Half the stocks above their 200 day moving average. To 30 down about 20 depending on what you want to pick. Keep in mind the yom kippur holiday. Your 10 year yield. Taking up slightly. Not quite what i would call a huge selloff in treasuries but you are seeing some people reposition, some folks like citigroup saying this is more of a reset, more they correction until that bond rally resumes. Crude oil Holding Around the 53 level looking for the impetus out of the eia data. That seemed to be a negative but keep in mind a lot of the inventories actually went down way more than expected. A somewhat bullish signal. Most of the hedge fund very bearish lee positioned and take a look at the dollar. We can call this flat on the day. We are high on the dollar. , those we get a selloff Dollar Strength still in place dont let that fool you. Late stake you look at where we are in europe. That is the stoxx 600 over the last five days. We are getting a bit of a bounce today. But not by much and i want to put what we are getting today into a bit of context. We are basically where we are three days ago. Yesterday withf bounce back, im not sure the narrative around trade has significantly changed. Noting that we are monitoring remarks from fed chair Jerome Powell, he is speaking at a fed event hosted wythe county city fed descant city fed. Posted by the kansas city fed. Lets talk to jenna henry. Lets start with trade. Deal, ist get a trade the u. S. Heading for a recession . There are various stages to that question. If we dont get a trade deal but dont get the additional tariffs in october and november and december, then we kind of muddle through as we are. But if we get all of those tariffs being implemented, then yes the chances of recession will grow. Guy in that environment what you think the fed will do . Janet we are not there yet and this is what the fed is trying to tell us of the moment. Our forecast is that the fed will cut one small. It is absolutely your typical midcycle easing. I think this is really what Jerome Powell was talking about yesterday saying we are data dependent which is another way of saying we are not on a preset course. But actually we are not sure weve got the right data to be looking at and when you are in this world, youre back to judgment and Risk Management, which has been the approach from the very beginning. I think the fed has eased policy at a much earlier stage than they did before previous downturns. We had a new record low on unemployment and they cut the Interest Rates so they use this Risk Management approach but it means while they do this watch and wait, if things escalate, the curve continues to invert, they just keep cutting until we get close to zero again before they consider getting into more conventional territory. Romaine there really is no precedence for this type of midcycle adjustment like this presuming that powell and the fed do sort of give in what Market Expectations are which is for another couple of cuts by the end of the year. Is this going to be enough not so much to avoid a recession, but to reaccelerate the economy . I dont think it will. Forecast for our the world in the last week or two and inevitably we lowered europe, germany. Germany we think is in recession and will remain until the end of the year. We lowered our china numbers. Our u. S. Forecast didnt actually change, still at 1. 7 for 2020. I think Monetary Policy supports certain parts of the economy, the u. S. Isnt in a liquidity trap. Liftts not going to investment spending. Thats whats quite critical about these ongoing trade tensions which every Central Bank Government in the world from Jerome Powell to mario draghi and others have said no amount of Monetary Policy is going to resolve the trade dispute. Other parts of the world are the world aret being hit by it more. It might still take some time to see through within the u. S. Economy but the longer they continue to fall, even the u. S. Will be vulnerable to any renewed downdraft. Romaine the trade war ostensibly started spring of 2018, january march of 2018. While there hasnt has been a lot of damage you can link to the trade war directly, it exposed a lot of economic faultlines that really had nothing to do with the trade war specifically. Things that might have sort of snowballed into where we are today had trump never let us down this path. Im wondering if we get a religion resolution to the trade war in some fashion or another, does that automatically reverse the trend or all those faultlines going to be exposed . Janet i still think we will be vulnerable because the world has changed. We are no longer in this world of ongoing trade relive bro is a around the world. We are getting regional trade deals led by the eu and some of these asiapacific type initiatives. But they are still going to be this uncertainty regarding investment spending. You are absolute right to point out trade tensions in early 18 but a lot of local investment slowdown was led by china, it wasnt to do with trade in 2018 