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tv   Bloomberg Daybreak Europe  Bloomberg  May 28, 2021 1:00am-2:00am EDT

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annmarie: good morning from new york. this is "daybreak europe." global stocks close in on their fourth straight monthly rally. strong u.s. data and hope for spending spree gives investors a tailwind. jamie dimon slams the president's tax plans as wall street ceo's face and other congressional grilling. a cautious tone on crypto's.
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g7 finance ministers ready for crunch talks. france puts the onus on the group to lead the way on the new global standard. good morning. 6:00 a.m. in the city of london. that is where my heart and mind is. 1:00 in the morning on the east coast. we are seeing euphoria and green on the screen. asia-pacific up more than 1% alongside european and u.s. equity futures after pretty strong u.s. economic data yesterday on top of that potential spending spree, proposal of a budget, the new york times talking about the budget from president joe biden. on top of that, the 10 year treasury yields above one 6% this morning and brent inching closer -- 1.6% this morning. demand side of the story, optimism is outshining the
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concerns regarding potential supply coming online from iran. global stocks pushing higher, headed for their fourth straight monthly rally. many markets will be closed on monday. they got a nice tailwind yesterday. jobless claims are the ones to focus on. a fresh pandemic low as orders for u.s. business equipment rose more than forecast. sentiment was boosted by the new york times report that president joe biden is set to unveil a budget that would increase federal spending to $6 trillion in the coming fiscal year. biden expects to outline those plans today. it's before memorial day weekend, which has been seen by some as questionable timing. joining us is bruce. regardless of party, budget proposals from the white house typically do not get approved since constitution gives the power of the purse to congress so why does this matter so much? bruce: it is a good point.
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a lot of this is sort of performative. it is a process that congress will certainly have its say on although it gives us our first big look at the entirety of the president's effort to boost the size and scope of the government and also really significantly, once the president delivers the budget proposal, that clears the way for the house and senate to be working on their proposals and once that happens, that sort of allows democrats to proceed with a lot of their plans to pass a lot of proposals on infrastructure, taxes, spending along party lines. while the proposal itself is not something that is going to become reality, it does set off a whole process. annmarie: what does the budget so far tell us about the administration's thoughts on the direction of the economy,
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inflation? what are they thinking? bruce: they are predicting the economy will grow under 2% per year for most of the decade once you factor in in nation and also the administration is not going along with fears on wall street and elsewhere about rapid inflation, saying consumer prices would never rise more than 2.3% per year. the budget expects that there will be a strong labor market with unemployment falling to just 4.1% by next year. and staying below 4% for the rest of the decade. annmarie: we are seeing pushback from republicans. the senator from indiana called it absolutely crazy. what kind of pushback are we going to see from both sides on this proposal? bruce: you are right. we are going to see strong pushback from republicans in the opposition. we are likely to see some
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criticism from democrats as well, particularly when it comes to the proposal for defense spending. president biden was talking about an increase in defense spending to $750 billion. so that will lead to some problems in the democratic party because you have some progressives who say that is too much and more moderate conservative members of the party who are looking for more defense spending and of course, there will be republicans who will say it is way too low. annmarie: very quickly, why the friday before memorial day? is it just going to get lost? bruce: that's a good question and i cannot speak for the president on why they decided to do this. it does raise questions. if you want to put out some news that you know is not going to
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get a lot of coverage, you release it late in the day on friday and if you really want news to get overlooked, you introduce it late in the day on friday for a long weekend. maybe they want this to go under the radar. annmarie: interesting. timing is certainly something to speculate on. bruce einhorn. the debate over inflation is not going away anywhere just yet but janet yellen weighed in during a virtual hearing of the house appropriations subcommittee. take a listen. janet: the recent inflation that we have seen will be temporary. it's not something that's endemic. i expect it to last for several more months and to see high annual rates of inflation to the end of this year. >> joining us is the chief investment strategist for aipac.
