The and pennsylvania. No sign of qe for the boe. Officials boost stimulus to prevent a doubledip recession. Good morning, everyone. Welcome to bloomberg surveillance, but welcome to our Election Special. Votes are being counted. I am Francine Lacqua in london. Tom keene is a new york. Tom, we look at the senate, the legal challenges. I know you and i have not slept much in the last 24 hours as we were roaring through the votes, trying to figure out exactly how throughident poring the votes, trying to figure out exactly how the president can mount a challenge. The other big news is the bank of england, because they did more than the markets were expecting, but remember this is in the middle of a brexit negotiation. Lockdown in london starts today actually, the u. K. As a whole starts today. If you look at futures in the u. S. , european stocks, they are tom, twocompared, yesterday. Liking what they see at the moment, but whatever the outcome of the u. S. Election was, it was pretty much priced in, because a very tight race expected. Tom futures up 42 in america, francine. It is about the politics, but i do take your point about the bank of england and those statements to be made, maybe we will hear from them later this morning, and also the Federal Reserve meeting this afternoon. It is pushed aside by the moment. If you want one moment of tension, francine, i have two observations quickly. The first moment is arizona tilted a little bit in a better trumpian direction overnight, ever so slightly. It was good news for the president as truly he fights for his political life. The single best headline i think ive seen, francine, on the American Election is out of the times of london, they simply say america holds its breath. Francine yeah, america, and you can argue the rest of the world, too. , msnbc, theyt cnn projected biden would win michigan, which trump took in 2016i will get to the board and a second, but we talk about joe biden being on the brink. I do not know if we can find out today come in next couple of hours, whether he has it or not, but it does mean that joe biden needs to only win an additional outstanding state, such as nevada or georgia, to become president of the United States. Again, i am looking at the data, and actually the data is pretty much at ease at the moment with the joe biden presidency and the senate that is held by the republicans. Stocks are rallying. Investors piling into technologies. I think, tom, this has to do with not expectation but extra regulation because there is the senate that is held by republicans, and then we look at the bank of england. I want to show you the pound, tom, because it may be a bit counterintuitive to what we have seen in the past and terms of doing more, and you can see sterling 1. 3012, tom. Tom we have got a wonderful guest for that, francine will bring in futures, yes, in the then, dow futures out in 28,000 level, 258 dow points, and the real story here, i will keep it short, folks, is the vix with a vengeance, with election uncertainty beginning to be pushed aside. What, three cups of coffee ago, now at 27. 44 on the vix. That is an extraordinary move, and evaporation of statistical uncertainty. Theyear yield. 72 . I think, francine, we will leave it there, because the political conversation right now is so important. Francine yeah, tom, although, three cups of coffee . I would say at least 24 cups of coffee, otherwise you are, you know, more virtuous than i am. So joe biden on the brink of a drifter flipping michigan and wisconsin. He is just six electoral votes needed to win0 the presidency. Joining us at this morning is dr. Leslie vinjamuri, head of the u. S. And Americas Program at chatham house. Leslie, given the mathematics, is that now a done deal for joe biden . Dr. Vinjamuri you know, i think the one thing we have learned in this election is dont call done deals until it has been counted, until it is confirmed. Indication we are on track for a bite and victory, but note nbc, the New York Times, there are some places that have not called arizona. They want to see, you know, all those votes come in, as you have gotten slightly different news in terms of the balance every night, but all the indications, it looks like pennsylvanias leading toward biden, georgia, some of the suburbs are interesting, so we are seeing exactly what people told us we would see, which is as those mailin ballots are counted, they are leaning democrat, and that is moving the result toward the biden victory. We are also seeing that of course the overall number by isch Vice President biden likely to win will be much higher than in those three states, those upper midwest battleground states than it was andPresident Trump in 2016, a very significant number in terms of the popular vote, more than Hillary Clinton won the popular vote by so, you know, everything looks on track, but it is important to, you know, overnightprotesting in regards to President Trump. They want their votes counted. On the legallie, challenges, what can President Trump and his team actually do to challenge this . Dr. Vinjamuri well, we saw President Trumps, quite frankly, shocking response yesterday night, morning here in the u. K. , already claiming victory, and, you know, saying that he was going to go to the Supreme Court. He can certainly he has called for a recount in wisconsin. He is calling for, you know, votes not to be counted anymore in pennsylvania. He is calling out irregularities. You know, i think, to notice, he is speaking to a very small choir right now, and what is interesting to watch is even those around him, i think, are going to become very quickly reluctant to support the president s call, and as the numbers move in Vice President bidens direction, that effect is going to be even stronger. But right now, i do nothing President Trump is going to, you know, be able to sustain the people around him in that rallying cry. But he can certainly he will use every tool that he has to try to mount legal challenges. Tom dr. Vinjamuri, good morning from new york. Dr. Vinjamuri good morning. Tom