deal. we thought we had a breakthrough between china and the united states. we get to work on monday morning and we are not for sure. what are people talking about? are they encouraged in any way to take more risk, given the confusion? on friday, there were hopes of an interim deal. china coming out here today, as expected. they said they want to talk again before signing a phase one deal. it has been a good run. it is a headline driven market. we are at the top end which happens to be record highs. it does not make sense taking additional risk at these levels. guy: a bunch of things that contribute to what is going to go on in oil prices as well. has this been a rally? >> it has been a rally to say. we came up $50. i have been a big fan of crude oil. there has been uncertainty with the iran attacks. we were getting short futures and we were doing some buying to protect our upside. coming out of the weekend, knowing what has happened, there were big question marks. i think we are targeting 51 to 50 in the near term. $48 in the long term. guy: 47? does it go lower than that? there are

real yield starts now. coming up, u.s.-china trade talks ramp-up in washington. little sign of anything testing the federal reserve's patients anytime soon. credit grinds tighter. is the good news baked in? is it time to start fading the rally? >> this is a good time for investors to de-risk. >> owning more cash than normal. owning more high-quality bonds. >> time to take -- off the table. >> owning less high-yield, less levered companies. >> our tendency is to reduce credit risk over the next six to 18 months. >> there is a cap on the outside in credit. >> helping the portfolio toward high-quality, investment-grade corporate bonds. >> ultimately, you will have a pickup in defaults. >> the headwinds are the fact that the market has priced in a lot of good news. jonathan: joining me around the table is invesco advisors chief income strategist, and in london the senior investment manager at aberdeen standard investment. is it time to fade to strength ?it is a good question. >> the turnaround from the fed has been so rapid, so sharp that i think it is difficult for most of us to c

order to prioritize oracles of intelligence. help thealth -- to u.s. they had of china. and inside an apple so-called black site. new report reveals the not so conditions forng the tech giants contractors. and the new york city mayor defending of the deal to bring amazon to the big apple, but will the backlash while over? besident trump wants u.s. to a leader in artificial intelligence for years to come. he has signed an executive order to launch what he calls the american ai initiative. it comes less than a week after the president stressed that investments in cutting-edge industries in the future for the united states. our reporter covers tech corporate lobbying in -- ndc and we have this ceo and cofounder wants to secure an open and symbiotic relationship. how big a deal is this executive order? >> we will see how the impacts play out, but we are excited to see that the administration is an important initiative. south korea has a billion dollar industry, france invested $1.8 billion. many companies in china are investing. if you look at the investment around the world, is something

trade talks in china. this is bloomberg. ♪ ♪ >> i am caroline hyde. >> i am romaine bostick. >> i am joe weisenthal. >> we have talks beginning between china and the u.s.. >> the question is what did you miss? >> president she is helping to start u.s. and china negotiations on the right foot. the secondll make it know in dollar deal of the. taking matters into their own are banningbrokers together to form a new u.s. stock exchange. meanwhile, the u.s. and china are kicking up another round of trade talks. by top chinesed officials. >> they've given each other 90 days. we should use that time. these agreements are never done early on. they are always done on the last light of those negotiations. that a positive signal there are ongoing negotiations. >> i think he would like to deliver a win. for theobably possible chinese to offer enough for him to declare a win. we will probably see some ups and downs between now and the end of the 90 days. >> this is a very short deadline. we can't be optimistic about a whole lot. ultimately there is a lot of the table. that is pushing the two leade

over the internet in their country. emily: would this look like china's internet? ryan: that seems to be the implication. they are looking to test their own version of the great firewall so that they could not only censor things they have been censoring for years now, but also have control over what communication channels are viable, preventing people from using something like whatsapp, facebook, etc. emily: what kind of firewall do they have in place? ryan: for many years, they have had many systems in their country's internet service providers. they could see pretty much everything that was going on. they have also in recent years developed capabilities to actually block things, and through the legal system, they have started to ban things like storing russian people's data in other countries. just last month, they wrote to facebook and twitter and said, you are not storing russian's data here in russia, you are in violation of our laws. emily: what are the actual mechanics of this? presumably, this can be done. ryan: it can be done and many countries do it. china is obviously the m

