Absolutely extraordinary. Thank you for joining us on Bloomberg Radio and Bloomberg Television worldwide. What have we got . Mcdonalds just out with a dividend increase. Ibm with a seismic restructuring. Morgan stanley to take out the venerable eaton vance of boston. On and on we go. Guess what . None of it matters. Someone speaking to maria in two minutes. Jonathan the present will be on fox news. I imagine he will have a reaction to the next debate being virtual. That news out from the commission on president ial debates. Tom i really want to bring up this story, below the fold on the internet sites, but our Jennifer Jacobs reporting that the head of security for the white house is gravely ill with this horrific virus. Really a difficult illness as well. It is amazing how this virus story in the debate last night, commenting ondent this debate. Jonathan the president tweeting, saying that this is not a separable. He is looking forward to doing rallies. He is feeling goods. Those comments coming through in the last 60 seconds. Tom we will monitor that as we look at finance and investment around the world. So much of that is the hope of stimulus. Futures up 15. Dow futures up 200. We are roughly 3 below record highs on the dow. Frankly, it devolves to Speaker Pelosi and her conversation in hours with david westin. Lisa theres an increasing amount of uncertainty, messiness. It doesnt matter. Basically, heads we win, tails we went even more. That is the story and markets. Either there will be some fiscal story before the election, which a lot of people took off the table and brought back on, or there wont be anything, and if there is a blue wave, which wall street is pricing in, then people are expecting even bigger fiscal support package. Either way, people are seeing more fiscal support, and if there isnt any in the near term, they are expecting the Federal Reserve to step in with more asset purchases. Risk on despite the uncertainty. Very much looking to policymakers to fill any gaps. Jonathan theres the headline we were waiting for, tom keene. The president says he is not going to do a virtual debate. Makes it interesting, doesnt it . October 15, miami, florida. The commission out with a statement that that debate will now be virtual. It will take a town hall format. People will be in the room asking questions of the candidates. The two candidates, according to the statement, will not be there. The president says he is not going to do a virtual debate, which raises questions as to whether there will actually be one come october 15. Tom i think it is in the zeitgeist. Rumor, there are supposed to be two more debates to the end of the month. Some people have said it will be one more debate, with the president feeling better, and days on from his hospitalization at walter reed. But it really to me comes up, as lisa mentioned, the cacophony of news and the salvation for the markets, at least, away from the political process is just the idea of getting some form of stimulus and assistance. Thursday . Er it is in this hour, we will see if we are back to 800,000 or 900,000 jobless claims . Jonathan remember the bombshell report about tax returns . Im not even sure that was two weeks ago. I think someone came on the program and said, what a year last week was. That is what it feels like right now. The polls in the last 24 hours, former Vice President joe biden with an 11 point lead in florida. I know for everyone, that feels like a massive outlier. If your point lead in pennsylvania, a five point lead in iowa. This is from the new york times. A one point lead in ohio. In ohio in 2016, the president beat Hillary Clinton by about eight points. For the president , he needs to make an impact. This isnt just about national polls. It is about the swing states as well. As the states that Hillary Clinton lost by a narrow margin, pennsylvania, michigan, wisconsin, how did they make a difference in the next four weeks . If there isnt in the if there isnt a debate on october 15, how does he make an impact on the National Stage . Tom the president says he feels perfect, and also says he is looking forward to rallies. We see the president maybe doing rallies even though he says he wont do a virtual debate. To synthesize this into the markets, we are going to try to do conventional business here at bloomberg surveillance. Brent schutte joins us from northwestern mutual. What do i do with an investor who was in cash, knows he shouldnt be, or she knows she shouldnt be. How do they deploy cash given this news flow . I think i would start by telling investors they should never overemphasize politics in their portfolio construction. If i take you back and pull you away from the emotions of politics, and certainly elections are important, but if you look us directly, to me, the bigger important part of what happens during an administration is what they inherit. What the inherit is a Business Cycle. Typically, if a president inherits a Business Cycle late in the cycle, the Federal Reserve is tightening and they have subpar returns. The average going back to 1960 is around 6 market returns if they inherit a Business Cycle with no slack left. On the other hand, if they inherit a Business Cycle that is either early or mid, the returns are much more. Indeed, there