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tv   Bloomberg Markets Americas  Bloomberg  July 9, 2021 10:00am-11:00am EDT

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guy: friday the ninth. 3:00 p.m. in london, 10 a clock, new york, 30 minutes into the trading day in the united states. my cohost in new york, taylor riggs. alix steel will be back on monday. taylor, yields start to rise. small caps catch a bid. we are kind of unwinding what the rest of the week has looked like. taylor: unwinding at least a little bit of yesterday's trade. that reflationary trade for today is back in vogue. we are up about 1.5% on the russell 2000. the s&p 500 up 0.7%. trying to address yesterday's losses. in the 30 year we were heading down for 1.90%.
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make our way back up to 1.98%, up about five basis points on the day. we have to talk about one of the big deals, sam's dotcom getting a buyout. you are now up 64% on the day. guy: bloomberg getting hold of an eu draft suggesting that all new cars will be zero emissions from 2035. the industry is starting to get a little bit nervous about what is happening here. a suggestion may be that the leaders need to not only talk the talk, but walk the walk when it comes to making it happen. in terms of the data we are getting out of the u.s. economy, a little bit in inventory build which is worth paying attention to. it's a 1.1 last time around. maybe an indication of what is happening here, i think it is interesting that inventories are being built up a little bit.
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companies certainly suffering when it comes to what is happening with supply bottlenecks at the moment. it is a big issue we are hearing from just about every company. we saw in the u.k. data today, throttling back the industrial sector. let's get a been inspected with bloomberg's international and -- international economics and policy correspondent mike mckee. michael: for those who are visual learners, you can see what is happening with the chart i brought along here. when we went into the pandemic, we were seeing inventories head of sales, and they dropped way below as people bought up what there was an companies stopped making things. but that has reversed now. we are starting to see the inventories rise above the sales numbers, and that does suggest that some price pressures are going to start to be relieved as supply bottlenecks wind down. how long that will take, we don't know. this is the bloomberg economist survey for july on what is going to happen with inflation. as you can see, the economists
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we surveyed this month see inflation in this quarter come of the next quarter, and for the year higher than they did in june. in places, psychology is beginning to set in. this is going to be a very busy week next week on prices. you not only have cpi, you have ppi and import prices. all of those come before jay powell testifies on capitol hill in his semiannual testimony to congress on the economy. it is likely he is going to take slack for the inflation numbers because members of congress don't like to see rising prices. consumers don't want to see rising prices, and they vote. so it should be a very interesting week next week. taylor: mike mckee, thank you, as always. a lot of news out of china today as well, cutting the reserve ratio by 0.5%, and more firms being added to a u.s. blacklist over alleged human rights
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abuses. let's get more with tom orlik, chief economist at bloomberg economics. that's start with that reserve ratio. is this just to help pump liquidity and help what might be a slowing economy? tom: the chinese economy was a story about strength, the only economy to grow through the pandemic. what we are seeing in 2021 and especially its with the news overnight is a reminder of some of the vulnerabilities. the people's bank of china surprising economists with a forceful move to cut reserve requirements by 0.5%. that releases about one trillion you want into the economy. what is striking is the idea that perhaps the pboc is seeing something that the markets are in seeing. perhaps the pboc is seeing weakness there and moving to get ahead of it. from the united states, news
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that more chinese companies will be added to the blacklist, reflecting concerns about human rights engine giant. is that going to move the macro dial? no, but it is a reminder that u.s. tensions are very much bubbling up, and also present a risk to china's growth prospects. guy: you do wonder whether ultimately, this is where other big economies are going, maybe just lagging china little bit. but maybe they will need some policy help further down the road. tom orlik of bloomberg economics, thank you very much, indeed. interesting in light of the bond markets we have seen in europe and the united states. g20 finance ministers our meeting, the group poised to embrace the oecd's minimum corporate tax or trait -- corporate tax rate of 20%. is ireland going to be a
