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tv   Bloomberg Surveillance  Bloomberg  October 21, 2020 7:00am-8:00am EDT

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>> people talk about a k-shaped recovery. it is true. those at the bottom are having a very hard time. >> it is not clear how you get the economy going. >> a multi-year bear market in cyclicality is probably over. >> the market is probably not as well-prepared as it is for these downside events. >> central banks and governments are in this together. we need support for the economy both for monetary and fiscal policy. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. jonathan: good morning. this is "bloomberg surveillance ," live on bloomberg tv and radio. alongside tom keene and lisa abramowicz, i'm jonathan ferro. .3 days until election day nobody wants to own the breakdown of fiscal talks on capitol hill. tom: that's just one of the stories there. saide what greg valliere
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about president trump and congressional republicans. i guess you are getting that body language from mitch mcconnell. but why is the bond market moving? we are at 0.83% on the 10 year yield, the steepest back to march of 2018. we are pricing in stimulus at some point. jonathan: through 80 basis points. wonder if, off the back of a move in treasuries, people start to talk about reflation all over again. lisa: i don't know that the underlying data is really supporting that. we will get a read at that with iea crude oil inventories. a report yesterday showed a surprising building u.s. inventories. many people are not consuming as as the covid crisis continues to spread. meanwhile, today, i know you
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guys care a lot. we get a lot of fed speak. we've got loretta mester, neel kashkari, tom barkan, randy quarles, and jim bullard all today. every day it seems like they speak more and communicate that much less. we are going to hold rates low. the question is just the threshold to further stimulate. then come append to your bloomberg -- then, pinned to your bloomberg terminals, the fed beige book. how much has the spread of the pandemic really trickled into economic readthrough to consumer confidence, to business confidence? perhaps we will get a picture. jonathan: this will become -- this has become my favorite part of the show, lisa telling us what is to come throughout the day and why it doesn't matter. [laughter] tom: there's no other way to put it. the beige book, i never put a lot of emphasis on. it is very dated. but every once in a while,
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there's a tea leaf there. really, how the beige book folds into the earnings expectations, and a little bit darker here off of ibm a few days ago and the netflix joy last night. a quiet: it's got to be wednesday morning for me to even pretend to be excited about the beige book. i'm not. 0.1%.sitive almost euro-dollar, $1.1850. a weaker dollar. copper higher. the chinese currency stronger. in the bond market, yields up to 0.8%. that's the move of the morning for you tom. is it that, or what is happening in foreign-exchange? tom: it is what is happening more in foreign-exchange now. i really want to walk through this because i think it is important, and it advances the real yield, what you can see friday's here across some of our bloomberg enterprises.
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yield versus a rising five year five year breakeven gives you a substantial real that at -0.92%, even with lifted nominal yields. we've still got a substantial negative real yield. jonathan: let's continue the conversation with mona mahajan, allianz global investors investment strategist. if you heard us talk about a breakout in treasury yields of 80 basis points, i think you would wonder what planet you just landed on. when can we get a real move on treasuries? interestingly from a percentage perspective, this was a real move. market are seeing in the is higher treasury yield, higher gold prices. so perhaps starting to price in
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.his democratic sweep idea to lisa's point earlier, how high can it go? we might not get much more movement from these levels until we get an actual eye on inflation. tom: part of this is the glide path involved. with your computers higher back -- if you're computer science background, it is simple. some point, there is a kink. there is a jump condition. is it near here, or surprisingly much higher? mona: with think over time, if inflation is in the 1.5% to 2% range, real gdp growth in the u.s. probably also at some point 1.5%, 2%, yields should also at some point to be in the 1.5% to 2% range. of course, we are emerging from a very deep crisis. we don't think that type of
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level happens in the next 12 months or so, but we expect a pickup in inflation expectations. we are keeping rates low, adding qe to the system. growth may be accelerating next year, especially if we get a vaccine, if we continue to get stimulus and investment into the economy. we are certainly setting up for .hat inflation expectation . lisa: in the meantime, a lot of parsing reason yields -- a lot of people saying the reason yields are rising is because the u.s. will have to sell trillions in additional treasuries. is that the real story here? i am looking at the total value of negative yielding debt globally. it is close to the all-time high. where else are investors going to go for yield other than the united states? mona: that is part of the story as well. keep in mind, even here at 80 basis points, compared to
