According to people friendly with the matter, they have had discussions about a potential acquisition or joint venture. Verizon is interested in aol technology that deals with the automated buying and selling of ads online and wants to expand its mobile video offerings. New Republican Congress goes to work in washington today. First thing on the to do list, keeping the fight in the family. John faces the challenge to his leadership from two house republicans, one from texas and one from florida have announced they will run for speaker. Their chances are slim. They would need to find 30 republicans were willing to vote against john boehner. In florida, samesex marriages are now legal. The dan was originally set to expire today, but couples in miamidade council got an announcement when the judge cleared the way for samesex weddings to begin a day early. They are now legal in 36 states and the district of columbia. Katy perry is rehearsing for the super bowl starting today. You will be up to look at talk about toys. Gadgets at the Consumer Electronics show in las vegas. 160,000 people will gaze in awe bedrooms. Plenty of cool things there. Bmw gave a preview of a self driving car. It remains to be seen if bernanke really will be seen with google glasses because they are so out this year it remains to be seen if Brendan Greeley will be seen with google glasses because theyre so out this year. Talks never. Access to a data check. No other story out there. Futures were negative. Tenyear yields, two point 0 . The euro, not much and the yenn is stronger. Ymex is draw jaw dropping. The vix back to its longterm average. Brent crude, 51. 78. Ruble sometime yesterday gave it up, obviously, linked to the intervention. Much weaker rbule. 75ish was the panic of a number of weeks ago. Lets do the 56. 59 number. This is totally esoteric. This is the wait out the yield curve spread. The difference in yield between the 10 year and 30 year, here is the gloom. Heres the 30 year lower than the tenure. Then we are better. This is lehman, the crisis of 20082009. It is interesting how we are getting near that again. Do you think the future is going to be any better than the present . This is the Larry Summers index. It are looking at something cyclical or this is people realizing they did the future is not going to be better bloomberg surveillance. In cash under the mattress, little bit. You cant put it on the mattress, by a 30 year bond. There it is. I want to make clear that is not something we look at every day. Dont try it at home. The implosion continues. Oil truly pledged at 4 30 with a median effect across Foreign Exchange and Interest Rate markets. Future site. For perspective on important Tipping Points along this way, we want to bring our guest, an expert on the nations budget and those plugin numbers they give us believe in what the budget will be. And also, a Market Strategist at Prudential Financial with decades of experience. What is different this time around . You and i have seen this before. What is the new new . You have had the fed and draghi 20062012, bank of japan, coming in constantly, consistently, and getting the markets to be happier. Getting the markets to say, ok everything will be fine. Everything is working . Obviously, it is in. We have been trained to instinctively buy on the dip. You are going to buy on the dip. Is what were seeing just a repricing of assets across equities, bonds, currencies . Once you have that kind of quick plunge in any commodity, any asset, it is going to bleed over and that is what youre seeing. If i understand you correctly, youre saying on a terry policy had an effect and now it is a psychological effect. We are going to see. Everyone is expecting mario draghi to come in and go into qe and we will see what kind of effect that has. We will see the fed comes out with any word other than patient to see whether or not january 22 meeting right . Sorry, i did not mean to interrupt. Youre so excited to be back from boston. It is warmer. It is definitely warmer. I used to live in boston, met my wife there, and i left it was 20 degrees. I said, thanks, goodbye. I need ask about the oil prices. Weve been talking about the net positive for u. S. Economy and consumer. Has oil prices gone from being good too bad for the u. S. Economy because of the persistent decline . When youre looking at the economy and then there is the stock market so we see bleeding into the market. The question is, how many layups are you going to have in texas and north dakota . In fact, the numbers are not that astounding. When you do the equilibrium on the equation, it is oxley better for the overall u. S. Economy. These are not petro states but diversified economies which have oil and gas. Exactly. Mind you, you go to houston and a lot of what you see is oilrelated, but we hope they learned to diversify a bit. Is it going to be painful . Sure. Real Estate Agents say they already here, im not buying that yet to see were oil goes. In the skyline of new orleans when oil crashed. Exactly. Overall, it is better for the u. S. Economy. Does it change the way washington perceives this year, especially as a tackles along to do list . First of all, it does put more money in the hands of consumers. If you look on social media youre seeing euphoria about what people are paying to fill up their tanks. One of the biggest users of fuel in the United States is the defense department. It will have a positive impact on the budget. It will put a little more downward pressure on Interest Rates in general. It is only a matter of time between one of two things happen or both, one, as you talked about yesterday, Larry Summers was pushing for an increase on gasoline tax. The second is, at what point to we Start Talking about or does congress Start Talking about a bailout for Oil Companies . That would be an interesting one. Stan collender with us along with Quincy Krosby. We want to bring our twitter question of the day tweet us bsurveillance. Good morning, bloomberg surveillance. I am told the fog pervades in washington. A perfect metaphor for the beginning of a congress where everybody is back in washington. And we have the arctic breeze , putting it kindly wafting the northeast. It