are 10 of those elections that occurred, and in each one of those at least nine of the 10, i should say, the returns of the administration with doubledigit, with returns around 14 . I think if we are coming out of recession, we are still at least early to mid, and the chances of having a decent market return are pretty good, especially when you consider that no matter who is elected, they are receiving a Federal Reserve that isnt tightening rates for as long as i can see. That is the one thing that will change. That is the certainty you have. Yes, the Federal Reserve does still have power over what happens in the markets. Jonathan how dependent do you think the fate of this cycle is on fiscal policy . Now, if weink right dont get a deal, the market will have some downside, but i dont think it is a dealbreaker. I heard lisa mentioned that after the election, you will probably get some. Thats a couple of months away. Theres still quite a bit of pentup income built up from the last stimulus. If you get positive news on a vaccine, i think a lot of those concerns go away because the market starts looking forward to what may happen in 2021. Stimulus is without a doubt important. It has filled the economic valley we thought tobit was going to cause. Then it comes to be spent in different ways, so you have an economy that is also adapted and shrunk the width of that valley. Important in the shortterm. It could cause a market downturn, but we are returning to where we were in march. Lisa just to be clear, i definitely wasnt saying that we are going to get stimulus early next year. Just that analysts are expecting stimulus early next year if we dont get one currently. Does the data matter at this point, given the fact that the virus continues to spread . We are going to get jobless claims in about 20 minutes showing another abnormally high jobless eating, even if it is down from earlier highs. It doesnt even matter does it even matter in the face of liquidity . Brent i think the thing lost in all of this conversation is the economy looks like a v right now. The estimate of thirdquarter gdp is 35. 3 quarter over quarter at an annualized pace. If that were to occur, the u. S. Economy would still be a pretty large number, but just 3 smaller at the end of this quarter than it was at the beginning of the year. I dont know many people who thought that was going to be the case back in march. One thing i think almost everyone missed with this is an economy adapts. We find new ways to do things. You guys have been mentioning miami. Maybe this is too corny, and i make letying to of the virus, miami was filled with milwaukee winners. I think you seen i was coronavirus, companies have learned how to serve their clients. Betainly there will industries left behind, but stronger sectors will pull the economy higher. Jonathan brent, fantastic to catch up, as always. And shoot their Brent Schutte there of northwestern mutual. Ibm to spin off their infrastructure her versus if Researcher Services unit. And we got this headline from the commission on president debates. The second u. S. President ial debate will be remote. We were waiting for the president s response. It took about 35 minutes and read as follows. The president wont do a virtual debate. October 15, miami, florida. We set at the top of the program, the moderator will be there. The candidates wont be. We understand that biden will be on the other side. The campaign saying now that the former Vice President looks forward to speaking directly to americans. The president says he wont. Tom i am going to suggest that this is not some thing about getting to october 13 or 14. Just through the day, we will see this debate move forward. I want to point out something that i think is so important in the secondary news. Mcdonalds raises its dividend. The chart of mcdonalds is absolutely extraordinary. For those of you on radio, it looks like a normal market because i guess everybody is buying mcdonalds. Have you ever had mcdonalds in america . Jonathan i have had mcdonalds. Not in america, though. In the united kingdom. I dont think for about 10 years, though. Tom when i am in london, i go to the mcdonalds at liverpool. Jonathan i know. I come with you and watch you there. Given all the is slow this morning, this has got to be the story of the moment, you having mcdonalds breakfast over at Liverpool Street station. [laughter] formerment, rick davis, Campaign Manager. Ritika next weeks president ial debate is up in the air. Earlier today, the commission put together changes for the format to have the candidates in separate remote locations. That is to prevent the spread of the coronavirus. Now President Trump says he Wont Take Part in a remote debate. Meanwhile, Vice President mike pence and Kamala Harris squared off insult lake city. Not surprising insult lake city in salt lake city. Thats a presently, the first question had to do with coronavirus. Sen. Harris you respect the American People by telling them the truth. The things that they need to hear to protect themselves. E when i look at their plan that talks about advancing ,esting, developing ppe creating a vaccine, it looks a little like plagiarism, which is something joe biden knows a little bit about. Said zpence pence says trump has put the health of the American People first. Haves says that they forfeited their right to reelection over the handling of it. Asset stanley has bought manager eaton vance for 7 billion. 