Bit despite news of increased inventories. For the global exchange, where we bring you market moving news from around the world. Are bloomberg voices are on the ground with this mornings top stories. Da tart with e curran. Had positive signs since sunday, when the government said they would push through new oversight of ip protection, and they want to punish those who are guilty of ip theft. That was followed by some details in one of the state newspapers that china is also looking at the oversight of any trade agreement with the u. S. In ways of ensuring that any deal isnt limited. Then we had the news yesterday from the Commerce Ministry talking about reaching consensus on core issues. The moonbeams it is been nothing but positive in recent days, matching what is coming out of washington, though we dont yet have any further details on when or if an agreement might be signed. We have your minder did have a reminder on the economy when profit for industrial firms dropped almost 10 from a year ago. That underscores the manufacturing side in chinas economy is hurting. David thanks so much for reporting from china today on trade. Now lets go to europe, where the European Parliament has been voting to approve a new European Commission. Joining us from strasburg is bloombergs maria tadeo. Butn are in the fore, really it is climate. Maria thats right. Leyen commission replacing jeanclaude juncker. She has made climate her number one priority. She says she wants to make the European Union Carbon Neutral by 2050. That is cutting down majorly carbon emissions. This is her number one focus, and you can see why. This is something that has really resonated across europe. Thers here are very into idea of being much more environmentally cautious. This also says the European Union needs to be more assertive on the global stage, and theres also the idea of brexit. This is still very much looming on the new commission because they will have to negotiate that trade deal with the u. K. If it manages to leave the European Union in january 2020. David thank you so much. That we go to london, where the pound fell for a second day as traders digest recent polls which show the u. K. Election race is narrowing. Joining us from london is annmarie hordern. The pound is now up slightly against the dollar, apparently on further polls. What are the polls telling us . Annmarie thats right. We have seen some pressure in the pound, even though it reversed a bit ago. These polls are pointing to the fact that we could have the risk of a hung parliament, and this begs the question, what happens with brexit . Theres going to be a key pull tonight. 2017, it rightly predicted that theresa may was going to come back without a majority when all of the other polls were saying the conservatives were going to win big. Secondly, this poll comes out at 10 00 p. M. London time, at this socalled Witching Hour between the new york market closing tokyo opening. Already during this hour, we could see rapid swings in currencies, but given the fact that we are headed into thanksgiving, a lot of traders may be leaving the desk early, we could see volatile swings in the pound. If this comes out and is favorable toward the conservatives, we could see the pound rally, but potentially if the gap narrows and is less favorable for Boris Johnsons tories, we could see some weakness on the pound and some big swings giving the time and of this poll. David think is a much. Earnings thiswas morning. Shares actually fell after the company beat on earnings, but gave a cautious outlook. Here in new york with more Brooke Sutherland of bloomberg opinion. Deere dear falling steeply this morning, all to do with that 2020 outlook. Analysts were braced for fourthquarter numbers to be not given some of the difficult planting conditions, but that 2020 outlook, people were expecting an uptick in agricultural demand. That has to do with stimulus in the Trump Administration flowing down to those farmers and optimism that we may see a trade deal. Deere is being conservative and calling for a 5 to 10 decline in that sector in 2020. David thanks so much. Finally, it is a really busy day for u. S. Economic data. We will get the second read for thirdquarter gdp, along with durable goods and jobless claims at 8 30 this morning eastern time. Mike mckee is here with more. Traders inl of the new york going over the river and through the woods. A cornucopia of data. The gdp number is not going to matter as much because it is a revision come up with the spending numbers are going to matter a lot. We saw a bit of a slowdown in september. Did that continue into october . How are we set up for the Holiday Season . People are going to be watching that. We had this faceoff between consumer and business spending for quite some time now. Consumer spending has been higher, which is important because it is 70 of the economy. Business spending is often negative, and we are expecting another contraction from capital goods orders for the weekend. If you are still around at 2 00 p. M. , the fed is going to tell you what it thinks with the beige book. Finally, cant get away without mentioning that fridays black friday doesnt matter that much anymore. People dont do all of their shopping on black friday. So ignore the hype, go get the tv if you want, but remember, we exited a very big Holiday Season last year based on the black friday numbers, and it turned out that Consumer Spending contracted in the Fourth Quarter. David thank you so much for being with us. We will have more on your morning trade and analysis of the markets in todays first take. Thats coming up. This is bloomberg. Now for the bloomberg first take, where we give you the news and you get the trade and analysis of the markets. Joining us for our inhouse team of wall street veterans and experts, Vincent Cignarella, ander fx and rates trader voice of the bloomberg audio and also joining us his Christian Lawrence, rabobank rates and ethics strategist rates and fx strategist. Are what appears to be getting toward a final resolution to phase one. The key for the markets is, thankfully, we will get to something where the talking kind of stops. At least, the outline headlines is what we dont want to hear anymore. It is not a trade deal, but a trade truce. Get to a point where at least the headlines stop affecting the markets, and we can go back to the fundamentals, back to what earnings are coming back to what really drives the economy and take this off the table. David we have a little bit of a deadline here with december 15. If we dont get a deal by the 15th, what is that going to do . Christian i think they would definitely pause the tariffs, but i am still not convinced we get a deal. Even if we do, i dont think it makes a big difference to the fundamentals. I think the risk is actually to the downside that if we dont get a deal, we get a bit of a selloff of equities. David we always talk about how the markets are responding. How is the economy responding . Are they paying any attention at all . Yelena we kind of forget about the impact on Overall Economic growth. The biggest impact comes not just from tariffs come about from the uncertainty surrounding all of the tensions. Apart, wedeal breaks will have a big impact, probably in the vicinity of 1 on gdp growth. If we do get a deal, maybe we will just stay where we are. David we get a slew of Economic Data out later today. Yelena cornucopia. [laughter] david exactly, appropriate for thanksgiving. Does that affect anything for trade . Yelena it is going to be focused on consumer. We can probably see this is impacting Consumer Spending growth. I dont think it will, although Consumer Spending is slowing for other reasons. Vincent i was just going to say, she stole my line. [laughter] vincent a big part of the talk with the trade deal is how are ceos reacting to capex, and how that investment is folding into the u. S. Economy. But for all of this year, if you look at real average earnings come up your disposable income for consumers, it is declining. Whether that is coming from a standpoint of ceos not investing , and therefore opportunities for employees to step up, get better jobs, increase their earnings or not, i will leave say, but thea to end result is consumer income is lower, and therefore Consumer Spending is likely to be lower. That is definitely going to have an impact on the economy. David david this may see really interesting point to me david this makes a really interesting point to me. The fact that they are not investing, doesnt that Say Something about what they are thinking about demand coming up . Christian in theory that is true, but i would argue over the last 10 years, we have seen this divergent i way from realworld investment to the financial world to share buybacks. I think thats one of the reasons we havent seen very strong growth over recent years, and one reason why we are not likely to Going Forward. But the point you make about the consumer is absolutely key. The consumer is holding up u. S. Growth. If the