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problem? are others going to be problems? maria tadeo is joining us with the latest. maria: yes, and this meeting is still happening, and it is ongoing here in venice. today, two things. of course, the discussion is very much focused on that 15% corporate minimum tax. the other aspect this which perhaps is just as equally important is the ability to tax these companies in the countries where they make their services. i did speak with the european commissioner for the economy. i also spoke with the spanish and french finance ministers, who both said we do see a deal come sunday. i also asked if the irish government can work with the relocation of tax come but they do not like the 15%, and the three of them agreed that this is a full package. you can't pick and choose. this whole thing needs to be one big package that includes both the effective tax rate and the
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relocation of taxation. we will have to wait and see, but behind the scenes here, they are competent that this is going to get approved this week. of course, after that we move onto the m limitation. the companies that are going to be affected by this are going to have to play ball. some of the critics argue that they will manage a way to reduce their task bill even if that goes up. taylor: bloomberg's maria tadeo, thank you. beautiful venice there in the background. meanwhile, president joe biden signing a sweeping executive order designed to promote competition across american industries. it called on regulators to increase scrutiny on pretty much everything. technology, drug prices, banks. joining us from washington, d.c., r white house reporter annmarie hordern. pretty broad sweeping when you take a look at the list of everything that this includes. annmarie: it is a plethora
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of different industries. technology, the former pseudo-injured tree -- determines who the coal industry -- the pharmaceutical industry. but the direction of travel is, if you look at all of these together, it shows a shifting power back from capital to labor , and that is what they are going to be using in terms of this executive order. i think what is distinctive is that the obama administration was on the former president's way out. biden is at the very start of his presidency. when obama did this, it did not direct individual agencies to take specific actions. right now, you look at this sheet, they are directing which agencies and what they should do . so really, it is all about competition this morning in washington, d.c. guy: thank you indeed.
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bloomberg's white house correspondent annmarie hordern joining us from the sea. what have we got coming up for you? the u.s. earnings season kicking off next week. leigh drogen, founder and ceo of estimize, will be joining us. what do we need to be doing? what do we need to be looking at? that is coming up next. this is bloomberg. ♪
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♪ ritika: let's check in on the bloomberg first word news. the u.s. will at least 30 countries to its economic blacklist today. at least for -- 30 companies to its economic blacklist today. at least 14 of them are chinese companies accused of human rights abuses in the xinjiang region and helping the chinese military. a new twist in the assassination of hades president.
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-- of haiti's president. haitian police said 28 people carried out the attack against the president. 26 of them were said to be colombian. the other two were described as u.s. citizens of haitian descent. four alleged assassins have been killed and six others arrested. a new british study says most young people face extremely low risk of illness and death from covid and have no need to shield from the virus. that backs up clinical reports that children and teens are less likely to be hospitalized or face severe attacks. -- face severe effects. 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. i'm ritika a good -- i'm ritika gupta. this is bloomberg. guy: the u.s. earnings season will officially kick off next week. what should we be expecting? leigh drogen, estimize ceo and
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founder, here to fill in the blanks. i guess the big picture question , is this as good as it gets? leigh: this is going to be the peak quarter for the cycle, given what we were up against last year for q2 was pretty dismal right at the beginning of the pandemic. so comps are going to be very easy, and it is going to get a little harder from here, but we are still going to have another couple of quarters before next year, when it is going to get real tough. from our perspective, if you think about it in the most simple way, investors don't want to be heavily invested in specific names or in the market overall coming into quarters where you're going to have incredibly tough comps. but it is going to be pretty easy still for the next couple. taylor: we have an executive order out today trying to increase scrutiny on technology, m&a, and this is a bipartisan issue. how much of a headwind is some of the anti-big tech sentiment on some of these stocks?
