Francine we will have plenty more on that throughout the day. Lets get to first word news with ritika gupta. Ritika no murder charges in the Fatal Shooting of breonna taylor. A kentucky grand jury chose not to file the indictments against any of the Police Officers involved. A single officer was charged with wanton endangerment for firing into neighboring apartments. The decision has sparked outrage and renewed violence. At least two Police Officers have been shot. President trump says the Supreme Court will likely have to decide the outcome of the november election. Hes arguing he needs to confirm a new justice to replace ruth bader ginsburg. Hes casting doubt on the validity of the election, reiterating his criticism of mailin voting. Idea of challenging the virus is gaining. The study speeding up research but raises ethical questions about exposing people to a potentially fatal virus. Global news 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more im ritikauntries, gupta. This is bloomberg. Tom equities, bonds, currencies, commodities. Im going to go through this quickly. 3. 221. You can rounded to 10 if you choose. Knew thatnothing, we coming in. Oil is an indicator of that stronger dollar, and what we see in the data check is expressed in Foreign Exchange with dxy up at 94. 40. If there is one thing that has changed, suddenly in four days, e. M. Gives way, and it really can look at any emerging markets that give way. We focus on turkish lira with the Important Bank meeting happening i believe momentarily. 7. 71 is new weakness on turkish lira. Its amazing to cem join the developed nations in weakness against a strong dollar. Francine and also there is a turkey decision later today. I know you have been watching the turkish lira very closely, so dont forget that. We will bring it to you as it breaks. Im looking at a similar data check. Stocks are falling. Futures are down. This has to do with what we heard from the fed and the warning of more fiscal stimulus being needed, and crude oil dropping below 40 a barrel. Thats what we should be looking at. Lets get the latest on the u. S. President ial election. President trump has refused to commit to a peaceful transfer of power. Ifocrat beau biden Democrat Joe Biden wins the election in november. There is President Trump and joe bidens response. Pres. Trump we are going to have to see what happens. Ive been complaining very strongly about the ballots, and the ballots are a disaster. But people are rioting. Will you commit to making sure there is a peaceful transfer of power . Pres. Trump get rid of the ballots and there wont be a transfer. There will be a continuation. The ballots are out of control. You know it, and you know who knows it better than anybody else . The democrats know it better than anybody else. Are ween what country in . Im being facetious. I said what country are we in. He says the most irrational things. I dont know what to say. It doesnt surprise me. Francine joining us now is elliot hentov. Thank you for joining us. Who does this play to . This is President Trump saying basically if he doesnt win, it is rigged and there will not be a smooth transition of power. We have never really seen anything like it in modern u. S. History. Does it energize his base or convince the undecideds to vote for biden . We have first of all, never seen it in u. S. History, but weve seen it in emerging markets, so i think we have a how, deep knowing emergingmarket stands. This is not an electoral play. The idea is not to change public patterns, it is to lay the groundwork for the postelection day strategy. Bear in mind, trump has had the most stable Approval Ratings in u. S. Polling history. Low but incredibly stable. So this is not about winning new voters, swaying independents. On that front it could even backfire. The remaining small group of sweet voters have not tuned in yet of suede voters have not tuned in yet. Both parties are particularly but particularly the rnc, the Republican National committee, has been fundraising for the legal fund for the day after. Instead of fundraising for campaigning, they have set aside a sizable cash buffer to be able to contest in a variety of states legally the processing and certification of the results. Francine if the race is very contested, how will it affect the markets in the days after the election . We have been flagging the u. S. Election as a major macro risk this year, and of course we had a global pandemic, so it pales in comparison to the coronavirus. And frankly, for good reason, the pandemic has been dominating market thinking. What is interesting, you talked about the recent market reversal the past few days, and we are still seeing this traditional risk off pattern. E. M. Sells off, equities go down, the yield stays flat. The dollar rises. That pattern is unlikely to replicate itself in november as we get a protracted dispute. What matters is a dispute where markets are spooked in the belief that there will not be certainty by early december, mid december, or come january. A range of scenarios remains wide open, widen certainty as to how a dispute would play out. It is fine, there is a few days of back and forth, and the markets can tolerate that. But i would say about five to seven days in, the end game is not predicable by margins, then youll start to see not only high volatility but some real risk off pattern. But in reverse, the dollywood decline in parallel. The dollar would decline in parallel. Fascinating, and i take issue not from you, but from the punditry, who says that this has not been seen before. Anyone who saw the atoms to jefferson trend the transition from john adams to jefferson would see it has happened before. Impute in a massive fiscal program, whether it is President Biden or President Trump come in february or march of next year . Elliott yes, i think that has to be the market assumption. Frankly, if you look at where we are, you said the correction. Overcorrection of 