Meet the inflation target of 2 and one of the reasons the National Sales tax increase that has slow down consumer spending. A sign of progress on one front between russia and ukraine. Russia has agreed to resume natural gas exports to ukraine just as temperatures turned colder. Russia had said ukraine was billions behind in payments. Agreed to ahas partial payment of more than 3 billion by the end of the year. Meanwhile, rebels have stepped up their attacks on Ukrainian Forces despite a truce brokered last month. New problems for citigroup. Citi is facing a criminal investigation into its foreignexchange business and a six hundred Million Dollar charge for legal expenses. It says it is cooperating with criminal and antitrust investigations in the u. S. And in the u. K. And switzerland. More Management Changes at twitter, which has seen a few this year. Twitter has named kevin wild of the head of product. He has been in charge of revenue product. He is the fifth product chief in five years. Twitter has replaced its cfo and ousted its chief operating officer. Ceo dick costolo talks to bloomberg west about it. Managements grow and change over time and that is always the case. I love the team we have in place. We have developed all sorts of tremendous news across the country. Across the company. Thewitter use slowed in fourth quarter. And basketball, the New York Knicks spoiled lebron james homecoming. He played his first game since returning to his hometown cleveland cavaliers. He made eight turnovers, and the knicks be the cavs 9590. Emotionalit an evening. I just try to focus and maintain, focus as much as i can. I am glad it was great, but i am also glad it was over. You call him mr. James, not king james. I think he gets four electoral votes in ohio in 2016 as well as it is great to see excitement return. Has 300 ballsks this year, 400 balls. On Carmelo Anthony comes out ahead on summary lecture me that mr. Anthony is the real superstar. I was like ok. I do not know that much about basketball. You have got to stop turning to me for sports about which i know nothing. Sportssurveillance report will be with you on monday. I will look at to data screens this morning that this is history in the making, futures up 23. They have advanced. Europe has not done much, euro has not done much. It is weaker, but nothing like the yen. We are on an 80 watch on American West texas intermediate. The vicks a lovely 14. 52. What is where we are, hundred 50 points from a record eye on it, the dow. Much weaker japanese yen and gold takes the cake showing deflation worries down 26, 1172 an ounce. Ok, screen one, the money screen for pros, longterm stronger trying to dois this, trying to get a weaker yen with his action overnight, he breaks through the three points back 15 years. That is years in the making of the yen. With all of the skill i can muster with no sleep, im going to try to do this right now. This has never been done before, folks, on television before, this is the first time, help me here, scarlet, with the pronunciation, the yen yuan. Yen yuan is how i would say it. Here is china doing better, and this is the massive japaninduced strength. Remember, scarlet, this directly taiwan, singapore absolutely, especially when you consider how much japan is helping. Is this a mercantile war . I do not want to get anyone in trouble, that yes, this will be a great concern. We keep talking about currency wars when in fact what is going on is nobody is willing to do any of the other things that we political institutional things that central bankers as they make decisions are the only people in any continent that can do anything that the only adults in the room. Says he you at ubs looks for a currency crisis in japan. It was a historic japan, capitulates further in a decades long fight against deflation, and the ramification. They are profound worldwide interview as well as. Asia willall of adjust. We are thrilled to bring you this morning john herman. He works for a Japanese Bank and is expert in the granularity of the u. S. Economy and the view from 70,000 feet above tokyo. Jerry linger with us to provide great perspective on the elections coming up tuesday in the United States. John, fortunate to have you here. So nice. Inlain for us the difference the punch bowl in washington versus the punch bowl this morning in tokyo. I was just over it tokyo visiting my equity and fixed income accounts two weeks ago when we had the big melt off. What is the level of desperation in tokyo . Where i thought was amazing as the equity accounts were very calm, and he fixed income accounts that i saw, who normally are long fits income products, i thought they were then very happy, but the fixed income account was very nervous, and the equity accounts looked very confident,s and i can see why he we are about 10 days later it all makes sense because they said there were going to increase their equity positions in the investment, and the National Investment fund, and then theyre going to cut the bond holds. The german yield grinding every lower, the japan 10 year yield is where we were in 2003 when japan completely screwed up. What does that signal to our viewers . You have longterm the eurozone and germany, they look almost identical. We think each of these will have to start sovereign debt, qe sometime next year, we thing more in the first half. That means for us german bond yields grind down to 50 basis points, and they sort of equate with japanese yields. I think that should be the single for the rest of the world that we are in a very sort of a low rates more moderate growth, low rate environment for extended period. Were looking at Exchange Rates like this, this is all a monetary problem, but what about the other two arrows of abenomics . Structural reform and stimulus. It is very hard to enact the Structural Reforms first hand second thing is just the actual implementation of getting traction on it is a long way in coming. Just look at the euro