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leigh: this has been a running kind of theme for the last 4, 5, 6 years. at every single turn, i have said it is just not an issue. it hasn't been. and i continue to believe that it won't be. it would take a very serious bipartisan desire to look at the actual problems here, and that just isn't there. there's only so much that this administration can do one sound without real legislation. i've said over and over again that if the legislature really wants to do something, it is not about breaking up big tech. it is about taking away what allows them to continue to add onto themselves, and in the social media sphere, that is very specifically the fact that their apis for the social graph, you don't need to go on this long road. all you need to do is write a law that says these companies
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have to open their social graph, and that will do it. you don't have to deal with having them selloff pieces. that will start to disintegrate them. guy: just talking of the big tech companies, what we have been surprised about over the last few weeks is the past that -- is the fact that growth stocks have come roaring back, led by the big tech names. people see potential safety, they see stability. that what we are going to get this time around as well? leigh: it is really interesting, the last three months. this is the highest level of upward revisions for the overall s&p 500 names that we have seen in six years, so analysts were way behind the curve here, and they are chasing the fundamentals higher which is why we have seen the market surge pretty well. tech, interestingly, is kind of right in the middle of that. it has really been energy and materials that have seen the
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largest upward revisions, but over the last month and a half, those sectors have lagged. so it looks like the belief from the market is that going forward , they have caught up enough on the earnings and revenue there and we are going to start to see the consumer take back over. taylor: within tech, are you looking for may be a divergence, a bifurcation between some analysts saying there's a really strong advertising environment, may be a preference towards companies that rely on advertising versus a subscription-based model? are you think any about the fundamentals and the impact within tech on the difference between tech companies? leigh: two ways to think about it. one is just where we are right now, the beginning of a massive bullish economic cycle, advertising is going to be amazing. so you want to be exposed to anything remotely like that.
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those names should outperform. the other way to think about it, and we have been discussing this for the last 18 months, is basically what happens to those names that saw a lot of pull forward and demand and adoption because of the pandemic. do they just kind of fade off? do those growth rates slow considerably? or is that stuff going to stick around? i think you need to pick and choose very wisely within that group. something like telecom is very different than something like zoom. i will let viewers decide which one is which, but i think there's going to be a big bifurcation in the multiple tech names that were very pull forward driven by the pandemic. guy: it is amazing, the market's giving everybody a free pass up until now. you do wonder, as the market starts to change, whether we get more dispersion in terms of
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where we are getting these companies performing. just a final quick question from me. one of the critical factors we will be watching out for his guidance during the second half. what do you think the message is going to be? what do you think companies are going to be saying? leigh: some friends of mine in the industry have been telling me that the supply bottlenecks specifically having to do with shipping are not going to be resolved within the next couple of months, that this is going to be a nine to 12 months story. what that produces is instead of having this massive piece of gdp and earnings in the next couple of quarters, the economic boom is going to be more drawn out, but at a lower level. for the market, this isn't an issue necessarily. we have seen in the estimize
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alpha factor models, the last two quarters have been some of the best we've ever had in our history, and what that basically says is that when those prints happen and companies blow their numbers out of the water, or they disappoint big, they are having to rejigger those expectations significantly and they are operating based on that. they are not thinking it is a one time thing. so i think that will continue over the next couple of quarters here. the numbers really matter because they do mean something going forward instead of just being transient. guy: it will be interesting to see what happens with labor as well. a lot of talk about labor getting a greater grip on capital. always appreciate your time. a nice set up into the earnings season. leigh drogen of estimize, thank you very much, indeed. the home of basf, the german chemical giant, coming out and
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upgrading its full-year adjusted operating forecast to 7.5 billion. you can see the impact in the stock. we have also over the last hour or so had really solid numbers being released by volkswagen. german cyclicals gaining a bit of traction this afternoon, as you can see. this is bloomberg. ♪
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ritika: it's time for the bloomberg business flash. bloomberg has learned that chinese aviation officials are open to conducting test flights on boeing 737 max, a step towards lifting the plane's grounding after more than two years. even if the test flight is made relatively soon, it could be months before the ban is removed. in london, the number of job openings in the finance industry
