Call for urgent action. President trump enters the conversation, indicating he may now support a wider stimulus bill. Debates joe biden refuses to push back his next meeting with the president. The white house rules out a virtual clash due to covid19. We have an update from President Trumps physician, dr. Sean conley, about the president s covid19 treatment, saying that the president has been responding extremely well, that his exam has remained stable while at home. President trump has completed the course of therapy for covid, saying the president can return safely to Public Engagements on saturday. The president was just released from hospital on monday evening and his health had risen controversy given the white house was saying the timing of President Trumps last negative test was regarded as private. We are finally getting an update on the president s health and dr. Sean conley saying the president can return to Public Engagement on saturday. Lets turn to the markets with Sophie Kamaruddin in hong kong. We have the open of markets in sydney. The asx 200 is holding above 6000. The Digital Payments platform has been the best performer this week. We are seeing the likes of fuel refineries under pressure over the course of these two days along with gold miners big new crest. We are keeping an eye on that space given industry consolidation forthcoming. Looking to push towards 1900. Saxo bank says gold will remain trading range bound before the u. S. Election. Bullion meets more of a catalyst when it comes to stimulus. Switching out the board to see what we are seeing with u. S. Futures, we could see just drifting moves this morning in asia, s p eminis adding. 5 , and we are looking for the nikkei to perhaps look to a race its yeartodate losses after rallying 40 from the march low. The best performer today on the nikkei 225 up more than 100 , and today of course, big on the calendar. Chinas markets reopened later this morning. Haidi. On to our top story, the stalemate over stimulus drags on as nancy pelosi pushes back on a piecemeal approach. She refuses to accept help for the airlines without a bigger bill being agreed. The airline workers. There is legislation that we had in the cares act, which we hope that we could continue for another six months or so. Oft expired at the end september. But wedo that separately cannot do it unless there is a big bill. It could be part of the big bill or it could be separate from the big bill from a timing standpoint. The latest onet those stimulus negotiations and much more from government congressional reporter Emily Wilkins, who joins us from washington. The white house signaling openness to something bigger than the package and staying on the white house, we just got those breaking lines that the president can actually return to Public Engagements on saturday, according to his doctor. Let me start there because this is the latest that we got out of the white house and its really interesting because the president has only announced that he actually had covid19 last week. He was just released from hospital on monday and hes already returning to public life. What do you know about the timeline of his disease and his health . The white house has not been completely forthcoming with a lot of details surrounding the president getting the coronavirus. It was a bloomberg reporter who initially started breaking the story that a close aide had gotten coronavirus. At this point last week, we did not know that trump had it. They were sort of being a little cagey today about when he last tested negative, details and that regard. Throughout the white house, they have really tried to project an image of strength that the president is ready to go back to work. They released photos at walter reed that purported to show him working. There was his motorcade. Trump is eager to get back out. We are less than a month away from election day. He sees any time off the trail as being detrimental to what will happen on november 3. Of the weeksms leading up to the election, there is still a great deal of uncertainty as to what the next president ial debate is not to look like. Is it going to be virtual . We know the two sides are far apart on even if it will go ahead. Emily at this point, the president ial Debate Commission has said the next debate, october 15, would need to be virtual. Trump said that he was not going to waste my time on a virtual debate. The Trump Campaign asked to move the second debate back a week. Thatiden campaign rejected plan. Trump says he will hold a rally on october 15 and biden is going to be participating in a town hall that will be televised that evening. Whether we get back to the debate format remains to be seen as well as what kind winds up happening. At this point, it does not seem like a second debate is in the books at this point. Shery it would provide a boost to president Trumps Campaign if we did see a stimulus package. Where are we on that regard . Bounced backhas from the position he was out yesterday. He is now calling for a stimulus package. Nancy pelosi has said that if we are going to move airlines they are going to move a more comprehensive package as well. She spoke today with steve mnuchin, the white houses may negotiator on this, but once again, pelosi admonition, they have been talking for a while on this. We have not seen a lot of compromise yet. We have not seen them get to a number. We have not seen them compromise on different parts of the language. There is just a question on timing. They still have to write the bill and it has to go through the process being passed by both houses, both chambers, rather. That is something that would be taking a good bit of time. Its very unclear whether we will get a stimulus package at this point before the election. Shery Emily Wilkins in washington. Lets turn to Karina Mitchell for the first word headlines. Karina. [no audio] exceeded its authority. A parallel effort by the wechatnt to block . 10 messaging service has also been halted in court. The administration appealed that ruling last week. A check on gaming activity in macau says Gross Revenue was down 76 from a year ago. Bernstein looked at casino activity in the first seven days of this month and says the results are disappointing but not unexpected. Was gamingy macau revenue falling well over 70 this whole year before a robust recovery through 2021. The mood among merchants in japan rose last month to its least pessimistic and more than two years, adding signs that the recovery is taking root. Store managers, taxi drivers, and the others rose to its highest level since april 2018. News will be welcomed for Yoshihide Suga and one of his key advisors says he may call an early election next year. Malaysian Opposition Leader says he will meet the king next week to offer proof he has enough support from lawmakers to form a government last month. He said he has the numbers to topple the prime minister, raising speculation he may demand an election. , saying hethat remains the legitimate p. M. 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 Karina Mitchell. This is bloomberg. Haidi come over to you. Haidi, over to you. Almosttrumps polls are back to where they were in the 2016 campaign. How a trump or Biden Victory could affect equities in china. Why a former ceo has moved away from republicans to back the Bidenharris Campaign. He joins us to discuss diversity in the race for the white house. This is bloomberg. As we approach the u. S. Election, investors are focusing on what impact a trump or Biden Victory could have. Joining us now is the portfolio manager, louis lau. Great to have you with us. This chart on the bloomberg right now showing our viewers the betting odds and we are seeing further divergence with joe biden taking an even bigger lead. What would this mean in terms of trade policy which seems to be most consequential for asian markets, especially the chinese economy which continues to rebound . Is verynk it interesting, when you look at the biden plan, it does take a different approach to just tariffs. I think it talks about bringing back american jobs. It talks about creating jobs in green energy. They also talk about the increase in local content rules where buying American Goods might be a higher proportion required of companies, so i think theres several things. One, it could impact countries like mexico or south korea that are very dependent on exports to the u. S. In terms of china, i think biden has not seemed to be having a sanction specific tech companies. It might not be repeated. I think we see incremental positive for trade with china. Does not mean we are going to go back to pre2016. The other thing biden would do is likely to get some support from europe and japan collectively to contain china. Shery right now, we continue to see the economical coverage take hold in the Chinese Markets. What does this mean in terms of valuation levels . Have the markets priced in the rebound already . Are we still finding some discounts . Louis yes, if you look at what is happening or has happened in the golden week, Domestic Travel is around 79 of what was in 2019, so i think in terms of, you know, travel, in terms of, you know, its more discretionary items. Its