china. deal,re going to make a they aren't going to make a deal, they have no idea. it's fake news. to they have fake news in china? i thinks. both parties want to make it a meaningful deal. i can speak for the vice premier, i can speak for myself. not a deal that is done and doesn't mean everything that mean anything. we want to deal that is meant to be good for both countries. china has the advantage of many years of tremendous success at the united states. china for that. our leaders have done a lousy job with trade. our country lost $800 billion with trade last year. said sameremier agreement should have been made 20 years ago. for 20 years the united states has been taken advantage of it i'm not blaming china. we have presidents that didn't do their job. i think the mru is going to be very short term. to me they don't mean anything i was never a fan of an mo you -- anything. i was never a fan of an mou. >> it's an actual contract between the two parties. a memorandum is a binding agreement between two people. detail, it's great just called a memorandum for a legal term. it's a con

china resume. optimism driving junk-bond toward a fifth straight week of gains. yield hit 20-month lows. the new york fed rolling out an old tool, funding markets signing some stability. a fractured fed meets a wall of skepticism. >> a lot of dissension in the ranks. >> there is a little bit of a split in the dots. differenceshonest of opinion and how vulnerable the u.s. economy is. parts of hand, certain growth, especially domestically, that are holding up. >> you can make the argument that the fed should not do anything. >> on the other hand, you have trade war, geopolitical risks. capex spending is going down. >> you will find more and more divisions in the committee. joining me here in new york city, priya misra, diana amoa, and krishna memani. priya,egin with you, your thoughts on the potential of another rate cut before year's end? priya: we are looking for another rate cut in october. in someis putting insurance cuts. our view is the consumer will show signs of stress, so we see the fed cutting three more times next year. i think relative to where they were in july come in j

u.s. and china. you have a growth that finally kicked up the high level and that makes people nervous. >> we've actually seen an economy that is slowing in terms of growth. but not stalling by any means. across.nty is generated the shutdown ultimately will affect productivity. it certainly does not make our job as dozens leaders easier. >> economic cost paid by the u.k. consumer u.k. industry because it has gone on for so long. andll eyes on this talk hopefully will share some good news. i hope something positive will pop up. >> we have all this uncertainty and the possibility that it's slower than people expected last year. >> we are likely to see weak first-quarter. i think the fed is going to pause and whether the resume will largely depend. tablening the around the is the portfolio manager, chief investment strategist at private ,ank america, plus from london international cio of fixed income at jpmorgan asset management. becauseo start with you in london you are bringing us the global european perspective. talk to me, in that soundbite that we just had, a lot of , are thoseom dav

begins building its $5 billion factory in china, which will shield it against import tariffs but will it protect it from the ongoing trade war? why the start-up overhauled is business model in europe and changed its hiring strategy as a potential i.p.o. nears and the consumer electronics show gets into full swing. we'll look at what tronalds look out for. first, tesla breaking ground on its first planled plants outside the united states. c.e.o. elonl musk was in shanghai on the ceremony to get construction started on its $5 billion factually. they didn't break ground in the traditional sense but he can kicking off a new timeline. what is the timeline for this factory to come to fruition in china? >> it's very aggressive. they want to build in factory in 2019 and have model 3 production by the end of the year. the tremendous month plant was a plant they brought from toyota and g.m. this one they're starting from zero from terms of construction. emily: what will a china plant mean for tesla's business? will this really protect the depeanl from political machinations? dana: that's the ho

market. >> the fed is easy, the ecb is easy, china has been easy. >> all of them signaling they are willing to hold for much longer. >> that's good for risk assets. it's no surprise that they shot out higher. high yield is up 7%. >> the default rate is extremely low right now. >> corporate credit spreads are narrow. >> called a trip these, quality single a's. there will be a bid for them and we are comfortable holding those. >> a tremendous amount of movement within the fixed income space. >> it's wonderful. after three years of raising rates and running down the balance sheet, the fed is called a truce on us bond investors. jonathan: joining me around the table to need the conversation is greg peters. marilyn watson, head of global fundamentals at blackrock. george ross and i, cohead of fixed income at wells fargo investment institute. maryland, let's begin with you. it has been a buy everything global market rally. the something have to give here? . marilyn: i think we've seen a sea change in the fed and global banks. the fed is on hold for the rest of the year. the data has been

extend the tariff truce with china and take steps to sell the deal to lawmakers. uber's losses continue through the fourth quarter of last year. sales are slowing. what does this mean? and bezos fails on new york. the fallout from amazon scrapping its hq to plans. how this could change how all companies do business with government. tech -- talksde will continue in washington. two days of high-level talks in beijing have wrapped. the chinese president says negotiations have achieved progress. president trump was positive about some kind of a deal friday. >> tariffs are hurting china very badly. they do not want them. if we can make the deal, it would be my honor to remove them. we are having billions of dollars pouring into our treasury. we have never had that before with china. the u.s. is scheduled to raise import taxes on billions of chinese goods if the world's two biggest economies cannot resolve their differences. sarah mcgregor joins us now from washington. what we know about what kind of progress is made? >> that is a great question. we keep hearing from the trump administration.