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europe, japan, across the globe, still fairly attractive. this year in particular, treasury bonds have been one of the best-performing asset classes across the board, especially since that march 23 low. clearly there is this flight to safety, but also this hunt for income. to the other point of your question, where do people go, they are also looking at the fixed income market. clearly there has been this push for investors to give out the risk spectrum. bit globallittle e.m., but also parts of higher risk fixed income as well, the credit market and high yield, as well as parts of the best grade. is a familiar conversation for many. the reflation story you mentioned moments ago, fold that into the equity market and the much talked about rotation that has really eluded us. mona: that is the key question here. will we get over the next 12 month period this much
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anticipated and much eluded rotation into the cyclical trade? clearly, and when we look historically over the last 10 years, there have been approximately four instances where value cyclicals have led in a more sustained way. usually they are leading for a six to 12 month period. with think we could be set up for another leadership in value cyclicals. of course, that would be in the scenario where we get the vaccine in the latter half of tos year or take some time globally. that backdrop, combined with ,ngoing low rates in stimulus we do see the opportunity for that trade to reemerge, so investors should layer that in when they get the opportunity. tom: procter & gamble the other
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day, and right now there is nestle coming out, and once isin, organic revenue growth simply better than the gloom that is out there. is that the major call for the next two or three years, with the shock of the pandemic and the agony of the pandemic? are we completely misjudging the ability of these companies to adjust and adapt? mona: it is interesting. i think second quarter, we certainly got a lot of that as well. the expectation was for a -40% decline, and we came out -29% or so, so there was a huge lowering of the bar in terms of expectations, and there was a nice beat. historically, companies are known to do that. but the percentage of beat was much more substantial than we have seen in the past. that could be the trend over the
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next couple of quarters. we would say over time, that probably goes back to more historic averages. i think in many cases, companies have performed much better in this crisis than we have seen in the past. partly that is because we have become a more digital, more online economy. this acceleration to a more stay-at-home world has really a lot of companies across the board. i think the ability for consumers to buy online and show demand in that way has helped. so i think this quarter will show a nice beat as well, and over time we see the ability for companies to rebound nicely. jonathan: mona, thank you. always great to catch up. ofa mahajan about lands -- allianz, thank you. pet food crushing it.
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does that bill -- does vet bill have nestle pet food? tom: no, he has to have the pet food prescribed by the vet. toould kill for purina darken the door of the keene household. the answer is no. and only mrs. keene feeds him. the family thinks you should have a human equivalent, where i am thinking water and a gains burger. jonathan: what is a gains burger? tom: it was like tang and sanka. jonathan: i know what tang is. you've told me what sanka is before. tom: you know, january jones is in the kitchen, serving the dog gains burgers. jonathan: very cool. [laughter] tom: jon, i am not concentrating
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today. i'm looking at all of the other networks playing highlights of mookie betts, and just not concentrating. jonathan: do you want to explain who mookie betts is? tom: he's the babe ruth of the modern era. the red sox traded him for sixpacks of cracker jacks, and he's killing it for the dodgers, including that steel of third base last night. jonathan: that's the dig for tom today. just keep saying mookie betts. you want to wind him up, send a tweet. he's available on social media. lisa: and for parties. jonathan: he's great at a party as well, lisa, when things reopen. this is bloomberg. ♪ ritika: with the first word news, i'm ritika gupta. ande speaker nancy pelosi treasury secretary steven mnuchin are moving closer to a deal on a new stimulus package. --zie hopes ash policy hope