consumer starts to slow down come of the recession indicates there will be flashing red all over the place yet again. That wont happen today, but Going Forward, we can expect that to continue. David when we talk about capital investment, we automatically think about productivity. If we are not investing, what does that say about growth and productivity . Yelena our longstanding view on productivity has been, if we makeome signs of companies a lot of money, and they have to pay a lot to compensate for the labor, then they will start investing because it will be profitable for them because it will not be profitable for them to keep paying the labor market. We will see growth in productivity one way or another. It is just going to be a very slow process. One thing we are forgetting about today, gdp data will be important because we get corporate profit data today. In q2, corporate profit bounced up after some declines in the previous quarters. We will see whether they can bounce or not. If it continues to grow, that creates an essential condition for growth in the future. Not a sufficient one. We still have a lot of uncertainty. But that is a positive sign if we see corporate profits grow. David but does the market care . They seem to want to drive the prices up no matter what. The earnings were ok. They werent great this last quarter. Vincent no, but it is such a low bar to beat the earnings expectations. I love that analysts do this. The idea is that we have all these headwinds coming on us and profitability is going to be declining, well, you set such a low bar that it is easy to overcome. The reality is it does come down to earnings at the end of the day. If corporate profits do continue to beat and grow, you will see the market grow. Albeit, i think, at slower rate of change. That is what is going to be interesting for 2020. Will we grow . Yes, but what will be the rate of change . Will it be sufficient to have a earnings drive equities higher . Christian mix a good point, we will not see recession numbers today. Theres all this talk about how tariffs were delayed, and that may be brought forward First Quarter. It is ending from corporations to bring inventories in. We wont know that until may be the end of march. If the consumer did exactly what corporate did, which is bring spending forward into the First Quarter, 2020 could be a very disappointing First Quarter. David weve got this whole discussion about Monetary Policy without talking about how cheap money is. We should factor that in. How much of the high values in the equity market are sump because theres so much money out there searching for yield . Christian it almost feels at the moment that if u. S. Data comes up strong, we see equities rally, and if we see data weak, we will see the fed cutting, and the equities rally. Lack ofalk about the Consumer Price inflation, and there is a lack of that, but we seen a lot of asset Price Inflation essentially. Ultimately cheap money make up for the essentials . We had deere come out this morning. Its forecasts were disappointing people. Stock is down right now because its got problems with trade, agriculture, and construction. Cheap money doesnt necessarily fix those problems. Christian i would argue it causes more in the way of structural problems. It hampers growth, and you dont get wage growth. We are seeing unit labor costs rise quite a lot for companies. Mark becomes,ion how long can the equity really continue . David what, if anything, will it indicate about the Fourth Quarter as opposed to the Third Quarter . Theres a lot of apprehension about what the growth rate is for the u. S. For the First Quarter. Telling usicators that growth will slow down below 1 . We are not in that camp. Todays data on personal income and spending will take us will tell us a lot about the Fourth Quarter. If it falls significantly, we will Start Talking about fed cuts again. David if you are a trader today, it is thanks giving tomorrow. Are you basically sitting on your hands . Vincent oh yeah. [laughter] vincent the Trading Community right now, half of them are hung over, and the other half cant wait to be there. You dont do a lot the day before thanksgiving. You try to hold a lot going into it, especially now. With the headline to bombs that could hit over the weekend the headline tape bombs that could hit over the weekend, theres so many things that could disrupt positions. You dont want to be in the camp that is better lucky than good. David you want to keep it pretty safe because you dont know what is going to happen. Vincent you can always get back in. Theres so many peaks and valleys, if you miss one, theres always another opportunity around the corner. David christian, what are you looking for in the Fourth Quarter . Christian theres been a lot of selling of vol recently. When we look at the currency space, we are seeing record low volatility. The issue is when we start to see that, we see more people we seeg and straddles more people engaging. Thats what people will be trying to be flat as we head into the weekend. David weve got about an hour and 10 minutes before all of that data comes down. What is the one youre looking at the most . Absolutely Consumer Spending. We will also be watching thanksgiving and black friday and all of that fun holiday sales. We dont expect a very strong reading on holiday sales, actually. We are only expecting Something Like 3. 4 growth from last year. Was weak last year because of the government shut down, but overall we will see some slowdown. David many thanks to Vincent Cignarella and Yelena Shulyatyeva of bloomberg. Christian lawrence of rabobank will be staying with me. You can run gtv on your terminal, browse recent features, and save your charts if you want by running gtv. This is bloomberg. Viviana this is bloomberg daybreak. Lower in deere premarket trading. The maker of Farm Equipment delivering a weaker forecast than expected. They say sales may fall as much is 10 . Deutsche bank selling another chunk of unwanted assets to Goldman Sachs. The latest seo involves securities as a notional value of about 51 billion. They are tied to emergingmarket debt, previously housed in deutsches wind down unit, where it has been able to compete. Dell has lowered its annual revenue forecast. Component shortages from chipmaker intel hurting growth prospects. That is despite surging corporate purchases of new personal computers. Still, dell faces falling demand for services and networking gear. David for more on tech, we are going to talk now with Christian Lawrence of rabobank, who is still with us. The valuation is pretty high. The s p price index is up pretty high. It is up the highest its been since 2009. What you make of tech . Christian it is interesting because tech is such a broad category, but we can break it down into those that are more value driven and those that are more growth driven. I think that is key. When we look at the s p 500 this year, we can see a fairly Straight Line higher. If we break it into those components, we see quite High Sensitivity to Interest Rates. When Interest Rates are going up, we tend to see value outperform growth. That is true within the tech space as well. Im always a little reticent to group them as one entity when really, tech stocks very a lot. David is it Growth Driving the high number . Christian it really depends on what the Interest Rate environment is like. At the moment, it has been Growth Stocks. It was different last year, when it was mainly those value stocks. David it is near 12 year highs and valuations. Does that make you think this is not the time to go in . Christian you could say that about a lot of equities. If the fed keeps money cheap, we can continue to see asset prices rise. It is not necessarily about the fundamentals. It is also about the cheapness of money. David how cheap does it have to get . If the fed stays where it is because jay powell has said we are sort of comfortable at the moment with where we are, is that good enough, or does it have to keep cutting . Christian i think theyve got to keep cutting, and i think they will come the second quarter. We will see data turn. We will see the consumer start to slow, manufacturing more. I dont buy this argument that the little improvement weve seen over the last month is a real game changer. I still think we are in a downturn and the fed will cut aggressively next year. David will it stimulate the consumer at this point . Christian the fed has written papers that rising stock prices doesnt really drive the consumer. So im a little bit skeptical of that, should we say. But i think wherever we look around the world, rates are lower. The fed will have to move pretty aggressively. Just one rate cut priced in . I think thats massively underpriced. David thank you so much. Coming up here, eu competition commissioner Margrethe Vestager says she is still looking at apple, facebook, and amazon. We will bring you more of our interview with her from strassburg, where maria tadeo has just spoken with her. This is bloomberg. Id bloomberg daybreak this is bloomberg daybreak. Equities are pretty much up across the board, with one exception. This is largely off of the positive indications about a possible u. S. China trade deal. On the other hand, some negative eco numbers out of china overnight. Eurodollarr to the , euro is off slightly as they put a new commission in place over there. The 10 year is really unchanged. , big stormsgas coming across the middle of the country, and nat gas is up a bit on the news. Crude is basically back to the trade story, driven by economics. New york crude is up now slightly by about 0. 