That may not be so easy. The s p 500 down 0. 5 . Chip stocks playing a part, which has the nasdaq down even more than that. 10 year yield bouncing up a basis point 02. 2. 01 earlier. Apple got a downgrade at , now with sell ratings at five analysts. Lira moving since resident erdogan this mist the Turkish Central Bank governor. Guy we are going to talk about that later on. Lets talk now about the Deutsche Bank story. Christian sewings plans for Deutsche Bank, the ceo says the company is going to return to its roots. It is going to exit its equity trading business to contribute to the banks workforce being slashed by 1 5. The Market Reaction today, shares falling in frankfurt come the some analysts saying targets of the plan will be hard to achieve. The company cfo had. O say sonali basak joins us now. Deutsche bank wants to return to its core, but getting there is going to be a difficult journey. Sonali even with the execution risk we are seeing here, the goal is i 2022, 8 return on tangible common equity. That is less than barclays and almost half of jp morgan. People haveplan, questions about how revenue is going to grow. Costs are going to be exorbitant for a year. How are they going to compete with large global banks . Vonnie typically when someone undertakes massive restructuring like this, obviously there has been tinkering at Deutsche Bank, but typically the stock goes up, yet we still saw a selloff today. Are investors not going to be happy, no matter what happens at this bank . Sonali they are already asking for a lot of patience from investors. They were happy at the beginning to see drastic action from christian sewing. They think this is the most drastic plan they have seen in a long time. Some are not sure what more he could of done on the forefront. Going to bet is painful for a little while. Is this is a bank that going to have to thread the. Eedle it is having to deal with the radical changes taking place outside. German data was weak. We are likely to see more radical action being taken just down the road here in frankfurt. In terms of trying to get this done, how difficulty challenges it . Is there anything we can compare it to . Sonali in terms of comparison, everyone hasnt seen a restructuring this drastic in good times. The bad times are coming, but they havent come yet. All of these expectations for 2020 are based on the economy going smoothly, and that is not a given. Competitors are entering the German Market particularly for corporates. Our colleagues had some great reporting last year that german beenrates head all reporting. Vonnie some of the banks lower today, including commerzbank. Does it mean that investors in other banks are a little disappointed now because it makes a merger less likely. Isali right now a merger not on the table, but over the this is the last real big. Plan if it werent going to work the last real big plan. If it werent going to work out, the next plan would be years down the road. Analysts were asking christians having this morning what is going to happen to the Asset Management unit. The rest some talk about maybe merging them with ubs. To be any sort of deal activity is the question. There ononali basak Deutsche Bank. Guy the global strategist at socgen will give us his thoughts. Lets take a look at Deutsche Bank and try to understand where we are here in europe. Europe relies on its banks. Germany relies on its banks. Yet making money in european banks is pretty problematic right now. How big a problem is that . I can just about see it from here at the ecb. Guest problematic. They like more of it. If you look at the euro zone fromte data, the improved pretty much the point where saving ofhi fired his the periphery with the first round of qe, that has not really been the massive problem. One is the long history of the Banking Sector not being terribly profitable. It is not there to do that for a lot of europe. Not whether it is the Banking Sector makes a huge amount of money for its investors. Its whether it provides credit for european companies. I think the problem on that side is how much demand has there been. But that is not the worst bit of the european economy at this point. Europe at the moment is hit by impart a global slowdown, but even more by a big global trade slowdown. That is a bigger issue. Europe, for the ecb, needs to ease your fiscal policy. The ecb is almost out of ammunition. They will be worried because if things spin out of control, it gets worse. But this is part of that journey got the coste now of money that is not the problem. Guy lets look at Deutsche Banks return home. How tough is the German Economy right now . As we are thinking about what you just said, if there is to be a fiscal push, could this be a smart decision . Guest i think it looks tough if the Global Economy rolls over into a synchronized downturn. If we take the u. S. Data up until 12 29 friday and rolet forward from that kind of and role it forward and roll it from that kind of environment, the German Economy is more glued into global trade, global manufacturing, than almost any other. Their share in export for such an economy is very big. This is a difficult point in the cycle. The softer the slow down, the luckier they will be. Right now it doesnt feel like we are seeing a lot of movement in fx markets. Will we see a catalyst break one of the currencies we are closely watching, including sterling, out of those ranges . Kit it is much easier once they are higher. Stronglar is very against its four biggest trading partners, china, the euro zone, canada, and mexico. The dollar is strong against all of them because the economy is strong, but we cant keep on buying a currency at super expensive levels forever for that same reason, particularly when Interest Rates