and the industrial recession center in europe in europe and the middle of 2018 was much more sector specific to do with auto, 2019 has been much more about the investment side and the uncertainty regarding trade tensions and we can look at economies where there has been uncertainty like the u. K. Or mexico to know that thats what happens to investment spending. Financial markets can move on a dime or a headline. Investment decisions about supply chains five or 10 years out are not going to be resolved because we get a partial trade deal out of the u. S. And china. They need to see much more convincing evidence. The World Economy is resting on the shoulders of the u. S. Right now. Therefore im wondering whether u. S. Politics is going to pose a risk to that u. S. Consumer. As we go into 2020 and into the impeachment story, are these economic events . Janet they can have economic consequences both directly that can influence. Its already influenced investment. We are not sure about investing but we can necessarily quite quickly. It might delay hiring a bit more. Its quite interesting how much in europe and in the u. S. And even the u. K. Over the last six months or so, Household Savings rates have started to edge higher. Unemployment rates may be low, but they are no longer perhaps quite as confident that they are still going to be employment a year from now. Guy lets talk about 20 20 in the election as well. Take a listen to both sides of the aisle of the moment, they are both fairly clear, particularly warren and President Trump, less so biden, that the china story is something that wont end with the selection but potentially will carry on and become more of a longterm theme. How do you factor that in . How are you thinking about the world changing . Are you putting it in a cold war paradigm, thinking about it differently . It is not a complete approach. Im wondering how you are thinking about it. Janet it is to some degree what economists like to call a supply short for the Global Economy. We think about globalization for the last couple of decades, yes there have been distributional consequences in individual countries that have been left behind, income inequality in advanced economies. But tens of millions of people globally have been lifted out of pop poverty by globalization. You have cheaper goods and services. Now as we go into the de globalization world, potential growth will probably be a bit lower. We are not going to get into that degree of specialization, it will be on a more regional basis. Different impact on inflation but from a gross perspective it will be lower as a consequence of it. Guy stick around, janet henry. Romaine lets get a quick check on global markets. Abigail doolittle. Offail a bit of a risk tone today. See art off in a show we bit of a mixed session. 25 waskei 5 nikkei to down 6 10 of 1 but the shanghai composite up. Perhaps hopes there could be a partial trade deal between the u. S. And china despite the fact earlier this week Commerce Department in the u. S. With eight tech firms in china and we see the response in the u. S. Up 6 10 of 1 . The dax in germany leading the way up 9 10 of 1 . All of these off the highs. Supporting the ideas it is risk on, lets look at the euro against the yen. Probably one of the more growthier risk on. This is an anomaly on the year down more than 6 as the euro has simply declined. Today some of the growth and risk are out. Thats for the u. S. In this sector. Today up 1. 4 . Qualcomm one of the big names out there helping out at 1. 7 . Crude oil up eight tenants of 1 , another risk asset. Haven bonds are falling off. All signs are risk on. Lots of volatility remains. Going into the bloomberg, lets look at the daily action on the s p 500. Back in august we see huge move to the upside and downside as investors cant make up their mind. More of a stalemate in september. The big moves remain back in october as one day we have good trade headlines in the next, bad. Volatility back in the mix. Abigail, always coming with those great charts. If you want to see those you can go to g tv on your bloomberg terminal terminal. Up on keyso catch analysis, save your favorites for future reference or play around until you get bored. This is bloomberg. Bloomberg. Guy from london, im guy johnson. Romaine this is the european close on bloomberg markets. Lets get a quick check on first word news. Courtney is here with it all. Courtney President Trumps counterattack against House Democrats is taking shape. The administration is vowing to stonewall the widening impeachment inquiries. A white house lawyer declared it unconstitutional and invalid in has trey gowdy to help him lead his strategy. Have begunops crossing to northeastern syria militantsfor kurdish who control the area. Dozens of u. S. Troops working with the kurds were pulled back. Michelleit negotiator is still optimistic the brexit deal with the u. K. Still remains in still remains possible. Negotiators need to remain calm. He will meet with the u. K. Brexit