and the fall off from different parties as was the job the ecb has done. francine lacqua asked him if he is worried that the ultracheap monetary policy from the ecb has taken away the risks we have seen in italy and therefore italian politics. : the ecb made an extremely smart monetary policy and president mario draghi has been very smart in mastering the qe and he still has the support. i personally believe the phasing
out would be rather quicker than slower for some of the reasons that were mentioned for the u.s., but also for the european in italy for sure, a very accommodating monetary policy has on the perception of the needs to act on economic policy, on real policies. i believe that among the factors which explain why the elector so liberallye them and irresponsibly by all the political parties, one of the reasons is that there is no feeling of pressure whatsoever. francine: what would reality look like? is the real danger that reforms will be slow or lagging with whoever becomes the next prime minister of italy?
also, there are a lot of parties offering tax cuts. how do you find tax cuts in italy? mario: a positive to be put on no party, either populist or not, has any longer in their program the idea of leaving the euro, calling a referendum to leave the euro. indeed the issuance of costly promises is virtually limitless. what will happen? i'm not too concerned that these promises will be honored. luckily, they will not be honored. ut what will be the explanation of parties promising so much the day they have to cut down on promises? the culprit will be europe because european constraints will not allow them to fully deliver on the promises. this is the traditional division
of jobs between nation of politics and euro politics except that every round of this game, the gap between the domestic public opinion and europe grows. in may 2019ill have the european elections for the european parliament, i would not rule out that the settling down about livingdeas the euro might come up again as the populist parties, say six months from now when the european elections approach. then the discussion will have to be about europe. that was former italian prime mr. mario monti earlier on "limerick surveillance."
we just got time for the bloomberg business flash come a look at the biggest business stories in the news right now. neiman's planning an ipo of its health care division. the new company will be called healthy when he is. they're likely to use money from the stock sale to acquire money in the main businesses. it's a warning that it's a warning that's an end of the boom in london housing. according to write move, home sellers in to be more realistic about their price demand. the firm's report says that london asking prices were down 1% from a year ago. that is your business flash for this hour. just some breaking news crossing the bloomberg as well -- the allegationsg against him. this is according to his lawyer. this is a story about the ecb governing council member rimsevics. he was headed for release on
bail. or hasntry's prime in us been keeping pressure on him to step aside, but the latest we have heard is that he is denying the allegations against him. that is according to his lawyer. we will bring you more on that as we get it. of course, we are heading for the close of equity markets in europe as well in just over four minutes. we are seeing european equities posting losses so far in the session. coming up, banking on the banks. we will bring you an earnings preview of the financials. that is coming up next. we will bring you all the equity market action as well. this is bloomberg. ♪ ♪
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pick up that voice remote and just say "show me..." ♪ experience nbcuniversal's coverage of the olympic winter games like never before with xfinity. proud partner of team usa. nejra: from bloomberg's european headquarters in london, i'm nejra cehic. equities finishing up the day in european trading, but first let's check on the bloomberg first word news. before that, let's go have a
look at what is happening in equity markets. , we have seen broad-based losses across the region. european stocks declining. the u.s. had its best we can five years last week. the u.s. stock and bond markets close for president's day today and we are seeing european equities trading on the downside after the best week since 2016. the dax closing down 6/10 of 8%. the ftse 100 down 7/10 of a percent. broad-based losses on a regional level. if we switch it up and have a look at industry groups performing come on a headline level, you europe's equity bench level down. every industry group in the red. the one exception is energy stocks, getting a little lift from higher crude prices. on the downside come in the biggest drag coming from health care and consumer staples.