are coming. Own by contrast, the euro is very cheap against the dollar because. Egative Interest Rates if we push german tenure bund yields, the euro drags along the bottom of this range. It probably goes down as slowly as its gone down for the last. Ear it is very hard to keep on selling on. Moves theplosive other way. You could have a fast fall for the dollar if the u. S. Economy starts to roll over. Vonnie are you anticipating a fast fall on the dollar on anything soon . Kit i think the risk is that way in that this is an Economic Cycle that is very long historically, and which has been stressed by last years fiscal policies. It had a sugar rush acceleration, much the same as giving someone too much caffeine and sending me offer my morning jog. I can justis that imagine, thanks. This has still got some resilience. It doesnt feel to me as if the big slowdown is necessarily a story for this year. That could happen more next year, and i could get more days like today out of markets. Vonnie we have lots more to talk about. Juckes isnerales kit staying with us. The u. S. Attorneys office for the Southern District of new york is holding a News Conference. Epstein was arrested over the weekend. We will continue to monitor the News Conference for headlines. You can watch it on live go on your bloomberg. This is bloomberg. Guy from frankfurt, im guy johnson. Vonnie in new york, im vonnie quinn. This is the rpm close on Bloomberg Markets this is the european close on Bloomberg Markets. Kailey fund manager Jeffrey Epstein appears in court today sex trafficking involving girls is in his 14th. In 2008 girls as young as 14. In 2008, he pleaded guilty to state sex charges to avoid federal ones. The prosecutor who agreed to acosta. L, alex admiral William Moran has been confirmed by the senate to be chief of naval operations, but is now retiring after he reportedly took advice from a former aide who had been accused of making unwanted sexual advances to others. The turkish lira fell after president erdogan abruptly fired the banks central governor the Central Bank Governor. He has said that they need to get behind his belief that higher rates cause inflation. In greece, the leader of the centerright new Democracy Party has been sworn in as Prime Minister. Kyriakos mitsotakis had a resounding victory over alexi tsipras. 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 kailey leinz. This is bloomberg. Vonnie thank you. Lets get a check of Global Markets and where we stand this monday. Heres abigail doolittle. Abigail still a bit of a risk off tone for Global Equity markets, and financial equity markets cant take a look at the stoxx. And the the s p 500 down for the second day, modest performance coming from the chip sector. 1 . Sector is down 9 10 of. E see real performance some weakness in the asian session. The shanghai composite selling off. We also have turkish risk assets selling off, down 2. 3 , the worst day in about three weeks. Confirming the risk off tone we have for global stocks, lets take a look at the 10 year yield. A small rally for bonds at this point. We can tell it is a bit directionless. Big raise after the on the friday stronger than expected jobs report. This chart is holding in there. It is amazing how that sometimes happens. Markets go farther either way then you can expect, up or down. Last year, the 10 year yield , investors seeking the haven around safety and bonds. 10 year yield sent sharply below. Now almost below 2 , but hanging in there. The rsi suggesting that some of the big bond rally we have seen this year, there could be some profit taking ahead. Maybe the 10 year yield heads back up towards 2. 3 . Guy thank you very much indeed. We will see what fed chair Jerome Powell has to say this week. We are on tender hooks waiting for that. Socgenith us in london, global strategist kit juckes. We seen Equities Trading lower today. You,uestion i have to ask how useful a guide for the Investor Sentiment is the currency right now . Effectively, the turkish authorities have squeezed all liquidity out of the market. Im just wondering how useful a guide that is. Kit it ought to be going up. There ought to be money coming in. Turkey is a country which basically finances growth off of borrowed foreign money to a greater degree than is healthy. It runs a big current account deficit when times are good, and when there is a loss of confidence, the currency collapses because they cant finance that international deficit. Where we are now with the country essentially in a doubledip recession, theres no shortage of money. Much going on, so expensivequeeze currency into short, and it is pretty stable. But how do you restore confidence and makeable invest for the longterm, and not panic because a soon as you get growth, you have a big deficit again . Thats the kind of forwardlooking challenge. You are not helped in an attempt to rebuild that confidence by giving the impression that you got rid of the head of your central bank because policy wasnt accommodative enough. But the currency is not going to collapse at this point in the the economy is drifting along in a very weak state. Guy we have to assume the central mike meeting later this month, the central bank assume at the Central Bank Meeting later this month, the central bank will cut rates. Will that be taken negatively given the backdrop youve just described . You could argue that in some ways, a cut is justified. My question is how will the market react to a kind of outside cut. Kit i dont know what an outside cut is at this point in time. The biggest reaction is the one that you have seen from people is that theywhich have long recommendations in the turkish lira, which they took off immediately over the weekend when they heard this news. What a central