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you heard from the treasury secretary. it is not endemic, but it will last several more months. a little bit of a timeframe on what transitory means for the administration. do you agree with janet yellen? >> yes, we do. we think that is spot on. what we are seeing is a peak in may and a slow decline of inflation at the annual level until the end of the year which means that the overall number will be that until the end of the year but then of ours, we will get 2022 and then we will see where the real inflation level is for the u.s. economy and then we will be looking for what is transitory and what is sticky, particularly the housing market. energy looks very transitory. annmarie: pending home sales, that data was not as good as the jobless claims but overall, the tone is starting to look like
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the recovery is picking up steam in the united states. do you think this will change the tone at the next fomc meeting? wouter: it's too early for that. all this tabletop, change of direction from the central banks globally, we think it's a little premature from a big economy perspective, from the fed and the ecb's perspective. simply put, they will look to the volatility of the data. for now, they will let the economy run up a head of steam before they will take any measures to counteract that. for now, it is steady as she goes for the fed and the ecb. annmarie: we just heard from bruce einhorn outlining what we can expect from the biden administration on the $6 trillion the new york times is seeing the budget of do you think that this budget could spur fresh produce and excitement around rotation trade? wouter: it certainly puts the ambition of the biden
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administration central again. we should be cognizant of the fact that congress will have a strong say and there's negotiations going on. i think it shows that the democrats are still pushing forward for both infrastructure and the american family plan and markets by and large will get these plans as they grow positive but of course, worried about how they are being funded. that's going to be a negative from a market perspective. annmarie: do the new taxes meet the spending plans? there's going to be a growing deficit. is that a risk that we are having to really worry about? wouter: not yet. if we look at the overall fiscal picture for the u.s., it is still healthy so we don't think markets are overly concerned about a fiscal situation that's going to be problematic. instead, it's more about where does the u.s. put its priorities and how does it want to organize its fiscal picture long-term?
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that's what the markets will be looking for an enemy clarity on that from congress i think will be impactful but a budget like this i don't think is going to make much of a difference. annmarie: northern trust asset management -- our guests stays with us. annabelle droulers. annabelle: the plan to end england's pandemic restrictions on june 21 is in doubt according to the health secretary, matt hancock. he's warning that the covid variant first found in india makes up as many as three quarters of all new cases. he says lifting the rules will only happen if it is safe. japan is extending its state of emergency in a bid to reign in the infections ahead of the olympics. the restrictions on tokyo and other major cities will likely last an extra three weeks until june 20, little more than a month. japan seeing one of the slowest vaccination programs in the developed world.
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so far giving just over 10 million shots. there is another twist in the gates to divorce. when the pair announced their supplies split, they said they would be no changes to the $50 billion foundation. the boss of the philanthropic organizations that he's looking at ways to strengthen long-term sustainability and discussing what steps and bill and melinda might take. he said no decisions have been made. 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. this is bloomberg. annmarie: thanks so much. annabelle droulers in hong kong. just ahead, finance ministers setting up for a virtual meeting before traveling to london next week for their summit. resident biden's global corporate tax plans, high in the agenda. this is bloomberg. ♪
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>> i have a very good feeling that in just a few weeks, we will agree on a revolution in international corporate taxation, a reallocation of taxing rights and a global minimum tax. >> we are not far from an agreement at the level of the g7, the g20, and the -- >> we are going to see change across 2021 and 2022 in relation to how very large companies are taxed. >> the u.s. proposal for a minimum rate of 15% is an interesting and solid basis. >> we are very much aligned with the approach of the biden administration.
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>> g7 leaders on joe biden's proposal for a global minimum corporate tax. finance ministers including janet yellen will meet virtually today ahead of a physical meeting in london next week, set to this class inflation -- discuss inflation and president biden's tax proposals. it follows a meeting of foreign ministers in lisbon during which leaders to discuss belarus hijacking of a ryanair passenger flight. joining me from brussels is maria tadeo. let's start with the g7 finance ministers. we talked about tax reform for years. i'm guessing i should not hold my breath. maria: this time, it may be different. the germans are calling this perhaps the beginning of a tax revolution. contrary to different times, in the past, i would argue the europeans feel like this is the
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best chance they have had. we could get meaningful tax reform on a global scale. a lot of this builds on that pledge and promise from the united states to go for 15%. what's key here -- the french finance minister highlighted this point. it's not just about the tax rate at the way taxation happens in relation to booking profits and that could really change the way that digital companies operate in europe where they pay their taxes on countries that have a low tax jurisdiction. that could change if that element is also incorporated. the issue here potentially is many have benefited from a low tax regime. the thinking is that if there's an agreement at a g7 level, there will be one at a g20 and it's very difficult to go against the biggest economies in the world. annmarie: how will this play out in countries like ireland, these low tax jurisdictions?
