Great deal of this because it is the first republican senator to say im not sure Mitch Mcconnell is handling it right. Not that the president should be convicted, but maybe we should not be working quite so closely with the white house. Is this significant . Kevin it is. Senator murkowski voted against the confirmation of Justice Kavanaugh. The question is whether senator murkowski can bring on other republicans to try to get on board during the rule package that leader mcconnell has to advance in the senate by a simple majority. Rules for the trial. It is not so much whether michalski and others will vote to convict President Trump, that is unlikely. It is more about the rules. Nancy pelosi has not sent over the articles of impeachment because she wants to have people like Mick Mulvaney and john bolton testify in the senate, something Mitch Mcconnell has said is a nonstarter. Right now what you are seeing from senator murkowski is in a centrist state like alaska she is trying to suggest maybe leader mcconnell might have to give something to democrats when theyre crafting the rules for that trial. Questionich raises the weathersby keep losey strategy may have progress. She has delayed it whether speaking whether close these strategy whether speaker pelosis strategy may have made progress. She has delayed it. Kevin Susan Collins voted to confirm Justice Kavanaugh and that is the barometer in terms of where senators are going to move. Murkowski just created a marker of sorts for those republicans give might be working to craft some type of rules to say they have worked for a fair trial and then set up a vote to not convict President Trump. David thank you so much for reporting. From the white house, that is kevin cirilli, our chief washington correspondent. Now we go to Gwen Ackerman from jerusalem where there is a big fight over the leadership of the likud party. Is a dramatic fight. It is the first time in 10 years or 20 years that Prime MinisterBenjamin Netanyahu has had a real rival for his leadership. And it comesc after the Prime Minister failed to form a Coalition Government after two elections. We are going into our third in march, and after the attorney general recommended he be indicted on corruption charges. Versus aetanyahu former minister and a younger likud Senior Member who was mentored by netanyahu in his early days. David is it likely Benjamin Netanyahu will use will lose leadership course at significant anyone was even able to challenge him for it. Will changes are slim he lose the leadership, but it is significant there is a real rival. Should the rival make a nice standing, some analysts have said it would signify the beginning of the end of Benjamin Likud ands rule over his leadership of the country. David that is Gwen Ackerman joining us from jerusalem. We will have the vote later on today. We turned to alex harris in new york. One of the stories toward the end of last year was dollar liquidity. What went wrong. What is the fed doing about it . Alex since september they have been doing these operations to inject more liquidity and ensure the pipes are running smoothly. They have really amped it up. They were planning on injecting half 1 trillion of liquidity at the most. Dealers are submitting and taking way less than that. Right now we are around 200 billion of liquidity for year end. What that is telling you is there capacity for how much they can take. That is what i think we are starting to see with these operations for the end of the year coming in under subscribed, less than the maximum the fed is offering. David does that suggest this may be a tempest in a teapot . We have had the rates by command 8 the rate spike dramatically. Now it has calmed down. Alex it depends where it was treading this morning, it is still 200 basis points higher than where the overnight rate is trading on a daily basis. It tells you there are some bouts of volatility because at the end of the day you do not know what people on the street will need until they get in on december 31. You can plan as much as you want but sometimes there is just a oneoff and you say i am not funded, i need to get more. I do not think we will see anything like we saw in september last year when overnight rates went to 7 at the end of the year. This is a volatile market and people need to remember they will be volatile. David 200 basis points is nothing to sneeze at. Lets get a check on markets. Butes not a lot going on, abigial intraday record highs for the s p and the nasdaq. Not a lot happening. Volume 50 below normal. Lots of traders and investors still out. Making it slightly risk on, the fact that you have bond slightly lower. The vix flat. Manytfolios Portfolio Managers hoping to lock in the banner year. Block that out. Let that in without tipping the ship. About theave to ask santa claus rally. Will be more difficult to pull that off this year . Abigial i love the fact that you know with the santa claus rally is, because most people think it is in december. Throughs the 26th january 3. Abigial absolutely right. We have a chart today that shows it could be wobbly. The yen appears as though it could have a rally. If we start to have investors going to haven assets, they may pull out of stock. That is the thing to watch. Today santa does seem to be visiting. David will it visit the nasdaq . The nasdaq has been on a tear. Nine records. Abigial it is pretty incredible, the nasdaq, chips, investors wanting in on the highgrowth docs. If the debt highgrowth stocks highgrowth stocks. If the santa claus rally does not happen, investors would probably pull money out of those cks, especially sent especially since valuations are sky high. Pretty rich. David thank you so much, Abigail Doolittle