zone economy as well. In america, we have our own problem, by the way. 90 Million People outside the labor force, and over the next a hundred, that is 50 Million People outside the labor force. Theears and older out of labor force. We are not the only ones that europe, same deal, even worse. I want to stay on the overseas market. Now that kuroda has done this, does it raise the bar for mario draghi . Is anone says this explicit currency war going on, but obviously it is a tacit currency war going on. It suggests that if you are the First Central Bank like janet yellen, if you are the First Central Bank to start hiking rates, you are going to get a hammy. Wher we will continue with mr. Herrmann here on japan in a moment. There is an election on tuesday. We have great and even and confident perspective on this strange thing called polling as we go into this tuesday. What is your confidence and midterm polls statebystate, governor by governor, senator by senator . It is different than a president ial race. Absolutely. You have to take each one with a grain of salt and look carefully under the hood. Right now, things overall are looking strong for the Republican Party. The request and i have is whether or not it turns into a wave. When you look at the staples, level, isat the seedy this simply going to be a generalized to strong election but caught in the trenches statebystate, district by district . Senator from kentucky feels regret, he says run up the score. As you go into the weekend, can republicans run up the score . It is not out of the question. This is another election of the publics discontents, the ramifications across the globe in the United States, the economic discontent in this country is profound and is continuing and is impacting our politics again and again. Look at the last several elections. We elect a president and then deliver a karate chop to his political party. Then we do it again, and we are bound to do it again. And reason as we are discontented with the way things are going economically and through that is political the satisfaction. Tom, just to echo garys thoughts come i put up a chart that ran twice this week and i looked at the real income recovery in wages and salary and i looked at it, benchmarked it versus every Economic Cycle since 1950, and this is by far we are 78 months, by far the weakest since the 1930s first thing, and secondly, we are rarely above break even point. Rates thet hiking the way some people are thinking about next year, you risk rolling that over and this is a follow on of all we are talking about this morning. All of the issues we are talking about are completely irrelevant. This is a general frustration with stagnation that has been going on for 25 years in median incomes. It is not anything that any president or congress can do. It is a double punch, and it is about that economic discontent but also about political discontent as well. Rudderless ande washington, that these guys cannot get it together and get anything done. The central bankers, the only grownups in the room, that is part of public sentiment. Does he know we have commercials . [laughter] tom, listen to this window if you look right now at the share of employment that people 50 years and older have versus people young age people from age 16 never been wider. 50 and older outnumber the people employed as a share of total implement versus young people from 16 to 35. It is on believable. And herrmann with us, history and japan today. Coming up, we will continue our conversation. In our next hour, Julian Robertson joins us with Tiger Management. What a perfect day to speak to mr. Robertson. We have a twitter question as well. Here we go what scares you the most in the markets right now . Tweet us bsurveillance. This is bloomberg surveillance. Brendan is going as elsa. I am going as the snowman. That is no treat, that is just tricking people. We still have singing after halloween . Good morning, everyone. Pretri ofhomas petrie partners, looking for that scum of the 10 00 a. M. Hour on Market Makers this morning to get you ready for your halloween, your hydrocarbon weekend. This was so stunning out of japan. Absolutely. Kuroda threw everyone for a loop by adding to stimulus. And of course after that another big announcement, which kind of gets buried here, japanese Pension Funds that it would put half of its holdings in local stocks. Start John Herrmann with us from securities. J this looks like a very coordinated action because it is a onetwo punch, the bank of japan says i will be buying more debts, and then the Pension Funds as we will be investing more, selling the debt to you and investing more in the equity universe, so it is a good thing. What kind of questions do you anticipate, what you speak to today when you get off the surveillance set and answer questions about the economy . I think this policy announcement, im not going to say a little bit discussed behind the scene in japan, but it looks like it very much was because when i spoke to the largest equity accounts 10 days ago in japan, they looked very confident and very calm during what was a very volatile time in the equity markets globally. Now i can see why. Looked verys nervous and now i can see why because they are being pushed out in the universe to be biting other product. We saw that with the nikkei to 25. I will review an announcement from last week the risk of the inflation targets come into sight, disorderly rush to the bond market, exits will ensue that the result is yields will have farreaching consequences. Japans angst, major holders, and bonds will face a major loss. Youll not get something for nothing. Are you worried about that . The banks in japan are insanely wellcapitalized you have to talk about the future challenges of Mitsubishi Ufj . Powerful. Ry a quick question here for gary. You are here to talk to us about how voters anticipate the election next tuesday. We have artie seen futures up right now. Voter sentiment