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. Im ritika gupta. This is bloomberg. Sen. Harris the president s trade war with china, he lost that trade war. What ended up happening is because of a socalled trade war with china, america lost 300,000 manufacturing jobs. Vp pence lost the trade war with china . Joe biden never fought it. Joe biden has been a cheerleader for communist china over the last several decades. Jonathan from new york and london this morning, good morning. Alongside tom keene and Lisa Abramowicz, im jonathan ferro. Hourews flow in the last absolutely incredible. The price action looks like this. Equity futures at session highs this morning, up 0. 6 . Just 50 of the picture, thats what this is. Stimulus talks starting to be productive. This from the president of the United States. Might lead you to believe it is just about airlines. He says that is being discussed, but a bigger relief deal is as well. I am keen to point out and emphasize this is 50 of the picture because it is only one half of the deal. We have to see what Speaker Pelosi has to say about this as well. Arguably it is only 1 3 of the deal because we have to hear from Senate Majority leader Mitch Mcconnell as well. Equity futures getting a list off the back. Tom s p futures up 19 as we speak. , 27. 71. Came in abruptly right now we will rip up the script and rip it up again with rick davis, formerly the Campaign Manager manager for senator mccain of arizona and a bloomberg contributor. What is the Debate Commission like . How do the candidates and their staff like you go back and forth with the debate conditions . Are you the boss, or is the Debate Commission the boss . Rick it is a hard answer because no one is the boss. The Commission Sets up the rules, picks a bunch of sites, then they sit down with the nominees of the party years in advance start negotiating. Out of that negotiation comes some version of that schedule and those rules. Are of those negotiations directly between the two candidates. We had Lindsey Graham as our negotiator, and rahm emanuel was the negotiator for barack obama. We got so frustrated with the Debate Commission we decided we were just going to do the debates ourselves. Then we decided the logistics were too much, and went back to the commission. But the rules are meant to be standardized, in that you then create a memorandum. Tom that is brilliantly explained. Huge public value. It is not a standardized time. As president , what is his power and with hisdate, visibility and vocal treatment, what is his ability to change the commission or make a more malleable process to get his outcomes . And you can always say no, that is what the president is saying this morning. I would say the Debate Commission would never have announced that they did agree on a virtual debate unless someone in the Trump Campaign said yes to that. So this is another example of donald trump not being connected to the leadership of his campaign, and now going rogue on the Debate Commission, and probably divide in campaign because the Biden Campaign would haves probably the Biden Campaign because the Biden Campaign would have signed off on this, too. We didnt want to do a debate because of logistics. It was on the other cited the country, and we were trying to campaign. On us tos pressure participate forced us to do a virtual debate, where we were on different sides of the country. For my purposes, that was a disaster. Jonathan to jump in, some response from the campaign i want to bring to our audience very quickly. They will pass on the sad excuse for a debate. The campaign will hold a rally instead of that remote debate. So it looks like the president and the team are on the same page here. With this perspective coming in from fox news, with biden having a 53 40 3 nationally, where do you see the polls right now . Tom just curls up into a ball, thinking about for years ago. What are they worth right now . Rick first of all, polls are a static picture. They are not dynamic. They dont take peoples opinions over time. They take them in one instance. So they are only accurate that day. In a campaign that is moving around, like four years ago when you had all of these massive wax want events in october massive black swan events in october, whether it was the access hollywood video, the development from comey, they only give you a snapshot. We know that biden has some momentum, some Movement Towards him since the last debate, including the period of time that the president contracted covid, and it looks like some of that movement is in a new voter group, not just suburban women, but white males. That is a signal to trump that he may have a problem with his base. Lisa how much momentum did mike pence give to the Trump Campaign last night . I think think rick he stabilized the Trump Campaign. Think about what has happened in one week. The trump debate was a disaster for donald trump. He almost immediately contracted covid, and then he blew up his own negotiations over the stimulus. That is one week. That is an amazing amount of activity. I think last night, what