secretary on thursday. California bracing for a power cut that will affect millions. Pg edy has begin shut has begin shutting a power for customers. Parts of napa valley and oakland are under the areas that will be hit. They already faced 30 billion in liabilities from fire in the last two years. Global news 24 hours a day on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. Im courtney donohoe, this is bloomberg. Guy thank you very much. Still with us, janet henry. Lets get back to that brexit story. A question i talked earlier and i asked him whether or not brexit can be a systemic event globally and im curious to get your take. Janet what type of brexit . Guy a hard brexit. Most if most forecast for a hard brexit the uks most likely to have a mild recession. Of adirect impact , theyction in an economy would certainly be significant hit to European Growth and i think also what it would be a demonstration of in is some of the trends playing out globally around the world and a lot of these are the issue of the left behind people that have not benefited from the expansion as much, perhaps voting for Something Different they feel they have not had their fair share of the pie, politicians being elected that will support what they are favoring in terms of isolationism and protectionism because we are because we are seeing that out more globally. Guy you talk about parts of europe being in recession. What a hard brexit tip the whole of europe into recession . Janet good question. Its underlying growth rate italy had a mild recession last year. We estimate germany is already in recession and will remain that way until the end of the year. We call these global headwinds. If the u. K. Was to go into recession there is a chance it would take a certain amount, we estimate even a direct impact would be low euro zone growth forecast,ly in our zero point seven to start with. Thats a direct impact. The broader impact, the underlying confidence i really particularly the financial transmission as well. And then you get in the realms of Monetary Policy, limited now particularly in the euro zone. And when will it come into play to support longerterm growth. Romaine building on this idea, you have brexit, potential warfare in turkey and syria. You have political unrest in china, hong kong. Out at theok potential shocks, potential economic shocks out there, is there anything that worries you most right now . Economists are known for worrying about the downside and a recession. We are not forecasting a global recession. When you look at the lengths of this expansion, unemployment rates being at low levels. You look at the yield curves and you look at the broader trade tensions and geopolitical tensions which you referred to. We know the risks are very much skewed to the downside. So trade broadly, particularly , that isepresents without a doubt the biggest thing on the Global Economy that could drag it lower. There will also be relative plays. Trade initiatives happening elsewhere in the world. Since the brexit vote, the eu has signed a deal with japan and canada. Since the u. S. Pulled out of the tpp, the remaining countries have formed their own trade agreement. There are other initiatives happening. Its not likes everyone is battening down the hatches and saying we are all going to be protectionist. They are looking for new avenues to where they can generate at least some offset on the growth side. Romaine thats interesting. When we talk about the potential shocks here we are not dealing with what would normally be considered normal. When we talk about the fed loosening policy, more fiscal spending out of germany or other countries. We are talking about i guess message that would apply to more normal circumstances when we are in a world economically and politically that is anything but normal. Janet yes, that is fair. What economists like to call a market failure. If we go back to 2008, the credit crunch at that time where banks would not lend to each other, that was typical market failure. It forced governments to come into support demand. Thats arguably where we are now where it really doesnt matter how low Interest Rates are or availability of funds, you are really going to build that thats going to take 10 years or if its a railway maybe 20 years to actually put in place or are you going to wait and see. Normal and thats where there is a role for government to come in and support spending, but not just to support growth over the course of the next year. It will be something to need support investment every year for the next five or so in a way that will support productivity growth and improve education in trading and the longterm factors that usually go well beyond the electoral cycle if we are going to get stronger growth. Guy great pleasure, janet henry. Troops movingsh into northern syria. We will discuss the them put cases for the Global Economy and do that with a geopolitical. Trategist over at cqs this is bloomberg. Romaine time for a Bloomberg Business flash. A look at some of the biggest news stories. Fitbit moving production of its trackers and smart watches out of china. The company tried to avoid u. S. Tariffs on chinese made projects. He said by january it will no longer have products of chinese origin but did not say where those devices will be made. American airlines is a bandit hopes of resuming flights with the boeing 737 max 8s year. Throughlling the jet january 15. American airlines having to , that followssult a similar action by southwest airlines. Guy quick look at where we are with europe as we are headed to the close. 