particularly. A lot less than you might a lot less than they used to. Why is that . Most people who are invested in the stock market are there passively. They will check it when they retire, and they are not trading on the market, therefore they are a sphere thing life, if you will come outside the market, and what they are seeing instead is a still sluggish labor market with more dropouts than job growth and flat wages come in a flat wages are critical. Americans feel as if they are doing less well because for about seven and 10 over the last generation, it is true, real income is not flat but declined lack arican ts who college education. It impacts their attitudes about how the country is going about how the politics are going, and the answer is not well. The late great marti said dont fight the fed. Should we not fight the bank of japan . Thing. Ink this is a good we need to see it make some traction is in terms of the real economy. We saw what well do sales have done. We need to appreciate the currencies. Up 23, dow futures up 200 points right now. Tuesday, theyre getting ready, with all due respect cong, an Election Special with complete and different coverage for you starting at 5 00 p. M. On tuesday. From new york city this morning, this halloween, it is bloomberg surveillance. Good morning, everyone. Futures up 24, dow futures up 197. History in japan, the bank of japan speaks in volumes, and they create massive further stimulus this morning. All of that of course wrapped into the european and u. S. Economies. It is part of my morning mustread this morning, this is the late great president of citigroup who writes a scathing oped in the financial times, rescueioning four measures, the instinctive antikeynesianism of the teutonic french a masculines countercyclical fiscal policy. Domestic political parallels lysis inhibit structural reform. John maynard scans, yes he was a row person, you should put kurodas face on it. You are enthralled by some dead economists. Stimulate this. They the way, amen about bonus bank and the teutonic french. Fringe. They are obsessed with meeting, balancing their budgets. They are savers by nature. Public and private. Is janet yellen boxed in . Than shek more realizes, and i think more than the market actually realizes because the key thing is we have a flattening in the u. S. , what we have is financial oppression abroad and at home, we have low demographic is janet yellen going as elsa or anna . We have researched this morning from goldman sachs. I want to ask you about inflation japan now, however, in the Risk Assessment of the outlook reports, the price outlook are to the downside, attaining 2 price ability target still looks very challenging. In the u. S. We will not even see a to handle in terms of inflation, 2016 at the earliest. Gary langer, this goes right to the angst of the american people. Nobody is coming home and saying hey, gdp is up, lets party. [laughter] that is the quote of the day. We are going to come back with the humorous gary langer here on the polls as well. Out twitter question of the day the following what scares you the most in the markets right now. Tweet us bsurveillance. Good morning, everyone. Bloomberg surveillance in the store. Surveillance markets really moved in japan. Weve also got other top headlines. Heres scarlet fu. But we need to start with the main one, japan actually, lets start with sony. Narrower than expected Second Quarter loss for sony. Demand for is Playstation Game four consul limited the impact at the writedown at the smartphone business. Sales surged 83 thanks to demand for the p. S. 4. Profit rose at anheuserbusch. Third Quarter Results were hurt by weakness in russia and china. The makers like bud light is the latest brewer to miss estimates. And an exciting game seven allows a 2014 world series to escape an unwanted distinction. Least watched world series of all time. 23. 5 Million People watched as the San Francisco giants held off them. It is the least watched in history. I should add one viewer that didnt get counted is my husband who was watch its overseas through slingbox. On we go. We have breaking news right now, folks, on russia. This after the actions by the bank of japan in what weve seen through october from other central banks. Putin and russia reacting and raised their rate thats central bank. In europe, in japan, in the u. S. , russia not at the zero bound. Thats not even merge market quality. Thats frontier economy crawling. This is what the bloomberg does for the pros. You look at dollar ruble. Heres the anticipation. That was yesterday. This is a normal reaction that you see, but again, the pros reactsed to this but you wonder what it means to the ussian people. You cant fix the fundamentals with the policy. This is the defense of the currency and it was real ramifications on the russian people. Im going to break some news right now. We have a coordinated stimulus for japan, not just the central bank but also tom is here with his sony camera. And not only is he here with the sony camera which he gave forward guy dance on, by the way. Hes been talking about its for two weeks. His screen saver is a picture of the camera on his iphone. Oh, god. Dont go there. Were on air right now. Not now, tom. [laughter] ok. Were going to move back to the u. S. Four days until the Midterm Election and 68 of the voters say they are closely follow the racism thats still high to me because they feel the outcome would make a difference. 56 dont like the president. 67 dont like the democrats in congress. 105 dont like surveillance. This is crazy its crazy [laughter] gary langer, youve been running polls for a quarter of the century. Youre the head of the abc news polling. It seems like the get nothing done strategy that the republicans have been pursuing since january of 2009 has been really effective. Voters hate everybody. Exactly. What the republicans have most going for them is that they are not the democrats. And t