mike pence did was something the campaign hasnt been able to do before with the candidate, and that is stabilize the debate. His set of facts, his diagram of where the country is headed is exactly what the Trump Campaign has been selling, and he did a good job delivering that. Jonathan just to wrap things up quickly, we had former new york mayor Rudy Giuliani on the program yesterday. He came out swinging. What we see today is the campaign coming out swinging against the Debate Commission. This is that classic siege mentality in the final few weeks of the campaign. Everyone is against us. Is this a strategy that is going to work . Is it working . Rick bunker is a very nasty place to have to occupy, and that is where the Trump Campaign is right now. Not only is their top leadership out with covid, but the polls are turning against them. One thing that sort of defies that is the nimbleness, or lack thereof, of Donald Trumps addressing the stimulus negotiations. He has flipflopped three times in three days. There is no question Congress Wants a stimulus. They know what the public needs and what the fed is requiring. I think that the decisionmaking at the top has always been donald trump. There is no campaign that is going to get in his way. Hes running the bus, and the bus is veering all over the road, and that does not help him collect the votes he needs for election day. Jonathan rick, wonderful to catch up. Thanks for your insight. Rick davis, former Campaign Manager and bloomberg contributor. We advanced 0. 6 on the s p 500. The stimulus debate is what matters here, as far as markets are concerned. The president saying talks are starting to be productive and a big relief bill is starting to be discussed. We will get the democrat side of that when House Speaker nancy pelosi speaks to david westin later on. Ago, october 15 debate will be virtual. This out from the campaign, he will hold a rally instead of the debate. Tom we will see how strong he is to do them. Jonathan up next, Frances Donald of manulife Investment Management. Initial jobless claims just around the corner. Your coverage continues. This is bloomberg. Jonathan one hour away from the opening bell in new york city. Alongside tom keene and Lisa Abramowicz, im jonathan ferro. Economic data seconds away in the United States of america. Expecting initial jobless claims to meet 800,000. Lets bring in bloombergs michael mckee. Michael it is thursday, so i am here. That is how you know it is thursday. We are waiting for the jobless claims numbers to be released on the internet. Usually they are faster because there is less data. Right now moving slowly because it is the only number out and everybody is trying to download the numbers at once. Initial jobless claims, 840,000 last week, that is up from the prior week, which was revised 837, and higher than the consensus of 820,000. Doesnt make a difference . Not really. A lot of questions given how accurate the numbers are. It does tell you we are not seeing any change in the situation with jobless claims. We are still seeing a lot of , whether it is 840,000 or not and a lot of people still receiving claims. Freelancers are filing. There is a problem with the labor market that we are continuing to watch. Michael tom with all of this and the mystery over the unemployment rate, i did a fancy math study and all i know is in four or five or six weeks, jobless claims devolved to a stable flat number of roughly 840,000. Is that socially acceptable to have a stability of 840,000 . Michael of course not. It means those people are without work and they are not only going to be not contributing to the economy, but their lives will be upended and that is not socially acceptable. Millionw we still 25 who are getting claims of one sort or another. This to be aing drag on growth in the Fourth Quarter. Do not forget since the last announcement on jobless claims, weve had disney, we have had the airlines laying people off. Not only are we seeing elevated levels but we could see them going up in the coming weeks. Lisa have initial jobless claims become a lagging indicator . I remember a couple of months ago when they were the leading indicator, that seems to have changed. Michael it is less important in the sense they are stable and there are questions about the accuracy of the numbers themselves. It does contribute to the overall picture. We are seeing the opentable reservation numbers in wisconsin go down because they are having a big outbreak. You add all of that up and you get an idea of where we are in this. The thing to look at is now with the stimulus talks off, and we will see if they get anything out of the new talks that may or may not be happening, economists are marking down their forecast for the Fourth Quarter based on everything they are seeing with this High Frequency data. Jonathan always great to see you. Not just on thursdays. We can do it daily. And sundays. 19. Ty futures up we advance. 5 . 