Does october start most interesting. As you well know, the president of the United States at walter reed hospital. He has been tweeting actively this morning, almost as much as jon ferro. In the markets, i would say weve got a bit of a celebration. Futures up 21, dow futures up 184. What do you make of the markets this morning . Jonathan a strong correlation between the president s health, his tweeting activity, and equity markets. We hope we avoided the local crisis, the chaos that many people were thinking about last friday. Up 0. 6 on the s p. In the bond market, this is where things get interesting for treasuries headed into election day. If the polling remains the way the polling looks right now, at a national level, the 14 point lead joe biden at the moment, at some point you do start to think about prices in the fiscal stuff. The key risk at the moment, i am catching up with Henry Peabody a little later tom on one of your other properties. Jonathan his view is that the risk the election is not a risk. Lets face it. If you get a democratic wave that is higher yield, potentially more inflation, fiscal impulse, those kinds of things. I am not saying those kind of things will materialize, but those are the things people wind up thinking about. Week, lets odd give you the synthesis of what is going on right now, particularly out of washington, and out of the pandemic in europe, also with the economics of finance and investment. It gets us out to q1 and q2 of next year. Theres no better place to look at those dynamics than full facing credit bonds versus highyield and ig. They were on two different planets on friday, werent they . Lisa they were. In credit, you saw yields going down. Down, so basic to become more creditworthy. Very hard to understand all of this, to build on what jon said, which is an increasing number of people are saying you cannot trade the nearterm turmoil. Youve got to trade the longerterm outcome of whatever this election has to hold. Given the fact that joe biden seems to be breaking away and some of the polls means people can price and a little bit more of that agenda, and i think you are seeing the key to watch, the dollar, continuing its weakening trend, which is also key as people watch this election. Tom we are doing the data checking in pieces this morning. It is a bloomberg surveillance thing. Shows stronger over the last couple of days. One other idea on this, the headlines out of madrid and paris on the pandemic are outright shocking, with the leadership of paris today really talking about a lockdown. A restriction to bars closing on tuesday. His london anywhere near the draconian outcomes we see in madrid and paris . Jonathan not for me to say that, but people are thinking about it a whole lot more. Pressure is really building on the prime minister. I dont think anything we wakes up in the new year and a new world. We hope we get to the end of the year and the outlook for a vaccine really improves. The distribution of an effective vaccine better as well. I would be focusing on the Economic Data and the correlation between Economic Data and the experience some of these are having at the moment. For france, for spain, they are the two countries on the continent right now that are struggling with coronavirus. You see it reflected in the Economic Data as well. As for the happy talk around the euro, if youve got a bid on the euro, that upside has got to be capped by the idea that if they did more restrictions, this data will deteriorate. Tom good way to start our conversation here. David riley gets us started in this hour with bluebay asset management. We are thrilled he could join us today. First chart i looked at today were those fiveyear out fiveyear forward breakevens. So different for the United States, with a lift of inflation, versus the disinflation of europe. What does that signal . David i think that signals that europe is in a very difficult situation in terms of the extent of the disinflationary, deflationary forces. Record number of inflation prints recently, and that is going to prompt the ecb to expect more policy action, but probably not until the end of the year or early next year. , there is toe u. S. A challenge on the inflation front, but i think theres more upside potential, particularly if we do get a substantive fiscal stimulus after the u. S. Elections. Lisa given that, using the rally we have seen versus the dollar is overdone . David well, i think if we get a situation where you were discussing before a democrats think sweep then i the expectation for markets will be a very sufficient fiscal stimulus sometime in early 2021. I think it will be associated at least initially with a weaker dollar. I think you will rightly see that play out with a stronger euro. I actually think it will benefit the sort of laggards of this recent dollar weakness, which has been emergingmarket currencies. I think a biden and democratic clean sweep is on them to give silly positive for emergingmarket assets, including currencies. That is where i would rather play, where we think we are going to see some future dollar weakness. Jonathan is that a trade policy trade . What is that . David i do think that it is a sort of trade policy premium uncertainty associated with a trump administration. That extends to not only relationships with china, but also the way that tariff policy has been used with a number of trading partners, including allies of the u. S. As well. When you take that out, that implies a weaker dollar. I think a big u. S. Fiscal stimulus package would also be a sort of signal for the market to more decisively go into a rotation trade and a kind of global reflation trade. I think you get a steeper Treasury Curve as part of that as well. I think you get some rotation from growth to value. I think also into some of those assets like emerging markets that do better in a global reflation world. Jonathan and there