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pelosi hopes she can get a deal by the election. senate majority leader mitch mcconnell is warning the white house about a deal before that election. he has not committed to a pre-election vote. british prime minister boris johnson will impose the tightest coronavirus restrictions on greater manchester. johnson warned that lives would be at risk if the government failed to act. the prime minister also left open the prospect of a national lockdown if infection rates keep climbing. shares of netflix are falling today. the streaming service missed wall street estimates for subscribers. that renewed doubt about its ability to maintain growth. netflix had warned that the pandemic-driven subscriber boom wouldn't last. the company says the surge in new customers could suppress the growth in the future. global news 24 hours a day, on air and on bloomberg quicktake,
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powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. ♪
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rep. pelosi: we all want to get an agreement because people need it and it is urgent, and our economy needs it. we have one little bump in the
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road with the appropriations committee that is not sure they are going to be ready, but let's hope they are. we are starting to write the bill and can have the negotiation. but i am optimistic. jonathan: the administration seemingly would like a deal. iader mcconnell seemingly -- don't know if he wants a deal at this point. tom: no. jonathan: that is what they are discussing at this point, in and around $2 trillion. tom: it's just not there. everyone has been talking about it. i think the story has really moved forward one day before this debate. jonathan: another morning edition of headline roulette down on capitol hill, lisa's favorite. the price action shaping up as follows, two hours and 12 and is the way from your opening bell. s&p 500 futures come in just a little bit, down five. about -0.1%. or four basis points on
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the long end of the curve. 0.8% is your yield. we are up a single basis point on the session. want to turn to netflix just quickly because this is the stock to watch this morning. the expectations game of earnings season. netflix down hard, off by 6%. the guide was a miss, but the numbers through the first half lifted the bar so high. they added almost 26 million customers in the first half of the year, the strongest start ever. how do you replicate that kind of performance? tom: you don't. it is going to be interesting to see how pandemic tech goes forward quarter to quarter. we will have more on that. with us now, or bloomberg congressional reporter. she has three netflix account logins, and she joins us now. can you explain how congress people that have to get elected or 1/3 of thes
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senate can focus on this baloney while they are running for office? anna: it is a very difficult thing to do, and that is why nancy pelosi is doing it for them. she has been the one negotiating this deal with the administration. senate republicans are very resistant to anything they come up with. this will be good for pelosi event happens. it would show she is the master dealmaker she has been throughout her career. it would not be good for mcconnell because then he is dealing with a very real split in his conference. tom: are you up to speed on lame-duck? that is the period after the election come before the inauguration. do they have a lame-duck parliament? jonathan: we change things pretty quickly in the u.k., as you know. if you lose the election, you move out. tom: i get it. we are a little more graceful about it than those heathens over in england. what happens in lame-duck?
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anna: the main thing the lame-duck session has to do is , butthe government government funding does run out by december 11. so we are running up against a funding deadline, and that could be the train leaving the station that carries stimulus with it. so we are going to be looking for any compromise between the house and the senate if they do manage to agree on some of the bipartisan precisions -- bipartisan provisions around the stimulus. lisa: you sound really skeptical that anything could get done before the election. is that accurate? anna: just looking at the calendar, it is hard to see how it happens. you have 70 days for them to tidy up the legislative language -- you have so many days for them to tidy up the legislative leg which. -- senate has to pass ther has to pass their bill, and
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there's the 72 hour deliberations rule. you have to pay attention to the legislative language. you don't just want billions of dollars disappearing because of a comma. it is hard to see how this all comes together before november 3. jonathan: just a final question for me on the campaigns. where is joe biden? here in the u.k. and british media, if you play a clip of one campaign, you could play another clip of a similar duration. my team often comes back to me and say we can't find much sound on joe biden. where has he been this week? anna: he's doing debate prep. that is definitely a huge focus. he doesn't really need to be out there right now. he's running so far ahead. he's got a ton of money in his war chest. he can just kind of coast to the election and hope nothing really changes before the. tom: i just figured out, that's where cirilli is.