1 . Re up by around half of take a look at the stoxx 600, by no means at session lows or at session highs. Yesterday was a pretty bad. We are where we were three days ago when it comes to european. We will count you down and give you the details. This is bloomberg. From the couldnt be prouders to the wait did we just winners. Everyone uses their phone differently. Thats why Xfinity Mobile lets you design your own data. Now you can share it between lines. Mix with unlimited, and switch it up at anytime so you only pay for what you need. Its a different kind of Wireless Network designed to save you money. Save up to 400 a year on your wireless bill. Plus get 250 back when you buy an eligible phone. Call, click, or visit a store today. Guy 30 seconds until the end of regular trading in europe. European stocks are higher. Recovering from the losses yesterday. Up. 5 on average. There are differences between the main markets. Also worth remembering where we have come from. This is last five days of the stoxx 600. We are up. 7 . We are basically where we were three days ago. Rise on the eight, today we are midway between the two. There was a lot of sound and fury earlier on talking about this bounce generated, this top search generated by the possibility of a skinny deal, a lightweight deal between the United States and china. Many are pouring cold water on that. There is some evidence that is having an effect. That is last five days. Lets talk about the individual markets. This is where we come back to the trade narrative and find some evidence of some effect of the straight story coming through. The ftse is up. 3 . The dax is up. 4 . The cac 40 up. 7 . Why is the dax outperforming today . It is a trade narrative. We will go to the grr and show you what is happening with the bloomberg. What it will tell you is the car sector is having a good day. Getxpectations, maybe we some kind of a trade deal, albee beit a lightne al one. Technology is bouncing back. There is the auto sector bouncing back, maybe related to the possibility tariffs do not go into effect. That gives us a reset moment to find a way out of the situation we currently find ourselves in between china and the United States. There is some evidence today it is reasonably scant, but there is some evidence the trade story is having an effect. The best place to find it is within the sector story in europe. In terms of a market search, not sure we are seeing one. That is look at the european close. Romaine lets take a look at what is going on in the u. S. The big question is do you believe in this rally we have today . 2911 is your number. 2914,in resistance point, the pivot point at 2903. We have been sandwiched between that. 500of the stocks in s p above the moving average. Not bearish signals not bullish signals either. In the options market, people are very bullish lee positioned. Keep that in mind as we had further into the day and get the fomc minutes and we head toward the end of the week. Your 10 year yield going at 1. 56 . Yields, butof the well below where we were a few months ago. Crude oil getting a bid and Holding Around the 53 level. Those hedge funds bearish late positioned. The dollar flat today and a 52 week high of 1223, we are pretty much near that. A little bit of positive. , up 1. 5 . E sox a lot of these names exposed to china. Rallying to percent to 3 on some of those names on reports of prospects that chinau. S. Trade tensions are going to ease. , these are the largecap chinese companies, this is the main etf tracking those. 3 , not a massive rally, but something to keep. Transports also getting a bid. This is mainly being led by the airlines. All moving higher today. Gold interesting. Despite some of the risk on tone we are seeing, bold is Still Holding higher. Citigroup out with a note saying they are still predicting 1700 for gold if you can believe that. Euro zone finance ministers today in luxembourg and discussing a wide range of issues from budget to brexit. We are hoping and working for an ordered brexit, but we are preparing for the worst. We think know brexit is a tragedy, bad news for europe and it will turn out to be bad news for britain as well. Of course we have to respect the voice of the british population. I still think that the best it takes brexit two to tangoe. Jeanclaude juncker expressed himself we must look for until the last moment. Guy bloombergs maria tadeo is at the meeting and has been