good place. as the united states and china look to close out of phase one trade deal. we begin with the big issue, an unexpected solid payrolls report. >> this is certainly a solid labor market report. >> very solid report. >> good numbers. >> strong. >> strong. >> across the board. >> the jobs number did not disappoint. >> we've not only had a strong report but a revision higher. >> the upward revision to the prior two months. >> don't write off the economy just yet. it's got a lot of fuppedmental strength. >> the u.s. economy is very resilient. >> a lot stronger than people think. >> the fed is in a good spot. >> i don't think that the fed does anything differently as a result of this other than pat themselves on the back. >> a pat on the back. >> this is like a picture perfect soft landing is what they're on track for. >> joining me around the table, bob, prima and gershen. to begin with you a solid payrolls report. i thought we would make this show by making up excuses for a weak jocks number. we we have a strong -- jobs number. >> i don't think this number told us a whole lot.

slowdown in china. the market volatility, the yield curve flattening. does it worry you that maybe markets are seeing something you may not be? >> the way i think about it is they may be pricing the risk a little bit more likely than i would expect. so if you look at both the forecast that are provide by the f.o.c. participants and summary of projections if you look at private forecasters, they're not seeing the risks that we're seeing in financial markets. i can tell a more dire story. i just think it's less likely than it seems like financial markets are pricing it at this time. so my baseline expectation is that markets will reprice and reflect the fact that the economy is doing better over time. but there's risks. you have alluded to some of them. china is slowing down. their financial -- there are financial stability issues that i think are relevant in chi in terms of the leverage they have. they do have concerns about whether the slowdown will be more substantial. and they are engaged with the united states in trade negotiations that if they go poorly will have a much manufacturer di

one market, 25%. now asia is strong too. asia, china will become bigger and bigger. there are billions of consumers there. david: let's talk about how you came to l'orÉal. you corrupt -- jean-paul: harris. david: did you say i want to run l'orÉal one day? jean-paul: not really. when i was 15 years old, i was trying to understand what job i want to do. i had three ideas. one was to be a psychiatrist. how you say it? david: eight psychiatrist -- a psychiatrist? jean-paul: yes, or a movie director. david: ok. jean-paul: for business. i chose business. in my job every day, i do a little bit of the three. [laughter] jean-paul: marketing is understanding the desires and .reams and wishes of the people it is a lot about movie direction too, because you create the images and everything. i was it able to put it all together. david: i think you took a finance class in school. the professor said you are good in marketing, not finance, right? jean-paul: yes, yes. i know you are a finance expert. i have to admit i am very bad and finance. i chose the finance major because it was trendy a

for europe to have some sort of qe program. china predicting some stimulus. onit has been settle treasuries. in germany, 16, 17 basis points over the last four days and hardly any attention and hardly any this option elsewhere, what do you think? >> we have been tactically our duration recommendations to investors. at the same time, it is going to be hard to fight central banks. this is not 2009 when we saw the first inklings of qe and everyone thought it would be inflationary. we are not there. inflation is going after the u.s. because of tariffs. we can't forget that. there was a tariff effect in the cpi number yesterday. that is not the good type of inflation that bond markets will respond well to. it will be hard to fight central banks. i would not be recommending an underweight duration position at this point. jonathan: i am sure you enjoyed some of the price action. >> it is interesting look at the last five easing cycles, the big move down and rates have been before the fed also trigger. maybe it lingers a month or two, not long after that. the market gets ahead of the fed

. it is still early. nobody has made a lot of money in the u.s.. in china, people have been more successful monetizing podcasts across alibaba and other platforms. it is a big opportunity for them. they have the users. i'm sure they are going to push the podcast to people. it is all about gross margins. the stock is down a little bit today. they gave a little weaker gross margin -- margin guidance. it came back a bit at the end of the day. this is about how do you get less reliance on the three major labels and all of the negotiations are coming up this year as well. >> do you think that spotify taking a step into this market could lead apple to make moves as well? >> absolutely. apple music has become increasingly important to them. services have become an important. it will be interesting to see how apple begins to monetize podcasting. maybe a subscription related thing to podcast. maybe original content in the podcasting world. there is a lot of opportunity there for apple. shares got punished about revenuerns per user shrinking. i think the stock was down on gross margin guid