both those groups down more than 1%. if we have a look at what is happening in the fx space, we have seen a little bounce in the dollar in some parts of the session today, bouncing back from a three-year low. back below 140. the euro a little on the backside as it touched 125. meanwhile, sterling a little higher against the yen, but weaker against the euro. it's a mixed picture you are seeing across the fx markets, but resilient in the dollar in this holiday shortened week. looking at what we are seeing in the fixed income space, yields moving higher in the core and periphery. up three basis points. the bond markets are going to continue to trade for at least another 30 minutes. switch up the board and have a look at what is happening in the commodities space. we have been focusing the most on crude today and we saw wti jump more than 4%. both higher by more than 1%. 62.45 and some of that lift
may have come from the recent weakness we have seen in the dollar. jessica summers has more. jessica: thanks. there's a report that former trump campaign aide rick gates has agreed to plead guilty and cooperate with special counsel robert mueller. according to "los angeles times," he will admit to fraud related charges and agreed to testify against former trump campaign manager paul manafort. in florida, student at the high school where 17 people were shot and killed are speaking out for gun control. they plan to organize nationwide marches next month. some of the student's will go to florida this week to demand immediate action. singapore's increasing taxes to shore up savings to cope with an eigh aging population. singapore's goods and services tax will be increased by two percentage points to 9% some time in 2021 to 2025.
and the u.k., it's a make or break week for the pound. it's near-term direction is likely to be driven by economic data that could determine whether the bank of england raises interest rates within three months. traders will put the most weight on british unemployment seekers wednesday. global news 24 hours a day powered by 2700 was and analysts i'more than 120 countries, jessica summers. this is bloomberg. nejra: germany's largest bank is cutting at least 250 jobs globally at its corporate and investment bank. deutsche bank is trying to limit expenses and a sustained slide. the cuts could lead to over 500 layoffs. the bank trend senior and mid-level investment banking positions and locations including london and the u.s. he with more details is bloomberg's german banking reporter. he is with us from frankfurt.
great work on breaking that story. we have given a little bit of detail there. have you anything to add in terms of what we know so far? stephen: not really. i think all the interesting stuff in the story, but what we have to keep in mind is that this is part of the very broad strategy of deutsche bank to cut costs. i think what people will need to look out for is what is happening at the management level i think there is a bit of a struggle between the forces that want to cut costs on one side and ones that want to invest and expand investment on the other side. thosehard to reconcile and we will have to see how it plans out in the future. 22 is i think what you're the fact -- pointing to is the fact that deutsche bank is no closer to improving revenues, the top line. how does that feed into that challenge? steven: that's exactly right.
the challenge is to increase topline while cutting costs at the same time. obviously it's a big conundrum. right now, just that the beginning of this month, john cryan announced they will pay a bonus in the investment bank because they have had a problem hiring and retaining talent there. it's an investment in the bank and they said they will not do it again unless the bank shows the corresponding performance. it hasn't in the past. it is still lagging rivals. it is struggling to grow revenue. unless it is improved, the cost-cutting exercise we are seeing right now will likely prove counterproductive. nejra: we are seeing deutsche bank shares at 2% and the markets closed now. we have seen a little bit of a game. do we get a sense that investors will take this news well? steven: i think so. certainly they have not taken it badly. it is a clear sign that
cost-cutting remains a priority. it is a focus. the bank is struggling to become profitable again and john cryan is known for cost-cutting. he has a cost target this year for 2018. he is showing now to investors that he is trying hard to contain costs at the bank and that's something they like. the same time boost revenue, people will ask questions where is this going to take the bank in the future? nejra: thank you to steven arons. great to have you with us. it's a big week for european banks as investors are awaiting earnings from top lenders. hsbc reporting tomorrow. barclays on wednesday. rbs on friday. for more, let's bring in stephen morris. also in that list is lloyd's. we have for you can't banks reporting this week. are there any themes that we can
draw? stephen: one of the major themes we have seen the last few years is just how long and has taken the u.k. banks to restructure themselves and really get themselves on sound footing and a position to grow again. we are seeing that at lloyds, which is preparing to unveil a new strategy. it will be interesting to see what they have to say. unfortunately if you work there, it will probably involve more job cuts. onlly we are focusing barclays later on this week, which faces a lot of the same questions that steve just talked about over there and fran in frankfurt. does that cut costs? does it abandoned the investment banking strategy? does a double down and gamble on be in the last man standing in europe? yielding revenue down the line. the question is whether investors will have patience for dnother backorders -- ba quarter of earnings at berkeley.