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almost tripled last month from your ago. a recruitment firm says they were more than 3300 jobs available at the end of june. the uk's upcoming exit from covered restrictions is stoking optimism about the economy. billionaire richard branson has made his reputation with a series of daredevil exploits. he returns to that on sunday, when the 70-year-old is expected to take a rocket powered trip to the edge of space. a test flight of branson's virgin galactic craft would be a step towards taking ticket buying passengers. that is your latest business flash. taylor: thank you as always, ritika. it is a big week for these markets, despite the market been closed for the holiday. can you believe that was only four days ago? etf investors moving their money around. here to walk us through the flows, katie grice held of bloomberg news -- katie grice held of bloomberg news. reporter: they port about $1.9 billion into the qqq etf that
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tracks the nasdaq 100. that is at the top of the flow leaderboard this week, and tech is your relative outperformer on the week. you also saw s&p 500 funds see inflows. that also makes sense because we know that tech is such a big part of that encz mark. -- that benchmark. guy: in terms of how this has changed the flows story, what have we seen? katie: tesla is the big winner, but interestingly you saw a estate funds really see a lot of outflows. iyr in particular got hammered, the ishares real estate etf. that saw big outflows. xlf, too. that tracks financials. that just makes sense because even though bank stocks are rebounding this morning, they have really been hammered by that big bond rally we saw this week. on the other end of that, you
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saw energy flows also getting hit this week. taylor: we are taking a look at the real estate outflows there. on a week by week basis, we know you can see value versus growth, bonds versus equities. long-term, where are we in terms of where is the money actually going on a year-to-date basis? katie: that is a really good question. you see s&p 500 total stock market type funds at the top of the leaderboard, and you are seeing more money come back into tech. you just see a lot of money getting pulled out of that. they are seeing inflows again to the leveraged tech etf's, starting to see some inflows. that is a real popular among the retail crowd. they like levered funds. that is where euro seeing money go. guy: katie, thank you very much, indeed. taylor: and guy, i didn't even
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make you do muni etf's. look how nice i am. guy: i'd forgotten that was one of your specialist subjects. to be honest, not an area of particular expertise. we don't have munis over here in the same way as you guys. i haven't grown up with muni's in the same way you have. but i've forgotten that you were a bit of a specialist. but we will do more muni for taylor. i'm just trying to think of how we make this work. tax reform topping the agenda at the g20 finance ministers meeting in venice. we will talk to tim sarson of kpmg about the them locations. this is bloomberg. ♪
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♪ guy: european finance chiefs
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trying to reassure their group of 20 peers that the region will unite behind a global corporate tax deal and won't undermine it with a proposed digital levy or a problem with ireland. tim sarson of kpmg joins us with what this means for global company. feels like we are in the very early stages of this process, trying to understand whether politicians can get behind it. what is your sense of where this is going and the timeline on which we are operating for a global minimum corporate tax? what are you advising clients? tim: it may seem like it is quite early in the process. we have been talking about this, actually. the oecd has been putting up suggestions for what i global minimum tax should look like. i think we are a lot further down the road than it may seem. if you look at the holdouts, it is largely small but wealthy
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countries, and then a number of developing countries. if the concerns of that group are going to be addressed, if not all of them are on board, i think we got consensus. we've got the big countries there already. but importantly, the u.s. is behind this. china has come on board. i would expect to see something implement it probably in 2023. if not that, then 2024. taylor: how do people prepare in the next year or two for if those holdouts stay? some of those loopholes that might be able to allow avoiding a 15% and minimum -- a 15% my mom tax, will those exist? tim: there will be very few loopholes eerie of the biggest loophole, you could say, is that any company below a certain threshold of 750 million euros
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of turnover per year, if you are an sme or even a pretty large or medium size business, you don't have to worry about this anyway. if you are a big is this, it is not on impossible to avoid -- it is nigh on impossible to avoid the global minim tax. then we have a secondary mechanism which is the under text payments method which allows a country that is paying something to a low tax country to capture their share. so when you start digging down into the way rules are going to work, i think it is going to be too difficult for most multinationals to even bother trying to get around. having said that, i think there's still going to be opportunities for companies to look at what is the perfect allen's. so there's still plenty companies can do. guy: what about the re-investors
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, so all of the money doesn't necessarily drop down to the bottom line? i am thinking of course of companies like amazon. tim: corporate tax is a tax on profits. we have other taxes that are on sales. we have taxes on people's payroll. if you want a tax on profits, then it is a tax on profits. if you are in a declining industry or reinvesting in the right way, corporate tax isn't really for you. so i guess the world just decided they've made some tweaks to it, particularly pillar one, but we are not abandoning corporate income tax right now. if you want to collect more on sales, than the question is