10 is an alltime high. I am comfortable with market valuations. There does not need to be a stimulus now. That stimulus in the coming months, data will be weaker. Whatever president can establish himself in january, there will be a support program to substitute for the missing stimulus in 2020. There will be one frontloaded. By the way, remember, it will be retroactive. How will businesses dip into savings now . Some of that will be replenished. You that into Market Analysis . What do you do with a marketing correction . Well, as long as you have confidence that the u. S. Macro,n will pass as a the rest of the fundamentalist points will both inequities and elsewhere, you have the macro recovery, the vaccine development, and a few other fundamentals that are moving in the right direction, more in the right direction than in the wrong direction. Right now policy is moving in the wrong direction, but the direction points upwards. Hentov, stateot street Global Advisors head of Global Policy research. Henry,up next, janet global chief economist. She is coming up next, and this is bloomberg. Equal to 2 . Our label market indicators, with them to be consistent with maximum employment in the labor market. So we have been very clear about that. If you will, that is the whites of their eyes. We want to see actual inflation at 2 . About 11 million jobs have returned, but there is still a deep hole. We have a very high rate of unemployment, a lot of small and mediumsize businesses that are suffering, so yes, and additional fiscal support will likely be needed. Clarida there, the vice chair of the fed. I want to thank for the whites of their eyes. This is the really interesting idea. Buried in that comment was the layer that the American Labor economy. Now joining us, janet henry of hsbc. She and her team right veer right piercing essays. On this thursday with jobless claims coming up, i want to go to the hsbc determination of the millions of unemployed that are out there. Is it a depression unemployed within this pandemic . Are certainly not forecasting a depression because the policy stimulus that came through has so far successfully avoided a depression. Withve seen a strong bank growth in the Fourth Quarter. It is still a very deep recession, we are still a very long way from a solid recovery. Tom but to the millions of unemployed, jon ferro has talked about the unappointed statistics in the united kingdom, but i would suggest in the hsbc world there is a real question about the employment dynamics that the fed and other banks have to deal with. What is the level of grim that they are . Janet well, the difficulty we have with the data you are right, we know there are millions unemployed, the on up limit stats are everywhere. You know, we are focusing on weekly jobless claims in a way that we never have in the past, even though we know there are distortions. In europe, you cannot even see the numbers because when people are temporarily unemployed, they count as employed. It looks like unemployment rates have risen. In the u. S. , the on appointment rate we know that there is a lot of excess labor, and that is why we keep hearing all of these calls for a more fiscal stimulus to support labor income, to prevent an ongoing inflation in the economy so that a certain level of demand can hold up, and gradually demand for some of these jobs return. Do you worryt about the most . We see in a lot of european places extra boost actions, the number of infected going up. Does that hit consumption first, but or does it go to bankruptcies directly . Janet well, initially it tends to hit growth. We talk about the pandemic and the impact of it, but the hit gdp is a huge one that we saw in the second quarter. It was much more about the degree of government restrictions that were put in place. Could notsome cases consume certain goods and Services Even if they actually wanted to. Now the second round that we are seeing is in some countries, the rising cases, the renewed localized lockdowns, that will impact on activity. Based on the pmi services we have seen for august and september yesterday from the eurozone, there are signs that social distancing reaction by consumers is starting to hit the Service Sector again. But it is different in the emerging economies. 90,000 cases a day in india, and they are still reopening the taj mahal. Francine when should we worry about debt . Janet we always worry about debt. Youve got to remember, im an economist, so at some point, especially in the emerging economies already, there is going to be renewed concern, if it slows down come about the risk of cap flows, emerging economies, shortterm flows with large external financing requirements. Even in advanced economies, we need to worry about the level of debt. When the level of debt is high, there is a desire to pay down. Hat debt rather than to invest the consumers desire to keep rates high and pay down debt enough to but we have seen from behavior of other countries already, the tax rises can wait. It was a couple of months ago that the u. K. Tax rises would be on the way. But instead in the u. K. , we are not going to have an autumn budget. We are going to have an extension of some of these schemes. There isnt time in the advanced economies to address what we know is a larger growing debt problem. Give us an update on the unique experience of hsbc in china. Relying on the marginal dynamic with china, how is it going . Janet the chinese recovery is continuing to come through. Youve got to remember the chinese stimulus has been different from what we have seen in advanced economies, which have been aimed much more at ordering and household incomes. In china, the policy has been more about keeping credit going and directing a lot of the investment into the fixed investment and Infrastructure Investment in particular. Also in china, because they were first in the pandemic and first out, to a large degree, they were able to get production side of