2 . Lets get back over to europe. Europeanay, the Commission Antitrust chief Margrethe Vestager spoke to maria tadeo in france. He first and foremost, in the business environment, you find a lot of impressive tech. You find engineers, find research, and find them in impressive startup environments. Of course, in the willingness to balance all of the possibilities and contain the downsides. Maria we do here many times that the reason youre so focused on taxation is because we havent really seen any real innovation in europe. Do you agree with that . Margrethe thats absolutely not the manyll of businesses who pay their taxes in europe. But not just some of them, every company should contribute where they do excellent business because this is the bottom line in europe. You did very Good Business here. Maria is that something you still think, by the end of 2020, it would be fair for the eu to just go it alone . Margrethe yes, we are strong believers in a global agreement. I am very happy to see progress made. There is a very strong push and positive feedback on the first draft. Of course, that would be a better solution. But if that cannot be met, when you look at all of the businesses who pay their taxes, it would only be fair that we pick it up again if a Global Solution is not possible. Maria based on what you hear now from the oecd, there is momentum now to get this done. Margrethe normally, i wouldnt be optimistic when it comes to taxation, but i think now there is a momentum. There is a deeper understanding that we have to update corporate taxation to digital times, and did not respect, i think the Global Dialogue is changing. Maria we also heard today from president von der leyen that data is key for the commission. It can also be weaponized. So what are you going to do about it . What measures will you protect consumer data in europe . Margrethe first of all, we are going to make a comprehensive strategy. For ai, data is the main input, but data is so much more than a commodity. It is also what defines us as people in digital ages. Weve taken a number of steps with digital Citizens Rights in the gdpr. We have a lot of public data that has been made available. What we need is a comprehensive strategy for data to be driving for a prosperous european economy. Maria what timeline are you looking at . Margrethe this has to be fast wellse it ties in very with what we are planning to do on artificial intelligence. The two things will have to come together. But for people to see the full scope of what data can do, we have to make a specific strategy when it comes to data. Maria and mergers and acquisitions, that was a big theme for the old commission. I know you specifically said you disagreed with a few of them. Are we going to see a change in the rules to perhaps make it easier to create big european champions . Margrethe it is quite easy already. We have giants that come from mergers here and have the vast majority. We dont question the business logic. It is so rare that this happens. Actually, the example we have bins discussing, they are not the prime example. What we want to do more is when it comes to data, you cannot just acquire access to data that you would otherwise not be able to have if that is harmful to competition. David that was Margrethe Vestager speaking with bloombergs maria tadeo. Still with us is Christian Lawrence of rabobank. It strikes me that if you are a big u. S. Tech company, it doesnt sound that friendly. Weve got taxation problems, data problems. Shes been very specific about her competition law. What does it say about tech in europe . Christian i think theres two issues, the taxation and regulation. Regulation is very hard. It doesnt keep up with the pace of technology. It poses a big risk to these Tech Companies. When it comes to taxation, at the moment, we are seeing rising inequality around the world, whether its developed markets, developing markets. In the developed world, we are seeing it with the move away from the center in terms of politics. Taxation isnt something that is going to be disappearing from the headlines anytime soon. With this concern about inequality, it is only going to become more of an issue and more of a political issue, so we are just going to hear more about it. That doesnt necessarily bode well for the future of some Tech Companies Going Forward. David when you talk about Tech Companies, you tend to talk about u. S. Companies. They dont tend to be domiciled in europe is much. Some have said they are antiu. S. Because you go against the big tech giants. It is some thing President Trump has said. Christian we are seeing companies become more protectionist, so we are going to see these things across the board. But with these Tech Companies, it is absolutely key because they are so large. Of course europe is going to want to tax them. The question is, can they . David talk about europe as an Investment Opportunity more generally. Some are saying the growth has not been there. Is it bottoming out, and is for someotential fiscal stimulus . Christian for europe, it needs fiscal stimulus. We. Nottary policy we are seeing the impact of Monetary Policy that they would like. Germany doesnt like to loosen its belt, so unless we do see some form of disco stimulus Going Forward, we are going to see a continued slowdown. At i dont think it is christinee that lagarde is the head of the ecb. Our foot on have the accelerator and the brake at the same time . We have brussels saying to people like italy and france and to spain, you are running your deficits way too high. You need to get some constraint back in. Are we trying to do both things at the same time . Christian yeah, and thats one of the problems. You have some countries pointing the finger at other countries come up when they should look in their own backyard for rising debt levels. But i think we are in a world where debt has been the main driver of growth since the 1980s, and we are not seeing that same bang for the buck we once did. But we are running out of room on the monetary side. I shouldnt say running out of room. Theres plenty more room come about running out of impact. ,avid in the sense of the ecb at the same time, european banks have struggled. They are not in as strong a position as the u. S. Banks. What can the commission or the ecb do to try to reform the banking system, which may be necessary to get the economy going . Christian this is one of the ierings we saw t being announced. The bottom lines flat curves are not good for banks. It is very difficult to envision the situation at the moment where we see a very steep curve in europe. I think the Banking Sector is going to continue to struggle somewhat, particularly as growth remains very lackluster. David as an investor and you look at europe, where would you be putting money . Where are there opportunities that are underappreciated . Christian when we go back to that story we were talking about line is the bottom equity markets do look ok in europe at the moment. I think that is one area. I also think we are going to see lower yields. We will see continued flows into, whether it is safe haven like bones or the Corporate Credit market. , basically, you need someone to buy at a higher price. David david we have this issue in the United States as well. Traditionally, you have thought that either the equity market or the bond market have to be right. They cant both go up at the same time. At the moment, they are both going up. Can we keep that going, and for how long . Christian they are behind us, quite frankly. That is not how a lot of Portfolio Management works these days. As we moved more passive, systematic investment, which means everyone tends to be in the same direction, you can see all boats rise on that same tied. So i dont think it is a contradiction i dont think it is a contradiction anymore. David Christian Lawrence of rabobank, great to have you with us. Stay tuned later for my interview with the Eu Commission Vice President for Financial Stability, Financial Services, and capital. About to get a big promotion to executive Vice President. That is at 8 30 this morning. Now lets get headlines from outside the business world. Viviana hurtado is here with first word news. Viviana viviana the u. S. And china are on the first viviana the u. S. And china are on the verge of completing a first phase trade deal, according to donald trump. Though stumbling blocks remain, one, how to robot