covering it for bloomberg. She joins us with the latest. Lets talk about the brexit issue and try to figure out where the ministers stand. How worried are they really about what a hard brexit will do to their economy . Maria that is the big question and the big elephant in the room. It is becoming difficult to figure out what the outlook for the european economy is looking like when you have all of this uncertainty around the european economy. One of the things finance ministers told me is this is a huge risk going forward. They do not recognize the narrative coming out of london. They will tell you they still believe a deal is the best way to leave the eu. They still believe and they will tell you the negotiations are still ongoing and they are working to get this deal. They also recognize the mood has changed over the past 24 hours. Everyone is a lot more pessimistic about this deal happening next week. They will tell you brexit alongside the trade war and the potential tariffs we could get from the diet state on european products are no question the biggest risk to europe at this point. Romaine the other Big Conversation out of europe is fiscal spending. Are the germans going to be ready to give at all . Maria . T is the other big debate maria that is the other big debate. Someone i spoke to said we do not like the idea of a crisis. They do not recognize the German Government is headed to a recession. He told me growth had slowed but that is the end of the story. I also asked him what are you going to put the money to work and are you willing to engage on fiscal spending . This is what he said. Lets take a look. Everyone knows germany is in very good shape. To follow all of the guidelines given about stable fiscal policy and this necessaryhe strength if there is a crisis. Maria the finance ministers speaking to us earlier. The data coming out of germany paints a bleak picture. This is a country probably headed to a technical recession. When you go into the specifics, the germans do not want to commit figures to this. They will tell you we have the money, but they will not go into the details. If you look at that conversation , i did not get the impression this is something they are willing to do over the short term. Very quickly, they said they will use it when they have it, but they are not there yet. Guy the bond market is certainly asking them to do it. Thank you indeed. Maria tadeo joining us from luxembourg. Romaine the brexit blame game escalating as talks between britain and europe seem to have reached an impasse. Hopes now rest on a meeting later this week between Boris Johnson and his irish counterpart. Neither side looks likely to give ground on the crucial issue of that shared border. Anna edwards visited that border to look at the key sticking Points Holding back negotiations. Borderhe 310 mile between the republic of ireland and the uks Northern Ireland looks unremarkable now. On this road from ireland into Northern Ireland, the only clue you are leaving ireland and heading into the u. K. Is this road sign reminding you speed limits will now be in miles per hour. The border has had a famously bloody history. Violence between Irish Republicans who favor a united land and prou. K. Unit yes unionists escalated in the 1970s. The troubles claimed three and a half thousand lives. Customs checkpoints like this one were allowed to gradually fall into ruin, and the good friday agreement meant security checks were increasingly unnecessary. Products flowand seamlessly over more than 2 hundred rd crossings. Trade between ireland and the u. K. Is worth about 1. 1 billion a week, 100 16,000 vehicles cross the border every day, with no stops and no checks. What would happen if, after brexit, custom checks in some form are restarted . We have no borders, we have no controls. Under this we would be faced borders, a Customs Border on the land, and border across the sea. It would present a lot of cost. Because we are a service provider, if we see manufacturing drop in Northern Ireland, less goods, and we see that is a huge threat to our industry. Anna where industries see trade friction, Community Spirit division. The border runs down the middle of this country lane. That is ireland on this side, the u. K. On the other side of the break it is the open nature of this long and historically troubled border that makes taking the u. K. Out of the e. U. So difficult. Anna edwards, bloomberg on the irish border. Our attention to another border. Turkey has begun its military offensive into northeastern syria days after President Trump said the u. S. Would not stand in the way. Joining us from london is neil brown, geopolitical strategist and hedge fund manager. What is the objective of turkey . Objective is it sovereignty. President erdogan is quite clear the Kurdish People represent a Security Threat to his government and his country. His entrance on the syrian side of the border, there is a vacuum post the war in syria, the likelihood of the beginnings of a kurdish state