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where you do it. taylor: here in the u.s., there have been talks of three or four years, if not more, that eventually this was coming. they eventually had to "pay their fair share." are these companies realizing that eventually these are coming? tim: in a nutshell, yes. they have been prepared for this for a while. a large number of large multinationals pacing differently more than 15% tax, and there are multinationals out there that have an effective tax rate of 40%, 50%, etc. you are used to not only paying high rates of tax, but paying tax on the same profits twice. for most groups, this is simply about making sure you are treated fairly, so your peers don't have an advantage over you
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, and that your compliant. actually, the story is not going to be what does this mean for our tax rate. it is going to be how do we comply with this? how do we keep the right records? it is behind the seemingly quite simple headlines that it can be fiendishly complex, particularly be global been a mom tax taylor: -- global minimum tax. taylor: complicated, and we will continue following you as you continue to give great analysis. of course, back here in the u.s., president biden set to sign a sweeping executive order later this afternoon designed to promote competition across u.s. industries. isaac boltansky, compass point research, joins us now. it's only been a couple of hours since we've gotten to read through all of those executive orders. what do you think comes from what sounds really good on paper
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to what can actually be implemented, what actual change that you expect to see? isaac: there's actually some similarities regarding this sweeping executive order and the underlying issues to your previous segment with the international tax regime. there's a big divide between rhetoric, which is what we are getting today, and the reality of policy. it is a sweeping order, talking about 70 plus specific actions that have to be done by 12 or more different agencies covering numerous corners of our economy. but my message to clients today is that some of these signaling shifts are things that we should have been expecting since president biden won in terms of more antitrust enforcement and a higher hurdle for m&a, but many of the specifics in here are going to take a lot of time because they flow through our regulatory regime, and they are
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still calling on certain bodies to do things that it is holy unclear whether they are capable of actually changing. guy: some of these institutions, the regulatory agencies are theoretically independent. can you walk me through how that is going to be applied in reality? basically, when the president says something, are they going to follow with the president says he would like them to do? isaac: the answer there is yes. some of these proposals are framed as suggestions because as you say, some of the regulatory bodies in question are independent. but we've got to keep in mind, the president just named the new head of the ftc, who is one of the leading thinkers and what is referred to as hipster antitrust or the new brand movement. this is really putting more detail around what the markets
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should already have expected as soon as she was named as the head of the ftc. so these suggestions from a market perspective should be viewed as things that all of the agencies in question are going to try their best to do, even though they are technically independent. taylor: the markets certainly brushing off some of those concerns as well, as you rightfully point out that the market had perhaps look at these headwinds coming their way. within the executive order, technologies, financials, health care, what sector do you think is under the most pressure and could be affected most by this? isaac: my client questions thus far have really been focused on the tech side of this. i think there are some specific areas where we can expect more scrutiny to actually change the market dynamic. specifically, i am talking about new m&a deals in the tech space that are focused on smaller
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competitors. this is an area where i think we can see the ftc, the doj, and others become far more active because there's an easier story to tell their regarding how consolidation is inherently anticompetitive and anti-consumer. that is an easier story to tell. with that being said, i think we have to look at this through the recent actions and say that it is going to be difficult, as evidenced by the facebook lawsuit getting thrown out, and the consumer welfare standard has been the coveting dynamic since the 1970's. it takes a long time to go from theory to practice. guy: the focus is going to be on tech, and i am sure that's where you're getting most of the questions, but this push back concentration within the was economy is fairly broad. it is interesting that looking at the railroads as well, an area which has been concentrating fairly rapidly
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over the last few quarters. in terms of how broad this is going to be, if i am an m&a lawyer right now, what am i thinking about? how broad do you think the effect is going to be? isaac: i think it is going to touch nearly every corner of our economy. for the m&a lawyers and the bankers and the dealmakers, my message here is that when we put it altogether, widens commentary from the campaign -- biden's commentary from the campaign trail on, and everything that is going to follow, the take away is that they will be far more active in policing concentration concerns, and that the new m&a proposals are going to face heightened scrutiny, which has to be part of the dealmaking calculus going forward. guy: just a little bit tougher. isaac, thanks for your analysis. coming up, wall street results.