-- barclays. nejra: hsbc the first of the four to report. is it likely to set any sort of tone? i know the key is the asia business. stephen: that's exactly right. increasingly more of its earnings are coming from asia. it does have strength in the u.k. retail business. what we see happening in margins and profitability on brexit will obviously set the tone for the rest of the week. we've also got a ceo change. andas been there since 2011 is handing it over to another long serving insider. it will be interesting to see what the outgoing ceo has to say about his time there, which was not as always smooth as he helped. he is handing over a bank in pretty good shape so we will see if the new ceo has anything to say about where he plans to take it. nejra: what can we expect from rbs as well, the last report at the end of the week? stephen: rbs is still struggling. it's almost an exactly the same situation it was last year. it still has very big litigation
cases to settle in the u.s. until it settles those, we will not get a very clear idea of where it stands from a capital earnings perspective. we are looking from any commentary on whether that has moved on from donald trump's department of justice. the media a lot and the u.k. has been one of the units, which is accused of driving small businesses out of business basically by not helping them out as they should come as you would expect from a state owned bank. we expect executives to catch a lot of flak over that. there's a report that may or may not be release, which would be another damaging thing for rbs's repetition. nejra: how much focus would there be on the ppi scrutiny? stephen: it should be coming to an end by the middle of next year. there's a big advertising campaign fronted by arnold schwarzenegger just to make sure that anyone who was mis-sold these financial products may be compensated from it.
this may be the last time we get hundreds of millions, which has been a constant theme the last decade. i forget the actual figure, but it is far north of 10 billion pounds for each of the banks involved in the scandal. it is interesting to see how much more that takes off earnings. nejra: we look forward to reading your story. thank you to bloomberg banking reporter stephen marsh. you don't want to miss our interviews with barclays ceo jes staley thursday on bloomberg television. coming up, it is the first e-commerce transaction of its kind. how nike customers bought on snapchat. this is bloomberg. ♪
nejra: live from london, i nejra cehic. this is the european close on "bloomberg markets." the mba wrapped up its annual all-star weekend in l.a. saturday was the 30th anniversary of michael jordan's legendary slamdunk contest. what better way to celebrate than two prerelease the air jordan sneaker? it was the first time the sneaker was released on snapchat, allowing customers to purchase the shoe on the app and have it delivered within hours. this was all made possible by nike, snapchat, and shop i fy. joining us now is lee. great to have you on the program. as far as i understand, it's the first time anything like this has happened. explain to roll what -- the role that dark store played in this. .ee: it has 40 urban at systems nationwide and the jordan brand over at nike
pioneered this revolutionary way of releasing a sneaker. they were the first ever brand to drop a sneaker on snapchat. snapchat users bought them and receive them within hours. nejra: wow. does this mean that this could be a new way for people to buy products like this was this a one-off promotional thing? lee: no, i believe this is going to be a new paradigm. as you saw, there's a snap cap -- snapchat code that user snapped and scanned and that allowed them to bring up the air jordan sneakers. imagine that on a bus stop or advertisement or sneaker in any store. snap it and tap a button and it's in your hands the same day. nejra: dark store as far as i understand kind of works in the fulfillment area. it does not sound incredibly exciting, but actually you do play a crucial role. you hear the word fulfillment and think how exciting is that? sell it to us. what does that mean? lee: they can sell itself.
has 100 76. it centers nationwide in the u.s., 43 are which to our delivery hubs. you are the only one who does want to give consumers that amazing customers experience. folks like nike are the first to ever enable their customers to have that fast delivery experience. nejra: is this a potential disruption for the likes of amazon? lee: we believe this is the potential disruption for every brand like nike who wants to sell direct to consumer and not have this intermediated consumer experience through a middleman like nike. you would go to nike and just like last night, you buy it from them and get it delivered within hours. you don't have a middleman could you are really creating this emotional connection with the brand and nike is the first ever to do this in a very ubiquitous setting last night in los
angeles. presumably iss highly reliant on social media and therefore, is it sort of more targeted at a much younger audience, maybe just millennials and generations there? lee: last night was targeted toward the millennials and it was the first ever sneaker to drop on snapchat. willwas the paradigm that eventually take off in its own way, but we believe the other brands are going to do this direct consumer on their own website. we are working with other brands as large as nike that are doing it as well. it is on social media, but it's also direct to consumer on their own channel. nejra: what sort of interest have you had from investors in dark store? are they as excited as you and the concept? lee: i think they are even more excited. we have raised over $2 million in venture capital and we are about to announce a series a of $10 million. we believe investors are just as excited as we are.