and he believes that represents an unacceptable threat to turkey. Turkey is taking action. Guy clearly some of this is down to the relationship between president erdogan and President Trump. President trumps strategy in the region seems to be confusing to most people. Standing aside, allowing the turks to make this move seems to have caused consternation, certainly in washington, d. C. What is your assessment of current u. S. Policy . L is very difficult to see. Youre absolutely right to highlight this. The only consistently most of us can see is President Trump is fulfilling a Campaign Promise to get out of unpopular wars, notably in iraq and afghanistan, and also in syria. That seems to be his intent. You will recall two years ago President Trump launched 59 tomahawk missiles into an airbase in syria. It was done with absolute precision. It was exquisite. It was about syrias use of chemical weapons. He avoided civilian casualties. Many of us thought this was an example of a wider strategy. When we asked washington is this an example of a strategy will apply to to ran and pyongyang over nuclear weapons, the answer was do not be ridiculous. That in we ask whether 2017 or his green light to erdogan recently as a sign of his longterm strategy. The answer will be the same. Probably not. Romaine this is a relatively small territory with regards to the bigger global picture. I am wondering, are there broader global consequences for the u. S. Pulling out, for turkey moving in, and what may, of the kurdish militants . The first question in many peoples minds would be what happens to the Kurdish People. There almost 13 million Kurdish People. They live in four neighboring countries, iran, iraq, syria, and turkey. The problem for them is none of those countries are likely to agree to losing any territory in order to create a kurdish homeland. That is the heart of this. I am afraid despite the human suffering from the conflicts that happened in turkey and syria, it is unlikely to have global import. The Global Implications are what it tells us about the u. S. Position in the middle east. This is not something that is just attributable to trump. Many middle eastern contacts i have, they look at president obamas pivot to asia, which they look at a pivot away from the difficult middle east, they look at obamas failure to enforce redlines. Im afraid that shell politically, this border issue is relatively localized. Iran on the one hand and the u. S. Stepping to the sides, it will probably stay that way. Our romaine romaine thanks to neil brown. We want to bring you breaking news on facebook. Mark zuckerberg will be hauled back before u. S. Congress. The House Financial Services committee on october 23 for hearing and tiled a hearing entitled examination of facebook and its impact on financial services. Maxine waters has been pounding facebook for some time about its efforts regarding libra and moves it may have been trying to make inside of finance. October 23, Mark Zuckerberg on the hill. Guy looking forward to that one. A look at where european markets have settled. The ftse 100 finishing mid range. Volume is being average today. Did not see much action during the auction process. The dax outperforming. There has been ineffective the trade story in some european stocks. Autos have been outperforming on the fact that maybe we are inching toward a skinny deal. Cannot forget, we will carry on the conversation at the top of the hour on bloomberg radio. We will take to the air on dab Digital Radio in the london area around the world and all of your bloomberg devices. This is bloomberg. From london, i guy johnson. Romaine from new york, i am romaine bostick. This is the european close fro. On bloomberg markets. Lets get a check on bloomberg first word news. Courtney donohoe has more. Courtney china is still open to reaching a partial trade deal with the u. S. In return, beijing would offer concessions like buying more American Farm products. The chinese also did not want any more tariffs. Negotiations are set to resume this week. China is turning up the heat on the nba. More sponsors of nba events there are suspending ties. A joint venture with nissan is the latest. The trouble began when houston general manager sent out a tweet that backed hong kong protesters. President trump will sign two executive orders raining in wrote agency rules. The order would limit the use of memos and other guidance agencies used to help people and companies with regulations. Conservatives and business groups have complained agencies use that process to establish selfrule that circumvents congress. The Trump Administration also wants to overhaul decadesold medicare rules. They were originally meant to stop fraud and abuse but are now seen as a roadblock to coordinating better care for patients. The rules were intended to counter kickbacks in the financial industry. Patient advocates worry Consumer Protections could be weakened. Global news 24 hours a day, on air and tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. Donohoe. Tney this is bloomberg. Guy thank you very much indeed. Time for our stock of the hour. We are looking at the luxury good giant lvmh. Shares closing higher today. The company is about to reach release sales and revenue numbers. Emma chandra is here with the details. Emma they will set the tone because they are the first of the big global luxury stocks to update the market on their Third Quarter performance. We will get those numbers in a few minutes. Of 12. 