almost back to normal. I still see some discounts and some of the travel stocks, especially to do with international travel. There is a lot of discount on durable goods such as household appliances, auto stocks in china still looking expensive, and macau has not really recovered. There are definitely pockets of Chinese Consumer companies that still trade at quite attractive discounts. On the other hand, the Ecommerce Companies have obviously done very well. This will continue as the theme for the next five years, increasing online sales penetration. It might take a break a little bit if we get some of the cyclical recovery. Definitely some of the consumer durables and travel. Theres still some discount there. Haidi would you maintain your exposure to chinese tech even with these concerns over potentially more implications for the u. S. Side . Louis yes, i think if you look at some of the Company Specific sanctions, the latest is possible restrictions on ant financial payments businesses in the u. S. , theres not much the Trump Administration can do because for these payment companies, more than 95 of revenues come from asia. If anything, if they were to expand outside of china, it will be Southeast Asia as well as other emerging markets. I dont think there will have it will have an immediate impact. I dont think we need to take down the technology exposure. If we have a biden win and some of the new slow and restrictions on huawei lesson, those companies could stage a recovery. I would not at this point take down the chinese tech exposure materially. Haidi if heavy tech weightings will continue to drive upside in markets, where else do you see opportunities within asia . I know that taiwan is not exactly supercheap at the moment, but do you still find opportunities in valuations compelling in that market . Louis taiwan, i would put in the middle of the pack in terms of emerging market valuations, maybe towards the less cheap markets but you can still find, you know, companies in the smartphone supply chain that have been put off by scares on huawei restrictions. Manufacturers are still interesting. Semiconductors with a longterm theme. We dont see china being selfsufficient in semiconductors for the next five years even longer. Theres hardware makers that are still continuing to benefit from this backlog of purchases for pcs and laptops. Lastly, some Companies Providing Cloud Services could also continue to enjoy a 15 attorney percent growth rate. Plenty of opportunities in taiwan. Shery let me ask you something about the macro environment. It has all been about the centralbank action, fiscal support as well. A spoke to Robert Kaplan just little bit earlier. Take a listen first. Robert to see us doing more in that area because i do not see the benefits. I could see how it would further add fuel to the financial markets. I am more skeptical how much it would help the real economy. What do we know at this point about how supportive Central Banks will remain, not only here in the u. S. , but also across asia . And what is the risk of withdrawing too soon for the markets . Know, i think the fed continues to be dovish, and i think they have signaled increased tolerance for inflation. I would be a little careful because, at the end of the pandemic, i think its likely to see theres likely to be a huge increase in inflation coming from all the stimulus that we have had so i think it will be interesting if the fed keeps the statement that they are going to tolerate slightly higher inflation Going Forward. I think it could be dangerous for the value of the u. S. Dollar and what it means as a reserve currency. And then elsewhere, we actually see china having a very prudent Interest Rate policy. It is still very normal. The policy rate is still around 3 . We dont see huge easing there. And then there have been collective Central Banks and emerging markets like indonesia and brazil that have started to buy government bonds with the centralbank money supply which is may be a risk for some of those currencies. Its going to continue to be accommodative. At some point, all of that will have to be reined back. Have youally great to as always, louis lau. Analysiset more market ahead as chinas mainland markets reopen after its oneweek golden week holiday. Plus, a cio joins us from shanghai later. Coming up next, Morgan Stanleys acquisition. We hear from the ceo about the deal to buy the company as well as his vision for the bank. This is bloomberg. Haidi Morgan Stanley has struck a second megadeal in 10 months, acquiring an asset manager for billion dollars. He has driven a dealmaking blitz that transformed the firm from a wall street specialist into a major player in the Money Management space. He told bloomberg how the deal could reshape Morgan Stanley in the years to come. This has been a 10 year strategy to take what is an extraordinary Investment Banking and trading business, putting that up in terms of the Risk Management business and take away the prop trading, use that capital more effectively, and it is doing on the believably well. Unbelievably well. We have to build up the Wealth Management business, which gave us a digital platform. Now, we are doing it on the Asset Management side. Now, excitingly, for 2030, specifically, you will find a very stable, faster growing, very feebased institution, wellcapitalized strong liquidity. Explain to me the strategy. Are you making Morgan Stanley for the masses . Are you trying to be all things to everybody now that you have added this large brokerage . James not at all. We have done many deals since i have been ceo. We sold oil storage and Oil Transportation businesses, servicing businesses, european and so on and so on. We have been reshaping the portfolio. This is about managing capital for individuals, institutions, and governments around the world. That is what we do. Being in the Asset Management space and the trading space is all consistent, all part of their process of originating, managing, and distributing capital. ,e are a more focused company the most of our peer set we deal with. This has been an expensive deal but at the end of the day, it is what this deal will deliver to shareholders in the future. It comes down to profit about margin. How do you explain the economics to them in the longer term . James i met a lot of people who want to buy Great Companies cheaply and end up not buying anything. If you are going to buy great assets they have been around for 90 years. Huge talent. Perfectly complementary businesses. Very little dislocation. Highgrowth, great businesses, with it has been growing very fast. This was a nobrainer. Do ifs what you have to you want to buy highquality businesses and they came to us. They came to be part of the Morgan Stanley business. Mildly creative day one. ,t used up 100 basis points which is our core regulatory capital ratio. Pointsted 100 business this year. We are sort of to neutral. Its going to be a terrific deal over the long run. Im not worried about the financials at all. It makes it about 1. 2 trillion at this point. Of wherell a fraction blackrock and vanguard and jp morgan is. How do you compete with those rivals at this point . James they are completely different businesses. Not trying to be the biggest. We are just trying to do you dont do strategy through in view. You do strategy based upon what works and what is important to your institution. Its unbelievable. I dont care that there are others that are bigger. We generate in the returns we need for shareholders. We provide clients the opportunity they need for the best product out there and through this deal, it is absolutely happening. Morgan stanley chairman and ceo james gorman. Lets get a quick check of the latest business flash headlines. Ibm is to spin off its legacy i. T. Unit as it pegs its future to the cloud. The new business as part of the Global Tech Services division and handles daytoday operations such as managing Client Data Centers and traditional i. T. Support. It has 4600 clients in an order book of and a hybrid cloud and ai unit. Ready to openis its driverless ridehailing service to the general public in arizona after more than a year of test runs. The alphabet unit began varying socalled early riders around suburban phoenix in the middle of 2019 and based on their feedback is making autonomous vans available to users in the city. The ceo says it is a really big deal for waymo and the world. Instacart is cashing in on appetite for ecommerce during the pandemic with the latest funding round seeing its valuation rise to almost 18 billion. The grocery delivery startup doubled in value since the march outbreak and is weighing a possible ipo. Instacart says it is on track to process 35 billion in grocery deliveries this year. This is bloomberg. Im dough hirsch. You may already know that goodrx can help you save up to 80 on your prescriptions. Unfortunately, Many Americans cant get to a doctor right now. The good news is that for many Health Issues you can see a doctor online. Its easy. Just go to goodrx. Com and with a few clicks youll be treated by a licensed medical professional all from the comfort of your own home. Visits are confidential and affordable. Need a prescription . Your doctor can send it to your pharmacy or have it mailed to you. Get the healthcare you deserve at goodrx. Com. We have breaking news out of japan at the moment. We are getting japans labor cash earnings year on year, a contraction of 1. 