840,000. Out, theints improvement is starting to fade. In the fx market, eurodollar unchanged. No moves on the back of this. 77 on the 10year. To bring you another headline from the president of the United States, he plans to use tariffs on china if he does get a second term. Some people might point out in last nights debate that was an area of vulnerability when they tried to attack the record of this administration on china, and Vice President mike pence came back quickly and set lost the fight, you never had the fight. I wonder if that is something they are looking to build on . Tom that may be the politics of the moment but the reality is the gdp statistics of 2021. Frances donald joins us. Let me take the headline of continuing tariffs. Can you make the assumption any new tariffs diminish our economic oath and if that is the case what is your run rate for the economy into next year . 2018 thein 2016 to economy was doing really well. It could take the near term of additional tariffs. What would worry me into 2020 and 2021 is we are still in the greatest economic shock in over 50 years. This is not the time to be putting additional headwinds on the economy. To would find, if you were use additional tariffs, you would have more downward revision. Your question is well framed. What is the run the economy . What we fail to talk about is what does the trend growth look like afterwards. Are we getting back to 2 growth . My suspicion is because a lot of the damage we are seeing people revised down gdp numbers and tariffs will make that worse. Lisa stepping on the tariffs and deglobalization we were talking about earlier, the idea that a deglobalization wave, any increase in tariffs will increase inflation, even if growth stay stagnant. Do you buy into that argument that a number of people are putting forth . Frances yes. We suspect that if we do see this ongoing deglobalization trend, that does contribute to moderate inflationary pressure. To 3 potential for 2. 5 inflation in the United States. That is more u. S. Focused men around the rest of the world, and precovid we were citing sub 2 inflationary pressure. Focusinged will be more on slightly above 2 inflation. If you add on the deglobalization shop, this is a very different paradigm. It will yield different outcomes than it did. It will have a different impact on the economy, worsening some of the challenges we will face over the next two to five years. Jonathan this is conventional economic wisdom, but let me ask you this question. Last night the Vice President had to sit across from someone who was talking about undoing the work they have done and you could see he took offense. He was talking about the tax cuts the Vice President and the president had pushed through. The candidate to become the Vice President , Kamala Harris said they would undo that on day one, saying there would be no tax hikes for anyone earning under 400,000. The Corporate Tax rate did not come up in any detail. I wonder how you would process that. If they took control of the white house and the administration have the power to get this through congress, if they undid that Corporate Tax cut of several years ago, how would that shift the American Economy . Frances you say this is conventional thinking, but so much of what is happening with deficits, Government Debt, and the role of government, that conventional thinking is being flipped on its head by more and more things like modern monetary theory and the idea deficits are not so bad. Regardless of who wins, we should be preparing for exceptionally large deficits in the highest level of Government Debt to gdp we have seen in american history, at least in the past 200 years. We will be having big conversations about what the deficit and large debt means. From my perspective it means to matter who wins, what they spend on will change, but you will see phenomenal issuance at the long end of the curve and ongoing expending of the idea that large deficits are ok. That means a steepening of the curve and it probably means we need to reevaluate the role of government in the economy. Government will get bigger in the u. S. And global economy. It will probably become a larger employer, that is regardless of who wins. That is the major theme. Not trying to game what comes out of november 3, but what are the Seismic Shift that occurred. That is turning conventional thinking on its head. Jonathan when we came out of the last election there was all of this happy thought of Infrastructure Spending but the trump trade turned out to be different. It was a tax trade. Trying to get my hands are out what this would mean for the equity market. The approaches the glass halffull. Andrew sheets of Morgan Stanley is an outline. I wonder for you whether that is a complete picture. ,here will be fiscal stimulus but one party is talking about hiking Corporate Tax rates. The other one is not. Frances i do not believe this economy will be in a position in the next 18 months to take any form of material tax hike. We are feeling good because a lot of our Economic Data has shown vshaped recoveries come but a lot of that recovery are red herrings. Housing is not behaving as it to we does. Autos are not behaving as they typically does. We have americans looking at claims right now. We are to any type of disruption. If we get a package and eight americans we can continue on a recovery and get tax changes. If there is a shop, an accident, whether geopolitical or financial, we are staring down the possibility of a double deck a doubledip. Now was not the possibility of large structural changes. It is the opportunity to build a bridge to the other side. Still a vulnerable moment in the u. S. Economy. Jonathan fantastic to catch up. Frances donald, thank you. Equity futures drifting higher, up 20 on the s p 500. We advance. 