8 expecting sales billion euros in the Third Quarter and for lvmh to widen its lead over its competitors. If you take a look at its lead over the past 12 months, you can see is a big one. Lvmh shares rising to 24 . The wide index has seen a much bigger fall in that time as the bloomberg luxury goods index down 18 in the past 12 months. Headwinds, not the least those protests in hong kong. Over the last month we have seen a huge plunge in the number of plunge in the number of visitors to hong kong, particularly from mainland china. That has also led to a corresponding fall in retail sales. Sales from hong kong make up 6 of lvmh revenue. Investors will be looking for reassurance and an update on strategy. Nevertheless, Bloomberg Intelligence saying lvmh has plenty to counterbalance this, not least the depth and breath of product and its geographic reach. They say that even before the protests in hong kong, chinese customers were starting to buy more luxury good at home. If you take a look at revenue for the whole of the asian region, it now accounts for about 40 of lvmh sales. Adding diversifying acquisitions like hotels and the growing ecommerce arm and there is plenty of balance for lvmh as you see growing headwinds. That is your stock of the hour. Guy thanks. Emma chandra with your stock of the hour. Coming up, your global battle of the charts. That is next. This is bloomberg. Everyone uses their phone differently. Thats why Xfinity Mobile lets you design your own data. You can share 1, 3, or 10 gigs of data between lines, mix in lines of unlimited, and switch it up at any time. All with millions of secure wifi hotspots and the best lte everywhere else. Its a different kind of Wireless Network, designed to save you money. Switch and save up to 400 a year on your wireless bill. Plus, get 250 back when you buy an eligible phone. Thats simple. Easy. Awesome. Romaine time for our global battle of the charts. You can see all of the charts on the bloomberg by running gtv. Kicking things off is eric val who nest eric balchunas. Will own this market, who will own 2019 . In the first three months it was all the s p 500. This year it is up 17 . In the last six months it has been cold and treasuries taking over leadership of the market. The yellow line is low volatility equities. What is working equities is low volatility. Etf flows have followed this. It is a bearish sign people are going into low volatility is to do equities. Most of the money is going into treasuries and gold and that is different than if you look at your to date. That 17 in the s p is misleading. Romaine guy, step into the ring. What have you got . Guy guy this is a chart of the 50, 100 pe versus the stoxx i. E. Euro zone stocks and the pe. This is relative valuation we are talking about on a priceearnings basis. We have the ftse 100 trading more than a decade low versus european peers when it comes to those multiples. What is interesting is this is not just about brexit. The obvious answer to this is that is brexit, that is the brexit affect you are seeing. Some of it is and some of it is not. Some of it is the trade war. The ftse 100 is stacked with Oil Companies and mining stocks, both of which have been suffering as a result of the global slowdown. You cannot completely put this story at the door of what is happening with brexit. However, some of it is, and the real question is what it reverse on a good brexit. Some people are saying that might not happen at all because the pound would cap it up. Romaine two good charts. Guy, i think you taught me something new, so i will declare guy johnson the winner. Eric is a winner, you can watch at 1 00 in iq today new york and 6 00 in london. Next balance of power with david westin. David from bloomberg World Headquarters in new york, im david westin. Welcome to balance of power, where the world of politics meets the world of business. On the brief today, Brendan Murray in london on u. S. China trade talks, and enters and on President TrumpAnna Anderson on President Trump impeachment strategy, and the turkish move into syria. Talks wegot the have the talks tomorrow. We got some encouraging noise out of china . Brendan, encouraging and the big scheme of things. You have china coming to washington with essentially the same offer theyve had all along with donald trump. We will make agricultural purchases, energy type purchases , and then we will see how it goes from there. That is enough for the Trump Administration to push back the threats of tariffs that are still out,