3 . This is of course a fifth consecutive month of contractions for japanese wages year on year. Of course, we have seen japan just experience its biggest contraction on record for the economy that put downward pressure on consumption and Household Spending year on year right now also contracting 6. 9 . Both numbers right now coming in worse than expectations for the month of august. Household spending really has been in contraction since october of last year and it continues its downward trajectory, although the decline seem to have narrowed a little bit in august july. In augusten some since july. We have seen more japanese people receiving their ¥100,000 in government relief payments. That could have helped a little bit. The labor cash earnings numbers and Household Spending, disappointing to the downside. The failure of the white house and congress to pass a stimulus package has some investors betting this will undermine the recovery and force the Federal Reserve to push ahead with more bond purchases. Bloomberg Global Economics and policy editor Kathleen Hays is here, and kathleen, you just had an exclusive conversation with dallas fed president earlier. Tell us a little bit about his views. Kathleen a couple of things. The minutes of the fed last that officials after the last meeting in september going into november are going to be debating more and more what they are doing with quantitative easing, what they are doing with bond purchases, how transparent they have to be. Rob kaplan, in the past, has been one who said that i am not so worried. I dont think they are necessary. At the same time, if there is no stimulus and you cannot cut rates, would this make a difference . That is one of the things we delved into in this conversation. He does not sound like he is on board. Lets listen. Robert the problem is this. The fed has a lot of tools and we have more things we can do, but our tools primarily ease financial conditions. They make it easier to borrow money. Our tools are not wellsuited when you have an income loss and we need to make up an income loss and theres two areas theres individuals that have lost their jobs who have lost income and theres states and municipalities that can borrow and are using the private markets and are borrowing. The problem is, they have a fiscal hole and they need to balance their budget. They need to cut expenses if they dont get any relief because they have a fiscal hole. Borrowing more money will not solve their problem either. I think the fed can do more and im sure we will look at all of our options but those are not substitutes for fiscal policy. Kathleen he said the fed needs to give details on guidance when it comes to the feds intentions with regard to bond purchases to ensure effect effectiveness. What is the question you guys are grappling with . Robert i will speak for myself on that. Are buying a substantial amount of bonds every month. Treasuries and mortgagebacked securities. I think we could say more about what our plans are Going Forward, but our own view is i, right now, would be hesitant to see us doing more in that area because i do not see the benefits. I could see how it would further add fuel to the financial markets. I am more skeptical how much it would help the real economy. Kathleen i got to ask you another question that struck me. The minutes said the new outcomebased Forward Guidance is not an unconditional commitment to a particular path. I thought you guys just said you said it against it that the fed will not be moving rates until inflation is at 2 and moving higher and you are at maximum employment. Now it seems like there is some sex ability there. Was this a compromise that had to be reached for you guys to put out this statement and have a new Forward Guidance . It seems vague and not clear still even though you said theres plenty of clarity on this new framework. Robert i think theres plenty of clarity for the next 2. 5 to three years on the path of rates. Going to have to be judgments made on what we do beyond to the next three years but i think its going to take us that long to whether the pandemic and get the economy back on track and i think until we have done that, rates are likely to stay where they are, but there is another paragraph. There is the paragraph with the Forward Guidance or enhance Forward Guidance and theres another paragraph after it which is worth reading, which talks about Financial Stability and a whole range of other issues going on in the economy that we are going to be cognizant of an hour my own view is we should be cognizant of it. Listen, there will always be people who say they want more clarity, they want more transparency, but im a businessperson. I have been watching the fed for most of my adult life. We have got pretty good visibility on what the path of rates is for the next few years, but there may be some debates about asset purchases. I think theres decent visibility there. I think you will want the fed to have the ability to use its judgment and adapt to overall conditions. Kathleen why is 2 so important . You mentioned the financial risks. That was part of your dissent. Eight years, when inflation could not get to 2 and stay there, on a plane i got down to a 50 year low, gdp was growing near trend. Does it really matter that much to get to 2 , especially if you take the risk of financial risk on your plate if you do so . Robert to me, and i have said this, i am much more interested in Financial Stability. So we do not want deflation, and we do not want come on the one hand we dont want inflation running away from us. What ideally you want is Financial Stability so people can go out and with confidence, buy goods, businesses can transact and not worry we will either have an extreme deflation or inflation. And ik its wise for us, support usry anchoring Inflation Expectations at 2 . 2 i itself is not magical. It is indicative of price stability and i think that is what we are shooting for. Kaplan and his team are watching the virus very closely. The trajectory of that probably trajectoryg the of the economy. What did he have to say given we are starting to see cases start to pick up again across the u. S. . Kathleen he said that that is a concern. I asked him about the dallas engagementty and index, where they use data on cell phone usage to track how much activity there is, what people are doing, where they are going, what they are buying. Rate, as the virus has started back up again, that index has stalled out. It made some improvement off the low. Make it simpler. Hes concerned. I dont think hes concerned about the economy being derailed necessarily but it is an issue now that it is a negative factor. At the very beginning of the interview, when i asked him about fiscal stimulus derailing the economy, he said basically he did not think it would. The economy has enough going on now that it is going to carry through the end of the year into next year, although he also pointed out how important stimulus has been and how Monetary Policy cannot replace it. So step back, i think a lot of people are looking at this on wall street at the Federal Reserve. It is a bad confluence of events. Bad enough if a stimulus package was not getting past right now. It would be bad enough that the virus was starting to come out of it in some places and make people even more fearful about getting back to work in helping to get the economy going again, but that is what we are facing now, so i think rob gave us a lot of insight into the issues that a lot of people are looking at as they try to figure out where the fed is and where it is heading, haidi. Haidi try to figure it all out. That is 2020 for you. Kathleen hays, our Global Economics and policy editor in new york after that great conversation with Robert Kaplan. Coming up next, the 2020 elections stirring up emotions around gender in the workplace. The former president ial candidate and former ceo of philip packard joins us next to talk gender in politics and the Global Workplace. Dont forget, if you are away from a screen, you can always find indepth analysis and todays big newsmakers on bloomberg radio. We are broadcasting live from our studio in hong kong. Listen in via the app, radio plus, or bloombergradio. Com. Lots more ahead. This is bloomberg. Karina daybreak asia daybreak asia this is. Stimulus talks remain gridlocked in washington although sources say Stephen Mnuchin raised the prospect of reviving negotiations with speaker nancy pelosi. We are told the approach came after President Trumps call for special relief for airlines. The speaker is ruling out its standalone bill to any sector of the economy without agreement on a broader stimulus package. We want to help the airline workers. There is legislation that we had in the cares act that we hoped we could continue for another six months or so. That expired at the end of september. It can do that separately but we cannot do it unless there is a big bill. The senior republican on capitol hill, mitch mcconnell, says he has been avoiding the white house for weeks because of concerns about coronavirus protocols. He revealed he has not been there since early august as the administrations approach to the virus differs from his in the senate. Mcconnell adds some people at the white house are paying the price for not Wearing Masks and not social distancing. More debates between President Trump and joe biden are in doubt with the Democrat Team rejecting the white house proposal to push them back by a week. The president rejected the idea of a virtual event, saying the idea was aimed at boosting his opponent. Bidens campaign originally proposed shifting the second debate from the 15th to the 22nd to accommodate the president s recovery. 