Reduce the citys glut. Here are exclusive interview. Hear our exclusive interview. Manus it has just gone 9 00 across the emirates. It is daybreak middle east. Warm welcome to the show this morning. We are in limbo. Will we get a december 12 election . Labor looks as if they will hold out. Could there be more pressure coming to bear on the pound this week . We settled down by 1. 21 last week. We broke the overall trend. They say sell the rallies. Ubs had a tactical overweight position. Sterling remains cheap. I leave it to the words of blackrock. Its like a 1980s pop song. Neverending uncertainty. Lets have a look at the oil markets. We are gliding to a deal. What is that going to do to the oil market . Stockpiles dropped for the first time in five years. A big week for the oil market. All hitting the table this week. Oil had a nice rally last week. Lets get your first word headlines from around the world. Desiree humphrey is with me right here on the ground. Desiree thanks. The leader of the Islamic State militant group has been targeted by the u. S. Military in syria. He has been killed. That news comes as President Trump says hes going to make a major statement at 9 00 washington time today. The president tweeted that something very big just happened without elaborating. Begun shutting off power to an estimated 2. 8 million californians in the largest and longest deliver it blackout ever. The giant is turning off the lights for about 940,000 homes and businesses across Northern California as it tries to keep power lines from igniting wildfires during the strongest windstorm in years. President trump is suspending some trade preferences toward thailand over concerns about worker rights. Thats adding to the obstacles facing the export reliant nations own economy. It affects 1. 3 billion in trade purchases and will take effect in six months. Leadertic Unionist Party has threatened to frustrate Boris Johnsons efforts to push his brexit deal through. Shes warning the u. K. Leader that her party will continue to oppose the accord in parliament. Johnson says he will seek an election on december 12 but he needs the support of two thirds of members of parliament and the Opposition Labor Party has said it will block the vote. German finance minister has slashed a firstround win for the leadership of his social Democratic Party. That is boosting the chance of survival for Angela Merkels coalition. 22. 7 of the ballots. He and his running mate will face critics in the november runoff. The vintage green cardigan kerkhove more kurt cobain more has sold for 334,000. That makes it the most expensive sweater auction of alltime. The government is unwashed and still marked with cigarette stains. The auction included a handwritten poem by two particular and a guitar used by prince. 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. This is bloomberg. Manus thank you. A little bit of breaking news coming from one of the heavyweights on the summit. Thirdquarter profits. The estimate, levy double tech. Third quarter profits, 830 million reals. The estimate was 2. 1 9 billion. This is a significant miss on the actual thirdquarter profit. Waiting to see if theres any slippage as well on the sales front. To that extent, we will see how this stock opens a little bit later today. Relations between sabic and clarion worsening, unable to agree about deepening their bond between the two of them. These are the top line numbers on clarion. We will get more of a breakdown on that as the morning goes along. Possibly some significant items in there. As we get more detail, we will bring that to you in full. Lets return to our top story about trade and the optimism therein. It will push sentiment in terms of the markets. China saying part one of the phase one deal has been completed. The two sides read reached consensus. The comments in beijing follow positive rhetoric struck by the white house. We are doing very well with china. We are good with the farmers. The farmers will do better than anybody. Everybody is doing well. China wants to make a deal. They would like to see some reductions in tariffs. They would like to see some tariffs that are scheduled to go on very soon, they would like to see them not go on. China really lets you know it. They want to make a deal. Manus its that week. Policymakers are excited to cut. Trade is warming to the idea that it may be the last rate reduction for some time. The odds of a december move have fallen from a near certainty to just 20 . Best 28 . My guest post this morning. Its good to see you this morning. A lot of optimism. Deal. One of a chinese how important is this for Market Sentiment . Markets are looking for any piece of good news. Lets be fair about what this is. This is phase one. It is still verbal. Lets call it the paltry trade deal. What has been agreed is more on products being sold ag products being sold to china. Things like poultry. Cooked poultry get sold back from china to the u. S. That sums it up. It is about agricultural products, which is what trumpcare is about at the moment. Hes looking at the elections. All the other issues, ip rights, subsidies, Stateowned Enterprises and their dominance of the chinese landscape, all those have been put into the background. The chinese are happy. They want to avoid another set of tariffs in december. Everybody would like to have a photo opportunity next month in chile. Manus if phase one goes through, will we see a lot of cash . The you expect a rampant reattachment to equity markets if phase one goes through . I think its already in the price. You dont have a lot to look forward to. Youve already been overly optimistic. Now you have a little bit on your table to be happy about. Thats not the big trade deal everybody was talking about. Manus i looked at some korean data. Japan factory orders fell to the weakest level since 2016. South korea has put in the worst performance. Lets look at it in the due to the library. It is the worst performance since the financial crisis. They are warning that this is ascribed to trade wars. How much more can Monetary Policy do from Central Banks to repair the damage from trade wars and and the cycle and the cycle . The short answer is very little. What we are seeing in asia is the supply chain of china suffering because of the trade deals. That includes south korea. There has been some trade diversion. Some Chinese Companies are now using subsidiaries in vietnam, bangladesh, and elsewhere to export to the united states. That has not delayed the effects of the decline in trade volumes on a global basis. Manus im going to interrupt you there. We will turn to the conversation very shortly. Lets go back to the sabic set of results. There was quite a shocking number that came through. They missed on the thor quarter numbers. Thirdquarter numbers. Charging 1. 