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are we already seeing some of that pushback? maria: yes. when i spoke to the irish finance minister, to some extent, he did say we know there is going to be a change in taxation. we know this probably will happen in the next few years. our economy is ready to deal with it. what is interesting however is that the imf says a country like ireland could take a huge hit on their tax revenue income if countries decide they want to relocate because it no longer as attractive so it could really change the business model, the economic model for countries like ireland. behind the scenes, the irish finance minister is expected to put up a fight but there is this thinking that if you do get the g7 and the g20, the biggest, most powerful economies in the world agreeing on a minimum corporate tax that would affect visual companies, it would be difficult for the irish to go against that. annmarie: european foreign
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ministers met in lisbon yesterday and really pointed the finger directly at president putin over what is going on with delivers. what are the implications for the kremlin? maria: it's funny because on monday, angela merkel said she was looking at belarus and russia as two different ones. the finance minister in germany said there's no doubt that lukashenko is only able to stay in office in what the europeans believe is a rigged election because of the support coming from vladimir putin. it's going to be difficult for the europeans to justify any normalization with russia when it comes to diplomatic ties and it would be interesting to see how this plays out with the summit coming up and the biden and putin summit coming up in two weeks. the europeans, difficult to justify any normalization when it comes to russia. annmarie: thanks to bloomberg's maria tadeo. wouter is still with us this
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morning. we have of you are writing in this morning and wants to put this question to you when it comes to the minimum 15% global tax the administration is proposing area if biden wants to do this globally, but at home, they potentially want to double that rate, how is that going to work? wouter: doubling that rate, i think they have already scaled it down to 25% but the underlying notion here is that it is a minimum tax so it's all about avoiding basically making companies avoid the fact that they are looking at these jurisdictions and picking the one that suits them best and then drive there tax rate well below 15%. people always focus on the headline number of tax rates but when you look at the effective tax rate, they are much lower than what those headline numbers suggests so this is not about putting the u.s. at a disadvantage at all is the way i would put it. annmarie: if you do think that
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this could be the time, we have been talking about a global minimum tax rate for years, but if you do think that potentially, this has legs to it, what kind of sectors are you going to be looking out for? wouter: the eye catching sector is the tech sector, which has used this booking system quite aggressively to lower its tax base so that is of course the one to look at. it is also earning really fast so there is an offset but clearly, that is the eye catching one but there's also other sectors that we need to take note of that are very global in nature and have been able to use the system more than others, thinking about materials and energy as well so there's these global companies that i think will be most watched in terms of what their current system for taxation -- and how they pay their taxes and what will change for them under this new system. annmarie: d think it can really be done, a global minimum tax
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rate -- do you think it can really be done, a global minimum tax rate? wouter: i think so. the notion that we are in a competitive situation driving these tax rates down is not a healthy one, not something the electorate really appreciates. it is a tension point for the electorate so it's a good thing globally and in the netherlands, where i'm based, it's also part of the system so smaller countries like us will need to change but i think it is for the better from a global perspective so i'm hopeful, but you know, realistic. annmarie: that is some optimism with a dose of reality. there's a lot of optimism that you have today in some of these questions but i have one question to you on the pandemic as a whole. it is the well getting ahead of itself? we matt hancock saying the u.k. lift off might be pushed back and other places like japan and australia still struggling. india. wouter: there's two things
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happening. from a market perspective, the pandemic is going the right direction. the big markets, europe, the u.s., have all been improving quite rapidly. from a global perspective in terms of population, you are right. there are huge population centers that are very much at risk and the vaccination drive is very far behind where we should be so that is that here. countries like india have new variants that could spread to europe and the u.s. and there is still an embedded risk from covid. markets for now are focusing on what is happening from a market perspective. and then they will focus on what is happening in countries like india and only if there's real confirmation that things are going in the wrong direction in countries that have high vaccination rates, do we see a retreat on this positive tilt at the moment? annmarie: thank you so much for
