Rotavirus coronavirus. A judge has denied a request for ghislaine maxwell. She had complained of onerous awaits trial she on charges of sex trafficking underage girls to her former boyfriend, jeffrey upstream. The judge also rejected her request to learn the identities of three accusers referenced in her indictment calling the motion premature. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in i am markountries. Crumpton, this is bloomberg. Is 1 00 p. M. In new york and 1 00 a. M. In hong kong. Welcome to bloomberg markets. Here are some of the top stories that we are following. We will be speaking with thomas with andd he is with the election around the corner we discussed downside volatility and how the results can change wall street and we talked the politics of finance with brian richards, chair of paul hastings. He says the election is a big driver of activity in his industry. Arricane laura post to become category three storm all when it comes ashore, the texaslouisiana coast, and threatening to inflict 12 billion of damage. What it could mean for the Nations Energy hub. Let us take a look at the markets. We were trying to get on more record highs. Eking out an additional two points. Meanwhile, the 10year yeild getting a lift up about three basis points with about 70 basis points. You are starting to see a rotation out of equities and into bonds a little bit, more so than this morning. Further dollar weakness and a little bit of gold coming off their about. 6 lower. This is all as i was mentioning stocks remaining near the record highs. There are fears of downside volatility, all as we had into election season. How are investors positioning for risk. Our correspondent joins us around along with tals. Take it away. Thank you for joining us. How are your clients bracing for what could be a really rocky fall into november . Who are preparing for increased volatility by these aspiring these expiring in november, and december, and i hope that the market will move at the time. But, it is soon enough. Selling is probably more typical than buying. What do you see happening in the market, what level on the s p 500 if there is a blue sweep in november . Thomas i think the market will case, but i think if there is a blue sweep, the market, in the shortterm, will go down more. See a long term, i demographic victory a Democratic Victory to be more positive for the market. You have mentioned some concerns about a biden win in the past given that higher taxation and more Capital Gains taxation and more Corporate Taxes would create a bit of an impact, how much of an impact tangibly would that be . Thomas well. Comment had, my nothing to do with Vice President biden, it has to do approach toser socialism, and what happens under socialism is that it is government officials who operate the economy instead of millions of independent investors and bills Business People who motivation togher succeed and to make a profit. Often, socialist governments find it necessary to employ harsh and intimidating techniques to repress this. So in eastern is europe where i grew up in that is what we see in cuba, and venezuela. I amcialism aside, wondering, you have given to the Trump Campaign in 2016. Have your views changed at all over that period of time . Well, i have not given mr. Trump a donation this year. Donations have given to Many Republican contenders for the house and the senate. On that note i want to talk about the markets. How disconnected are they from an economy with 10 unemployment . Asking how the market prices are disconnected from the economy . Taylor correct. Thomas on the one hand they are disconnected, but on the other the fed keeps pumping all of this money into the economy and inflation will come, and prices will rise. Tell whetherd to it is overdone at this point or not. Anothert to go back to point you had made. You said you had not given to President Trump in this election cycle. We have seen that from another a number of republicans. Why havent you given and what are some of the concerns among your peers . Thomas i think everybody is worried about being intimidated. About the intimidation . Thomas that is right. What do you mean . Thomas it means personal threats i have received, on several occasions. Elements. Which encroach on our daytoday freedom. What do you mean by threats . What thatu know means, no . By who . But i do not want to make it more difficult for people around me. I, please understand that would appreciate if you stop this line of questioning. We hear you. If people are threatening to boycott the business, can we talk about the Business Aspect of it . Thomas that is also a possibility. It has not happen so far, but it certainly could happen. Taylor let us get back to some of the markets as well. Talk about rising deficits. You mentioned inflation early on. Are you seeing inflationary pressures from the massive deficits that we are running . How are you thinking about deficits . Thomas you see, all of the money that the fed is putting into the economy will never reverse or be able to reverse. Sloshoney is going to around in the economy forever. So, the money never leaves the economy. , so that will put continuous pressure on the prices. And, the prices of consumer goods will rise and services will rise. Of operating businesses will rise, and therefore businesses will have to charge more for what they produce. Ongoing cycle. An the fed is not wanting to look on this question. They think that the covid private prop problem is not serious. People have to be paying more for their price of goods, and they also might be paying more in taxes, how much money do you think they will put aside to invest in the stock market as we have seen in the rise of retail at the beginning of this year . Corresponding