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 Karina Mitchell. This is bloomberg. Haidi. President ialce debate between Kamala Harris and mike pence stirred up more than just angst over the big election issue. Commentary in traditional and social media erupted over the onstage dynamic that women in the workforce experience everyday. Joining us to discuss gender in this political cycle and the Global Workplace is founder and a company. She ran for the republican president ial nomination and served as the ceo of hewlettpackard. So wonderful to have you on bloomberg tv to talk about all things equality. Watching that Vice President ial debate as well as the reaction we saw, particularly on social media, from women responding to that, to what extent did he see the gender dynamic that we see every day in the workplace and in politics play out on that stage . Well, of course we saw them play out. Good morning. It is great to be with you as well. Of course we saw them play out. I would say from personal experience, being the first woman to lead a fortune 50, when you are first, it is very difficult, and Kamala Harris was first, the first woman of color to serve as a Vice President ial nominee. It is more difficult when you are first because you carry with you the hopes of so many, the hopes of change and the fears of so many, the fears of change. And when you are different, and she is different, from most politicians, who remain male, just as most Business People remain male, the scrutiny is different. The expectation is different. The criticism is different. The standard is different. She is experiencing all those things, as women do every day in the workplace all over the world. There was also a sense of disappointment from some parts after the debate. She had been built up to deliver this searing takedown of the Vice President. Whilst it was not a very good performance, it was not quite to that level. Because of the burdens of wanting to be seen as likable, not being aggressive again. Are these the gender dynamics women have to deal with everyday, and as a result, it subdues their own performance . Toly i think we need separate it. Politically speaking, i think Kamala Harriss most important job last night was to do no harm. And i say that because biden is winning this race, according to all the polls. Performance in the last debate was universally condemned. Indeed, the polls suggest voters were repelled by trumps performance. As long as the race remains the same, that is good for biden and bad for trump. I am quite sure that politically speaking, people said to Kamala Harris, look, you have got this job. You are the nominee. You dont need to show it all on this first performance. Do no harm. Im sure he did pull her punch she did pull her punches to a certain extent. That is an example of the unfair burden that someone who is first carries. All these women, particularly women of color placed all their hopes in this one performance of Kamala Harris. I have endorsed joe biden so i very much hope that Kamala Harris is our Vice President and she will have plenty of time to demonstrate all the capabilities that won her this position. Shery how much has gender bias improved since 2016 when Hillary Clinton was running against President Trump . Carly well, you know, that is an interesting question and it is a mixed bag. On the one hand, we are very aware of it. We talk more about it. The Metoo Movement i think globally has really opened peoples eyes about what can go on in the workplace, and yet, if you look at the numbers, we have not made all that much progress. In the United States today, there are more men named james who are ceos in a fortune 500 than there are women. In the Corporate Boardroom, less than 16 of Corporate Board members are women. The csuite is not much better and those numbers have not changed in a long time, and the u. S. Is arguably the country with a great deal of diversity, perhaps the most diversity in business, and so, you know, we are getting they are, but the progress is a lot slower than many of us would like and that many of us had hoped, and i think it is because people do not yet truly understand. Men perhaps do not truly understand that the more women participate, the more economies grow, the better businesses perform, the data is inescapable on that point. Diversity a diverse Team Delivers better results every time. Shery you cited to me some numbers. How important is it to keep track of those metrics and also make them transparent to the public . Carly i think it is very important, and indeed, when i was the chief executive of hewlettpackard, we not only started tracking those numbers, but we started sharing those numbers. I actually do not necessarily believe that in this day and age you need quotas. What i think you need to build our true meritocracys, where actually, only merit counts, not who you know, not what you look like, not how long you have been around, not who is in your network, but truly your merit, your accomplishments, your potential, your qualifications, and when you focus purely on merit, a diverse team results. However, you do not know you have a problem unless you look at the numbers. That is how business operates. We operate on numbers. So if you are not measuring something, that means you do not think it is important. If you are not measuring something, than other people dont think you think it is important. If you are not measuring something, then you do not know how much progress you have to make. Haidi to what extent does your support of the Bidenharris Campaign is that a result of there being a woman on the Vice President ial ticket . Endorsedll actually, i joe biden before he selected his Vice President ial nominee. I believe that joe biden is the leader we need to heal the nation. He is a man with a long track record of collaboration with people who disagree with him. He has a long track record of reaching across the aisle. He has the character that has been demonstrated over decades. He is both humble and empathetic , which are critical qualities of leadership. Leader i think he is the our nation needs, and unfortunately, i think donald trump failed virtually every test of leadership that has come his way, including but not limited to his response to the global pandemic. Thank you, but do stick around. We will have more with Carly Fiorina, founder and chair of Carly Fiorina enterprises, when we focus on a trade war between the u. S. And china. You can watch more of this interview on our interactive tv function, tv. You can become part of the conversation by sending us instant messages during our shows. This is bloomberg. Shery the evolution of u. S. China tensions from trade war to type or and now to chinese payment apps as far reaching consequences. Still with us is Carly Fiorina, founder and chair of Carly Fiorina enterprises and unlocking potential foundation. Thank you so much for sticking around. Lets talk china. In this very divided election year, it seems to be that we are seeing bipartisan pushback against beijing. How worried should americans really be about china . I think chinas trade policies and practices needed to be challenged, actually, having done business in china for many decades. There is no question that the chinese rules that apply to American Companies are deleterious, unfair, and there is also no question that they violate many of the commitments they made around intellectual Property Protection in the wto. On the other hand, the Trump Administration has not challenged them effectively because trump has been both inconsistent and unpredictable, and in complex trade negotiations, complex negotiations of any kind, inconsistency and unpredictability are not very successful. Are you worried about this idea of a bifurcated internet, bifurcated tech world, if these tensions with china continue . Carly i am. I do think that the United States needs to be consistent, persistent, and strategic and how it deals with china. The chinese are always consistent, persistent, and strategic. Hats off to them. We need to be the same. That involves, among other things, the Technology Industry in general in the United States and government being more collaborative about the right approach to china. There is no question that china and the United States are interdependent and that we can be collaborators, but theres also no question that we are challenging each other in new ways and that we are competitors in very significant ways. Go, want