the two countries agreed to a rollback on tariffs. thee duties now applied to majority of china's exports to the u.s.. longtime republican operative says he never lied to a u.s. intelligence panel. they are telling a different story and use his own testimony from 2017. today evidence stone held nearly 50 calls with members of the trump campaign, this in connection to his communication with wikileaks. the labor equality spokesperson wants to become its deputy leader. the declaration coming after the current deputy announced he will step down. this on the day of the upcoming election campaign. butler speaking exclusively with bloomberg in london. >> i thought very carefully. we should replace tom and after giving it some thought, i will be throwing my hat in the ring. i have a track record of being very supportive to our leader, jeremy corbyn. in his showed the labour party is on the front foot. viviana: butler's emergence showed how much power has shifted to the socialist wing. gunmen ambushed a convoy leastorting workers, at 38 people were killed in the assault. they say it is the

going up. bonds going up. >> this is a gift in the market. >> the fed is easy. china has been easy. >> all of them signaling that they are willing to stay on hold for much longer. >> that is good for risk assets. no surprise they shot out higher. high yield is up 7%. >> -- is extremely low. >> quality triple b's, quality single a's. there will be a bid for them. >> a tremendous amount of movement within the fixed income space. >> after three years of raising rates and running down the balance sheet, the fed has called a truce on bond investors. jonathan: joining me is greg, marilyn, and george. let's begin with you. it has been an interesting global bond market rally. does something have to give? >> we have seen a change in terms of central banks. we have seen the complete repricing of the fed. it is very much on hold the rest of this year. the data has been weaker than a lot of people expected. the first quarter is generally pretty weak. you expect the data to start to come down. especially in the u.s.. we have seen a lot of concerns around global growth. central banks do nothing.

china competition. >> there are so many reforms required for the asean country to be able to design and develop deepening financial sector or financial system. then, also creating an instrument based on the local currency. with that, you are not going to be affected mostly either external or regional factors. so you are more or less in charge for your own economy development. haslinda: financial inclusion is a key focus for the region, but financial literacy is still quite low across the region. how challenging is that, and how do you bring everybody on board? >> indonesia is one of the cases in which the financial inclusion we are still behind, just like india. we are maybe the two largest economies that if we make progress, it will make a lot of difference globally. >> asean's role in the global economy is a mathematical inevitability. we are now $8.3 trillion per year plus economy growing at more than 5% per year, so 14 years from now, we are going to grow to be an extra $7 trillion figure economy out of a roughly hundred trillion dollar per year world economy, so we are a signif

. >> china, europe. >> the eurozone. >> close to a recovery. >> data is encouraging. >> europe has many existential issues. >> structural hurdles. >> structural problems in europe. >> this year worse than people expected. >> so awful over recent months. >> the u.s. economy is doing well. >> the u.s. is not doing poorly. >> the u.s. economy may be stuck here. >> the u.s. was stable last year. there is a pass off to china and improvement occurring in china. a big week for economic data worldwide and to discuss is free from his rough -- priya misera and victoria fernandez. we have had u.s. retail sales, data out of china and eurozone pmi. what is your conclusion this week? ?ictoria i think we did get a mixed bag as the people on the clip were saying. we are still going to have positive momentum in the second half of this year and is long-term investors that is what we're looking at. of had positive numbers out china. gdp was where they expected, industrial production was good. you are seeing the stimulus finally starting to feed through and beijing is probably not done yet. that is going t

rate. also, during the hawkish rhetoric and saying they will focus. u.s. and china trade negotiators now working to hammer out details. for more, let's welcome our guest. always good to have you with us. how substantive a deal can we expect by the march 1 deadline before u.s. tariffs are expected to increase? >> they are working around the clock. i think it is going to be a bit of a push to conclude all elements of this by march first. i would not be at all surprised if that date slips a little bit. i think they are looking at the prospects and possibilities of a summit between the two leaders later in the month. the real issue is that the united states has signaled rather conclusively that they need a deal. they not only want a deal, but they need a deal. the president is going into too big potential engagements. one in north korea and one in china in which he is basically indicating that he wants something substantial. >> does the president need a structural deal on reforms in china which include a forced technology transfer ip theft or could it be to lower hanging frui