tariffs. Next week, a public hearing in theu. S. To sherry in house judiciary committee. They will discuss the constitutional basis for impeachment. An explosion and fire at a tpc Chemical Plant in east texas today at about 1 00 a. M. At a factory in the beaumont poor Arthur Beaumont poor arthur metro area. Global news 24 hours a day, on air and tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. Im the vienna hurtado. This is bloomberg. David thanks so much. Coming up, Deutsche Bank sells another chunk of unwanted assets to open sex. More on that in to Goldman Sachs. More on that in todays wall street beat. Go to tv on your terminal. This is bloomberg. Viviana youre watching bloomberg daybreak. The comedy buying behind a popular the studio behind a popular vr game, beat saber. Amazon trying to break alexa away from its robotic monotone. It is giving Developers Tools to make the Software Sound excited or disappointed. The company says the tool may be congratulating users on trivia wins or consoling for a sports team loss. Capital once to forceout a longtime ally of President Donald Trump that holds about 2 of colony shares. Blackwell says it has lost confidence in tom barrack. Colony insisting in the last year, it has made significant progress. Im Viviana Hurtado. That is your Bloomberg Business flash. David the other thing distracting tom barrack, hes playing so much polo out in an aspen club. We turn now to wall street beat, where we cover three things wall street is buzzing about this morning. First, Deutsche Bank slims down. The struggling german bank cells goldman a big chunk of emerging market debt it doesnt want anymore. Sec ishe u. S. Regulator proposing sweeping changes to those who are less wealthy to invest in hedge funds. And finally, mackenzie says things will get worse for active managers as fees shrink and assets continue to grow. Joining us to take us through all of this is bloombergs sarah ponczek. Deutsche bank has had this plan to spin off assets. It is a notional of 50 billion. Sarah right. It is exactly 51 billion dollars, all tied to em debt. Like you said, this is really all a part of that massive Restructuring Program that is going on under ceo christian sewing. This isnt the first time Deutsche Bank has sold assets to Goldman Sachs. Back in september, goldman sold the asian portion of its equity derivatives portfolio to goldman , and they sold some other portions of other portfolios as well. What Deutsche Bank is doing is they are looking across their portfolio, figuring out where they really cant be competitive, and trying to spin off those assets, roll down the capital buffer on their Balance Sheet to be able to fund other costs. David christian sewing is doing what he said he could do, betting that they would get a good deal. Sarah Goldman Sachs clearly wants these assets. Same thing with the equity portfolio, the asian portion of the derivative portfolio. They also sold off other portions to barclays, morgan stanley. They sold hedge funds assets as clearly, to bnp, so clearly people across wall street are interested. David our second story, the sec making this change to who can buy hedge funds. It is an interesting potential shift for hedge funds. Sarah this comes back to what is called the accredited investor standards. It basically sets the limit for who is able to invest in assets that arent regulated by the sec, for example. These rules havent been updated since 1980, interestingly enough. If you are an individual, to invest in private assets, you have to have an income of 200,000. As a couple, you have to make 300,000, or you have to have a net worth of 1 million. What they are floating changing is on one side, they are potentially going to be adjusting for inflation. So we could actually see that 300k, one milliondollar number increase. David i once talked to the sec chair, and it takes us to the third story about passive versus active. A lot of the smaller investors are totally in passive, and as a result, they dont have a portfolio that makes what a blackrock has, and may be left out. Mckinsey says passive is going to continue to grow. Sarah newsflash there. Going back to your point, especially in an era of unicorns, the idea that if you are a retail investor, you dont have access to investing in a ub er maybe you didnt want to or a facebook before it goes to the public market, because that is when you have a massive amount of growth potential. Yes, you are looking at potential growth rates for assets under management, the profit pool. The yellow line is the last five years. To the right side, that is the future five years. As you can see, the growth rates for all three are shrinking. We have seen this across the industry as Profit Margins just have been crimped. David and the fees get lower and lower, they make less and less money, and it gets more efficient to go into some of them are free. Sarah there are some zero basis point etfs. Theres one on the market that hes in have a negative expense ratio. The idea that youre going to be getting paid negative Interest Rates. Although there is a twist, it only lasts for a certain amount of time, so kind of a marketing gimmick as well. But all year long, we have heard the notion of funds coming out of equities. That is really a part of mutual funds. You can see that 200 62 5 billion has gone into eds that 200 ticks to 5 billion has gone into etfs. David our people saying we have to be more picky about what we are investing in . Sarah theres an argument where you can spin it either which way. Say whatpassive side is going to happen is, when you see major losses in the market, people then are going to take their losses and ship them from active to passive. So take whatever site you agree with. David ok, many thanks to bloombergs sarah ponczek. Great to have you here today. In todays off the beaten street, we are looking at an equity firm blessing a 500 , orion bet on football soccer, as we call it here, making Manchester City one of the most valuable franchises in all of sports. Silverlake is valuing the team at 4. 8 billion. This would lets the value of livestreaming soccer matches in the it alluded to cash in on global following for teams like man city. Coming up, we look at the link, believe it or not, between thanksgiving and the u. S. Dollar. That is next in todays traders take. If you are jumping into your car, tune into Bloomberg Radio, heard across the u. S. On sirius xm china 119 and on the Bloomberg Business app xm channel 119 and on the Bloomberg Business app. This is bloomberg. David it is time now for our traders take. Joining us is Vincent Cignarella, voice of the bloomberg audio squawk. Listen to vincent on the bloomberg by typing and squawk go of squa. Vincent we are just having some fun today. It is thanksgiving, and traders dont really care much about what is going on, but i found this silly correlation which makes no sense whatsoever. The weekly turkey slaughter count on a threemonth average actually correlates to the bloomberg dollar index. David hold on a minute. On the bloomberg index, you can find the weekly slaughter index for turkeys . Vincent thats right. Thats actually the white line. The point i just want to make his most of my career, i have been a fundamental trader, and use technicals to support it. The market has gone very much in a different direction these days, were technicals has sort of taken over the fact of life. If the fundamentals dont support the technical strategy, it is really a flip of a coin when youre trading. So what i would offer to folks much younger than i these days, have a bit of a basis in fact when you start to trade something. You can see the silliness of Something Like this isnt going to tell you a great deal. Use the technicals to support it. An hour from now, my colleague bill maloney is going to come on , a technician who really knows how to use technicals. David david maybe we will confront him with this chart. Vincent it probably would not be a good idea, to be honest. [laughter] vincent bill is going to have a much better take on where equities are going to go. But i just wanted to have a little fun for thanksgiving. Fundamentals is something you should not let go of when youre trading. David there you go. Thank you so much to bloombergs Vincent Cignarella. Coming up, walter todd, greenwood capitals cio. This is bloomberg, coming to you from new york. Here, it all starts with a simple. Hello hi how can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone wifi up there . Uhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your local xfinity store today. David welcome to bloomberg daybreak on this wednesday, november 27. For alix westin, in steel. Pres. Trump we are getting very close to a very good deal. David phase one trade deal in final throes. We had the news yesterday from the Commerce Ministry, talking about reaching consensus on core issues, so the mood music in beijing has been nothing but positive in recent days. David President Trump says it has to be good for the United States. Europe