to let you get your views on these antitrust clouds coming over silicon valley. Is the breakup of big tech something that is inevitable . Carly im not sure that it is inevitable, but what i think has clearly changed is there is now bipartisan support, bipartisan agreement, that big tech has too much power. And that is very different from 20 years ago, when Technology Got a free ride basically, no taxation, no regulation, just leave us alone and let us grow the economy. But we now have four huge firms who exert enormous power in the marketplace, and i think there is bipartisan agreement that something needs to be done, although not agreement on what should be done. Haidi really appreciate your time with us, Carly Fiorina. Lets get you a quick check of the latest business flash headlines. Facebook has pulled a network of fake accounts that were trying to sway public favor in favor of trump. They criticized joe biden and the democrats and praised the president and the republicans. Mcdonalds has returned to growth in its home market. The virus pandemic continues to roil its international operations. U. S. Sales grew by 5 . Loreal is set to close stores and cut jobs. It says covid19 has altered consumer behavior. They will be shifting more investment to ecommerce. U. S. 400 jobs in its division will be affected although some staff will have the chance to move to new positions. Coming up on the next hour of will bek asia, a ceo joining us with her Global Investment strategy. The importance of getting it right for the rest of your portfolio. We will be speaking with ahead of china markets, coming back online after golden week. We have the market open in seoul they are closed for alphabet day. But the open in tokyo is coming up next for the final trading session of the week. This is bloomberg. Shery you are watching daybreak asia, we have an alert on the bloomberg. President trump said president Trumps Campaign has come out saying there is no reason for the second debate to be ritual, the Campaign Calling for that october 15 debate to go ahead in person, remember the president had dropped out of that event after the organizing commission made the debate virtual saying that he will hold a rally instead. We have heard from President Trumps doctorate saying that to the president can return to Public Engagements on saturday. Japan is opening for trade, south korea is away on alphabet day holiday, take a look at the nikkei and the topix gaining ground, the nikkei up 3 10 of 1 . We have a japanese yen Holding Steady, but this after the weekend took almost former it four week low against the u. S. Dollar. We have august hussle spending and wage earning numbers and they both improve from the previous month, but they missed expectations. South korea as i mentioned is away on holiday, but the korean won is strengthening against the u. S. Dollar already having climbs to a ninemonth high. More when itl get comes to the dollar outlook in just a moment, but take a look at how things are trading in australia. We are seeing fluctuating movements when it comes to trading in city sydney with the flattening of the asx 200. Ozzie stocks poised for their best week since about mid april, we have seen gains every day this week despite these fluctuations we are seeing at the moment. In terms of what we are seeing for the aussie dollar a little bit of strength of their 75 against the dollar weakness story and some stability returning to the bond markets after the rally got a boost from the expectations of an increased deficit from that expansionary budget. Says she isst hitting the pause button so her portfolios are not too bullish or too bearish and others determining on the u. S. Dollar. She joins us from all also and always good to have you, it is a goldilocks positioning you are looking for there. Ust you need to see to give give you conviction on where the greenback goes . Nadine i think it comes down to where the dollar is that, you have to can feeding versus two competing forces. You have the dollar in the u. S. Versus what you are seeing in china and other parts where you guys are situated and that tends to have one impact on the dollar. At the same time we heard that trump may be willie willing to do a deal with policy, that could strengthen the dollar initially, that would have different opinions on where you would be positioned. If that is bullish or bearish on a market versus the fundamentals of the economy. We see marketse starting to press out, the idea of a contested election result in the event of a clean democratic when. Take a look at what a Senior Investment strategist from Goldman Sachs has to say about the variety of risks that she is seeing. I am quite concerned that there could be considerable downside as well depending on any number of factors that we cannot fit easily into our models, this includes what will the congress to, what will the president say, and of course the election outcome. Haidi go ahead. Nadine so i think in terms of that, there is hedging there, but the point is right. When you look at on the one hand there would be a contested election, theres going to be a lot of volatility. Not great for a lot of different Asset Classes when you have to wait around for certainty. I think that is where she is getting at in terms of the unknown versus saying that obviously if there is a clear winner in the election, i think that risk would go down. People in a lot of protection around the election. It is not like they are waiting to do that. Haidi lets talk about the unknown and how that is leading to more cross asset volatility, this chart on the bloomberg showing how we saw the pop in bond volatility. All of the backandforth when it comes to the stimulus package, but all in all, it seems to have been a downtrend from march. How do you decide to deploy your cash in this environment . Nadine we look at creating a per folio of 812 investment themes and you can have multiple plays with anything. The key line is you do not want them correlated, think of popcorn popping, you want popcorn popping. View which is a not argued have on election, but that would be one of maybe a dozen different things. We are looking elsewhere, looking at the acceleration of growth in china, looking at data centers in australia, green deals in europe, higher volatility overall given a lot of the unknowns. We have not talked about brexit or a number of the other things, the point is do not put all your eggs in one brexit basket. Shery you are not necessarily withdrawing from the u. S. Right . I mentioned u. S. Stingless package, but what happens if the administration moves unilaterally on that . Nadine i think what you have to be cautious about is saying there is one certain way. If you do that and put your hope or for the around it, that is risky. We are looking for data points to confirm or deny potential outcomes and we really think it comes down to the dollar. The stimulus, if it were to occur is going to have one more impact than the dollar, if the stingless did not occur, a fedof the prior events, the action would probably depreciate the dollar. We think will have an interim dollar up, but in an intermediate term dollar down which benefits em, benefits gold , other Asset Classes. Shery do you cling to commodities as well . If we do get a bite and victory, a lot are thinking we could see a boost in alternative energies and that could lead to a natural gain in some of those sectors including say the likes of silver. Basket on have had a whether or not it is a bite and when, there is a lot of spend in those areas from other countries. You do not necessarily have to have a bite and when, but this week we have seen with the polls widening towards biden versus trump, a lot of this has already appreciated. We are taking chips off the table at this point because the money has been one won. I would be cautious as an investor coming in now, a lot of those investments have appreciated this past week. Great having you on, thank you. Lets turn to Karina Mitchell for the first word headlines. [no audio] haidi are at we have the latest when it comes to President Trumps medical situation, his doctors thing he is responding quite extremely well to treatment after undergoing a full course of therapy and of course now we have just heard from the white house saying that there is no contagion concerns when it comes [no audio] we seem to be having technical issues, we will have plenty of daybreak asia had. This bloomberg. Haidi we are getting breaking news when it comes to china ever grand, this is chinas most heavily indebted property developer. Watching these numbers across golden week, september and china holiday contract coming at 131. 6 billion um u. N. That is about a 29 billion target for the two month through october, it comes after offering its deepest discount in history to try to drive up interest in sales. Discounts being offered to apartment buyers, revenue of 142 septembern. Between and october according to filings coming out now generating 173 billion in revenue to last year. If you want that comparison of course, China Evergrande skirting the deal last week with investors of their right to force that payment. If you take a look at how the bonds are trading at . 