closed up china. monday tends to be a good day for chinese stocks and it is continuing that way. the pound falling as we get word that theresa may does not have the support for her deal. 10 year yields are near negative for the first time since 2016. can you believe we are back here? david: i cannot believe they .ere that far, the bund yields today at 8:30 eastern time, we will get u.s. retail sales numbers for the month of january. tomorrow, u.s. cpi data, and the british government will have a quote meaningful vote on theresa with furtherone, votes scheduled later in the week in the plan is defeated for a second time. on thursday, u.s. ppi and durable goods numbers. congress, that npc finishes in beijing. and we will also have the skinny budget from the white house today. ,e kind of know what is in it cutting all discretionary spending by 5%. and that means we will not get a balanced budget for the next five years, like, because corporate tax rates are down. lisa: i have to wonder, even bond traders don't seem to care. when they are not pushing back them up and why not just keep ex

slide since december. plus, retaliation. china will establish a list of "unreliable foreign companies" they say hurts chinese firms. ft still holding ground in the big apple. first, to our top story -- u.s. markets posted a dramatic slide today as global trade has spooked investors. the endt weekly losses of last year while treasuries rallied for the fourth year as the trump administration's trade spats are on multiple fronts. and the s&p had its worst month of the year. we want to bring in michael regan from new york. a lot of different things going on. where did we see the bloodshed? >> the bloodshed was widespread. nine of the 11 main sectors in the s&p 500 were down. theeally stems from surprise announcement of potential tariffs on mexico. no surprise that the president is ratcheting up the immigration rhetoric with mexico. u.s.-mexico-canada have a trade deal that i think most of the market had assumed was near the finish line. it was recommended to go to the senate in mexico by the president there last night. it was believed that the u.s. congress would be voting on is soon. tha

u.s. and china resume. a little optimism driving junk-bond toward a fifth straight week of gains. yield hit 20-month lows. and the new york fed rolling out an old tool, funding markets signing some stability. we begin with the big issue. a fractured fed meets a wall of skepticism. >> there is a lot of dissension in the ranks. a division 7-3. >> i am surprised bullard went as far as to dissent. >> there is a little bit of a split in the dots. >> there are honest differences of opinion in how vulnerable the u.s. economy is. >> on one hand, certain parts of growth, especially domestically, that are holding up. >> you can make the argument that the fed should not do anything. >> on the other hand, you have the trade war, geopolitical risks. >> manufacturing is slowing down. >> capex spending lower. >> you will find more and more divisions in the committee. >> they want to see more cuts by the fed. jonathan: joining me here in new york city, priya misra of td securities. diana amoa of jpmorgan, and krishna memani. of invesco. let's begin with you, priya. your thoughts on the potential

%. is this an apple problem or a china problem? it is a little bit of both. remember that the smartphone market has been challenged. out, apple is a luxury good in china. we also have to consider there are geopolitical issues at play. apple is a large american brand. the chinese consumers are starting to feel the concerns around the trade war. perhaps reacting against apple to some degree. i think that is part of the issue. .e will hearwe more i think that is definitely a factor. is this good news for google? are people switching to android phones? >> i'm not sure it's a win for google because it is a broader smartphone market issue, not just apple. there is the potential that google and android could grab some share back from apple. the vast, android owns majority of smartphone market share. at most, it is a modest uptick for them. it is a smaller factor long-term. the bigger question is what is apple going to do in reaction to this? what are suppliers going to do? clearly i think there is going to be a challenge for apple in 2019. smartphone market challenges are on top of t

compensate for losses from u.s. trade war with china. under the new program, eight for most crops will be calculated based on what has grown in their county, rather than individual farmers plantings come in order to avoid influencing production decisions. secretary perdue says farmers can expect to receive their first payments on july or august. in missouri, residents are cleaning up after tornadoes ripped through the state, killing three people, injuring nine, and causing extensive damage. twisters have swept across the great plains and midwest over the past several days, along with violent thunderstorms that have led to widespread flooding. at least seven people have died. the severe weather is expected to continue today as the storm system moves east. man charged in the pittsburgh synagogue massacre was to clean not guilty in exchange for a lighter sentence. authorities say he killed 11 people and wounded seven at tree of life synagogue last october. he faces 63 counts including hate crime's. like to, carlos ghosn's prove his innocence has moved to the courtroom. the former nis