5 billion in regards to their provision, their investment in clarion. This is a very significant moment. It will have quite a significant Market Impact today, one would imagine. As we get indications on how sabic will open. Sorry to interrupt you there. That is what it is bringing to the markets. I want to pivot to lebanon. You have a little bit of history with lebanon in regards to your roles and ability to interpret whats happening in the market. , theys of disruption worstperforming equity market in the world. What is the next shoe to drop in the financial consideration for lebanon . Write that the fault is something you are looking at much more aggressively. What we need to look at manus debt restructuring, my apologies. What we are likely to have is a debt free profiling. Manus what does that mean . A large number of maturities over the next years, particularly in domestic currency. You repackage them into a new bond which gets subscribed by the central bank in the local banks with maturities over 5, 7, and 10 years. That removes liquidity pressure over the next few years. It allows you to undertake fiscal reform which is what lebanon needs. Manus bond owners will have to take a haircut . 90 of the debt is held by commercial banks in lebanon and the central bank. Leave the euro bonds and external visitors investors aside. Do it in terms of lebanese cap currency. You can manage it. What you want to avoid is a debt default. 70 bt default, given that of banks assets are in sovereign paper, you want to avoid a default. That would wipe out the equities of the lebanese banks. Everybody wants to avoid that. It would be a true financial meltdown. Manus Democratic Party union leader has threatened to frustrate Boris Johnsons efforts. Shes warning the you can leader that her party will continue to oppose parliament. Johnson says he will seek an election on december 12. To hold it, he needs the support of two thirds of the members of the british parliament. The Opposition Labor Party has said it will block it. My guest house this morning. Lots of stories going around. Labor is set to block demand for december 12. They thought we would get an election in january if the eu extends. Do you concur . I think the eu will extend, probably until the end of january. Any election in a highly polarized parliament and country is unlikely to resolve the issues. The only way forward that i could see is a referendum. That is the elephant or camel in the room. Manus labor have offered that if they get into power. I dont know if thats a real risk. Thats because labor wants to get into power. Jeremy corbyn wants to be p. M. You have to look at the wider issues. Where is the u. K. Heading . It has nothing to do with Party Politics. Everybody is still playing Party Politics at the moment instead of looking at the wider outcomes , the outcome for the u. K. Economy moving forward. Manus your base case for 2020, a referendum . I expect a referendum in 2020. If not earlier. Manus referendum risk, what does that do to sterling . We give back 1. 2 . We get back 1. 2 last week. What does referendum due to sterling . Any proposal of referendum would be all the value of u. K. Assets as well as sterling. It would be a boom for u. K. Equities, assets, and property. Manus you are working on the assumption that a referendum would deliver us deliver a remain outcome, yes . I do. Manus what makes you so sure . The numbers we now know about the u. K. , the assessment of u. K. Brexit, are very clear. Every single assessment has said that the u. K. Will lose between 2 and 6 . That is a massive decline. The public is now aware, particularly young people. Young people back then did not vote. Theres a whole wave of young people who are now much more aware of the issues, more likely to vote. That will be the swing vote. Exeters have the dominated before. Young people and remainders will dominate now. Manus demographics will do the damage, perhaps. Thank you so much for coming to broad church with us this morning. Go back to tv. His comments on lebanon are relevant. You can pick up nassers comments there in regard to a bank from run for lebanon. Many things covered. Dive into all the functions we use. Become part of the conversation on tv. This is bloomberg. Manus dubais largest private developers are urging a complete halt to all new Home Construction to help reduce the citys property glut. Yousef, exclusively to the chairman warns that Relentless Development could spell disastrous results for dubais banks and the economy. In, there is no currency risk. That is a big advantage. Worldclass infrastructure. Safety, the 1 one of the most safest cities. You come to the political instability. You come to the government which is very probusiness and active on business. Time where the light every religion and sector can live in the city into whatever they want. The city has very strong fundamentals to grow and is still the growth of the city can become 10 times more. Yousef at the moment, its not enough. I understand that. The city has an amazing leader who has built the city, working day and night to reach where it is. He is the working to take it further. It takes all