thank you for starting this morning on this most interesting thursday. Dr. Vinjamuri [laughs] to leslie, i want you discuss for the guardians worldwide the disparity of a recount, because what i think is a web and here the audience worldwide the disparity of a recount, because what i think is important here is where a recount is typically a percentage discussion, and, to be direct, we are nowhere near ensysmall, teensy we percentages that have led to a of the past. Dr. Vinjamuri no, we are not. The numbers are significant. If you listen to people who are talking about this very clearly, the state level individuals in charge of conducting elections, they are simply not seeing the irregularities or any of the allegations substantiated that President Trump has levied. And the numbers dont bear out the need this is a president who is very distressed. He has been distressed for some time. The most extraordinary thing about his or marks, of course, were, on the one hand, he claimed victory, that everything was going well, and on the other hand, he sounds like a loser, he sounds like someone who is deeply distressed, who wants to recount, confirming what we already know. Tom right. Michael\i thought was brilliant last night on msnbc, talking about the same 20 of the east room. This is really inside the beltway, folks. We all know the east room is a magical room. How will washington react to a lameduck trump if and when we get there . Dr. Vinjamuri well, this period right, whenever this election is called, whether it be today or tomorrow, or if there is a legal challenge, maybe it will take a little bit longer, all the way through to january 20. There are a couple of questions one is how washington will react, but the bigger question, tom, is what will President Trump do in the days, weeks, and few months ahead. This is an incredibly uncertain period for u. S. Politics. Donald trump is highly unpredictable, and i suspect that he will double down on any number of measures designed to protect himself, to protect his friends, to push through policies that he wants to see, but it is going to be erratic, it is going to be difficult, and i think we need to gear up very quickly for managing what will be a difficult few months. Tom leslie vinjamuri, thank you for joining us. We appreciate it very much and we look forward to seeing you tomorrow at some time. I do not know if we will see dr. Vinjamuri tomorrow, but that would be good. Francine tomorrow and monday and tuesday. In norancine, bloomberg way is trying to get out in front of the polls in the moment. As i mentioned, arizona with a few votes recently has gone more toward the president. He is still behind in arizona come about within our conversation, folks, we are not trying to get out front. Francine but what we are trying to get out in front of, tom, is what the market is looking at, right . So we are looking at polls from others, we are careful, but we also need to try to understand what is moving the markets. It is clear that the senate race and the race for the white house are moving markets. Up next, on the break to victory, joe biden sounds confident as he wins michigan and wisconsin. We will discuss with david a sarah of davide serra of algebris. This is bloomberg. Francine this is bloomberg surveillance, tom and francine from new york and london on bloomberg, and this is our bloomberg surveillance Election Special. Any major policy changes while the u. S. Election hangs in the balance. To discuss the election, the fed, and centralbank policy is a davide serra, chief executive of algebris. Inide, it is the second day a row where markets seem to like what they are seeing. Technology stocks are definitely leading the gains. The general exultation in the markets that joe biden is president , the senate republicans, so we are kind of in gridlock. The lack of stimulus may outweigh benefits of no extra regulation and not a breakup of technology stocks. Yes,e well, i think, first of all, there is certainty. That is what the market is pricing, so basically the market has decided it is very likely that biden will win. That means you will not have the scenario potential, the contested election, which was in the cards before. Way, back to a normal relationship, so less picking fights with anyone outside of the United States. And, fourth, at the same time, because it is not a clear blue wave, in a way, you are not going to get a massive sweep of regulation, as you said. Having said so, i think the proof is in the putting in the coming months, because these tech oligopolies i think will have to be dealt with, particularly from the european stance, it is no longer accessible across the continent. Davide, what does it mean for stimulus in the u. S. . Why is theyou know, market not pricing in these legal challenges in the u. S. , becoming something that turns into something more real, that becomes real divisive issues that hurt Economic Growth . Um, letsthink they, say, there are from the numbers perspective, first of all, the election looks like to be a clear win, so, you know, we are not talking about a small recount, so any legal challenge is basically noise. Fedsly, from the perspective, i think they will be pretty much on hold. The ecb has already said early december we are going to cut back, so this situation whereby you are getting fiscal stimulus, i would say now, stable policies, compared to before, and still very relaxed Monetary Policy means it is conducive, basically, for owning risky assets, particularly in equity, which is the only one giving yield, because on the other, you need to consider the whole planet has liability on the others, fixed income, gets pretty much zero. Of the 53 trillion sorry, 65 trillion fixed income assets of 85 trillion, 20 is agative, 90 yields, and as result, mods of liabilitydriven investors are forced into equities. Tom davide, tom keene in new york. Good morning to you. Thrilled you can be with us. I look at a number of bank stocks and bank indices yesterday to get a sense of how the Financial System is reacting to all these politics, and what