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is he the moderator for the debate prep? anna: no, but i am sure he would be a good member of any candidate's team. i am sure he will be telling us what to expect next. tom: what do you expect next from the senator from kentucky? .nna: from mitch mcconnell he is going to be whispering in trump's ear, saying this is going to be a good idea, which is the last time he did when trump said he would pull his negotiators out of a stimulus deal. if he puts it up for a vote, it is not a good look for a divided congress. jonathan: anna, come back. i felt like i had to say it, given your abuse at the end. just have a bit of patience with people. rand paul is the
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other senator from kentucky. does anybody care what rand paul thinks about stimulus? jonathan: some people might. eastern ina.m. d.c. , "noaugust 19, rand paul incentive to open the economy." lisa: we look to our people to help us out. if you chase them all away, they will not come back. they will go to debate prep. jonathan: rand paul is never coming on the show after that. [laughter] lisa: fair point. tom: that's what he said. jonathan: isn't that the whole point out in d.c. at the moment for the moment? tom: seriously, the fact is a lot of people got this right. the race has tightened dramatically in the last one he four hours. the polling today -- the last 24 hours. the polling today will be fascinating. jonathan: do you think if they do agree to a stimulus bill, if
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leader mcconnell put it on the floor, and these senators voted for it, do you think that would help them? tom: on shore. it would -- unsure. it would definitely help the president of the united states. he said they will come around. . i am paraphrasing. lisa: i don't know that it would because people aren't necessarily going to get the checks before the election, so it could just look like a win for the democrats. it is a really dicey political calculus here, which is the reason why it is unlikely it is going to get done. jonathan: are the fiscal hawks hawksto help their -- going to help there? we haven't heard for them for the past few years. tom: the debate is going to be fascinating. i may be threatening to stay up and watch it. jonathan: i will wake up and watch a replay. what is the thing on the
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plate that looks untenable -- looks un-edible? jonathan: i will tell you on the break. raymondp, kevin giddis, james chief fixed income strategist. tom: we are killing it today. ♪
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jonathan: from london and new york, this is "bloomberg surveillance," live on bloomberg tv and radio. alongside tom keene and lisa abramowicz, i'm jonathan ferro. counting you down to the opening bell, two hours away, equities shaping up as follows. we rolled over a little bit on the s&p 500. we are negative five points, down a little more than 0.1%. dollar weaker against everything in g10 through much of this morning. throwing the chinese currency into the mix as well. a really strong chinese currency. the lowest we have seen on the currency pair since 2019. in the bond market, yields up to 0.8041% on the 10 year. how do you get through the next three months and look up to 2021? take a listen to what john normand at jp morgan had to say. >> i think we are assuming that
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something positive can happen in january that is going to keep expectations pretty high in markets, but if nothing happens in terms of big stimulus, you could see consumer retrenchment well before that date and a much worse outcome on the economy. jonathan: and what about the near term? kevin get us of raymond james writes the following. "the fixed income market is underestimating what a blue wave could mean. we could see a massive increase in spending, higher taxes, increased regulation, at a lower dollar." we see that weaker dollar right now and those high yields through this morning. tom: this is incredibly important. lisa abramowicz out with a 5-30's spread yesterday. i would note the vanilla twos-tens spread back to where it was in march 2018. this is the interview of the day on fixed income. kevin get us is with raymond james -- kevin get us -- kevin
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is with raymond james. is the bid slipping away on price in full facing credit? kevin: we are finally starting to see this. a week ago i would has had probably not, but we are starting to see this hope of closer and closer -- this period closer and closer to the election, especially if we get this blue wave i talked about. i have these kind of nightmarish feelings of 2016 after the election. if you are a bond guy, you were not expecting that outcome and you did not expect the price outcome after the election. i think the bond market and the treasury market in particular is underestimating the fact that if you got a complete sweep, one might occur after that and why interest rates are likely to go higher, not lower should that occur. ,igher spending, more taxes
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increase growth, and growth tends to have a friend. it is called inflation. if all of those hit the mark, rate moves would be fairly significant, especially in the 10 year and 30 year. lisa: tom keene is going to be closely watching the 10 year auction of treasuries. i know he watches every auction very carefully. is this a supply story of high yields, or a growth and inflation story? kevin: from a rate moves, it would be a growth and inflation story. haven't had a problem selling our debt. you mentioned earlier in the show about negative yields in particular. thelook across the globe at opportunities, there still is a great opportunity and treasuries , especially at the long end of the market, but the door is starting to close. the only way it will closes if we get a blue wave. if we get a wave, but republicans control the senate, and if you've got a democrat or