gets a new commission. The Von Der Leyen Commission finally getting the green light. Includingtake office, von der leyen as European Commission president , in december, replacing jeanclaude juncker. David setting priorities with Climate Change right at the top of the list. Can the consumer keep powering the u. S. Economy . If the consumer starts to slow down, then recession indicators are going to be flashing red all over the place yet again. David markets eye Consumer Spending for october as low growth could signal dont growth at all. Deere is being conservative on agricultural demand, calling for a 5 to 10 decline in sales in that sector for 2020. David earnings meet estimates come about the ceo delivers a cautious outlook for deere. Now we are going to take a look at the markets and where we are right at the moment. S p futures main up across the board because of the trade talk from President Trump, saying things are looking pretty good. The euro is off a little bit. The 10 year going nowhere fast. Crude is up a bit, a variation from the last few weeks, which is been down. Joining me for the entire hour is Brooke Sutherland of bloomberg opinion. We got to talk about boeing if we are together. Brooke of course, it is almost thanksgiving, and one plane not flying anybody home is that 737 max. The faa is now saying they will inspect each of these planes before they can be delivered to airlines. This is a variation from the past, where you actually had some boeing employees being willing to i just whenever but its no exact uim exactly who i am. David they cant have you not having your bedroom. Having your badge on. Brooke theres airlines are getting a little bit frustrated. They continue to push back timelines for putting this plane back into service. This is maybe potentially creating even more delays here. David doesnt have to create delays if you are going to inspect each and every plane . Brooke one question is, is this mostly symbolic . Is this the faa reasserting its authority, realizing theyve handed too much authority to boeing over the past years and want to take it back . David which is a criticism. Brooke it has been a very valid criticism, and something the faa is very conscious of. The other issue is that boeing came out and said they think they can start delivering these planes by the end of the year, even if the faa not approved the training work airmens. That rankled the training requirements. That rankled the officials. You have to wonder, what is the communication strategy of boeing . How do you keep having these pr issues where the faa is upset and boeing is not necessarily incoordination . That just raises even more questions for me about whether this will happen on boeings timeline. David and the other regulators around the world who arent the faa. Brooke indications at this point are that regulators will be more in lockstep with the faa then what we hadnt is abated a couple of months ago, especially on Pilot Training then what we had anticipated a couple of months ago, especially on Pilot Training with flight simulators that are a little more expensive. David we heard from President Trump overnight, and he said, we are in the final throes of a very important deal. It is going very well. Now is brooke and me walter todd come Agreement Capital cio. How money times will we walter todd, greenwood capital cio. How many times will be told we are close to a deal . Walter theres no question that the optimism on trade is one of the factors that kick started this market rally in early october, and the market is definitely pricing in at least no new tariffs in december. If we keep moving in this direction and keep being strung along, i think the market can continue to move higher into yearend, but ultimately, at some point, we need to see a deal signed. David does you brooke does it give you pause when you hear deere earnings, with lingering concerns in the Business Community . Will a trade deal be enough to rest us out of this uncertainty Holding Back Investment . Thats thats a great point, and that is the difference between the Broader Market move, and then you get the individual earnings from companies and the promises of a trade deal cant make the quarter for deere or other companies. I do think that is a risk on individual names. I think that any type of certainty around pushing out tariffs or delaying them indefinitely could give us a little bit more confidence to invest, but the highlight of deere and the danger on an individual, and he basis of these tariffs, you saw yesterday dollar tree, the promises of a trade deal cant make the quarter at the end of the day. David we are a little over a month away from the end of the year. It has been quite a year and equities in the United States. Quite a year for equities in the United States. Is it because we keep hoping for a trade deal . Is it because theres so much money come to do the market place from a fed that is cutting, or Something Else so coming to the marketplace from a fed that is cutting, or some thing else . Walter this time last year, we work weeks away from powell raising rates for the fourth time. Also, the Balance Sheet has increased a cool 250 billion over the past six weeks. I think the liquidity backdrop is what is driving markets higher. We have started to see, as we discussed, some incremental improvement on the trade front, potentially. That has helped. The third thing i think that we have seen the data stop getting worse overseas in europe. Incrementally, it is Getting Better. We are seeing some slight improvement on the data front as well, but definitely the liquidity backdrop is what is driving markets. Brooke when you see a lot of these markets at alltime highs, where do you go . I know the fed and the ecb have both raise concerns about pushing into riskier assets. Is there anything that is safe right now that is not overpriced . Walter its a great point. This is a key time for investors to separate the broader index from individual names and and Industry Groups. Time to reallye look at individual names and Industry Groups, so i think you can find some areas that have not participated in this move to alltime highs in the s p. One is on the h in basis. Small caps have not per dissipated nearly to the extent that large caps have, so you can look smaller for one, and look at Industry Groups that havent persist abated. Look at some of the big uglies, as we call them many pharmaceutical space, that have not per dissipated in this market rally. That is where you can start have not participated in this market rally. That is where you can start to look for value. David where are we right now in the stock market, relatively correlated or not . Where it is not, that is where you start being individual stocks. Walter on these broad macro headlines on any given day, let the trade news today, you will see a broad move across potentially Interest Rates and stock market. But as was just highlighted with the deere quarter, you get back to the individual fundamentals. Across see broad moves the market based on these micro headlines, but you still have to dig in and look at the Company Fundamentals and look for areas that have not dissipated that have not participated in this move to alltime highs. Theres concern for industrials, that this earnings downturn was relatively shallow. Will this make valuations look attractive . Walter i think with industrials and a lot of cyclical sectors, but people are looking at is the comps as we head into 2020. We have seen the earnings downturn that has been relatively shallow, but as you start to look at where can i see relative Earnings Growth in the market in 2020, if the data continues to improve, if we do get this trade deal, the comps for a lot of these companies become relatively easy in 2020. I thing that is what investors are focusing on. Not just in the industrial space , i will also say that is true in the material space. Industrials may have run a little bit faster ahead of the fundamentals at this point, and you get these pullbacks like you see with deere at the end of the day. I do think you can see strong relative Earnings Growth and some of the cyclical sectors, assuming growth has stabilized or bottomed outside the u. S. And starts to turn higher in 2020. David the key question is what is going on with global growth. Where do you see that . Do you think it has bottomed out . Walter we are starting to get indications that that may be the case. We got industrial profit out of china that was not too good overnight. When you look at the pmis in europe, for example, they are still in contraction territory, but they are better than they were. They are off the bottom. Same thing in the u. S. There are early indications that growth may have bottomed, but the market in some cases has run ahead of that. That is something we are watching very closely outside the u. S. David walter todd of greenwood capital will be staying with us. Coming up, we are coming back to lowered its 2020 guidance. We will use deere to look at industrials more