and prices will rise in general, everything will rise. So, i do not think that there will be a problem right now. We have too much money going into the market, that is why we see the market rising every day. Do you see, as we have seen, the economy start to reopen. Have we see the same seen the same level of participation by Retail Investors that we saw at the beginning of the year . Thomas at the beginning of the year there was nothing special happening, but in march, suddenly, everyone participates in buying investors in the market suddenly shut off. And may, that is where it stabilized, and since then it has been very slightly gradually calming down. Blood, it is almost not at all but, it is almost not at all. I think, up until people go back to work they will keep trading. We only have a few minutes on youram curious thoughts on u. S. China relations. We seemed to get an improvement on talks of phase one. How are you viewing relations . How do you think they would differ under a Biden Administration . , supposedly under a Biden Administration, relationships will be more relaxed. That myld not Forget Company along with many others or doing business in china, would like to do business in china. Getting the various licenses there is not easy. Is in all of our interests that whoever the powers may be us nicely andt give us the licenses that we would like to get. And, on the other hand, i am not sure if thatnot so would be better for the United States. Lot ofyou seeing a Retail Investors flocking to chinese adrs as they are investing in the u. S. . Thomas no. Always a great conversation covering a load of topics. Thank you for joining us. Ate sure to tune in tonight 10 00 p. M. For special coverage of the Republican National convention. All of that coming up next. This is bloomberg. Taylor this is bloomberg markets, it is time for the stock of the hour. Scarlet fu has more for us. What are we looking at. Scarlet childrens place, the worst reporting stock. You can see the gap lower at the open. The retailer had an adjusted loss of 1. 48. This is the Second Straight Quarter of losses which is not surprising when you think about the fact that the company had to shut down during the pandemic. Now that it has reopened 90 of its stores it is still struggling because there is not much of a backtoschool shopping season. This is the busiest or second busiest period after the Holiday Shopping season. With so many schools choosing to go Remote Learning or hybrid, there is not much need for parents to buy clothes for kids. That will have a meaningful negative impact on results. Childrens place not offering guidance for this quarter. It is seen as it, a pure north american retail seller because 90 of its sales go are in the u. S. The dropoff in physical sales hurt sales overall. You saw a 12 drop for the quarter, the lowest for a backtoschool quarter going back five years. On a relative basis when you look at it stacked up against other retailers, sales held up well. Down 12 but you can see that womenswear was a lot worse. Footlocker is the outlier as people bought sneakers. It is a grim picture snowfall for retailers. Place what is childrens doing to limit some of those losses . Rlet it is washing its watching its costs and closing stores. It has shut down 102 this year and will shut down 98. It is very mall reliant. We know the struggles they are. Retail pref traffic has not gone back to prepandemic levels and keeping in mind what we are seeing in new york, people are not allowed to go back into inside malls and if the covid situation worsens in the fall you could see it shut down again. Taylor she gets to stand up next to those awesome charts. Thank you as always. We continue our theme of politics and wall street. We will focus on private equity and how the election is driving that industry. This is bloomberg. Taylor this is bloomberg markets. Earlier we were discussing politics and wall street with the founder of Interactive Brokers and now we are turning our attention to private equity. Our next guest says that pe activity has increased over the next 30 to 60 days and one of the biggest drivers is behind the surge and a concern over higher taxes if democrats prevail. Joining us now is brian richard, partner and share of the Global International private equity practice paul hastings. Walk me through the big reasons you have been seeing big activity starting to increase. Brian so, first good afternoon. Of reasons number why activity has started to increase. First, businesses have been able to predict demand a little better than they were at the beginning of the pandemic. And, forecast supply. And, the Biggest Issue is, i think, that the tax rates that we will see if and when there is a blue sweep, and they had us at a lot of different levels. We are talking about individual Capital Gains rates, Corporate Tax rates, and one of the proposals from Vice President biden is that individual Capital Gains rates would go from 23. 8 today to 43. 4 post election. And that obviously has a Significant Impact on the amount that owners of businesses to be able to put into their pockets after they sell their business. Taylor walk me through that is putting pushing more space in private versus public equity markets. Push private equity markets more so . Brian in Public Markets individuals can make their own independent decisions. A private equity, you have company in its entirety being sold in transactions. And, there are two levels of owners typically in the private equity transactions. There are the limited partners, the people who put up capital, and they pay tax at capital wens rates, and they are, as talked about, going from a little over 20 and 40 . In the privaters equity transactions are the owners of the private equity firms, the general partners. Interest, 20 ied of the profit on private equity investment. Today, those rates are also taxed at Capital Gains rates of roughly 20 plus 3. 