. and can elon musk be the voice of reason in u.s.-china relations? we will bring you the latest from his meeting with the premier. ibm took another step towards tonging superfast computing commercial reality. and the ceo sees results coming as soon as 2021. she delivered the opening expote at the largest tax and highlighted what she believes is coming next for ai, data, and quantum computing. and how it is impacting business and their clients. we spoke with her after she delivered to her remarks and talked first about ibm's relationship with delta. had a great conversation with ed bastion at delta and we have done a lot of work together and it boils down to how you can make the flyer's experience better. yournizing who you are and history without saying anything. if your flight is canceled, all the work we have done to build ai to say this is the flight you should take and to predict the kind of compensation for the situation. at the other end of the spectrum, it is maintenance. and we made a big announcement today on whether. we own the weather company. this is a huge announcement a

pause, china stimulus, or trade truce, has the greatest potential to influence price swings. >> the trade war is interesting. it has the potential to be resolved quickly. there is no question that the economy is strong right now. but has the market run ahead of the economy? everyone wants to sell on the highs. when the market is near all-time highs, especially given the head fake in q4, it does not take a lot to shake a leaf on a short-term basis to shake confidence. scarlet: there's a lot of nervousness. we also knew the market calm could not last forever. who benefits from this hiccup in pricings? >> there are two groups that benefit from volatility in general. that's market makers and exchanges. they increase opportunities for trade is great for market makers, as well as transactions happening, could be good for exchanges as well. >> speaking of winners, a lot of people think when the trade talks wrap up, it's good for smaller companies, they get revenue domestically. you have our rvrs, reverse half weighted s&p's. the smaller large caps get a bigger weighting. talk about how thi

managers index is from around the world, from china to europe to the united states. we will see if it gives us any kind of signal. basically, the fed and others say we are slowing. we are slowing from unsustainably high growth to trend growth. that is not a recession. we don't need to react immediately. alix: regardless of why, it is having some whipping action in the s&p for dividends and financials. gina: first, i just want to reference the fact that we have been here before. we've been in a negative yields situation in the euro zone. and things were really bad. we were there in 2016. but i want to stress the fact that negative yields are not a leading indicator for equities. they are actually a lagging indicator. if you look at what happened to come equities bottomed, and three months later yields suddenly crashed into negative territory. coincidentally, the same thing is happening again. we didn't have a yield curve inversion, but you had similar behavior. the yield curve followed the early market in the initial stages of that advance, and then flattened materially, and there w

concerns around china. but overall, issues when it comes to corporate numbers. joe: just remember, december was so intense, so dramatic. there were so many white knuckle days. how long ago does it seem like steve mnuchin letter that came out of nowhere about blank liquidity, people were freaking out. here we are to some extent seeing that's not back after that extreme of pessimism. scarlet: seems like we made a complete 180 here. maybe i spoke to early. -- too early. caroline: amazon coming out with fourth-quarter earnings. 20% growth in terms of sales that forecast 56 to 60 billion. 61 billion for the first quarter. they are but he guided us to the downside for a certain extent. forn terms of the breakdown fourth quarter, amazon sales had met sales of $7.43 billion. analysts were looking for 842% increase. 42% plus growth in amazon services. overall, $72.4 billion, higher than the estimates. seeing to 72 billion dollar general expectation seeing it lowest revenue growth since 2015. >> we are joined by the ceo of activate, a strategy firm and cohost of bloomberg surveillance. when you hear

manufacture data in china raises concerns as trade talks end with little progress there. escape from new york, dropping plans for a second when reporters in queens. -- headquarters in queens. francine: good morning, everyone. good afternoon if you're watching from asia. welcome to "bloomberg: surveillance video -- surveillance." we had retail data out that it was of concern to a lot of market participants. a lot of these european stocks are looking at earnings, some of them better than expected, we are trying to see if there is a breakthrough in those negotiations. 2.65, andury yields if you look at the pound, is one .2802. theresa may's government was once again defeated in the house of commons and that we look to february 27. francine: coming up, we speak to a former chief executive microsoft and the owner of l.a. clippers. let's get to bloomberg first word news in new york city. >> few signs of progress in the u.s.-china trade talks. the latest round of high-level negotiations wrapping up time is running out to avert an increase in u.s. tech increases. trump says he is open to letting the

? david: how concerned should we be with china? ♪ ♪ david: if we listen to mr. carney, the governor of the bank of england a solution to the , problem is not brexit. at least not a disruptive brexit. it's fair to say, we have some projections now in case of a disorganized exit. what do you make of those? do you agree with them? are they overly negative? gdp, was 8% reduction in 25% reduction of the pound. they were pretty dire. jes: if there is a real hard brexit, where there is not an understanding between the european union and the u.k. on an orderly separation of the rules of trade, the governor -- while it's very hard to predict, i think it's a good enough estimate of what might happen. you are seeing it in where the sterling is trading. bank, as ceo of a major how do you plan for that? do you have to plan for a hard brexit no matter what? jes: the sunday after the referendum vote which was on a thursday, the whole met,tive committee preparing for hard brexit, almost two years ago. for and --n hoping and organized separation. we have been preparing for a very hard one. we had a bank su