broadly. Thats coming up. This is bloomberg. David deere reported earnings earlier this morning. It beat on both top and bottom line, but lowered guidance for 2020 income. Still with us is walter todd of greenwood capital. It was pretty disappointing for people, their projections for 2020 going down. Is that telling us something more broadly about the u. S. Economy it comes to construction, or more broadly in the Global Economy . Walter i think you have to think about it from the standpoint of deere management. Theres really no upside for them being aggressive on the guidance, so this could be conservative. We saw a similar situation with caterpillar earlier in the earnings season. I am curious to see how deere trades. I know it is down 5 or so premarket. We saw the same thing with cat. They were down, and ultimately rallied. I will be curious to see if as haves buy this cut, a lot of companies that have muted guidance this earnings season and bought in an biz patient of an upturn and bought in anticipation of an upturn. Brooke i will point out that deeres ceo john mae just started this month, so there is something to be said for a new ceo playing things conservatively. When you look at some of the industrial data, there have been positive signals that we may be getting a bottoming in this slow down. What is the risk that that is just a blip . A lot of these projects can be lumpy. You have the gm strikes mixed in there. Walter we could all be here a month from now, and this could be a big head fake from these moves in the market. I think at the end of the day, what weve got to focus on is seeing the data come through on a week by week basis and a month by month basis to see if it continues to improve. That should confirm that weve seen a bottom encyclical earnings area that is certainly what the market is betting on at buy theint, given these dip mentalities encyclical areas. I certainly wont know until we get some guidance because a lot of companies have not issued guidance for 2020. When we come out of the First Quarter in april, it will be interesting to see how the guidance for 2020 plays out. Brooke all eyes right now are on the trade deal. To what extent can the election uncertainty affect the industrial sector . Walter i dont think industrials are in the bullseye on the trade front. I think health care would be one. We talked about big tex before in terms of a political big tech before in terms of a political bullseye. But definitely, uncertainty around the outcome of the election and the policies that would come from that could continue to hamper capital spending, which would impact the industrial space. So i think the whole market could be potentially impacted, including industrials and cyclicals, by uncertainty around the election. That will start to come into focus february and march when we start to narrow down the candidates for the election in 2020. David we have value stocks beating Growth Stocks for three months in a row for the first time in three years. Weve been hearing forever, it feels like, about a turn to value away from growth. Is it possible that it is more like you that it is more likely you want to go into value . Walter it is really a debate about sectors, at the end of the day. On deep a focus cyclicals. Growth focused on health care and technology. I think they can both work, quite honestly. Value has outperformed really for the reason that Interest Rates moved up in anticipation of improved economic growth, and has led people into those sectors that are classified and overweighted in the value indices. It is really a sector call more so than value versus growth debate that goes on. But i think if Growth Continues to pick up in 2020, i think both can work, but values definitely do. It is underperformed for it seems like a decade almost, so those are the areas that are not necessarily per dissipated to the greatest extent as technology has, and even in technology, theres value within the sectors themselves that you can look to differentiate as well. Brooke youve brought up health care a few times. Obviously, that is subject to election uncertainty, but i know you own some names there. How do you get comfortable with that risk . Walter walter at the end of the day walter at the end of the day, you look at what is discounted in these stocks. J j, there a pfizer, is certainly some overhang from the political front, as well as lawsuits, etc. When you look at where these stocks are trading, 12, 13 times, yielding 4. 5 in some cases, theres a lot of bad news and risk discounted. You see the ebbs and flows of the democratic side as warren chances have declined. You see Health Care Stocks start to pick up a little bit. There will definitely be influence as that race plays out, but we are comfortable that theres a lot of bad news discounted in these names, and we think they could be provide some outperformance in the months ahead. A staying withot us. We will get his thoughts walter todd is staying with us. We will get his thoughts next. This is bloomberg. Viviana youre watching bloomberg daybreak. Shares of deere premarket,e delivering a more cautious outlook than expected. Deere forecast in fiscal 2020, global sales of agriculture machinery may fall as much a sin percent. Deutsche bank selling as much as 10 . Deutsche bank selling another chunk of unwanted assets to Goldman Sachs with a notional value of about 51 billion. They are tied to emergingmarket debt, previously housed in deutsche is wind down unit. The bank has been exiting businesses where it is unable to compete. Forecasts,ng its shortages from chipmaker intel hurting growth forecasts. Dell thesis falling demand for servers and networking gear. That is your latest Bloomberg Business flash. David thanks so much. For more on the tech sector, we bring back in walter todd of greenwood capital. We touched on this briefly. Lets go back and talk about your distention between some of tech is growth your distinction between some of techs growth, some of tech is value. Isething like cisco different from an apple or facebook. Dell and ciscor would fall into that category. They beat the cisco news earlier in the earnings season, not so much a surprise with dells numbers earlier today, contrast that with microsoft, a software company. Facebook definitely in the arena of a growth stock as well. Apple, if you look at the s p 500 value etf, apple is the Largest Holding at 9 . How people define growth versus value is really in the eye of the beholder. At the end of the day, for us, it is companies that are maybe thaty valued on a pe basis have significant Earnings Growth in the mid teens are higher versus companies that have lower basis, andon the pe price to sales lower as well, dont have much growth. But it is a tradeoff of how much im willing to pay for the growth. I think the market really shifted when this we work this wework ipo failed. The market shifted from i will take anything for growth to let me reassess what i am willing to pay for growth and no profits. So we have seen more balance within the market place overall. You mentioned value outperforming. That is one of the reasons we have seen that shift over the past three months. Investors really took a step back and reassess what they are willing to pay for any level of Revenue Growth at the end of the day. Brooke it is hard to talk about names like dell and other growth focused Tech Companies without also talking about debt. Are you concerned at all about the level of corporate debt, not just in tech, but elsewhere . Walter for sure, debt has exploded on corporate and sovereign Balance Sheets. With Interest Rates low, it is very manageable, but at some point, if Interest Rates ever start to normalize i am not sure that will happen in my lifetime that will be a problem for some of these companies. As you are looking at individual names, you need to be mindful of the Balance Sheet and how much they have, and is it serviceable as Interest Rates start to move up. One thing i will say is that corporations, unlike governments, have done a very good job of spreading out there Debt Maturity risk. Theyve taken advantage of low rates and elongated the maturity of their debt, so that helps them manage it. But theres no question that the debt burden on corporations is pretty high. If you look at spreads as well, something we are watching very closely, high yield spreads have actually not performed or not come down the way the equity market has gone up as you would expect. They remain a little bit elevated, particularly as you go down the spectrum of quality into the ccc space. Theres of the same levels they were in late when he 17. Do need to Pay Attention to the Balance Sheets of these companies. David walter todd of greenwood capital, thank you very much. You will be staying with us. We are minutes away from the second read of thirdquarter gdp. We will look at the numbers with Steve Ricchiuto, Mizuho Americas chief u. S. Economist. This is bloomberg. Beyond the routine checkups. Beyond the notsoroutine cases. Comcast business is helping doctors provide care in whole new ways. All working with a new generation of technologies powered by our gigspeed network. Because beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected. To do the extraordinary. Take your business beyond. David this is bloomberg daybreak. I am david westin in for alix steel. A check of the equity markets, there up across the board with one glaring exception. Up in london, up in new york, and up in europe, but china is down because of bad chinese vika data. Lets cross over to other assets. Year has been unchanged all day. Weural gas futures are up as have a storm coming in and oil is up. Now we have ecodata. This is the second read of the Third Quarter for gdp annualized 2. 