70 to the dollar, you can see those lingering doubts amongst bondholders there. To get more analysis on them as well as Consumption Trends across golden week ahead, going into of course the reopening of Chinese Markets today we also get his outlook for the final quarter of 2020 given these political and economic challenges. Shery given all of that asian stocks seeing a mixed day of trading, we have the failure of the white house and congress to pass a stingless package and this continuing to cause volatility in the markets. Investors are betting this will cause the Federal Reserve to push ahead with more bond purchases, Bloomberg Economics and policy editor Kathleen Hays joins us and you recently spoke exclusively with the dallas fed president , what was his view . There is a view on wall street right now at least among on the traders and investors that with no ability to cut the key rate and a lower, the Federal Reserve is a if a stainless package is not come through for the next few months and the economy loses steam, there may be a reason for them to increase their bond purchases. You may remember in september people were this appointed in the bond market that the fed left its treasure purchases at 80 billion and its mortgagebacked security purchases at 40 billion. Apparently they are going to be debating this more closely at the next meeting in november which is in discussion ipsen top in september. He thinks about all this i asked him what he think about all this, lets listen to what he said. Problem is this, the fed has a lot of tools and we have more things we can do, but our tools primarily ease financial conditions. They make it easier to borrow money. Arterials are not wellsuited when you have income loss and need to make up an income loss. Individualso areas, 12 lost their jobs who have lost income and there are states and municipalities that can borrow that are using the private markets and are borrowing the promise of a fiscal hold and need to balance the budget and they need to cut expenses if they do not get any relief because they have a fiscal. Borrowing more money is not going to solve their problem either. I think the fed can do more and we will look at all our options, but those are not substitutes for fiscal policy. Needs to give fed details on guidance when it comes to the feds intentions ensurend purchases to effectiveness, transparency, accountability, what is going on here . What is the question you guys are grappling with . I will speak for myself on that. I think we are buying a substantial amount of bonds every month, treasuries and Mortgage Backed securities. I think we can say more about what our plans are Going Forward, but my own view is i, right now be hesitant to see us doing more in that area. I do not see the benefits. I could see how it would further add fuel to the financial markets, i am more skeptical on how much it would help the real economy. I will ask you a question that really struck me coming out of the minutes, the new outcome faced forward bidens guidance is not conditional to a path, i thought he just said that the fed will not be moving rate until inflation is at 2 and moving higher and you are at maximum employment. Now looks like there are some flex ability, was the compromise that had to be reached for you to put out the statement . It seems vague and not clear still even though you said recently there is plenty of clarity on this new framework. I think there is of clarity for the next 2. 53 years on the path of rates. I think theres going to have to be judgments made on what we do beyond the next 2. 53 years, but i think it will take is that long to whether the pandemic and get the economy back on track. I think until we have done that, rates are likely to stay where they are. There is another paragraph there is a paragraph with the Forward Guidance, then there is another paragraph after it which is worth reading which talks Financial Stability and a whole range of other issues going on in the economy that we are going to be cognizant of. My own view is we should be cognizant of. I think there will always be people who say they want more clarity, transparency, but i am a business person. Ive been watching the fed for most of my adult life, we have got pretty good visibility on what the path of rates is for the next fears. Few years. I think there is decent visibility. I think you want the fed to have the ability to use its judgment and adapt to overall conditions. Important . Percent so why is 2 so important . On a point i got down to a 50 year low, gdp was growing near a trend, does it really matter that much especially if you are going to take the risk of financial risk on your plate if you do so . This,me, and i have said i am much more interested in Financial Stability. We do not want deflation and we do not want inflation running away from us. What you want is a Financial Stability so people can go out with confidence, by goods, businesses can transact, and not worry that we are going to have an extreme deflation or inflation. I think it is wise for us and i support us reanchoring 2 . Ation expectations at for me, the 2 by itself is not magical, it is indicative of price stability and that is what we are shooting for. Concerned is he about the economy now with the prospect of a delay, partial, maybe not even existing stimulus . What is interesting to me is that he said he has seen data the last couple of weeks on the economy that suggests the economy is moving ahead, maybe even doing a little better. He mentioned the jobless claims s which continue to show over the past three or four weeks of improvement has stalled out. He does think the gdp forecast is on track for positive growth over the course of the year. I asked him about the dallas feds mobility and the Economic Movement index gives a sense of where things are going not just in the dallas area or federal district, but across the country. What he sees there is it has leveled off, it has made some improvement and as the virus is darting to pick up in certain parts of the country, maybe it is the fact that people are worried it will pick up further as we going to enter. He is seeing that index level off, that is a bit of a concern, something he is watching closely. Editorour policy Kathleen Hays there after that conversation with Robert Kaplan. You can get more on this push for stimulus deals on todays edition of daybreak, go to your terminal, it is also available on mobile in the bloomberg anywhere app. Coming up next, opec boost its supply forecast saying the worst of the oil prices is over. His recovery just round the corner . This is bloomberg. Haidi opec is booting supply forecast for the next four years hoping to emerge from the pandemic with a greater market share. Says the worstal appears to be over. Isassuming that covid19 contained in the coming year, oil demand should partially recover and increase by almost 10 Million Barrels a day rising to around 109 Million Barrels a day in 2045. Haidi lets get more from our Energy Editor, we know the supplies potentially weigh into this, but when it comes to the long story, should he be more optimistic . Have heardyes we quite an interesting statement from the secretarygeneral pointing out saying the worst is over for the oil market. A report from the group today showed that opec raised its forecast for the amount of oil it will need to supply over the next four years and the cartels arsenal also projecting demand will grow for another two decades. Opecs quite a bit more bullish, in fact the other Companies Forecast oil regain about 2030, but 15 years earlier than opecs estimate. When it comes to shortterm demand, the outlook is concerning especially with global virus cases above 35 million, governments from london to madrid and new york city, but thats contemplating further measures and restart Many Companies having employees work from home, children at home, less demand for gasoline. When it comes to demands specifically in asia, he pointed out well receive it returning to previrus levels by 2022. We have a way to go, that was a very optimistic call from the opec secretarygeneral and things cannot easily change and play out in a different way, we are still on a bit of a shaky path when it comes to a true demand recovery. Lets talk about supply because right now wti Holding Steady but this after climbing to a one month high in the new york session. We have hurricane delta now approaching. That is right, im so glad you brought that up, we are focusing on hurricane delta. Wti did get a bit of support today as the gulf of mexico producer had to quickly shut in, prepare ahead of the circuit in which is currently a category two and it could land as a category three. Have shuttered nearly 90 of crude and just over 60 of natural gas output. Ports in the port arthur sector including boy month, lake charles, they will also shut off. We are expecting little limited put off in the gulf which may tighten the market significantly until that storm passes through and until it is safe for operators to ramp back up in offshore production. Course political news affecting oil price, we hear that oil workers are striking in norway, what she we watch out for in what could hit prices in the