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joining us, chief investment strategist for aipac. just ahead, day two for u.s. banking ceo's. what they said yesterday in front of the house. this is bloomberg. ♪
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>> i don't see the directors -- the direct lenders pulling back at all. extremely competitive environment. >> what do you see as the greatest threat to our financial system right now? and to your company as well? >> juliette: public -- >> public policy not being executed in the united states of america which means we won't be able to take a leadership role for the rest of our lives. >> what does that mean exactly? >> i think we have done public policy -- immigration, health care, taxation, regulation. american leadership really matters and if we don't get our
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academic act together, we will not be a leader in 20 years. annmarie: day two of bank ceo's grilling on capitol hill. a lot of his criticism seemed to be centered around biden's tax proposal. was that the take away from the house testimony? wouter: that adds to one of the biggest -- dani: that adds to one of the biggest takeaways. he was probably the most outspoken ceo to testify yesterday. one of his big criticisms he launched was against biden's tax proposal. it was not necessarily new although the tone of it was new. he said do not just throw money at the problem, calling for biden to put out an itemized list of where those taxes would go. missed or not, he was saying that higher corporate taxes would be detrimental to america, detrimental to companies, push a lot of capital overseas. he also got a lot of attention because he basically downplayed
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or did not like the idea of an independent racial inequality audit, something jane fraser said she liked the idea of and at the same time, he also talked about employment, saying americans have a lot of money and they are not really looking to go back to work anytime soon. annmarie: we also had some talk of crypto's. what did they say? wouter: -- dani: crypto's was a buyer beware a message from both solomon and diamond, which is awkward because both goldman and j.p. morgan have been looking at offering crypto type products so it's a thin line they had to walk. jamie dimon, for his part, compared it to marijuana, saying that i personally would not do it but if it's legal, we have to figure out a safe way to do it. when it comes to rto, this came from david solomon saying the reason that it was such an issue was not that they used total return swaps, it's that their
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position was so concentrated. along the same lines, saying it would not be bad for there to be more scrutiny that. annmarie: dani burger, thank you so much for that. jd logistics -- has compl (announcer) back pain hurts, and it's frustrating. you can spend thousands on drugs, doctors, devices, and mattresses, and still not get relief. now there's aerotrainer by golo, the ergonomically correct exercise breakthrough that cradles your body so you can stretch and strengthen your core, relieve back pain, and tone your entire body. since i've been using the aerotrainer, my back pain is gone. when you're stretching your lower back on there, there is no better feeling. (announcer) do pelvic tilts for perfect abs and to strengthen your back. do planks for maximum core and total body conditioning. (woman) aerotrainer makes me want to work out. look at me, it works 100%. (announcer) think it'll break on you? think again! even a jeep can't burst it.
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annmarie: good morning from new york. i'm an reordering and this is "daybreak europe." here's what you need to know. -- i am annmarie hordern and this is "daybreak europe." here is what you need to know. jamie dimon slams the president's tax plans as wall street ceo's face and congressional grilling as jane fraser sounds a cautious tone on crypto's.
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we hear exclusively from the bank of japan governor on the nation's long-standing battle with deflation. >> it will take time. once it is entrenched. this is also a lesson learned from japan's experience, prolonged inflation. annmarie: we are 90 minutes away from the start of european equity trading. a lot of green on the screen across asia, the u.s., and european equity futures. msci asia pacific up. futures more than .2%. strong u.s. data, especially the jobless claims. a fresh pandemic low is very good momentum for the u.s. recovery in the labor market. on top of that we are learning that president joe biden will be delivering his proposal for $6 trillion budget. a lot of that giving a little bit more of to the market -- oom
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ph to the market. a lot of that is to do with the strong economic demand of the united states that means more demand and that is overshadowing the concerns of supplies coming from iran. but just now, we have an exclusive interview breaking. read headlines crossing the bloomberg terminal, interview with the bank of japan governor, haruhiko kuroda, weighed in on the ongoing debate on global inflation. take a listen. >> i think the discussion regarding a possible surge in inflation is particularly relevant to the united states. some academic economists have pointed out that such a risk -- the large-scale economic progress with vaccinations. in fact, international commodity prices have risen recently and the u.s. inflation rate has accelerated.