1 . That is better than the 1. 9 in the survey. Personal consumption is 2. 9 again. Which than the survey, was 2. 8 . Price index up. 1 over what was expected. Core pce better, lower in that sense. Orders, a big gain , up. 6 . The survey was down. 9 . Joining us now to go through the ,umbers is Steve Ricchiuto walter todd of greenwood capital is still with us. Steve, a quick read. This is encouraging. It is encouraging. I would go beyond the gdp numbers because an uptick in consumption expenditures added thehe headline numbers, headline numbers are better at the core. The real thing is the durable goods number. When you get down at the shipments of bond defense capital goods, up. 8 percent relative to expectation of down. 2 . These are numbers that will feed into the now casters for the Fourth Quarters. Those now casters, which have been in the lower range will have to be upwardly revised, probably north of 1 . David i agree. I had not gotten down as far as capital goods orders. Initial jobless claims, we do not pay much attention, but a two hundreder, 13,000 versus 221,000. Across the board mildly encouraging. Steve a lot of what happened is the gm strike. It was a long strike. Six weeks long. Even though we diminish the value of autos these days in terms of the economy, it is still an extraordinarily important component to the economy. Pervasive in terms of all of the goods and services that feed it and distribute the pot the product. We sought the gm strike. Brooke is this enough if you start to see a parking up in the industrial sector to offset the potential week consumer in the Holiday Season if we see weakness . Walter these are encouraging data points. The nondefense number which feeds into gdp, that is very good. We were getting concerned claims were starting to turn higher and it is good to see those back down. I think even though we have six fewer shopping days, which i know i am scared about between now and christmas, i think the consumer i think it is going to be a good Holiday Season. A lot of hits and misses on the retail space, but i think the Consumer Confidence is high. The job market is good. I think it will be a good Holiday Season. We will see after the holidays. I think it is another example of the incremental data Getting Better and seeing the end of this inventory drawdown we have seen for the past couple of quarters in the data. Brooke the other thing to watch with the shortened period between thanksgiving and christmas is the shippers. They have to speed up their schedules for delivering things. If you dig deeper into these gdp numbers, do you see continued strength in the consumer as we are watching this . I know that has been the big driver for the economy. Steve as long as we are generating the type of hourly Earnings Growth and weekly Earnings Growth weve been generating, which are north of 3 , you will continue to get this kind of consumer expenditures. I do not think there is any risk Consumer Spending will drop down. I think the driver is what happens in terms of the overall trade situation. I think we are on the cusp of the train numbers starting to improve Going Forward on a sustainable basis. That gives you the additional push back up to a trend growth number, which i put at higher than the consensus. 2. 25 . Er is 2 to i think those were the Growth Numbers we will deal with for 2020. David trade numbers improving because of a deal or irrespective of that . Brooke irrespective steve irrespective. What will be critical is the fed behavior. The fed desire to purchase bills in october was a function of dxy going up to 99. 5, that happened the day before they moved. If you get the dollar up near that 100 level on dxy, that is going to send a signal to the fed they are starting to run the risk of importing deflation at this continues to push the fed down the path of broadening its portfolio, driving up inflation expectations. I think that is critical for where we go forward and that keeps the dollar from going dramatically higher. Brooke what about the risk of importing deflation . Does that have to do with china . Steve i actually think china is already in deflation. If you readjust chinese cpi, pork is 2 of the chinese cpi. Housing is also 2 of the chinese cpi. If we readjust the waiting in china for something realistic, headline china is already negative territory. Combined with europe and japan, you have 30 of global gdp on or near deflation. That is our biggest risk is importing that deflation. That is what the fed should be doing. There is a concept they will target inflation is starting to come through and i think it is where they should be going. They have to make sure the dollar does not put them in a position where theyre importing everybody elses trouble. David what about from your point of view . What is the strong dollar due to you as an investor . Walter the dollar has come off the highs, which has been helpful to certain sectors of the market. We would like to see the dollar remain in a range and not breakout to the upside or too much to the downside. A weaker dollar would potentially favor overseas markets at the end of the day. I think the comments back to the conversation about deflation, that will keep central bankers around the world. Aggressive. Jay powell said a couple of nights ago that we are very committed to 2 in nation. That was a strong statement 2 inflation. That was a strong statement they would keep their foot on the gas pedal in terms of trying to get Inflation Higher. We may be sitting here saying be careful of what you wish floor because it may be successful. Keepssk of deflation policymakers aggressive, which helps asset prices at the end of the day. As long as the dollar does not breakout to the upside or dxy above 99 or 100, i think we are ok. David you say be careful what you wish for, but we have a long track record of having no ability to get inflation up to 2 . You think it is not a structural change that has changed the rules . You think it will come . Walter there is an old saying in economics that things take longer to happen than you think they shouldnt happen faster than you thought they could. It has been a long week but at some point with the liquidity backdrop we have, there are going to be structural changes that are playing into this. I think at some point they will probably be successful and it will be in the conversation of how do you keep it from going higher once it starts to breakout to the upside . We will see. At some point, the money supply will start to overwhelm the Deflationary Forces and start to push Inflation Higher at the end of the day. Brooke you talked about how the fed should focus on inflation and not Interest Rates. How do they do that, practically speaking . Does the data we got today at any urgency . Steve you are asking a great question. I would look at what your previous guest was talking about and i completely disagree. I do not think there is any risk inflation breaks out to the upside. I think there is so many structural issues that keep the inflation low. I think the fed should actually look to target a higher rate of inflation then 2 . The best defense against deflation is a higher rate of inflation. How they do it . Monetize the debt. Balance sheet expansion is what they need to do. If you look at the Inflation Numbers and the history of we want, qe2, which they never completed. Qe1 and qe2 worked beautifully. Twist did what it was supposed to. It lowered inflation expectations. Infinity they began to aborted before they began at. They began it. The fed portfolio, three out of four times work to and expending the Balance Sheet is what the fed needed to do. Ofid Steve Ricchiuto missoula and watford todd of greenwood capital might think being with us. And a special thanks to bloomberg son the Brooke Sutherland of bloomberg opinion. On balance of power ill be talking to douglas holtzeakin, former director of the cbo. That is coming up at 12 00 new york time on Bloomberg Television and radio. Now it is time for an update on what is making headlines outside the business world. We turn to Viviana Hurtado with first world news. Viviana the u. S. And china on the verge of completing the first phase of a trade deal according to President Trump. He says the sides are in the final throes of a very important deal. Stumbling blocks remain. One is how to rollback tariffs. There has been an explosion and a Chemical Plant in east texas. 