short term . That is true, though we are market has been feeling the lingering impact of offshore Oil Workers Strike in norway which thed very well extends to northeast field and then the equivalent of almost one Million Barrels a day at the countrys output. Right now echo nor will have to , if that lastld until october 14. Other projects will also have to shout if there is no agreement reached by midnight on october 10. We are watching that october 10 date approach quickly to see if an agreement will be reached. Our Energy Editor joining us with the latest on oil, lets get a quick check of the latest is this headlines. Toon Morgan Stanleys provide them morgan fund for about shares were up almost 50 with the replies at a 30 premium to the previous close. Morgan stanley gets Brand Recognition and also expands its Asset Management business, some big players continue to double up gobble up small money managers. Ibm is putting off its legacy unit as it pegs its future to the cloud. The new business currently part of ibms Global Tech Services division and handles daytoday operations such as managing client data vendors and traditional i. T. Support. It has 4600 clients and an order book of 58 billion, the move effectivelys lets ibm in two, i. T. Management services and the hybrid cloud and ai unit. Facebook has pulled a u. S. Based network of fake accounts that were trying to sway Public Opinion in favor of President Trump, Facebook Says the network began in 2018 and was still working this year criticizing joe biden and the democrats and framing the president and republicans. The accounts comments most regally on the new york times, washington post, fox, and cnn. Up next, Chinese Markets come back online after the golden week break, we will hear from hao hong about chinas recovery. This is bloomberg. 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. Taking a look at japanese stocks, honing in on some of the japanese retailers we are seeing moves when it comes to rising as much as 10 . The company reporting a bigger than expected annual forecast. Posting as after revenue and of course the heavyweight fast retailing climbing on those results, the stock was also raised to a hold concernsies despite and uncertainty over the coronavirus in their earnings. Lets turn to china with the pandemic seemingly under control, goldman week is set to exploit confident in the economic rebound. Over the holiday, data shows that Domestic Tourist income hit almost 70 of 2019s level, Box Office Revenue was the second highest on record and Consumer Spending rose just over 6 . The macau suffered saying a gross gain revenue was down 76 on the year. Lets get some information from hao hong. Does the Consumption Patterns today or over the golden week holiday give you or of a perspective on how investors should invest in the markets in china . Common nk the numbers come in more or less than expected. The polls were people were expecting a rebound. People were in their home or offices, can go anywhere, so i think people were looking for consumption. The so, if you look at is slightlyme, it at last years level. Most of the trips people are taking our very short to nearby areas. I would not be too surprised by the numbers. They can be in an environment globally. Shery what does that mean for the markets because we have seen a bit of a support for the cyclical sectors given the economic rebound and yet it seems the shanghai composite could be largely cap if we do not see that support. I think from value to cyclical, and also from growth and value being discussed globally, i think it is already having china. If you look at the cyclical components in recent weeks, even the Chinese Investment and the second will index industry as well. I think the Chinese Market is showing the rest of the world what it will look like if your economy starts to recover. Issuek the cyclical bond shows very strong momentum and i think the momentum will continue. China has joined the who kovacs vaccine. This is a global program, be 18 billion initiative to potentially deploy future covid19 vaccines once the vaccine is available around the world. Moving into its next phase with now 156 countries and regions on board. China had been joining the u. S. To stay on the sidelines, we had been talking about china potentially coming up with its own independent program, but now we are hearing that china has joined in to the who Covid Vaccine program according to the Chinese Foreign ministry. Let me ask you about your picks when it comes to Health Care Related stocks. Health care as well as some of the related things like t9 health for example. This is change consumer trends, particularly in a way that health care and advice is dispensed. Hao i think health care is one of the better performing sectors this year. And even bigger opportunity to be had in the sector is the upandcoming ipos. I think years ago when the Hong Kong Exchange and also this years chinas ipo reform, i companies [indiscernible] i think in general, most of the Health Care Companies have had it very well especially i think the sector has larger money raising abilities impaired to the other sectors. Think people can look to the market which has been preferring performing very very well this year. Let me get your views on China Evergrande. Enjoyedheard that they a 20 million which is a great day for property sales in china. You take a look at how the bonds are trading at the moment it is not seen to be a great deal of conviction. As this company headed off disaster with the deal with its creditors last week or is this just Something Like kicking the can down the road . Hao i think it is more likely to be the latter case which is just kicking the can down the road. I think recovery is unlikely to let it go early on. Think they tend to be better months for property sales, but even so if you look at the national level, i would say the have been [indiscernible] evergrlly for example ande is the First Company to do online property sales in china. The pandemic is causing some job losses especially in the consumption sectors. To affect how people come up with money to buy properties. August, we have seen property sales coming back and actually in august, property sales seem to be slightly higher than the numbers from last year, i do not think they are going to continue. I think the inclination to curb property speculation is very strong. The result, you can see is ic credits in china the same momentum, same in the u. S. Before regulus talk about the chinese yuan because is we have because we have seen steady strength since june against the u. S. Dollar, how much of a risk does the yuan face going into the u. S. Election and even after the election . Of whothink regardless wins the election, i think biden if he wins it would be better for the relationship between china and the u. S. I think a huge stimulus package to be anticipated by the market is great and the price. [indiscernible] that would put pressure on the u. S. Dollars, at the same time, china is enjoying one of the largest surplus in recent years. I think all those factors and also the between china and the u. S. Is very large as well. [indiscernible] i would say that the chinese chairman is regardless of who becomes the president of the United States. Very quickly, there is been excitement of the financials, rua about these increasing ways that the u. S. Government is looking to potential bans and limitations on chinese tech or is that something you expect could simmer down after november . Reveilleink the tech continues bribery continues. I think [indiscernible] for tencent, only 5 of the revenue is coming from u. S. Of know china in terms application of tech in Consumer Tech is essentially if you look at online payments, if you look at the Online Shopping and china has 14 billion consumers in china come into play. Even though the rivalry is expected to rise, i would not be too worried about the chinese tech sector even though some restrictions could be posed by the u. S. Government. Always appreciate your time, lets get you a recap of the breaking news coming in just a few minutes ago. Chinas Foreign Ministry confirming the country will be joining the World Health Organizations kovacs vaccine program, previously china had stayed on the sidelines along with the likes of u. S. We know they have been making progress in the dolonc of their own homegrown vaccine, but confirmation they will be ax programan that cov which is an 18 billion Global Initiative for the assessment of a potential vaccine when it becomes available. The u. S. Of course still remaining on the sidelines from the program. We will have plenty more including that story coming up on daybreak asia, this is bloomberg. Circling back to the news just a few minutes ago, china has signed on to the whos Covax Program in 18 18 billion initiative. News get details from john in beijing, of course, beijing has stayed on the sidelines not really joining us first. What took them so long . The idea was perhaps by joining this initiative, it could actually help repair the reputation. There was some uncertainty be a about uncertainty about whether china would join because part of one of the great benefits of having a Covid Vaccine is