6 . It is the debate of the moment. The happy talk around the potential blue wave, what would mean for this market. I do not hear a big discussion on what the Corporate Tax hike could mean for the market. A big discussion on fiscal stimulus, Infrastructure Spending, and the rest of it. Tom it is a silly season where you do not get policy and the outcomes of policy. It has been amazing to see joe biden and his team stay away from what is perceived to be the free lunch the president gave corporations. Maybe that will be the surprise in the next 20 days. What i would suggest is what the president is talking about and what the Vice President is talking about, Vice President biden, goes right back to what we are seeing with Morgan Stanley and the splitting up of 109yearold ibm. Jobs will go. There will be synergy. What did you call it other day . I said right size and you put me in the jon ferro timeout shed. Resize. Jonathan it is resize. I take the phrase right side. What is right about it. I take it for a laugh like this time yesterday. This debate is about on and jobs in america. I wonder if we get back to that policy. I cannot agree with you more. The good news is the president will be tested. He says he is doing better. Tom what do his doctors say . Jonathan you sound better than you did this time yesterday. Tom no i dont. Jonathan from new york and london, this is bloomberg. Ritika with the first word news, i am ritika gupta. Now there is a question of whether there will be a second president ial debate. President trump says he will not take part of the candidates are in separate negotiations. He told fox that is not what debating is about. Earlier today the commission that runs the debate said next week event will be a Virtual Event to prevent the spread of the coronavirus. Meanwhile the Vice President ial debate there were a few fireworks and interruptions. Still, mike pence and Kamala Harris battled over a wide range of issues, including u. S. Relations with china. The president s trade war with china, you lost it. What ended up happening is because of a socalled trade war with china, america lost 300,000 manufacturing jobs. Farmers have experienced bankruptcy. Pence lost the trade war . Joe biden never fought it. Joe biden has been a cheerleader for communist china over the last several decades. Ritika on the coronavirus, mike pence said bidens plan looks like plagiarism. Harris said donald trump had forfeited his right to reelection by his handling of the crisis. In london, more than half of the volume in london in shares of European Union companies. That is at risk of migrating to the eu without a breakthrough in negotiations. The biggest losers would be investors because trading will result in worst prices. Global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. Am ritika gupta this is bloomberg. Jonathan from new york and london, good morning. Incredible news flow this thursday. Equity futures up 21 on the s p 500. It just a moment on bloomberg tv, looking forward to pick to catching up with greg staples. Tom keene . Tom thank you for spearheading us this morning. The president still speaking on fox. Deadlines have been a bit of a jumble on covid. He also says he will be tested for covid very soon. Much going on. Erik schatzker will join us on this Morgan Stanley transaction. We have the work of Lisa Abramowicz in Asset Management over the years. My knowledge of the boston mutual fund business, and erik schatzkers efforts at understanding how james gorman once a Morgan Stanley distinction. Erik schatzker, does james gorman want to do what blackrock did . Rik in terms of transforming the firm and making it look like unlike any other in the industry the answer would be yes. Think about where we were before 2008. All of the firms on wall street, Goldman Sachs, Morgan Stanley, bear stearns gone, Merrill Lynch gone, kind of look the same. The two survivors, Goldman Sachs and Morgan Stanley look different from one another, and that has much more to do with what james gorman has done than what James Solomon and roy blankfein has done. Successivedone acquisitions to push Morgan Stanley into the Retail Finance business. On the trading side with e trade and out on the Investment Management side . What are the realities . When they go in and do a retail synergy, how many bodies go . What percent goes . You Morgan Stanley wants to believe not too many bodies go. They are talking about combined cost savings of 4 . They say the deal will be neutral as of the acquisition. I am telling you what they are saying. We will not note the body count for two years. The point is they have identified a firm with which there are very few overlaps. That is the key. You are talking about redundancy. You get redundancy you put your standard aberdeen and janus henderson. Those firms desperately need to cut costs. In Morgan Stanleys case, it is not about cost. Tom lisa, you cover this with aberdeen standard. Some of these become a trademark. Lisa the Asset Management model is getting whittled away by the low Interest Rate regime and