for that great report. Now we turn to Mark Crumpton who is here with bloomberg first word news. Mark it will soon be harder for california businesses to treat workers as independent contractors. Beginning next week, a new law will restrict the use of labor. The legislation is aimed at creating and equities on the growth of the gig economy and improving employment practices. Critics worry legislation could use smaller forms that contractors due to budget and staffing restraint. Federal regulators unveiled a sweeping proposal that mandates the tracking of most rounds. The faa says the measure would promote Public Safety and help prevent terrorism. The rules call for a massive new tracking network that can spot the devices flying anywhere. The United States has dropped payingand on south korea five times more to host its military personnel. The deal comes days before a troop funding bill was set to expire. South korean media reported the u. S. Softened its stance after seoul threaten to buy american weapons and offered to step up its presence in the strait of hormuz and help u. S. Efforts to protect oil flows in the region. The Constitutional Court in ban onsays turkeys wikipedia is unlawful. The ruling was reported by state run media. The courts says banning the online encyclopedia constitutes a violation of free speech. Inkey first block despite 2017 because are removed to it refused touse remove content that accused the government of cooperating with terrorist organizations. Global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. I am Mark Crumpton. This is bloomberg. David . David coming up, we will be joined by isaac boltansky, Compass Points director of research to talk about policies headed into the new year. This is balance of power on Bloomberg Television and radio. David this is balance of power on Bloomberg Television and radio. We send into the new year with Geopolitical Uncertainty lingering. Withwith the trade deal china and a pending ratification of the usmca. We welcome isaac boltansky, director of policy research at Compass Point research and trading. Thank you for joining us. A lot of uncertainty. Lets start with the big one. Impeachment. What extent does the pending impeachment hangover the markets and business . Isaac impeachment bits within a broader narrative. There is going to be high drama inside the beltway but it has very little impact on the markets. Lets start with impeachment. There is going to be a lot of political posturing. We still do not go we still do not know what the rules will look like. We do not know if there will be testimony in how the white house will formulate its strategy. We know the end game. We know there are not the necessary votes to remove the president from office. We know he will be acquitted at some point after the trial. I do not think the market will care much about the different permutations that come out of the impeachment, other than how long that backandforth could delay the usmca ratification. David that is what i was going to raise. The length of the process could affect the markets. Number one because Mitch Mcconnell said we will not vote on usmca in the senate, and as an old lawyer, the longer things get dragged out, things can show up you did not expect. Isaac absolutely. Lets tackle the first one. Usmca will clear the senate. You will hear consternation from the right. They believe the negotiations gave away too much to secure democratic votes in the house. The reality is a good compromise leaves everyone unhappy. That is what we have. It will clear the senate. I cannot tell you when. We havenow for sure is a markup scheduled for the usmca on the seventh of january. The earliest possible date for that. That will occur. It will clear at some point at the end of january beginning of february and then canada can move. As for the timeline, i think nancy pelosi strategy to extend the negotiating period is bearing out some fruit at this point. We already have some pushback from at least one senator about what the process will look like. Who knows what this storyline will be in a week. Lisa murkowski said something about that. What about the u. S. China trade deal. They say it will happen in january but we do not have a date, do we . Isaac we do not. We are still waiting. I think the phase one portion is done. We have the detente that will continue through the election. There is going to be a moment where we get a oneoff tweet from the president , perhaps he is attacked from the left during the primaries or the general election about his position on china and he comes out aggressive. The reality is we are in this phase where we will not see progress forward, but thankfully we will not see much of the retaliatory spirals. For right now, it will be a nice picture when they signed the agreement. The market believes that agreement is done and now we have to wait until after the election to figure out what the next phase will be between china and the u. S. David we are talking with isaac boltansky. How much uncertainty for markets might there be in the primary season . How much of a swing could there be if you have an Elizabeth Warren versus a joe biden apparently moving toward the nomination . Isaac we have had two clients to three dozen clients meeting the past two weeks to have to figure out the year ahead. There are a couple of points you want to highlight. The democratic primary has to take some time. We are all going to react as we all do immediately and with force after the first four primary races. Those four are only representative of 4 of the pledged delegates. It is super tuesday on march 3 where you have one third of the delegates and then the remainder of those primary races in march that will