the economy the production side of the economy back on stream and benefit from the increased demand for some of the things that we needed during the lockdown in particular, whether it is ppe or Home Computers so that we could all continue to work from home. The chinese recovery is on track. Othere than some of the advanced economies, they have an eye on financial stability. We may not get the huge fiscals to mills that the rest of the the huge fiscal stimulus that the rest of the world gets. Dynamic, is the trade off the core of the united states, when you saw exports and imports, what is that dynamic right now . Can we benished or more optimistic . More china will provide of a lift and global trade then any other country. Exports and imports tend to run in line with global trade, but it obviously does matter. It is still the largest economy in the world. That is what we are seeing in the markets at the moment. In cases, bute because the u. S. Fiscal stimulus is delayed. If we dont get that u. S. Fiscal stimulus, then growth which is already going to be slower in the Fourth Quarter, quite significantly so, without a fiscal stimulus, that will be even slower and that will hit demand elsewhere in the world. Francine janet, thank you so much. Janet henry of hsbc stays with us. Dont miss some of our big interviews ahead. Guy johnson will speak exclusively with airline chief executives at the World Aviation festival. This comes at the outlook for airlines is turning increasingly grim with new restrictions and dashed hopes for a recovery. That is throughout the day. This is bloomberg. Ritika this is bloomberg surveillance. Over thes apologized struggle to find the struggle to find black executives is down to a limited talent pool. He issued an apology saying they were insensitive and showed unconscious bias. J. P. Morgan is set to pay close to 1 billion to resolve market manipulation investigations. Record potential settlement involving alleged spoofing. The accord would end probes by the Justice Department in industry regulators into what are metals and treasuries traded that is your latest Bloomberg Business flash. Arecine this is what we looking at in the markets. A bit of a downward session when futures when you are looking at futures and some of the european stocks. Much more than that, they are looking at what we heard from jay powell at the fed yesterday, warning that more fiscal stimulus is needed to sustain the economic recovery, and that also came out in toms fantastic interview with richard clarida, Vice President of the fed. What im looking at as well is a bit of gold is a bit depressed, and you can see oil holding below 40 a barrel. Tom lets make clear that the fantastic interview was because of lisa abramowicz, who asked him three times about fiscal policy, the vice chairman was clear about the need for fiscal policy. What we have in the data, it is the deepest of the markets. The foreignexchange market tells so much. Janet henry just with us, what david blum has done on hsbc on a resilient u. S. Dollar, certainly not a weaker dollar, rings true at least this morning. Index,at big country exit em and x china, the number gets your attention. Sterling with a little rally off the shock of Prime Minister johnsons comments. I want to focus on the deterioration of em, where the you look at brazilian rail, mexican peso, and a beleaguered turkish lira. 7. 7 one on turkish lira is extraordinary. Ed phelps ofour, columbia is fired up. This is bloomberg. Good morning. Janet, we were talking about the fed had said and in terms of significance of dollar dynamics. Janet, you are also talking risinghe number of cases but the taj mahal being open, which is a story i missed. How much do you worry about emerging markets right now . Always tend to worry in the world if we are turning risk off, because any emerging markets that have any external deficit reliant on capital finance, that deficit, particularly if they have any high inflation in the past or whether they are embarking on any kind of unusual policy makes, those are always a countrys going to be a little more vulnerable. I also know emerging markets are where the great opportunities are. Even in this extraordinary world we are in, we have higher growth forecast in emergingmarket stand for these economies. Does china become the real winner in this because they got out of the virus much earlier . They seem to have a handle on it, so the economy can be on a much stronger footing more quickly. It certainly is coming out the recovery more strongly than other advanced economies, but the difficulty we have at the moment is that when we are thinking about a different country, there are different paths for the story. In some cases, the extent of the construction contraction is much more a degree of government. Rather than the level cases. What we saw in china was a your coney and locked down in the First Quarter and intense contraction of gdp, but as it ,pread to the rest of the world china was starting to come back. Industrial production in particular, and they were producing goods that the rest of the world were demanding. The policy stimulus did not put labor support labor incomes in the same way it has impacted fiscal stimulus in the advanced economy, but with private investment starting to improve a Public Infrastructure spending seeming quite strong, we have seen the recovery economy start to recover. China does have the best picture in 2020 and 2021 as well. Tom only go back to the claret comments yesterday, particularly his speech august 31 at the Peterson Institute without imposing. Janet, what is so Foundation Institute with adam pozen. Et, what is is the reason we are so aware of negative rates because of our predominance of money market funds in our system . Also,t is part of it, but when you look back, it is hard to find an example of any ever gone intos negative Interest Rates that has come out of it. So when we look at, certainly in our outlook for