i say, you said it a muscle lets discuss it, this rotation. The elusive rotation. This idea that the banks can start doing well, the curves can start steepening. That is the trade Everyone Wants to see work and just hasnt for so long. If it worked in the United States, can it work in europe . David i think it can help. I think if we see that kind of move in the u. S. To steeper curves, to some extent that would show the way for european policymakers. We have seen a better and more coherent policy response from policymakers on the fiscal side in this crisis than we have seen in previous crises. That in order to get that sort of story for europe, we are going to need continued fiscal policy support, and i think the ecb is going to have to accommodate that by extending its asset purchases, by essentially saying we are going to backstop government borrowing, and dont worry about how much debt there is right now. Keep on borrowing, keep on supporting the recovery. Story in thet as a u. S. And europe, i think we will see steeper curves and i think it will be beneficial for cyclicals and value. Lisa what is your hedge . What is your go to asset to counteract if you are wrong about this reflation trade . Actually not an easy thing to do to find hedges for portfolios right now because i think the way that fixed income has behaved toward government bonds during september shows that has become very asymmetric. I think it is harder for those yields to go much lower, and if we do get incremental policy news, particularly on the fiscal yields sortk those of move higher. How you try to mitigate that risk a little bit, weve reduced it in our portfolios given the level of uncertainty at the moment, but also you stick with your bias to up in quality to places like highgrade credit. Great to catch, up as always. David riley there of bluebay asset management. Get your head around this one. Jens eichmann of the bundesbank is speaking at the moment, saying german recovery is likely to be incomplete, and culling liquidity and low Interest Rates crucial. With his workr would think that was unthinkable from him 10 years ago. It is not how people respond in the emergency, and the media aftermath of a crisis. It is how they shift, and the permanency of that shift over time afterwards. To hear the hawk over at the ecb talk about low rates being crucial just tells you about the whole we are in and the shift we are seeing. Tom what is so important here is the percent of gdp of every story out there. I dont have the percent with me of germany needed. But we are miles, even with speaker pelosis fiscal stimulus, we are miles from the kind of fiscal stimulus economists are talking about of 5 or 6 or even 7 of gdp. We are miles from that. Jonathan after 2021, maybe beyond. Coming up, university of London College professor of political science. To rofessor Group Professor gupta, ritika gupta will be joining us. Jonathan i believe it is professor norman. This is bloomberg. Ritika with the first word news, im ritika gupta. There is confusion over how President Trump is being treated for the coronavirus. In public, his doctors remain upbeat. One says the president could be released today from the Military Hospital in maryland, where he has been since friday night. Another says the president has been given supplement to oxygen, and he has received medication typically used in more severely ill patients. Meanwhile, the president unexpectedly left the hospital to greet supporters in a bid to demonstrate strength. Joe biden leads President Trump by 14 in the new wall street journal nbc news poll. The lead is his biggest of the campaign. The polls were taken after tuesdays debate, but before the president was hospitalized for coronavirus. Boris johnson is warning the British Public that a very tough winter lies ahead. He says he accepts that people are angry with the way he has handled the pandemic. He says it will be a bumpy ride to christmas, and maybe even beyond that. A huge deal and big pharma today, Bristolmyers Squibb has agreed to buy biotech firm myocardium at a 61 premium to the companys Closing Price on friday. It will expand personal myers lineup of heart drugs. Im ritika gupta. This is bloomberg. See the leader of our country getting it, i think you start reassessing your chances. My guess is people will be much more careful about going out. Jonathan the former Federal Reserve governor weighing in on the prospect of consumers disengaging. Fascinating column out overnight, worth the read on bloomberg opinion. From new york and london, good morning. Alongside tom keene and lisa abramowicz, im jonathan ferro. One hour and 12 minutes away from the opening bell this morning. The good news in your market, futures up 20. Equity futures up 0. 6 on the s p. Eurodollar, 1. 1768. Curves steeper at the long end. I believe we will hear from the fed chairman tomorrow, jay powell. Put that one in the diary. We will bring you some of the headlines on bloomberg. Tom far more importantly, charles evans. Always f always fascinating. Right now, julie norman with us with ucl, professor of political science. Arabisraelion conflicts, particularly around the palestinians. But far more, it is simply about the politics of our conflict. I dont mean to make light of it, but you can take your conflict over to culture wars of the United States of america. How will they play out in the next 29 days . Julie that is certainly what we are all going to be looking at. This has obviously been such a polarized year, a very polarized election, and with the events of the recent days, with trumps diagnosis, with the response to that, it is looking like the end of the campaign is going to look even more different than we had thought before. Looked at things in the Biden Campaign and the trump campaign, and have they moved up leading to the crucial time in november. Tom all of the focus on the president tweeting out