8 obamacare surtax. Under the democrats proposal, that rate would also double, so that would drive there is significant buildup gains and a lot of private equity companies, a lot of holdings. If you have tens of hundreds of millions of dollars and are talking about the difference of being able to put 80 of that in your pocket versus 60 in your pocket. That will be a significant driver toward an exit sooner rather than later. Taylor i am curious, do private markets feel as highly valued as some say the Public Markets are . Brian there is no question over the past six to eight years we have had a significant increase in the multiples that people play pay. On an adjustment of the multiples, and they have been high over the past six to eight years. They have not gone down despite the pandemic and lack of certainty about the nearterm future, but we have not seen them gone up yet as a result of these potential play that we are talking about and we may yet see that as we get closer to november and december 31. Taylor our most of them being financed with debt given a are most of these deals being financed with debt given that they are free to borrow . Brian yes. Thecally, at least half of Purchase Price is paid in a form of debt, and to your earlier question, the cheaper the debt, the higher price the buyer will pay to hit its return thresholds that it is seeking. The fact that there is a lot of debt out there that it is free, and following your prior guests commentary, the fact that you have inflation anticipated, i think those all support these historically high prices. Taylor very fascinating. Thank you to brian richards, chair of the Global Private equity practice at paul hastings. Stay with us, coming up best buy sales surge, but the giant does not expect the momentum to last. Betweenher bifurcation bigbox retailers and some of the smaller ones. Within the general markets, trying to hold onto the gains. Four points within the s p 500 after closing at 3400 for the first time yesterday. This is bloomberg. You doing okay . Yeah. This moving thing never gets any easier. Well, xfinity makes moving super easy. I can transfer my internet and tv service in about a minute. Wow, that is easy. Almost as easy as having those guys help you move. We are those guys. Thats you . The truck adds 10 pounds. In the arms. Okay. Transfer your Service Online in a few easy steps. Now thats simple, easy, awesome. Transfer your service in minutes, making moving with xfinity a breeze. Visit xfinity. Com moving today. Atk first lady milani trumbull step into the spotlight tonight. She will make the case for her husbands reelection from the white house rose garden she helped renovate. Her speech of the 2016 convention was criticized when it was found to have included passages similar to what Michelle Obama said of the 2008 Democratic National convention. The speechwriter for the Trump Organization later took the blame. The father of a black man shot multiple times by police in wisconsin says his son is now paralyzed from the waist down. Jacob blake told the chicago suntimes he is not sure if the 29yearolds paralysis is permanent. The shooting on sunday by police in kenosha was captured on cell phone video and quickly spread on social media, igniting new protests over racial injustice. Federal agencies are bolstering arsenals of teargas and other crowd control equipment has Racial Justice protests continue around the country. The government spent at least 28 million for the gear since may 25 when the death of george floyd, who was unarmed in minneapolis, sparked protests. According to data analyzed by bloomberg, spending his sword 114 over the same period last year. Officials in jamaica say usain bolt has tested positive for the coronavirus. His recent contacts are being traced. On monday, he said he was quarantining himself as a precaution while he awaited his test results. The 34yearold retired sprinter won gold in the 100 and 200 meter races at the last three olympics. He said today he does not have any symptoms. Global news, 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. I am mark crumpton. This is bloomberg. Greg welcome to bloomberg markets. Taylor we are joined by both a possibleand warning from best buy. It warms the boost he received from reopening stores wont last through the rest of the current quarter. Bringing back the rush hour buzz in new york city. A coalition of top Property Owners and managers working the phones, pressing the biggest employers to speed up the return of workers. A serious hurricane situation unfolding for the gulf coast has hurricane laura barrels towards texas and louisiana. We will tell you how the fallout could impact the Nations Energy center. Lets get a quick look at those markets. A bit of a mixed trading day but it seems the broader s p 500 is finding its way into positive territory. We are at alltime highs for the s p 500. It seems to be the United States and china, some indication they are willing to talk. The phase i deal. That is a positive. The dow under pressure now but on days when we are looking for direction we usually dont look any further than the tech stocks. 10year, money in the u. S. , up. We are talking best buy. Look at shares right now. What we are seeing and a lot of companies is not about the quarter you had, it is the warning of what is to come. A warning of slowing growth after the Quarterly Sales soared. We saw americans opening up their wallets, splurging on household upgrades. Best buy warns this will not continue for the rest of the year. Investors are getting cautious. Ets bring in greg portal the l