two decades. china is in focus. apple has become the latest and biggest corporate casualty of the pullback by the chinese consumer, and the company says the trade war hasn't helped. is this just a china problem? will the rest of tech get dragged down with it? the apple ceo now faces his biggest test since taking over. first, the shocking letter from tim cook to shareholders. apple cutting its revenue outlook for the first time in two decades, citing weaker demand in china amid the ongoing trade war with the united states. apple dropped a big can't that iphone sales -- big hint that iphone sales were dropping in november. here is a take of some of what we've seen on bloomberg television. >> they will still hit an all-time high in earnings-per-share this quarter, so profits per share will still be better, even though revenue will decline for the first time in a long time and, unexpectedly, they have hit a real speedbump in china and with the iphone. >> people who have been watching apple closely for a long time have known that the wall was going to hit at some point, and it's just h

. ecb easy. china easy. >> signaling they are willing to stay on hold for longer. >> that is good for risk assets. no surprise they shot out higher at the beginning. hi yields up 7%. >> default rate is low. >> corporate print spread narrow. therelity single a's, will be a bid for them. we are comfortable holding. >> tremendous amount of movement in fixed income space. >> after three years of raising rates and running down balance sheet, the fed has called a truce on bond investors. jonathan: joining me, greg watson, george. marylin, it has been a rally. something has to give. >> we are seeing a seachange. complete repricing of the fed. the fed is on hold for the rest of the year. the data has been weaker than people expected. first quarter, you would expect data to come down especially in the u.s. without fiscal stimulus. we have a rally. we have seen concerns around global growth. essentially, thanks doing nothing. -- banks doing nothing. we are not concerned. >> the direction is correct. it has been too extreme. pausing is one thing. we are pricing cuts. that is a much higher hurdle

joining us. now to trade. president trump indicating he is flexible on the march 1 china bothf deadline as countries continue negotiations this week. earlier today, president trump was optimistic when he address the ongoing talks. >> it is going along well, we will see what happened but i think it is going along well. they are showing us tremendous respect, something that countries didn't used to show the united states, they are showing us respect to now. shery: let's bring in shaun donovan in d.c. how close are we to that very enforceable trade deal that the administration wants? i think the president is very keen to continue portraying progress. you have heard that line about the chinese paying respect to the u.s.. that is something that we have heard from him over the last two years that he's been in office, that the chinese have given him more respect than previous occupants of the oval office. when you talk to people who are briefed in the room, in some places people in the room, what we are hearing is there is still a ways to go between the two sides. they are a long way

china top trading beijing and investors are hanging on every word. >> a lot of indications both side want to deal. in washington, ideal on border security heads off another government shutdown. >> we went from shutdown craziness to now a new phase. >> the order is signed and we will have a national emergency, and we will then be sued. >> we have no shortage of people lining up and threatening to sue. abigail: with the brexit clock ticking, it is anyone's guess how negotiations will play out. >> groundhog day. >> we should stop the clock. give it more time. season in fullg swing with companies reporting and executives reacting. >> we have a great operational plan, good organic growth. >> the next three years will all be about profitable growth. >> not necessarily in the position -- abigail: as global growth shows experts telling, where they see the biggest risk. >> i'm a lot more concerned about europe. >> i expect the u.s. to being a minor recession by the middle of 2020. abigail: it is all straight ahead on "bloomberg best." hello and welcome. time abigail doolittle. ," your "bloomb

policy, the china slowdown, the yield curve. out of these, what actually worries you the most? philipp: i think to me what the greatest concern, is the pressure that is coming down from populist economic policies, from governmental policies, particularly the china-u.s. context. the pressure this generates that is coming down on financial and economic structures. this is undermining confidence. it is hitting growth. it is leading to safe haven flows, all the things we have talked about that we are seeing is ultimately reflected on the pressure bearing down from populist economic policies and politics generally. if you look at the risks geopolitically -- we follow these indicators or create these indicators -- it is at a very high level. we have an unusual amount of hotspots across the world. francine: does anything look ok out there? putting it into context, if you look at the point to spread, it .2% spread,-- the is there anything that leads up to it? philipp: i thought you might ask me that this morning. it is hard. on an optimistic note, it is quite remarkable how well parti