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republican in the white house, rates are not going to move that much. we know what gridlock looks like. but if you get a clean sweep, the treasury market would have to catch up fast, with higher rates across the board. but i don't think it hurts financing right now. jonathan: you mentioned 2016. it wouldn't just be political event -- it wasn't just the political event that was affected for many. it was the outcome that people missed, with the red wave would mean for markets. what do you think people are missing right now? we know the consensus. people think the probability is lifted over the last couple of months. what is it you think people are missing about what that means? kevin: the part that they are missing is the inflation part of the occurrence. a 1.80% 10nt from year to almost a 2.50% by the end of the year on the expectation of deregulation, tax cuts and growth. what wasn't dissipated was the inflation component that never
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really came. we did see it when the gdp peaked in the first quarter of 2018, and then inflation reached its highest point in may of 2018. the point of this is now, if they are not thinking about it and the ways he would normally think about it, growth will bring that inflation at some point in time. it may not be in the next few months, but the bond market tends to try to get out in front of any uncertainty, and i think we will see it for the next few months through the election. jonathan: so how would you push this view through fixed income right now? where do you want to take advantage of? kevin: it is really still hard to find, but one of the things, either way this goes, the market is likely going to gain on the prospect of higher taxes, and uncertain or continued environment is probably going to support that market. we are still at 121% yields to the 10 year versus where we were
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at 75% in the precrisis period. i still think, even though a lot of state, county, and municipal credits are coming to market, there is value in the muni market now, no matter who takes the white house and who owns the congress. tom: long ago and far away, we had a munro trader where we could enjoy price declines. we have hallways of people say that the bond market never has a bear market. can you model out a bear market to come off of my munro trader calculations? [laughter] kevin: i always said that when my munro trader stopped working, it was the end of my career, so i still have a couple around. tom: that's when you bought a bloomberg, thank you. are we headed for a bear market in bonds? kevin: we have a potential for it, but the only way we see a bear market in bonds is if we see this big blue wave occur at election time, in my opinion. the rest of it looks like we
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will get increased stimulus at some point in time. we think that may be inflationary somewhere down the road. we are still looking up a lot of ground and we still have the pendant to deal with, so i don't think it is extremely bearish unless we get this scenario play out and a blue wave after the election. lisa: the reflation trade you are talking about, this idea of higher growth, has let a lot of people to feel safer going into the riskiest bonds. i was looking at the extra yields that investors demand to own the riskiest junk bonds over benchmark rates. it has contracted back to february levels. it is as if the pandemic did not happen. if this market right, that we are not going to necessarily get escalating default cycle? or is it saying something else? kevin: it is saying that, but i am not sure it fully realizes that that may not occur. i think, as you point out, we are almost to the precrisis
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spread levels, and certainly high-grade in ig corporate debt, and almost there again on high-yield in particular. that is a sector i would be very careful with right now because over 300 for the tends right now is not enough of a cushion for me based on where we are headed. so, less than 300 for high-yield is expensive for a portfolio for me. debt, butuld favor ig realize you are going to get it at less than 100 basis points. you have to be happy with that. even if we get higher yields, spreads would tend to contract further, but you would get at harry yield -- a higher yield versus where the treasuries is now. jonathan: you live and breathe this world. from the conversations you have been having over the last few months, do you since there is a
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little bit too much confidence in credit because of the fed backstop? kevin: there really is. i think there's a point here where we are going to see a lot more bankruptcies because they just have to occur, especially if you don't get stimulus within this calendar year. that is going to have an effect on credit themselves. opportunity,tting even high-yield companies, even the state of illinois are refinancing their debt at much lower yields, and they may be able to ride the storm out. giddis with us. one of the cool things is kevin memo be cincinnati reds earlier -- reds memorabilia behind him. we just lost joe morgan. what did joe morgan mean to your
