Significant challenges. Hedges rise, oil falls for a cplus talks ope are delayed for a third day. Crude had capped its biggest monthly increase since may. Heading for the exit. Unicredits ceo is stepping down after four years at the top of italys biggest bank. It comes amid clashes with Board Members over acquisitions. It is 6 00 a. M. In london, 7 00 a. M. In vienna. We are where we are supposed to be. You wanted to start with oil. I absolutely applaud the decision. There is this line that the prince threatened to resign. My question is simple, is that petulance, posturing, or productive . Good morning . Morning. Annmarie i am certainly sure it is not productive. They are meeting on thursday. A brilliant note overnight saying that like with everything with opec the first day, there is always drama. She compared it to as much as drama you would see in an episode of gossip girl. A lot of infighting. Usually, you and i will report on it between saudi arabia and russia. This time, it is really between saudi arabia and uae, which are stalwart partners for the most part. Manus absolutely. This is all about complaining about the attribution of the various cuts. Just circle back to Global Markets. I like Michael Avery who was with me over an hour ago, he said we are in the halo effect, which is we are pricing everything to perfection. Global markets are rocking it out. What have you got . Annmarie we are starting december to the upside. Chinese equities outperforming after fresh pmi data. Factory orders all over asia doing well. U. S. Futures also pointing to a bright sunday. Under 48n 0. 6 , just a barrel. This comes as opecplus deals with drama. Bitcoin, another record yesterday. Today, down 0. 4 . We saw this three years ago and then there was a record but then an epic plunge. You usually call this the millennial gold. Will it actually stick . Manus i will go all tom keene on you and ask you the question whether it is an existential threat to gold from bitcoin. One breaking news line coming through from Credit Suisse. We saw them change ceos this year. A new suisse proposes chairman to the board. Former life, a lloyds. Lloyds announcing charlie nu nn as their new ceo. This is moving to change the top of Credit Suisse. We will dig into the changes at the top a bit more. Lets pause. We will get into the market for a moment. You look at the changing dynamics across the performance. This is a man that led floyds, had a great deal led lloyds, had a great deal of Retail Banking experience. The two main stories are that, ta suisse, and being Credit Suisse, and being challenged. A great there was opinion piece about the fact that this was a french man working in an italian Banking Industry that may be he did not have the political chops for, but he certainly had the financial industry chops to do the job. Thet of movement within Financial Industries and Services Industries this morning. Manus i like it when you bring your interamerican to the show. He just did not have the chops to do the job. We will leave that thought there. Lets talk about the risks in the world and in the markets. The prospects for the Coronavirus Vaccine has caused global stocks to drive 12 higher in november. 20 rna shares rose yesterday after the company moved ahead with plans to request emergency approval for its vaccine in the u. S. And europe. I think its going to be like a typical flu vaccination, just at a scale that has never happened in the world in terms of the number of people being vaccinated at the same time. Its like a regular shop. That shot shot. That Jerome Powell warned the u. S. Economy remains damaged and in an uncertain state. Is the head of Global Market strategy and investment at natixis. You share the optimism but say we may need to diversify away from the u. S. To achieve same level of returns as this year . Good morning. Esty good morning. I think that is very much a can consensus view. We saw in november moving from more defensive sectors, more slick google sectors cyclical sectors. Other regions such as europe needing to play catchup, much more cyclical over there. I think we are going to see that rotation continue for some time, as long as the vaccine news stays positive. Annmarie my question is the fact that, are we at a point now where there is no more vaccine news to be priced in . You saw the moderna news yesterday. That gave a bit of an uptick to the market, certainly from moderna itself. Have we reached a point where all of that is priced in . Esty i think that is the big question, right. So many of these views are positive. We have got encouraging news on the vaccines. A number of hurdles and questions remain. Logistics still one. There is one of mid2021 in terms of broad distribution. Even at the end of december, they can get a few shots in, we do not know how long immunity lasts. We do not know if the virus can mutate. Quite a few questions still. And then, luckily we have a number of different vaccines, but we need a lot of people to get vaccinated at the same time, which we have also not really seen in the past so, mostly priced in. I would expect some head caps on hiccups on the way. Manus i am always interested in trying to find the underappreciated and under consensus of use. If i look at tips, inflation bonds relative to treasuries, they have beaten treasuries for the second year in iraq. The breakevens in a row. The breakevens are beginning to turn higher. Is this an underappreciated risk . If so, how my eye position for it in 2021 . Esty the question for inflation is, are we too late or too early . Tips have done well for the second year in a row, outperforming. I am not so worried about inflation. As we get vaccines, as we start to get back to normal, we are likely 12 easthear we are likely to at least conversations least heartion