the takes all icks all the t boxes for the most amazing city in the world. It competed very quickly with singapore, hong kong in a short time. Why are we having this problem . , a bomb exploded. The the currency fall . Did we have a demonstration in the street . We dont have all those issues. What is happening is very simple. We had a very good market. It peaked in 2017. Property market is cyclical. Years,l see a good five you will see a slowdown. We are having a nice, slow, soft landing which was healthy and good. What happened in 2018, we started having a slowdown. Then some of the big boys in town started dumping the supply. And creating one of the most ridiculous things for the city. The payment plan is not good. It is not good for the consumer. It is purely encouraging speculation and has a disastrous result. Yousef what has the committee done so far . What can they change, from your perspective . I dont know what the committee has done. I am not part of the committee. They have a mandate. Im sure they are working on it. Im sure they have a plan for it. To be fair, it has only been a few weeks. It will take some time to see what can be done for that. Didnt ask me, they me, my answer is simple. Stop the supply. Not forever. For a year come 18 months. All the developers in the last 12 months have reduced supply by 80 . , dubai reduced it a lot ofreduced it, the private sector has stopped it. Every single developer other than amr has stopped supply or reduced it 80 . One Company Keeps dumping and dumping and dumping. Yousef if that continues, the crisis this has now reached a critical level. This is now an emergency. Yes. 100 agree with you. Now we are entering a crossroads. Either we fix this problem and can grow from here, not tomorrow but in 24 months, if we dont, we will see disaster. This will have impact on the Banking System. Yousef allow me to follow up on that. Are you planning to sell any assets at all . We have no issue from a financial point of view. Last year, we made two launches. We used to do 20. This year, we made one launch. Next year, we will do one. We curbed the new products. We have not bought any land. We reduced our land buying. We have enough land bank. Look at theill as management and a board. We decided, we will not by every piece of land. We will not do major launches. We are running our business very well. Yousef evidence to the pain is the stock price. Leveldown at the lowest since 2014. How are you going to turn that around, given the challenges in the market . My job is to perform. I cannot control the stock market. The stock market is the subject of sentiment and geopolitical issues. What the whole market is doing. 4000 unitsdelivering this year. We will be delivering next year 6000 units. I am on the delivery focusing. We are not going to do many launches. We will focus on selling what products we still have. Our financial position today is very strong, apart from 6 million an extra in extra. , one was dueue last april. We paid it fully and on time. My next bond is due in 2022. If they give me a 6 discount on that, i can pay the next may. We have the money to pay that one. Two years ahead of time. We are paying our contracts on time. The only thing we cannot give dividends because our profitability is down. We are not going to give dividends in this market because the saturation of the market. I want to keep the cash in the company. The most important thing for me, to pay those two bonds. Yousef up next, manus up next, nor on the more on the breaking news for the hour. Sabic. This is the lowest quarterly profit in 10 years. It is based on a provision that they are taking in their numbers, they are taking a billion, of over one 1. 5 billion saudi riyals. Clarion investment has a 25 holding. A great deal of discomfort in that relationship. This is bloomberg. Manus we are 30 minutes away from the start of your trading right here in the emirates. It is sunday morning. Dazzling with your first word headlines. The leader of the Islamic State militant group has been targeted by the u. S. Military in syria. Newsweek is reporting that he has been killed. That news comes as President Trump says hes going to make a major statement at 9 00 washington time today. The president tweeted that something very big has just happened, without elaborating. Pg e has begun shutting off power to an estimated 2. 8 million californians in the states largest and potentially longest literate blackout ever. The bankrupt utility giant is turning off the lights to about 940,000 homes and businesses across Northern California. That as it tries to keep our lines from igniting wildfires during the strongest windstorm in years. China says parts of the first phase of a deal with the u. S. Are basically completed. The two sides reached consensus in areas including standards used by agricultural regulators, Peter Navarro says tariffs on china might be in play. Democratic giddiness party leader has threatened to frustrate Boris Johnsons efforts to push his brexit deal through. She warned the u. K. Leader that her party will continue to oppose the accord in parliament. Johnson says he will seek an election on december 12 but to hold it, he needs the support of two thirds of members of parliament and the Opposition Labor Party has said it will block the vote. Turkeys foreign minister says germanys offer to establish an internationally supervised saison in northeastern syria isnt realistic. The comments cast doubt over european efforts to broker an internationally acceptable compromise in the conflict. 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. This is bloomberg. Lets bring into the conversation are middle east markets reporter. We just had the sabic results. 1. 5 billion writedown on clarion. We are waiting for first abu dhabi bank. This sabic news is going to be quite substantial. It definitely set the tone for trading in riyadh today. It was a big mess, lower than any analysts estimated. Riyals5 billion saudi was not expected.