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markets have been somewhat unstable at times. now, the fed, i understand, pointed to the following two factors in this regard. first, the recent acceleration in the inflation rate is due to the base effect and the temporary restrictions in the supply chain amid rapid recovery that reflects the opening over the economy, so to speak. second, the labor market threat is still significant. given these factors, it's fair to emphasize that it would maintain an accommodative stance of monetary policy so that inflation averages of 2% over time and long-term inflation expectations are well anchored
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around 2%. i think this policy stance is based on the recognition that it will take time to overcome low inflation once it is entrenched. as you know, this is also a lesson learned from japan's experience of prolonged deflation. that said, of course, it is true that central banks around the world have conducted monetary policy while facing significant uncertainties due to the shock of covid-19. in this situation, i think the appropriate conduct of monetary policy and effective communication are important in terms of ensuring market stability cerro the bank of japan will continue to closely monitor developments in global financial markets and the global economy.
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and now, turning to the outlook for prices in japan, the inflation is likely to increase gradually but it is expected to take time to achieve the price stability target of 2% cerro the bank of japan will continue to persistently conduct powerful monetary easing. that can achieve that target of 2% price stability target. >> does this mean that we will have to see -- we will have to wait longer in countries like japan and other countries for a change in policy? >> of course. each central bank has to adapt its monetary policy to its own price. and so that even if our economy
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recovers from the impact of covid-19 pandemic, we expect, by the end of this year, it would come back to the level before the pandemic but as you know, our inflation rate continues to be relatively low and it will take time to achieve this 2% inflation target so i must say that in that sense, the bank of japan's substantial monetary easing will continue even after the economic recovery from the pandemic is achieved because we
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have, like other central banks, 2% inflation target. inflation under 80 is still quite low and so we have to be persistent in conducting monetary easing to achieve a 2% price target. annmarie: haruhiko kuroda speaking to bloomberg in an exclusive conversation. we will bring you more on the interview throughout the day area recapping some of the headlines from that exclusive interview. talked about the transitory policy stands from jay powell. he said that is a policy stance based on recognition that it will take time to overcome low and nation once it is entrenched. he said that is a lesson that the fed and other central banks have learned from japan. other headlines. one of the breaking ones flashing red across her terminal this morning is about to change, saying it will become a
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discussion topic for policy. this is different from largely what kuroda has stuck to in the past which is that climate change would be something that would be a discussion regarding how it could impact and present a risk when it comes to the financial system. other headlines coming out of this exclusive interview is that the bank of japan governor, he sees japan's economy recovering to pre-covid levels by the end of this year and the boj's powerful easing will can you even after covid so that is our exclusive interview with the bank of japan governor, haruhiko kuroda, and you can expect more from that throughout the day. jd logistics, the delivery arm of, rose as much as 18% in its first day of trading after a mammoth 3.2 billion dollar ipo. they're offering was the second largest debut in hong kong this year despite jd logistics continuing to operate at a loss.