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the six biggest u.s. banks reporting earnings. that's a great sick -- betsy graseck of morgan stanley will be joining us next. that conversation next. this is bloomberg. ♪
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ritika: this is "bloomberg markets." coming up, subadra rajappa, socgen head of real rates strategy. this is bloomberg. ♪ taylor: the biggest u.s. banks will be out with second-quarter results early next week. jp morgan, goldman sachs kicking off the season. joining us with what to watch, what to expect, betsy graseck, morgan stanley global head of banks and diversified finance research. it was jp morgan's daniel pinto that said trading is back, that the trading slump is gone for
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good. do you agree with that? betsy: it depends on what your frame of reference is. trading will be down on a year on year basis, and a large part because last year was a banner year, and we all know what happened with spread compressions driving the bus on unusually higher earnings. we do expect trading is going to be down roughly 30% year on year, and that is what we are looking for. i think it is the forward look over the next several years. that is a different question relative to what we are looking for this quarter. guy: huge moves in the bond market this week. a flattening curve. we have obviously been watching what is happening in the impact coming through on the banks. what is the biggest driver? betsy: we expect to see some commentary around the bond
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market and with the impact is on the forward look. i think the quarter should be fine for most interests -- most institutions, but the question will quickly roll to how has this yield compression impacted your forward look. we are very clear, we think most of the companies, if they have not yet guided down like jvm has, they will need to. -- like jpm has, they will need to. taylor: we get an executive order from the president which he is expected to sign this afternoon, and he targets the financials, encouraging the doj other agencies like the federal reserve, the fbi see -- the fbi see -- the ftic, to perform more robust scrutiny around m&a. is that a headwind for the financials? betsy: our view on bank m&a is
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that structurally and strategically, it makes sense for institutions to have the scale and the product breadth they need to drive growth in their business, and strong profitability. i think the environment is positive, more positive when you got banks that are able to generate profit not only for shareholders, but for the overall stakeholders that they serve area our view is that on m&a. guy: can you give us a sense of how you think things are working out for the different banks? wells seems to go from a series of mistakes to another series of mistakes. there's a report out this morning about them shutting down personal portfolio credit lines,
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elizabeth warren on the back of that. she was on twitter earlier on talking about it. in terms of how banks are executive right now, how big a divide is there between the ones continuing to do well and the ones like wells, which continue to struggle? betsy: on execution, i think there's different capability sets, different results here, and part because of how institutions have been investing in their tech platforms and their brand over the past decade. these are large institutions that don't turn on a dime. when i think about the question you are asking regarding wells, what we are talking about is personal lines of credit. i am sure it will come up on the call next week. when i look at this business, it is a small piece of the overall product set they are delivering to consumers. we looked at the personal loans business. it is really about 3% of
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earnings. that includes loans and lines, i'm guessing. it includes both. what we are talking about specifically is on the lines. the question for the management team is, what are you seeing in this product that you are interested in are exiting a flexibility tool for clients, or is there another product in your wheelhouse that you're going to be migrating people towards i think that is an important question here. i don't think the fact that they are shifting a product hike means that they are exiting client flex ability. let's hear from them, and it is definitely on our question list for now.