deliver two thirds of the overall delegates. I am sitting here saying we will not know the day after iowa or the day after New Hampshire with the democratic nominee is. I think it will take until the spring. There is still the possibility of a brokered convention at the end. I am telling my folks we should know by the spring who was the front runner, who was the likely democratic nominee. That will be the first moment where we can say there is some certainty in the story. Until then, it will be in overhang part of every single investment decision. David that raises two questions. How much difference will be there be between the politics of the democratic nominee and donald trump . The second is if a democrat elected president how much leeway what he or she have given the fact that the senate is likely to remain republican . Isaac this reminds me of my quote, you campaign in poetry but you govern in prose. Many of the Campaign Promises you hear from both sides in this election season will not come to pass. Odds are the houses going to stay under democratic control and the senate is going to be under republican control. Even if i am wrong and the senate slips to democratic control, it is going to be a slim majority. Suddenly the most powerful senators will become the centrists red state senators like joe mansion who have already shown a high degree of reticence to big ideas like medicare for all and killing the filibuster. David always such a treat to have you with us. That is isaac boltansky, director of policy research at Compass Point research and trading. One of the key issues on the campaign trail has been a potential wealth tax. It has been prominently touted by elizabeth and bernie sanders. On november 1, i sat down with nancy pelosi and got her thoughts on the central wealth tax. Whatever we do about our revenue, about our taxation has to be done in a bipartisan way. We have to have fairness and we have to have enough to run the government. We do not want any more government than we need. Candidates are putting forth their ideas on these things. It is up to them to describe why that is a good thing and how that will help grow the economy. I do think i would enlarge the issue to talk about how do we conduct meeting the needs of the American People in a way that does not increase the deficit, that does increase job creation, growth that creates job creation for good paying jobs. We think growing the infrastructure of america is a path to get that done. I would like it in a green way. There are plenty of areas of Common Ground for us to do that. What we want to do is increase the paychecks. However it is paid for, that is a negotiation. David you talk about growth, which is terribly important. If there is more for everyone, everyone will do better. President trump ran on a progrowth policy. He did deliver tax cuts. Speaker pelosi attack scam. 83 of the benefits benefited the top 1 . David unemployment is at a 50 year low. If you are a trump voter in one of those key districts in 2016, what in 2020 will cause you to say i will switch to a democratic approach to growth in this country . Me say thissi let about your characterization. , theverage working person stock market, the gdp, that is not resonating with them. They want to know why their wages are stagnating. The Unemployment Rate is important. What we are talking about is growing the paycheck, reducing the cost of health care, growing the paycheck. Our economy will grow better if people have Consumer Confidence and they spend and they inject demand into the economy which further creates jobs. Not about some indicators that may or may not relate. I say lets take apart what it gdp anden you say the in what respect. I think the president s tax bill had many mistakes benefiting the top 1 . 83 of the benefits to the 1 . It was a scam. Now they are saying you have to help us correct all of the mistakes we made. We will try to Work Together to have technical corrections, seeing what we can get for americas working families. , you should not do a tax bill of that magnitude without being bipartisan. That was part of my interview with nancy pelosi on november 1. Coming up, how changing consumer tastes are affecting stocks. Ons is balance of power Bloomberg Television and radio. David this is balance of power on Bloomberg Television and radio. Our stock of the allegory is a category called vice. New studies show domestic beer and cigarettes are being left behind in favor of harder alcohol and vaping. That could help shape new national policy. Abigail doolittle is here to look at the findings. Abigial this is a classic example of what you can see in a quiet holiday week. We have cowen talking about this. From a fundamental perspective, it is disturbing. Studies are showing teenagers vice tendencies are shifting away from domestic beer brands and as budweiser and coors going more toward international ,rands, significantly mexican plus American Craft beers. Relative to the winners, constellation, they have no della, they have corona, and from a vaping standpoint, teenagers moving away from cigarettes and toward vaping. David as a father of a 17yearold im concerned about the vaping with all of the injuries and deaths. Abigial not only that but they are vaping pot. There is a study that shows High Schoolers are vaping pot, relative to eighthgraders. 17 of seniors are vaping pot. That is a trend to think about. David that is not good news. Thanks to Abigail Doolittle. Coming up, iraq in political crisis. The president threatens to resign rather the name and iran backed governor as minister. That is coming up next. This is bloomberg. What are you doing back there, junior . Since were obviously lost, im rescheduling my Xfinity