nejra: would you ever consider going public or are you not at that stage yet? lee: we are a small company and very focused on our mission. we do intend to scale the company and grow to be a multibillion dollar company. wherever the universe takes us, we will go. obviously ans exciting and unprecedented development with nike and air jordan. what other brands could this work for, this concept of using snapchat to buy directly? jordanr jordan and the brand specifically was the first ever to drop their sneakers and the first ever brand to release a product on snapchat. other brands that use dark store are tough and needle. these guys make a premium headphone. it's a headphone that goes over your head. floyd makes a bed frame that comes in a box. website ato their
floyd detroit.com and you are in new york, you can receive it in three hours. we focus on very large brands to direct to consumer brands have this customer experience that has same-day delivery within a few hours. nejra: all right, i don't know if you are wearing any air jordan's. dark store ceo, thank you for joining us. very interesting conversation. time for the bloomberg business flash, a look at some of the biggest business stories in the news right now. in israel'sners largest gas deal have signed a $15 billion agreement to export gas to egypt. houston-based noble energy and derek drilling will supply natural gas for 10 years. the tel aviv stock exchange oil and gas index rose as much as 15%, the most on record. in italy, fake twitter accounts have rocked back to life in the runoff to the march election. facebook has taken out ads asking italians to flag dubious post. the problem is box come automated accounts that masquerade as real people.
the council warns that the italian campaign be vulnerable to manipulation using these robot accounts. polls indicate no clear winner. "black panther" is a box office smash. the latest movie from marvel's unit opened with retail sales of $192 million in north america. that's a record for a february opening and will likely become the biggest movie ever starring a largely black cast. that's the latest business flash. coming up, billionaire ray againstbig short bet italian banks will cost and year. -- cost him dear. highlights from that interview next. this is bloomberg. ♪
this is the european close on "bloomberg markets." cracks are appearing in the center-right bloc. the coalition is feeding with itself over who should be prime minister. an investment see you spoke with francine lacqua on "surveillance" today about the vote. she asked how it will impact ecb bond buying. theell in a way, remember issue is that inside the ecb, the only true risk of the monetary system is whether italy has to think about leaving the eu. first of all, it's unconstitutional, so you cannot even have a referendum. you need to change the constitution first. italy try to change the constitution and it failed. so secondly if you are to take a 130 business pointspread, you multiply that by seven and that makes about 9%.
you assume the potential euro devaluation equal to 40, but he -- 25% calculated from the back of the envelope of italy leaving the euro. consider the parts that want to stay in the euro, but the 25% probability is very high when one party does not want to even discuss it and say we are 100% and it. the spread has upside, meaning it could tighten further simply because it is for the euro. francine: you are telling you this can tighten? davide: yes, not the absolute yield. the bund at 60 or 70 basis points can go higher. the same for italian bps. is vis-a-vise german bunds. that can tighten further with
both of them widening. francine: the euro-dollar one point .415 at the moment. where do you need this to be for italian exports? davide: here the question is italy went through a severe recession from 2008 to 2014. gdp collapsed by 10%. the gdp is 50% of public, the private sector gdp collapsed by almost 20%. of 25%s led to a washout of industrial action, which is the reason why it is consistent. where can survive and its left, it strong and able to compete. what you are seeing today besides the italy export is the fastest-growing outside of germany and is still the fifth-largest because whatever is left of the industrial capacity is very strong. i think italy can easily compete with the euro no problem whatsoever as far as exports are concerned. dalio going to
lose money on his big short? davide: i think he will lose money because we are one of the largest investors in italian mpl. we have seen tremendous value in some of these asset classes. the market is overly worried about an asset where there is value. as most banks are cleaning up the balance sheet and they are ofning the european level nonperforming the lens the next two or three years, the profitability will go up strongly. i think it is very hard to have an economy growing at 1.8% with an inflation of 1.5% so a of .3%g nominal gdp growth where in hedging in the u.s. you are close to the 2% level. what ray is missing is that it goes from -40 20 the italian
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