1 00ppened today at around a. M. In the beaumont port arthur metro area. The plant makes products for chemical and oil companies. Rising pollsren have had a uturn. Since october, the pole dropped the candidate dropped 14 points. Attacks from her medicare for all plan are taking a toll. Joe biden now has a clear lead. Global news 24 hours a day, on air and tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. I am Viviana Hurtado. This is bloomberg. David . David coming up, the prospects of a Banking Union in europe. I will speak with valdis dombrovskis, Eu Commission Vice President Financial Services and the euro. Bloomberg users can interact with the charts shown using gtv. Browse recent charts featured to catch up on key analysis and save charts for future reference. Live from new york, this is bloomberg. David the European Parliament voted again on approving the new Eu Commission today. The president elect won the backing of a clear majority of members of the European Parliament, allowing her new team to start work on december 2. We welcome valdis dombrovskis, Eu Commission Vice President of Financial Stability. He comes to us from strasburg. Let me congratulate you on your election today. Let me ask you, as the new Commission Takes its role, what is the main agenda for you and what is your role in delivering on that . If you look at the next European Commission, we will be in the area of economy dealing with green and Digital Transformation of eu economy so there is the potential for europe to become Carbon Neutral by 2050. Andill be working on europe when undergoing those Major Economic transformations, we need to ensure they preserve our european model of social market economy. This will be one of my tasks when working on the economic and social matters. David and on the question of green, particularly, i know youve said you would like to see reforms made within europe that would make it easier for banks in europe to make loans for Green Investment here it is that possible within your jurisdiction or it does the european have to sign off on that . As regards financing of European Green transition, it must be said it is a much broader question. We will be working on sustainable Europe Investment aiming up to one trillion euros of investment over the next decade. Setting the be framework for private finances. We will be working with our next Sustainable Finance action plan. Your question on providing some support for bank lending for sustainable goals like green mortgages will be part of that discussion. For is one of the questions the preparation of the next Sustainable Finance action plan. David as you suggest, this Green Initiative require a fair amount of investment. Infrastructure investment in europe. Will that take the place of fiscal stimulus . Will that provide the fiscal stimulus that may be needed for European Growth as an economy overall . , we will needly public and private investment. We are looking at what can be done at the eu budget level and we are proposing there will be mainstreaming of the eu budget so 25 of the next eu budget, the annual eu budget will go for the sustainability goals. We will work with Member States on applying the same sustainable budgeting principles in the Member States. All member state budgets will be working with European Investment 2025, half ofe by the lending costs of the financing is related to climate. Indeed, we will need to work most at public and private financing. Stimulus,ds to fiscal this is a question of a broader Macro Economic feature. To balance fiscal sustainability, financials to state ability and Member States with also green fiscal stimulus. David one of the things that has been talked about we hear from president Emmanuel Macron of france is a move toward a Banking Union in europe. Would you be taking that up . Is that achievable and is it achievable within the next six months . Bankingwith regards union, this is an ongoing initiative. Already we have two out of three members of the Banking Union up and running. We talk about single supervision and single resolution and in the next month it will be concentrating to finalize work on the third pillar, which is european deposit insurance. Beeed, the banking unit will one of the next European Commission priorities. David we have minister schulz of germany out with the proposal on that subject. Is that something you can work with . Valdis exactly. This is a welcome opening because european deposit insurance schema has been moving quite slowly in discussions among eu Member States. Germany had a certain this position from schulz is a welcome opening and we hope it will facilitate discussion and facilitate agreement on european deposit insurance. David as we look at the possibility of fiscal stimulus in europe, one of the possibilities are the individual budgets of the Member States. There been objections lodged with respect to italy and france and spain on the spending levels. Has the approach to budgeting in europe, more transparent for the Member States so they can comply with it more easily . Regards eu fiscal hass, i would say the eu clear and transparent fiscal rules and they are having an annual cycle of physical and Macro Economic policy coordination. Just recently, the European Commission gave its assessment of euro area Member States budget for 2020. The picture is mixed for a number of Member States, where there is a risk of noncompliance with eu rules and also a number we consider its importance as they continue to bring depth to gdp debt to gdp ratios down and at the same time we see companies which held fiscal space which could use the fiscal space to facilitate investment. David is it possible to have some of the states that have challenges with brussels i will pick one out at random italy, with which there were objections, to trim back their debt and borrowing without going into austerity which could hurt the overall european economy . , it is first of all worth noting that the eu economy continues to grow. Economycast is the grows at 1. 4 this year and next. All 28 eu Member States continue to grow. That obviously includes italy. It is important italy strikes the right balance between fiscal stability needs. Italy has the secondhighest debt to gdp ratio in the eu, and the needs to ensure economic growth. David thank you for joining us. That is valdis dombrovskis, Eu Commission Vice President for Financial Stability and Financial Services and Capital Markets union coming to us from straws bark. Coming up, dell sinking in premarket trading. We will look at the stocks to support level next in todays technically speaking. If youre heading out and jumping in your car, tuned to Bloomberg Radio heard on sirius xm channel 119 and on the Bloomberg Business app. Live from new york, this is bloomberg. David time for technically speaking. Bill maloney, voice of bloombergs equity squad joins me now. You can listen to bill on the bloomberg by typing in squa. With techs start off earnings. Dell is down 4 in the premarket. It lowered its sales forecast. It had been failing at the 200 day. It looks like it will cap allow the 50 day on the open. Toential support range is 49 51. We will see if it holds it on the open. Next, lets go to vmware. This stock is trading higher, up 2. 5 , around 1. 69 a share. Third quarter revenue beat the highest estimates. It day had been support, now will be resistance on the open. That is around 1. 70. If he gets above that, one point 77 is the retracement level. Upid resistance on the level for vmware, down level for dell. Thank you so much, bill maloney. That does it for bloomberg daybreak coming up, Amy Wu Silverman will be here for the open. This is bloomberg. Hey. Hey. You must be stevens phone. Now you can take control of your home wifi and get a notification the instant someone new joins your network. Only with xfinity xfi. Download the xfi app today. Lisa from new york city for our viewers worldwide, i am Lisa Abramowicz in for jonathan ferro. The countdown to the open starts right now. Up, u. S. Economic data showing signs of a rebound in momentum. Orders of durable goods knocking estimates out of the park. Treasuries lower with Futures Holding steady. Wall street during up for another day of new alltime highs. President donald trump continuing to boost optimism over trade negotiations, saying a phase one deal is here. 30 minutes until the opening valve, we are seeing a lift in the markets ahead of the open, but not as much as you might think even the betterthanexpected Economic Data and the mood music around trade. You are seeing the Dollar Strength and versus the euro and 10 year yields rise with crude as well. We begin today with the big issue, which is the barrage of Economic Data this morning. Joining me to break it down is michael mckee. Michael barrage . We have been saying cornucopia. Lets keep the thanksgiving theme going. Our
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