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tom mackenzie caught up with the companies ceo. >> we regard the market valuation as their starting point in the capital market. i believe jd logistics will see growth in the long-term. tom: you have raised about 3.2 billion u.s. dollars. what are your priorities for putting that money to use? >> first, we will spend the money on keeping building our warehouse network, especially in china's lower tier cities. second, we will also spend on building warehouse networks overseas. third, we will spend on technology. jd logistics is a company that emphasizes long-term investment in technology. we invested over $780 million in technology for the past years from 2018 to 2020. tom: give us a sense of your ambitions. what are you targeting alternately in terms of market
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share from this is this? -- business? >> according to third-party data, our market share in the logistics industry is 2.7%. jd logistics will stay on a relatively high growth path for the next several years. tom: jd logistics is still lossmaking. what is the timeframe in terms of continuing to focus and prioritize expansion over profitability? for how long will you have to do that? >> we will focus on business expansion and revenue growth for the next several years. our net margin will keep improving in the long term. frankly speaking, the focus for the next few years will still be growth. tom: i want to ask you about broader economics because some of the data around china's economy now suggests the recovery is starting to slow. there is a big focus on the consumer. you have your finger firmly on the pulse given all the data that use the. talk to me about the demand you are seeing right now across the
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business. >> china's gdp growth is strong. from our perspective, we see brands and business models that keep evolving in china's consumer market. there is local brands rising, fast-moving consumer goods areas in recent years. some local building brands have made big growth. the market is good overall. tom: i have seen reports as well, and you touched on this, about expansion in europe. how aggressively will you be pursuing that expansion that you have already started to lay the groundwork for? >> in fact, we have completed communication with many of our local partners in europe. i predict that we will probably see some jd logistics centers within one year and there will probably be an operation by then. tom: we are in the middle of a
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big antitrust crackdown from regulators in beijing on the tech sector. what are the biggest regulatory challenges facing jd logistics? yu: the sector is a perfectly competitive market. jd logistics is doing better than any other company and sector in terms of ensuring the benefits of our front-line workers and regulatory compliance. from our point of view, we don't see much potential risk and regulation. annmarie: jd logistics ceo talking with tom mackenzie on the companies debut and their plans for expansion. joining us now for more on this from beijing is tom mackenzie. so interesting at the end is what you asked him regarding the regulatory hurdles. how does this fit into what china is doing right now? a lot of it is cracking down on these very big companies, especially tech firms. tom: absolutely and a lot of the
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biggest tech names in china have felt pressure from the regulators, whether it's demands by officials to rework business models or stock prices. his answer was straightforward. they don't see themselves as being a target of regulators. at least not at this point but that was a concern for some analysts looking at this ipo, concerns about valuations, about inflation, and about the anti-tech crackdown. some of those things playing out globally as well but the investor perception has been positive today. just to give some size and scope to this company would be a bit like amazon spending -- spinning out its own logistics company. it goes toe-to-toe with alibaba so a major e-commerce player. the logistics side of the business, they have warehouses, about 1000 of them, the transport networks, delivery, and the software and arguably, they put the piping in, the
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plumbing in for arguably the biggest consumer story we are looking at right now, which is china's continuing appetite for e-commerce. they have challenges. they are not yet profitable. i asked them about that. no near-term plans to build out their market share which on some metrics remains relatively slim and this is a very fragmented market as is often the case in china, and readily competitive. it will not be easy for them. they have their eyes overseas as well so watch for more expansion plans, particularly in europe. annmarie: expansion plans breaking out of asia and the stock is higher in hong kong. tom mackenzie in beijing, thank you so much for bringing us the interview. the palestinian prime ministers says a standup with israel and jerusalem remains tense. we will hear from him and the senior advisor to israeli prime minister benjamin netanyahu, next. this is bloomberg. ♪
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annmarie: good morning. this is "daybreak europe." i'm and reorder them in new york. the palestinian prime minister says the cease-fire in the gaza strip is holding but the standoff between israel and the palestinians in jerusalem remains tense. we will bring you that interview shortly but let's hear from the senior advisor to benjamin netanyahu. >> of course we are interested in having a positive relationship. there are things that they need to do. we are willing to move forward in that process. >> there weren't any incentives offered around this issue? >> it's a matter of conversation, not incentives. we want to have peace. we want to be on good terms with
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all nations. over the past few months, we have dramatically advance the peace process. we had peace relations with four arab countries. and in africa, we had a breakthrough with sudan and morocco and there are more arab countries on the way and we would like to see the process move forward with the palestinians, too. president biden said peace demands that they finally recognize the legitimacy of the independent jewish state of israel. without that, there can be no peace. >> what about the ongoing discussions around a re-engagement with iran about bringing them back into the fold, a potential breakthrough in a nuclear deal? israel is opposed to that. what steps is the country taking to derail progress on that front? mark: the prime minister said very clearly that we think it
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would be a mistake to return back to the 2015 deal. we think that deal actually gives iran a clear path to nuclear weapons with international legitimacy and we believe, as i say, to return to that deal would be a mistake. we are not just expressing the position of the israeli government. many of our friends in the region, many arab countries, share israeli concerns about that nuclear deal. >> egypt and qatar, united states, europe, arab countries, we have been in full coordination to bring the cease-fire to a reality. the problem is that while we do have a cease-fire in gaza, the situation in jerusalem continues to be very inflammatory. it continues as well as the threats of ethnic cleansing of our people.