at some conversations about inflation. At some point, Inflation Expectations are bound to rise a bit further. Talk,ie expectations of but you are not going to actually start pricing in inflation in 2021 when you write your outlook note, are you . Esty not at this point. We have had qe for a number of years. Even if the speed or scale has increased in 2020, that has not really led to much more velocity of money. So not much from an inflation perspective. The second question is inflation stimulus fiscal stimulus. We certainly need the second round from the u. S. We need the europeans to get together as well. The fact that we did not get the blue wave or it does not look like we are going to get this blue wave, i am not sure fiscal spending will be big enough to boost inflation next year. We will get a bump this year given the shock from covid. On a core measure, i do not think it will not it will be enough for 2021. Annmarie we will talk about fiscal stimulus in a moment. Esty dwek from natixis Investment Management stays with us. Lets get a recap on her first word news with laura wright. Opec is delaying talks for two days to give ministers more time to reach a deal. Thats after a long and tense meeting on Oil Production broke down without agreement. The nations are discussing whether to increase production in january as planned or maintained the cuts to help a rally in oil prices. Chinas economic offensive against australia could end up backfiring. Spat,amid an ongoing beijing has ramped up tariffs on a variety of austrian tariffs. It is a warning for countries not to criticize beijing. It may end up punishing some asians closer to the u. S. Bitcoin has had a record, beating its previous high set in december of 2017. It takes this years surge to more than 170 . Even with the recent rally, bitcoin ownership remains concentrated, with a small number investors. About 2 of accounts control 95 of positive digital assets. Global news 24 hours a day, onair and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Annmarie laura wright in london, thank you so much. We hear from our exclusive interview with Michael Corbat on bidens treasury nomination, janet yellen, u. S. Stimulus, and bank bonuses. How big will they be this year . Stay with us. This is bloomberg. Manus its bloomberg daybreak europe with me, manus cranny in dubai and Annmarie Hordern. Staying true to his pledge of a diverse administration, joe biden rolled out his formal nominations for the economic team. Janet yellen will lead as treasury secretary. Citigroup ceo Michael Corbat spoke exclusively to David Rubenstein about Janet Yellens nomination as treasury secretary and why the u. S. Needs more targeted stimulus. I would say that not just citi, but i think the Banking Industry had a Good Relationship with her. Into or if sheed is voted into the seat, i think she will do a great job. I would expect that relationship to continue. Anotheralso shout out Glass Ceiling broken in terms of her then becoming the first female treasury secretary. David lets talk about the economy for a moment. There are many people around the country who think the economy could use another stimulus bill. We could not get one so far before the election but may be in the lameduck there might be one, and may be in the new congress. Do you have a view that the economy needs a stimulus bill in order to get forward go forward before we get a vaccine . It is unclear whether we will get that new stimulus package between now late january. But i think if we do not get something done right now, i think we will get something done in probably fairly early 2021. I think the question is not going to be the if, but i think its going to be more about the. Ize and what can get passed i think that will be largely determined by the outcome of the senate races in georgia. With covid19 cases on the rise right now, additional stimulus their unemployment checks, ppp loans, rebates are all helpful tools to bolster the economy. While also helping individuals to recover from the Economic Hardship of the pandemic experience and what we know is that while we are all in the same storm, we are not all in the same boat. I think if we can get these moneys targeted at those most be ated, i think it would very good thing in terms of helping restore the economy otherwise quicker than it would. David lets stay we have a stimulus bill. Some people have said we could use one, but on the other hand, we cannot ignore the fact that the debt is rising quite rapidly. We are having a budget deficit now of about 3. 2 or 3. 3 trillion per year. We are borrowing about half the money we spend each year. How much longer can we keep borrowing this money without people in wall street or in the general economy saying this is too much borrowing . Are you worried about that . I am. I think we should all be worried about that. We have been talking about deficits for a number of years and what is sustainable. I think the consequence and the prospect of lower for longer in terms of Interest Rates obviously significantly reduces or holds down that borrowing cost. We cannot believe that rates are going to stay necessarily where they are forever, so weve got to be mindful. Thats why i believe that it is actually very important that we are targeted in terms of getting the moneys to those that are really in need. Because we know that the longer this goes on and the more small business, the more individuals, certain geographies, neighborhoods get affected, it just makes the come back from that much more difficult. I think we have seen that and that has been proven from a historic perspective. Group ceocitigroup Michael Corbat. The full interview this friday, you dont want to miss that. , senatewith stimulus Majority Leader Mitch Mcconnell has urged congress to pass virus