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cincinnati reds? kevin: if you remember, it goes way back. we got him from the houston astros at that time, and really filled the void on second base for the reds at that time. so the impact that joe morgan had on both the organization and afterwards was long-lasting, and we are fortunate that he elf with the reds versus the astros. jonathan: just a final question for me, to end on a more positive note. can you give us a review of what you would think of a player like team --etts and why the why a team the red sox would let him go? [laughter] tom: killing me, kevin. kevin: i have become by default a bigger dodgers fan then i would admit. i am happy they have mookie betts. tom: cut this guy off. [laughter] kevin: the debtors haven't won -- the dodgers haven't won since
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1988, so they have suffered with us. tom: so mookie betts is the joe morgan of the dodgers? kevin: for a short period of time. we will let that play out. jonathan: i get to do this for a number of years? i would love to do that. mia dodgers fan now? tom: you are such a dodgers fan. i can see you sliding in with haley kovacs behind the home plate there. jonathan: i can't afford your tickets, tom. tom: you would have to get the $600 fancy sunglasses, though. jonathan: i don't think that's me. tom: i can just see you at the sunset hotel there. i can just see it. lisa: that's a new insult. you are such a dodgers fan. jonathan: the sunset hotel. i don't even know if that is an insult, lisa. i'll run with it. alongside tom keene and lisa
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abramowicz, i'm jonathan ferro. bazinet of citi global markets. we are down 0.1%. from london and new york this morning, good morning. this is bloomberg. ♪ ritika: with the first word news, i'm ritika gupta. senate republican leader mitch mcconnell may stand in the way of getting a new stimulus package before election day. bloomberg has learned mcconnell has warned the white house not to rush into an agreement that he has not committed to taking a vote. nancy pelosi and treasury secretary steven mnuchin are moving closer to a deal. pelosi says she is hopeful for an agreement this week. the coronavirus pandemic is quietly gathering force in a region that has already suffered greatly. southern states in the u.s. by absolute numbers come of the region remains the national center of the pandemic. more people are hospitalized with covid-19 across the south than in any other part of the
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u.s. kentucky just hit record hospitalizations. west virginia and oklahoma did so on friday. a new report on president's taxes reveals details about his activities in china. according to "the new york times," that includes a previously unknown bank account. the paper says the president spent a decade unsuccessfully pursuing projects in china and had an office there. the president and his allies have denounced joe biden for being soft on china and point to his son's business dealings there. it is an echo of the cold war. the five eyes network is made up of the u.s., u.k., canada, australia, new zealand. it is seeking better intelligence on everything from the coronavirus to child trafficking. other nations now want in. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries.
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i'm ritika gupta. this is bloomberg. ♪
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>> the same way that there was a push to re-regulate the banks after 2000 and 2007, you are seeing that would now with tech.
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that's where the innovation is. it would force the regulators to take an eye and look and see about monopoly pricing power. so i don't think this is a blip. kicking our of global asset allocation on regular -- kkr global asset allocation head on regulation in tech. on the s&p 500, we are up by 0.1%. market,d about the bond about 0.81%. in foreign-exchange, weaker dollar bleeding through g10 and against the chinese currency as well. the stock to watch, netflix down in the premarket by a little more than 5%. bazinet joins us now with citigroup. we will get to all of that any a moment. does netflix finally have competition in the streaming wars?
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are they finally not the only streamer on the block? jason: that is 100% true. the market is definitely heating up. we've got tubi and pluto and peacock and hbo max, so the market is definitely getting more crowded. i think you traditional media companies have woken up. jonathan: and some of those companies have reclaimed the content has well. we have seen this play out over a number of years. what is that look like at netflix at the moment. jason: what does it look like in terms of content? jonathan: how they replace it, but it means for the amount of subs they might be losing. jason: netflix has sort of trained the market to react to better subscriber numbers, and those always require more and more spending. covid is itd during
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was sort of this jolt to the market because suddenly you are getting a lot of net adds without a lot of incremental content spending because production was shut down. almost as manyd subs in the -- subs as they had in 2019. into the company's credit, they told everyone we just pulled a bunch of demand forward, so it is going to be pretty soft. but that is actually what happened. the trick for netflix going forward from my perspective is the strategic question for the ceo on the board, how do we move from a model where we spend a bunch of money on content and get subs, but burn cash, to actually demonstrating that this is a good business? lisa: i think netflix has its next hit on hand with training the market like a bunch of pavlovian dogs.