bank that is very we willative will do is probably get weaker over time, but not sure how. It is going to be an opportunity missed. The returns for investing in turkey are too attractive. Any plan would get us put money in, and people saying i dont trust it anymore. It is easier for people to not sure. Then to say, i think very few have the stomach for that now. Vonnie the turkish lira is the worst performer today versus the u. S. Dollar, but the second worst is the south korean won. Is there a way you would trade the trade war right now . That in general, the korean story although the span between south korea and , it caught me by surprise the korean won is vulnerable. The central bank doesnt want to begin too much further. I would remain long the japanese becauseshort korean won that is the trait that will work the trade war becomes much more serious. Im not sure it is the single best short in the market, but the longer this drags on, the more negative it will be. As with all these trade disputes, the assumption is that this isnt going to damage the yeah, theo much, but market was caught by surprise by this development. If we get bad global data and another month of those coming not be againstd buying against the korean won or the taiwanese dollar. Vonnie what about some other Southeast Asian currencies . The vietnamese, for example. Are these currencies you could take a position in with any great confidence one way or another . Kit with everything in asia at this point of time, youve got to enter the big question. Yuan going toese trade below seven or above . On the day it breaks above, they go with it. I think i would quite like to buy some of them. I think the Australian Dollar is the only one i would want to buy because it has been properly beaten up, and i think the central bank is getting closer to the end of its easing cycle. But there is a problem of trying to diversify away from that central question. One of the chinese authorities going to do with their currency . It is not easy to get it right. Vonnie kit is staying with us. S is Society GeneralSociete Generales kit juckes. This is bloomberg. Guy take your opportunities where you can find them. Breaking news. Italy mandating banks for a syndicated reopening of a 50 year bdp. Pay attention to that 50 year btp. Pay attention to that one. The european closes next. This is bloomberg. Hey im bill slowsky jr. , i live on my own now ive got xfinity, because i like to live life in the fast lane. Unlike my parents. You rambling about xfinity again . Youre so cute when you get excited. Anyways. Ive got their app right here, i can troubleshoot. I can schedule a time for them to call me back, its great you have our number programmed in . Ya i dont even know your phone anymore. Excuse me . what . I dont know your phone number. Aw well. He doesnt know our phone number you have our fax number, obviously. Todays xfinity service. Simple. Easy. Awesome. Ill pass. Vonnie stocks finishing of the day in european trading and you can see most of europe is in the red. Not so much the core countries. The peripheral countries faring a lot worse. Turkey seeing a selloff today on the news over the weekend. Did see green in scandinavia but just a little of it. In terms of the individual indices, the ftse 100 ending unchanged. 1 ,ax and cac 40 down mainly on individual stories. Deutsche bank having a terrible day even announcing a massive restructuring. The stock down more than 5 . We also had plenty of currency action today with the dollar continuing to rise, stronger versus a lot of currencies, including starling. Including sterling. Basic resources doing well. Oil and Commodity Companies doing well. Oil and gas up. 7 . I mentioned the downside. Health care stocks selling off impacted,f companies Cancer Companies on the idea the u. S. Might change the structure of its pricing and that would impact some of those Health Care Companies based in europe. Look at some of the other asset classes. The lira down 1. 8 versus the u. S. Dollar. A big weekend of weakening for turkish assets as the president , Prime Minister erdogan continues to metal and monetary policy. We had a guest earlier on talking about how greeces 10 year yield is a little bit higher than the u. S. 10 year yield. Interesting. We move on to the u. S. 2. 02 on the 10 year. Weaker. Dollar index stronger and crude above 58 a barrel, now trading at 58 even. Weed to our next board have symantec, the best performer in the s p 500. The broadcom deal looks like it might get the goahead. The s p is down half a percent. The other major indices lower. Apple down on a downgrade. Plenty of stocks are lower, particularly the chip stocks. Tech hardware as a group down 2 and that is the main drag on the disease today. On the into see on the idicies today. Athens a look at guy lets take a look at athens im unsure if we are going to athens or london. I have answered that question. Now im being told maria is good so lets go to athens because it sets it up better. Lets try to do this sequentially. Aria tadeo in athens what me through the challenges the new Prime Minister will face. Maria there is many challenges now. Spoke to him yesterday after he won the election with a big majority and he will tell you i want to grow this economy aggressively. He talks about 4 annual gdp growth, double the current rate. He wants to cut red tape and attract foreign money and taxes corporations taxes for corporations and households. To do that he needs fiscal leeway, and the only way he can do that is by convincing creditors they need to lower the surplus target, which is currently down to 3. 5 of gdp. He is saying he can make a case for reforms, but essentially he says if the country grows the tax cuts will pay for themselves. It is not clear