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taylor: some of the biggest banks have said their biggest come edition are fintech and technology firms. are they pivoting fast enough to take on tech? betsy: definitely they are pivoting fast. this is going to be an ongoing question that we have probably through the next 5, 10 years, maybe forever. and why? at its core, banking is about capital, how much capital have you had to allocate to your clients. it is about people, about trust, and about technology. i remember during the 1998 internet boom period thinking that are most tech oriented industry is financials. so there's always going to be more they can do, and i do think they are pivoting, and we will see them accelerate. guy: wall street divided come of the world of banking divided. work from home, not work from home. flexibility, no flexibility. there is a clear division. where do you come down? is working from home going to be
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a competitive advantage in attracting talent, or are these banks going to do better to bring everybody back? betsy: you caught me on a day that i am working from home. if you had cost me on any other day over the last three weeks, you would have caught me in the office. i just want to make that clear. this is the first day in three weeks i have been wfh. i think that the answer here is going to be very specific around what kind of rules you have. -- what kind of roles you have. if you have a client facing role, you've got to be in front of the client. if you are any role that is not facing the client, that might not be as required to be face-to-face every day, there is some flexibility. we see that not only at a couple of institutions, across the
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board with institutions. i thought it was really interesting, bny mellon's ceo, over the last conference call, started off by saying they want to be an employer of choice, and they want to have work from home as a key offering. so i think there is the underlying question that is what is your goal, and what do you need to do to succeed in that role. guy: i think as long as you haven't been out for lunch, you are probably good. betsy graseck, morgan stanley, thank you very much, indeed. this is bloomberg. ♪
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♪ >> i'm quite confident. i think a lot of work has been put into these negotiations. they will break through with a new administer asian on the others of the atlantic.
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i am confident that we will have a deal that sets the basis for appropriate legislation from the world. >> when you look at this deal, there's two sides to it. on the one hand, we are looking at the tax rate, the effective tax rate, at least 15%. but there's also what countries would argue is equally important , that you would have the ability to tax for the services -- tax where the services are made. the irish could work with that, but not the 15%. you look at this as a full package, or get a hybrid solution? it cannot be that there is agreement on one without the other. no way. maria: so you are looking at this is a full comprehensive package. both need to be there. how much resistance do you think you will get from the irish government, and a number of other european countries that have said we are not fully vetted? >> what we have seen in the last couple of years is that more
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countries are joining this consensus. the idea that we need to have a fair tax system, to stop this race to the bottom, which is at the end of the day impoverishing us all. so i hope and look forward to our land adjoining this consensus -- to ireland joining this consensus so we can move forward with legislation. guy: the spanish economy minister speaking a little earlier on today to bloomberg's maria tadeo in venice. we are going to get more from the g20 in the next hour. we are going to be hearing from mexico's finance minister at exclusive interview, coming up on the european close. european stocks starting to come back, germany in particular posting some really strong members today. we will deal with the details. this is bloomberg. ♪
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>> the countdown is on in europe. this is "bloomberg markets: european close," with guy
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johnson and alix steel. ♪ guy: friday the ninth. 30 minutes to the close, this is what you need to know out of europe. the u.k. economy faltering in may as the destruction of manufacturing stalled on supply bottlenecks. hospitality and leisure bouncing back as society reopens. volkswagen shares jump as the complete forecasts first tap -- first half operating profits is nearly 11 billion euros. our woman got a -- they are warning that a lack of chips will cause problems over the next year. european leaders say internal divisions over minimum corporate tax rates will not derail a deal at the g20. we will take you to venice this hour. let's talk about where we are with the markets. most european equities are in the negative for th.


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