massively , single cap, all caps singleline, all caps tweets. What should we look for from Vice President biden . Julie biden really needs to keep up his momentum for these crucial weeks. Hes already decided to suspend negative ads while trump is sick, and has canceled a few events, but for the most part, is moving ahead with his plans and planned events starting in florida this week. It is really crucial that biden keep that going. He needs to make sure he keeps the enthusiasm going as it gets closer to november, and doesnt play it to safe even though hes ahead in the polls. Jonathan at what point do some of these senate republik ands start to break away and go solo Senate Republicans start to break away and go solo . Julie that is something we have been wondering since the start of trumps ascendancy, and so far, most have stayed allied with trump. Of course, there are a few notable exceptions. But i think for Senate Republicans right now, especially with the Amy Coney Barrett nomination trying to push through the senate, theres a sense of commitment to conservative values, conservative policies, and trying to look more at the long game of staying committed to those aims rather than race forly making it a trump, and keeping a standard strong front with the Republican Party with its conservative values. That seems to be the best way forward for those senators right now. Toathan how difficult is it get the senate operational now, given that some Senate Republicans have been exposed to covid19 . Can you walk us through the process and what that might look like down in washington . Julie we heard from Mitch Mcconnell that most Senate Activity will be suspended this week and not start again until the week of october 12 at least. But mcconnell emphasized that the confirmation process for Amy Coney Barrett will move forward. That regards some of the meetings and procedures they are currently having. People, even if they are sick or dont feel safe coming in, can tune in virtually. Where that is dont change is when there is actually a vote. They will actually need senators to come and be physically present. That is really when it will probably depend on the health of those senators who have been inspected you have been infected so far, and the extent of the virus among other members at that point. Lisa there is so much confusion about the virus and how it is hitting washington. President trump with conflicting information from his own doctors over the weekend. From an International Relations per spec if, given the fact that President Trump is on the mend, if there is such a lack inconsistency in the number make, how much does it put the u. S. At risk or anymore vulnerable position when it comes to dealing with other or in a more vulnerable position when it comes to dealing with other countries . Julie this is a rather vulnerable moment for the United States, having the president hospitalized. Does seem to be recovering within the next few days. But you have a president who is hospitalized. You also have a number of other members from the highest levels of government who are sick or have potential for being sick. And also the country really quite distracted at this moment. From a Security Point of view, the United States is relatively vulnerable, but i say that relatively strongly. Inrything else we have is place. There are so many agencies and things beyond the presidency and beyond the white house that really gauge more of our International Relations. It is a rather unprecedented situation. Jonathan late start to the year for universities here in the united kingdom. Today is a day off, julie. Thank you. Headlines coming from the new jersey governor, tom. Tom you were way out front on this. It is like governor murphy is channeling mr. Ferro. We spoke with mr. Murphy a a few days ago. There was a concentration, as you identified, at the trump fundraiser, and here is the governor saying it should have been canceled. Jonathan the timeline never stacked up, and still doesnt stack up. It wasnt just from reporting and sources from in and around the administration. It was white house chief of staff mark meadows that basically revealed they knew about the positive result before they left for westminister new jersey about the positive result of hope hicks before they left for bedminster, new jersey. Why did the president go on that trip . Tom at that fundraiser, there were x number of people in the higher risk groups, over 60, over 70, over 80. How many of those do you have to line up before you get very serious illness in one of them . That is a tangible risk at events like this. Jonathan we hope that risk doesnt materialize, but the messaging is also where lines blur as well. There are protocols they have to abide by. Good morning to you all on this monday morning. Equities. Up. I talked equities up. The president and the first lady, their health continues to improve. Thats the message from their doctors. Advance 0. 61 . So youre a small business, or a big one. You were thriving, but then. Oh. Ah. Okay. Plan, pivot. How do you bounce back . You dont, you bounce forward, with serious and reliable internet. Powered by the largest gig Speed Network in america. But is it secure . Sure its secure. And even if the power goes down, your connection doesnt. So how do i do this . You dont do this. We do this, together. Bounce forward, with comcast business. Newthan from london and york, here is the price action. Im jonathan ferro, tom keene and alisa with us. Now, upodollar i k 4 10 of 1 . Tom i am horse. Hoarse. Im exhausted. 30. 61. crude is at and equities are up after a week of gains. It is amazing what ive learned to do with a skill set that is useless, apart from this program. Talk about the market and converse with my coanchor who is talking about something completely ridiculous. My skills, tom. Tom do the data, why are there so many goals being scored . Good morning on ra