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you talked about how netflix did warn everyone that they were just bringing forward subscriptions from later on to earlier. how much is this going to be the story in big tex more broadly, the idea that they brought forward a lot of the market share gains and they cannot post the earnings and the profit means people have been expecting going forward? jason: i think it very much depends on the company. there's no sort of simple answer to that. it depends on the business model. tom: i want to shift to amazon. there's countervailing themes here. what is the huge success of prime day and how you extrapolate that into what a cardboard box makes for them. then there's the upset ibm over their competition, etc. how are the margin beliefs on amazon, not only forward a quarter or two, but forward five years? and they sustain margins across these disparate businesses?
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about i don't think it is sustaining margins. i think you've hit on something that is sort of misunderstood. our view is that what amazon is doing is sort of intentionally having selling products to consumers at low margin, using that infrastructure to sell services to businesses at a profit. what are those services? it is ads, commissions, filled by amazon. it is not predicated on making margins on e-commerce. it is all about making margin on services. the market tends to go back and forth on amazon. sometimes they care about revenue growth. sometimes they care about margins. i am sure we will go back at some juncture in the future. tom: what is your sustained revenue view? jason: the interesting thing about amazon is it is global, but really they have demonstrated the efficacy of the
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strategy of using this dual poppers -- this dual purpose infrastructure. i think there's probably a longer runway for amazon than any other company i cover because it is very u.s. centric, and they are just getting ready to roll this out at scale outside the united states. lisa: looking forward to third-quarter earnings, who do you think will be most like --flix in under little ring in under delivering the market expectations? jason: i think the kissing cousins are going to be the videogame publishers. you saw a lot of gaming going on. the companies were very similar to netflix in that they cautioned that it was a pull forward, and similarly, the market so far hasn't really believed that. jonathan: amazing, this market does not believe what it is being told by these companies. [laughter] jason: i know. well, it is able market, right? jonathan: exactly. jason bazinet with citigroup.
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when a company is telling you something, literally spelling out, and no one believes you, and you are telling the investors that this is a pull forward, and still the stock gets bid up as aggressively as it did, you heard it just there, that's a bull market. tom: i'm an expert on snap. i look at it socially and all of that. but i look at the snap overnight, and again, it is just these tech juggernauts continuing to extrapolate out. you heard him separate carefully from the mysteries of the income statement just up to the blunt instrument of revenue. jonathan: you know lisa has got a list of reasons to be bearish, and it sits there on her desk. she just does this and just ticks every time someone comes on. another reason to be bearish, people not listen to the c-suite. lisa: yeah, this is a bull market. people just ignoring facts. tom: oh, listen to you.
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lisa: other potential optimists out there should say everything has to price up if yields remain low. , you could hear the argument that facts just don't matter out there. jonathan: i love doing this. ,ctober 21, lisa abramowicz "just ignore facts." [laughter] lisa: you are looking for an entry point. jonathan: i am going to do the 2020 wrap and just put lisa's greatest hits at the end of the year. lisa: i'm going to be absent. jonathan: alongside tom keene and lisa abramowicz, i'm jonathan ferro. here is the price action for you. shaping up as follows on the s&p 500, one hour and 35 minutes away from the opening bell. equity futures positive, negative, now they are flat, down about two points. elsewhere in the bond market, yields up three basis points to
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0.81%. the story of foreign-exchange, euro-dollar $1.1850. from london and new york, this is "bloomberg surveillance." ♪
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>> people talk about a k-shaped recovery. it is absolutely true. those at the bottom are having a very hard time. >> it is not clear how you get people to spend money and get the economy going. >> the multi-year bear market in cyclicality is probably over. >> the market is not as well-prepared as it usually is for these downside events. >> central banks and governments are in this together. they are one while it. >> we need support for the economy both from fiscal and monetary policy. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. good morning,


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