china look to close out phase one. we begin with the big issue, an unexpectedly solid jobs report. -- solid payrolls report. >> pretty solid report. >> solid report. >> really strong. >> the jobs number did not disappoint. >> pretty impressive. >> we not only had a strong report but we had a revision higher for the prior number. >> don't write off the economy just yet. it has a lot of fundamental strength. >> the u.s. economy is resilient. >> they are a lot stronger than people think. >> the fed is in a good spot with where the data is. >> i don't think the fed does anything differently other than a pat on the back. >> a pat on the back for chair powell. >> this is a picture-perfect soft landing is what they are track for. jonathan: here in new york is bob michele, priya misra, and gershon distenfeld. priya, a solid payrolls report. i thought we would start by making up excuses for a weak jobs number but we got a strong one. priya: we went in looking for a weak number with the gm strike. i don't think the number told us a whole lot. we have known the labor market is very strong. p

francine: the one climbs after china -- the yuan climbs. 30 year treasury yields test record lows. pimco imagines a world where negative yields reach the u.s.. s'sdas is warning -- adida warning, shares drop on a disappointing results -- on disappointing results. ♪ good morning, everyone, and welcome to "bloomberg surveillance." these are your markets. we are looking at the stocks europe 600 gaining. we also had gains in yuan lifting currencies. you can see the u.s. 10 year yield at 1.72. the fixing at 7.04. we are getting breaking news out of the philippines, another central bank that needs to do something because of the world economy. 4.25, cut the key rate to following india, new zealand, amongst others. coming up, we hear from the chief executive of adidas about trade wars and global demand. now, let's get straight to bloomberg first word news in new york city. >> this morning, oil is rebounding from a seven-month low. looks tos saudi arabia stem the slide and processes -- in prices. bloomberg learned react will not tolerate continued price weakness as oil has been driven do

bloomberg headquarters in new york. carol: in this week's issue u.s.-china trade talks front and center. jason: the magazine has several stories enter into a relationship with big tech and its impact on the digital economy. carol: on the cover the technology zinet president trump spared,

markets, the squeeze potential, goes back to the eurozone and china to some degree. if you measure the spread between the em equity etf, the volatility metric relative to the vix, that is year-to-date lows right now. you look at some of the economic data coming out of the eurozone, it is not getting obviously better, but it is seeming to bottom. play a scenario out here where the bund yields, if they do march back to zero, that is going to re-steepen our curves over here pretty sharply. andy: bear in mind, the fed's operation at the front end, we almost see this as a reverse operation twist. we are getting sick and tired of the self fulfilling prophecy of an inverted yield curve. how many times has it been discussed on this show? by buying all that short end paper and providing that liquidity that george referred to, the curve steepens. the models that tell everyone recession is around the corner, no one is talking about it anymore. you've got to be careful. there is some smart strategy going on. jonathan: that is helping the three-month to 10-year, and let's talk about the rest of

artificial intelligence, and when we are dealing with great power rivalry. david: china might be a bigger rival in some respects than russia. let's talk about 5g and huawei. there is an indictment in the eastern district of new york. how big is the threat from china on cyber? michael: china is probably our more serious rival in terms of cyber. i want to step back. the russians in my view have a -- russians in my view do not have a long game. they are in decline. oil prices buoy them but people are not clamoring to buy russian technology for their telephones. china basically has a growing, strong economy, a large population, and they are advancing in innovation and producing tech products that are widely sought-after in other parts of the world. the challenge is, they use these tools as weapons and -- in geopolitical conflicts in order to position themselves to become dominant in the region and maybe globally, economically, and in terms of their force potential. i think we need to view them as a serious competitor. it does not mean they are an enemy and it does not mean we cannot work toge

asia is strong too. asia, china will become bigger and bigger. there are billions of consumers there. david: let's talk about how you came to l'oreal. you grew up ion -- jean-paul: paris. david: did you say i want to run l'oreal one day? jean-paul: not really. when i was 15 years old, i was trying to understand what job i want to do. i had three ideas. one was to be a psychiatrist. how you say it? david: a psychiatrist? jean-paul: yes, or a movie director. david: ok. jean-paul: or business. i chose business. in my job every day, i do a little bit of the three. [laughter] jean-paul: marketing is understanding the desires and dreams and wishes of the people. it is a lot about movie direction too, because you create the images and everything. i was it able to put it all together. david: i think you took a finance class in school. the professor said you are good in marketing, not finance, right? jean-paul: yes, yes. i know you are a finance expert. i have to admit i am very bad and finance. i chose the finance major because it was trendy at the time. every business case about finan