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the problems are still the same. while things in gaza are quiet now. yousef: is there a plan for ap summit in cairo where maybe the likes of you and hamas and israel are all invited with some other regional and global powers? is that in the making? >> i don't think that's in the making. i think what will happen in cairo is that there will be palestinians because it is so important for us to relaunch so that we all reach to an understanding of a situation in which nobody goes to war alone and nobody goes to peace alone. we have to be united in order for us to achieve our goals and in order for us to be able to take things to a different direction and take things forward. annmarie: palestinian prime
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esther and mark regev. they were both speaking to yousef gamal el-din. stocks close in on their fourth straight monthly rally. hopes for a spending spree from joe biden gives investors a tailwind. that is next. this is bloomberg. ♪
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annmarie: good morning. this is "daybreak europe." market sentiment has been boosted. joe biden is set to unveil a budget that would increase federal spending to $6 trillion in the coming fiscal year. biden is expected to outline those plans today the friday before memorial day weekend which has been seen by some as questionable timing. joining us to discuss this and what we are looking forward to
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is bloomberg's bruce einhorn. they typically don't get approved since the constitution gives the power of the purser congress. why does this plan matter so much? >> it does give us our first look at expanding the scope of the federal government, our overall picture of the whole thing. also, it significantly does sort of set things in motion when it comes to the house and the senate started working on the budget -- on spending themselves. when they start doing that, then that will enable democrats to move ahead on passing some of president biden's agenda like infrastructure taxes, social spending, all along party lines. those are things which would be done through the whole budget process. while it may be that the budget itself that the president has
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released may not be that important, it is part of this bigger process. annmarie: what does this report tell us about what the biden team thinks of the economy, inflation, unemployment? >> the biden folks are saying that they think the economy will grow at just under 2% per year for most of the decade once you factor in inflation. they are saying consumer prices will not rise more than 2.3% per year despite all of the predictions of inflation that we are hearing elsewhere. they also expect that the jobless rate will be 4.1% next year and unemployment will remain below that for the decade and so they are looking at pretty healthy job market numbers. annmarie: bruce einhorn, we will be looking out for that proposal being announced. what else is coming up this
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friday, euro area economic and consumer confidence surveys that will be released and then from 12:00 p.m. u.k. time, angela merkel and mario draghi are among the speakers at the global solutions summit so you don't want to miss that, followed by a virtual meeting of g7 finance ministers, hosted by richey sumac -- rishi sunak. the budget request is scheduled for release. new york times saying that will be a total of $6 trillion. let's take a look at where we trade this morning in terms of the financial markets. we have a boosted to equities across the world. futures market, this has everything to do with the data yesterday, especially jobless claims, as well as the boost we are getting from the initial proposal we are seeing from the new york times reporting from
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the biden administration. that does it for me. monday is a bank holiday in the u.k. and memorial day in the united states, but i will be here in this seat. this is bloomberg. ♪ (announcer) back pain hurts,
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anna: the morning. welcome to "bloomberg markets: european open." i am anna edwards in london. the cash trading is less than an hour away. local stocks close in on their fourth straight monthly rally. strong u.s. data and hopes for a spending spree from joe biden gave investors a tailwind. jamie dimon slams the president's tax plans as wall street ceo space another congressional grilling. this as jane


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