relief legislation covering areas that both sides of the aisle agree on. Thats as lawmakers face a rapidly approaching deadline to pass a new round of aid. Esty dwek of Natixis Investment Managers still with us. What do you make of the stimulus right now . Are governments losing the firepower . Can that have serious impacts as we head towards what many are calling a dark come along winner dark, long winter . Esty absolutely. Thats one of the questions. We want to make sure that politics does not take over for necessity. In the u. S. , we have a number of Unemployment Benefits that are going to fall off at the end of the. Thatee with mr. Corbat some targeted measures need to work and we need to work for them. We know we are not getting the 2 trillion stimulus the democrats were hoping for. They do not want to hold up what is really critical stimulus for a lot of areas of the economy. There are plenty of areas they can agree on, including airlines, including Unemployment Benefits and consumers. I think we will start to see some of this. We might have to wait until january, but the problem is right now on both sides of the atlantic, its a lot about politics. Its about the Georgia Senate race. Its about which type of strategy or size of stimulus is going to help the different sides the most. In europe, obviously purely about politics and not at all about economic necessity. That narrative is about where the dollar goes. The whole world is short and aggressively short. Into hat carry through 2021 . Esty it should, at least at the beginning, and at least to some extent. The more Risk Appetite recovers, the more we think about getting all of that is definitely going to weigh on the dollar. There is also flip side of other areas, especially emerging markets, starting to recover better and benefiting from this as well. The consensus factor is what troubles me a little bit. I think the fact that growth is going to be probably better in the u. S. , the next fiscal impetus is going to come from the u. S. , earnings are probably going to be better. Ultimately, when you look at the developing world, there are not a lot of areas where you can get positive yielding debt. It is about Investment Grade come about credit, about picking up Investment Grade, about credit. Annmarie does this mean you are going to head east and look to e. M. In china for that yield pickup in bonds and currencies . Esty absolutely. In terms of currencies or local currency bonds, you have to be selective. There are plenty of idiosyncratic risks. The Chinese Growth Engine is back to 2019 levels and moving along. The region in general is benefiting from this. It has handled the virus situation a lot better, so there winter is not going to their winter is not going to look as tough as ours. China gives you a nice yield on your bonds. We have seen a lot of flows into that and i expect it to continue. Manus those yields at the highest since 2019. Esty thank you so much,. Esty dwek, head of global microstrategy over at natixis. A multibilliondollar tesla is set to be added to the s p 500 are you ready . Christmas is coming early. It could send a ripple through the entire market. We have the story. This is bloomberg. Manus it is bloomberg daybreak europe. Dubai. Nus cranny int tesla is to be added to the s p 500 later this month. It will happen all at once. Indices announced the decision yesterday. It had previously been considered that tesla would arrive in two parts, given the massive size. It is coming all at once. It is like christmas, isnt it . Dani exactly. Christmas could have been divided into two days. Christmas for tesla and s p 500 happening in one day. Jones also surveyed a lot of other investors. You have to imagine that wall street traders have a massive a lot of confidence that they can handle this massive rebalancing cupping coming to the market. Tesla will be the Largest Company ever added to the s p 500. There are a lot of Money Managers who need to readjust their funds in order to continue to track the portfolio. Confident there is enough liquidity in tesla, in the market itself to handle this at just one time on december 21. It is like ripping off the bandaid. Either way, there would have been a disruption. It is better to do it all at once than try something new. 538 billion worth. What kind of Market Impact can we expect when we do see the move . Dani on the day that indexes have to rebalance to include tesla, the market is going to be absolutely flooded with trades. One strategist estimates that 72 billion worth of trades are going to occur on the rebalancing day. Let me put this in context. The average rebalancing day is less than half of that. The prior record for a rebalance was 50 billion, so about 20 billion less. The volume is going to look a little bit strange as this happens. Either way, this really would have had to happen, its just whether it happened in one or two parts. Passive Money Managers that track the s p 500 are going to have to offload other companies in order to make space for tesla. Either way, this was set to be a disruptive event. Manus thank you so much. Dani burger there in london. You canet our ubers, get a tesla to come pick you up. We are green. Up, greene coming schism. Oil falling again. Aecplus seeks time to reach new deal. This is bloomberg. Its moving day. And while her friends are doing the heavy lifting, jess is busy moving her xfinity internet and tv services. It only takes about a minute. Wait, a minute . But what have you been doing for the last two hours . Delegating . Oh, good one. Move your Xfinity Services without breaking a sweat. Now thats simple, easy, awesome. Xfinity makes moving easy. Go online to transfer your services in about a minute. Get started today. Annmarie good morning from bloombergs european headquart