the idea interest funds have taken hold. Erik schatzker, there are dueling narratives. On the one hand you have Asset Management firms that are saying our Business Model is threatened by low yields and low fees and then you have banks that say their Wealth Management arms, the idea this is been a Profit Center for a lot of big banks. Which is it . Erik it is kind of both and i will explain why. If you are pure asset manager and do not have more than a Million Dollars in assets, you are in trouble. You do not have the have to to compete against the black props and the invesco. Are diversified institution like Morgan Stanley and you have an Investment Bank and you have a Wealth Management business, the Asset Management business, which is what we are talking about when we are talking about adding eaton vance is the third leg of the stool. I hesitate to use the word because it is overused, but you have the synergy people like james gorman are looking for. Lisa there it is. Drink. Assets, 1. 2ve the chile dollars of assets. That was a goal of james gorman. Insaid it was a mistake 2009, and now he is atoning for het mistake because recognizes Morgan Stanley needed a bigger Asset Management business if it wanted to build a full suite of products that it could offer the affluent client. That is where Morgan Stanley is focusing its energies, unlike Goldman Sachs which is pursuing a more barbell strategy of going after institutional and ultrahigh net worth on the others and very plainvanilla Digital Consumer on the other end. Lisa basically if you could say this in a nutshell, it is about crossselling for Morgan Stanley . Erik that is a verboten word on wall street. The s p does not want you to hear does not want you to say that world. You fill the halo allowed around the brand. The customers more likely to buy more from Morgan Stanley then he is to go to jp morgan or wells fargo. Tom stop it. Will james morgan will james gorman have them sell mutual funds in sears store. Erik i did not think we are going back to white sox and white shoes. Tom erik schatzker, thank you so much on short notice. This is really something. For anyone involved in the mutual fund business, whether it was pioneer taken out by an italian shop, eaton vance is literally a rollup as well. A rollup of what we have seen from scott or and other firms. Your thought on the active management debacle of the last 10 years. Lisa im trying to envision the future for Asset Management as five to 10 massive firms. We are already seeing that. The blackrock, the vanguard, what does that mean in terms of shareholder votes . What does that mean in terms of balance of power additional Public Offerings in new debt offerings . Some of these questions become that much more preeminent as you get these behemoths that increasingly control assets and do not necessarily themselves have an obvious state in the actual company. Like to tom i would say i was little bit out in front of this a decade ago talking about the separation of getting inequities theme versus how do you get a fixed income fee is the yield on a portfolio comes down . These are huge pressures. Lisa this is been one reason why people are increasingly going into private assets and private equity and direct lending. Tom is that good for the client . Lisa that is the outstanding question, the idea of whether you are getting extra yields but also so much extra risk. That is the Value Proposition a lot of people are debating. Tom it has been an extraordinary day. I will summarize to get you through the morning. I will finish with nancy pelosi and the timely conversation. You need to know the futures where 1415 and have come up nicely. I would suggest off a single headline from the president , still talking 55 minutes later to maria on foxbusiness. We are continuing to monitor those headlines. The single headline was his optimism there would be stimulus of some form, particularly centered around the airline business. Mcdonalds with a dividend increase, mcdonalds showing samestore domestic sales that looked smart. Ibm with what has been widely anticipated for five years if not longer. They will split up and two companies. We will split up and get through the morning. David westin will lead us forward. The 12 00 conversation with the speaker of the house. It is the most historic time for the need for the nation to find stimulus. Stay with us through the morning on Bloomberg Radio and Bloomberg Television. Good morning. Jonathan from new york and london for our viewers worldwide, good morning. The countdown to the open starts right now. Equity futures up 21 on the s p 500. We advance. 6 and we begin with the big issue. There is a new narrative in town. Ofthe increasing probability the blue wave. The democratic sweep scenario. From a contested election. Market surprised out some of the fears around a contested election. We are less likely to have a contested election. Heading towards a likelihood of a joe biden win. This is a blue wave type of trade. The blue wave might not be such a bad thing. We will probably get more stimulus with a joe biden administration. A Democratic Senate will make a big change. Any blue sweep is considered to be very positive. We will see larger fiscal
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