diplomacy. You can use it to entice other companies to do things. If china is going to distribute its vaccines to the who it sort of undermines or undercuts that ability. As weve seen before, teaching that it wouldwho be a vaccine for global good. He seems to be making good on that promise. This mean about the exercise of soft power or diplomatic pallor power. We know a lot of officers offers have been made to other regions from china anyway, we know they are making progress with their own vaccine development. Interestinghis is when you set it against what the u. S. Is doing. Donald trump has already said the u. S. Is not joining covax. The u. S. Is investing money doing all it can to make sure that americans get the vaccine first. Showing less concern about what the state of the rest of the world is. I think china is trying to show the world it is a responsible especially with so much criticism having been levied at how china handled the initial stages of the outbreak and potentially may be have lost time in trying to stop the pandemic. Shery it is an insurance policy that it would get access to any successful vaccine . What is the track record for beijing when it comes to the safety of their own vaccine Manufacturing Industry . China is a huge maker of vaccines, so far, it is got i believe two or three vaccines in the stage three trials. Thousands of people in china have already taken the various vaccines. As far as we know there have not been reports of that reactions to those vaccines. Things seem to be moving forward. One of the china one of the troubles china actually had, they have found it hard to do phase 3 because they had to work with countries and other parts of the world where there are still going ongoing outbreaks. Our executive editor in beijing, lets get to Karina Mitchell for the headlines. Itina we start in the u. S. , is it appealing a court ruling that blocked President Trump on tiktok, a preliminary injunction against the ban was issued on september 27, the judge saying the administration had exceeded its authority. A parallel effort by the president to block tencent we chat messaging service has also been held up in court, the administration appealed that ruling last week. Fed officials telling the Trump Administration more fiscal eight needed to aid the economic recovery saying without it, the rebound will be weaker with stimulus talks remaining stalled, Margaret Kaplan told bloomberg tv it is not time for more qe. Change there unlikely to large scholastic procedures as it would not do much to help the economy. To see us be hesitant doing more in that area because i do not see the benefits. I would see how it would further add fuel to the financial markets, i am more skeptical at how much it would help the real economy. Karina the Trump Administration has imposed new sanction on iran to further isolate the country from the outside world the move against 18 banks is and that cutting the government from the Global Financial system and putting pressure on iran. Previous u. S. Sanctions have crushed the iranian economy by curbing oil sales. Global news 24 hours a day on air and on Bloomberg Quicktake powered by more than 2700 journalists in more than 120 countries. Im Karina Mitchell, this is bloomberg. Has struckan stanley a second deal in just tenmonth acquiring an asset manager forget about 10 billion. That is transform them from a wall street mesh list to a management player. He told me earlier have a deal could reshape Morgan Stanley in the years to come. This is been a 10 year strategy to take what is an extra ordinary Investment Bank and trading business, clean that up in terms of Risk Management of that business, take away the tradings, is that capital and more effectively and it is doing unbelievably well. Up theto pivot to build Wealth Management business which we did first through then e trade which gave us the digital platform. Now we are doing it on the asset anagement side which made very small boutique on the west coast and now excitingly with we think for 2030 specifically, you will find a very stable faster growing, very feebased institution. Strong liquidity. Strategy,ed to me the are you making Morgan Stanley for the masses . Are you trying to be all things to everybody know that you have added this large brokerage and this asset manager . Not at all, firstly, we have done many deals since ive been ceo we sold oil storage and transportation businesses, we sold Mortgage Service businesses. We sold european private banks, we sold a business called in the u. K. And so on and so on. We have been reshaping the portfolio. Originatingt distribute in managing capital for individuals, institutions, and governments around the world. That is what we do. Being in the Wealth Management space or the trading space, it is all consistent, it is all part of that process of originating managing stripping capital. We are a more focused company, certainly the most that appears that we deal with. This is been an expensive deal, but at the end of the day, it is what this deal will deliver to shareholders in the future. It comes down to profit, margins, how do you explain the economics to that in the longer term . I have met a lot of people who want to buy Great Companies cheaply and and up not buying anything, hopefully by buying underperforming companies. If youre going to buy a huge talent, perfectly calm entry businesses, there will be little dislocation. Highgrowth, great businesses with parametrics in particular growing very fast. The traditional Asset Management space, so, this was a nobrainer. We paid full dollar for it, that is what you have to do if you want to buy highquality businesses. They came to us, they wanted to be part of the Morgan Stanley business and our cultures aligned. It has used up about 100 basis points of cet1 which is our core regulatory capital ratio. It created about 100 basis points this year, we are sort of back to neutral. It is going to be a terrific deal in the long run, im not worried about financials at all. Prettyakes as a manager big here, above 1. 2 trillion at this point, it is still a fraction of where blackrock and vanguard and even jp morgan is. How do you compete with those rivals . They are completed different businesses, vanguard and blackrock are largely index or exchange businesses, we are not trying to be the biggest. We are just trying to he did not do strategy through envy, that is how you make mistakes, you do strategy based upon what works and what is important. 1,000,000,000,002 Asset Management company is unbelievable. I do not care of others who are bigger, that is not the point, the point is we generate returns for our shareholders and we provide our clients for the opportunities they need for the best product out there. Through this deal between our Asset Management business it is absolutely happening. Is morgan chairman Morgan Stanley chairman and ceo speaking to us. Up next, the reserve bank of india makes a decision later today with a new fed of committee members, we will have a preview of what is to expect. This is bloomberg. India is expected to maintain its benchmark rates as the economy continues to struggle with high inflation amid the pandemic. We are joined by our Southeast Asian economics editor, it seems what are we expecting from today . Mentioned, the new npc members that have just been joining the committee will have to grapple with high inflation. 2 6 ion is sitting at target and that gives the rba very low room to cut Interest Rates at this point. We are not expecting any change in the benchmark infringed which remain at 4 . We are looking for new guidance from the rba it rbi especially on inflation and Economic Growth. This will be the first indicator they give on Economic Growth for into march 2021. We know the pandemic has had a devastating impact on indias economy and expectations are that the gdp could contract as much as 8 in the coming fiscal year. How the new members of the npc affect policy Going Forward . The three new members that were appointed have very much growth focus, we can tell from the previous statements that they favor monetary and fiscal policy. Tilted more towards the dovish side and even though they may not cut Interest Rates today, we expect they will resume cutting Interest Rates in coming months and they will keep the accommodate the stance of the central bank in order to provide support to the economy. To ease aexpected bit, that should make it easier. Economics editor in singapore with an outlook on the rbi rate decision. Coming up we are closely tracking china as stocks there go back online after an eight daybreak. Li andl speak with jum also get a snapshot of the economy with the chief Greater China and economist raymond yen. That is it, our markets coverage continues at we look ahead to trading in hong kong and reopening in shanghai. This is bloomberg. It is 9 00 in beijing and shanghai. Welcome to Bloomberg Markets the china open. Avon we are counting down to the open of trade. Here are our top stories. Two major stories. The stimulus saga in washington and chinas return from the golden week break. Spending will show the extent of the mainland recovery. Tom
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