i see is a massive ambiguity. Which way does a Biden Administration cut for the banks . Davide tom, i think, first of all, overall, i would say it is neutral, because, you know, the fed is in charge of a regulatory side. Tripoli capital change, the business marco banks triple the capital change, the business model, if you think about it, it is a one and 100year shock, making profits, and as a result, i think, you know, this time around, through the social utility, and i think at the same time, we are catching lower rates, which is important, because obviously banks are a conduit of the Monetary Policy. So the fact that we are not expecting rates to go any lower globally because of the fiscal stimulus, i think, means overall financial stocks are underpinned here. And into next year, when the vaccine will be deployed in 2022, 20 23, i think you will see a very positive scenario, whereby basically you get an acceleration in growth, banks, massive amounts of capital, and dividends that will be, you know, reallowed, which means theallin yields for sector, whether in u. S. Or in europe, could be well above 10 , and that compares to 2 of the s p. So i think in the next 2, 3 years, you are looking at as ignition outperformance of financials. A significant outperformance of financials. Tom francine, jump in here. We have interesting headlines out of the bank of england. Francine, i want to go to davide of the negative yield conversation, our guy johnson speaking to the governor of the bank of england here in a bit. Francine, do you note the leaking of the decision . Is that accurate from bloomberg . I believe it is. Francine no, tom, actually, the bank of england was meant to come out with it at 12 00, and then yesterday, they did not want to front run anything that richey sumac was going to say, so they timeline the decision. There is a decision at 7 00, he spoke to the press, then the press are actually allowed to do headlines right now. Governor bailey, davide, saying they are working a negative Interest Rates, and we had a conversation in the past about when is the right time to even do negative rates in the u. K. . Is it end cycle, is it when we start to see a pickup . Given lockdown is here, what does it mean if we go to negative rates for u. K. Banks . Davide well, i think, first of all, negative rates in the u. K. Means actually, with brexit, what u. K. Has achieved, it is a fully onetoone over europe, because basically they are forced to go into ecb politics. Secondly, negative rates basically are a nuclear option, arehat savers, and banks obliged to basically mobilize the resources they had, because if not, they get taxed, if they stay high. You basically want to put your cash in a bank account. If you are not doing anything with it, you are losing money. I think the combination of brexit plus lockdown is going to thea very bleak scenario on u. K. Economy, so i think the bank of england is basically just copycat the playbook of the ecb, which had similar deflationary pressure, and this is going all in. It is a clear reversal of politics, because they always deny, and come in a way, also distance themselves. But the reality is 60 of u. K. Trade is with eu, and now you are going to make it more complex, with brexit, and then on top of it, you just drop a pandemic. Davide, thank you so much, davide serra, chief executive of algebris, for some much needed perspective on the markets. Coming up, the bank of england takes decisive action, the lockdown begins in england, and the second wave of coronavirus is the u. K. We will discuss that next, and our guy johnson speaks to governor bailey a little bit later on. This is bloomberg. This is bloomberg. Francine this is bloomberg surveillance. I am francine from london, and this is special coverage of the u. S. Election, 2020. Of course we are day two. We look at all the votes in the remaining states we look at what the markets are doing. The bank of england and boosting andbond buying program, policy makers of course voted unanimously to we have been talking about it all day. To increase their Asset Purchase Program by 150 billion pounds. They are keeping benchmark Interest Rates at a certain percentage. We will speak to governor bailey a little bit later. Businesses today are looking to tomorrow. Adapting. Innovating. Setting the course. But new ways of working demand a new type of network. One thats more than just fast. You need flexibility to work from anywhere. And manage from everywhere. Advanced technology. With serious security. And reliable coverage, nationwide. Forwardthinking enterprises, deserve forwardthinking solutions. And thats what we deliver. So bounce forward, with comcast business. Pres. Trump millions and millions of people voted for us tonight, and a very sad group of people is trying to disenfranchise that group of people, and we wont stand for it. Mr. Biden it is clear we are winning enough states to reach 270 electoral votes to win the presidency. Im not here to declare we have one, but we have won, but im here to report that when the count is finished we believe we will be the winners. Of in the first light thursday morning in america, we welcome all of you worldwide and across the nation, perhaps a president selected today. We will get to the data, lots of other conversations as well, a really important conversation coming up in moments to the local response we are seeing out of washington, but it is election 2020. What you need to know right now is a wide set of states still up for grabs. We will go through those dynamics throughout the show. Francine . Francine first lets look at data check. Of course, we could see a razorthin majority or a win for joe biden. We have to be very careful. Toare waiting on about four five states, but we are also looking at the senate, and this could change the composition of the u. S. Economy. The markets are pretty much focused what they found out over the last 48 hours. Stocks rallying globally come investors piling into technology and health care firms. I guess what they are betting on is that the u. S. Election re