is called winter, right . They will cancel something as the sun rises in the east. One thing is certain, washington could care less about what markets are doing, rather, political elites return to the Nations Capital and are ready to inflict budget process. We begin our coverage with Philip Mattingly in washington. What i want to know is, who are you going to watch . I cant keep track of the players i know come the players i dont know. What is the back story . Who should i watch . Tom, you naturally gravitate toward the leadership position, but there is a time of key numbers the hind the scenes that i think are very important. Not necessarily the people you dont about, but those who have relationships with the white house or work on issues at the white house is about. The top one on my list is senator bob corker from tennessee, republican, very, very involved with Foreign Affairs but also willing to move into the center and try and make deals. On one of those issues, transportation funding. He is a bill to raise the gas tax, something most republicans wont go near. When it comes to issues on Foreign Policy and fiscal areas, you can count on bob corker to try to get into the white house. It is whether the white house will help him out. Does anything happen before the state of the Union Address . Will probably be most interesting is if republicans find a way to force the president s hand on key stand, to force the veto by passing bills. The senate will start to move on keystone xl pipeline build this week. The house could start as late as this week. That is probably the main thing. In time, you will see a lot of positioning. House republicans will start to move bills quickly and Senate Republicans see what they can do in trying to keep the process open. Democrats are queuing up a ton of amendments that would be problematic for anything they want to do on the messaging side of things. What is going to be interesting is seeing how piece of all people position themselves before that january 20 speech. How we understand headline i saw in the New York Times which was republicans eager to show they plan to govern starting with the Keystone Pipeline. The Keystone Pipeline is politics. It is theater, not economic policy. But, you have bipartisan support. 63 64 people are already on board in the senate for this bill. That is a couple of democrats on there as well. It is not necessarily a policy issue they can move forward to show they are governing, it is more important to show their actually able to compromise. Find areas of agreement with democrats, show they can move things forward, something say say senator harry read was incapable of doing over the last six to eight years. The bills will not be all policyladen, but they will be there. Expert on the game, Stan Collender decades and watching washington and run in phone books on budget analysis. What is the new new . How theyre not going to get things done. The bottom line, youre right, it is going to be the same. At the end of the year, very little will be accomplished. But it will be not accomplished differently. With the market turmoil, do we have any believe the plugins the cbos use as a trend again the budget . Probably not. Theres a lot of turmoil now with the new cbo director the assistant directors term expired january 3. The question is whether republicans will lose it use it to appoint a new director that believes in fervent dynamic scoring . We of been hearing hits of it. Do you think they will go for this or is it out of sheer habit . Cbo does do dynamic scoring they just dont do it to the extent that a republican majority wants. I dont think there is any doubt they will get a cbo director who will be willing to push that. That will be the litmus test and make tax cuts look less expensive, not increase the deficit is much, therefore, not be as big of a procedural hurdle. This shows you this is more political. This is not a question of compromising and getting things done, but a question of showing our constituents that you are willing to support what they want. That is so discouraging to hear for those who are cynical that both sides can work on something governing together, i know youre skeptical, can you give us any reason to be less skeptical about what is going to happen in washington this year . Actually, no. Thank you for that. So were finished. You have been wonderful support to surveillance deficit is under 3 . That is a miracle. That is phenomenal. It is. We have had taxes going up, tax revenue going up across states and across the federal government, and that is one of the reason, by the way, that the supply and treasury market is down. Are there going to be fewer bonds . Absolutely. The deficit will keep falling and baseline assumptions to about 400 billion. Do you believe the prices of debt will be bid up and the yields come down . I think it has been going on for the last 8, 10, 12 months, actually. One of the ironies, under the republican majority in both houses, chances are fiscal discipline will go down, that the deficit will be higher. How do you know that . Look at what theyre pushing. Tax cuts defense increases additional money for the highway trust funds. Where is the discipline . This is the problem with dynamic scoring. There is evidence tax cuts have this effect, but it is, how big to make the multiplier . If you have the discretion of the cbo director to put a huge multiplier on tax cuts, you can get away with anything. The good news as far as market watchers are concerned the final say on where the scoring goes is done by the office in management and budget. Cbo may provide the numbers for what congress will do, but ultimately, they do not decide whether it loses money and by how much. Then it could be dynamic for government expenditures. Exactly. Stan collender with us as well as Quincy Krosby. Coming up, mr. Musk tesla, Cape Canaveral, spacex. Does it have a tesla engine . It will be launching from Cape Canaveral air force station. Theyre going to put it up with a satellite, but even cooler part of the falcon rocket is supposedly going to be recovered in the ocean. We will see. I dont know how they do that. They built a test like they can do this. We will come right back from bloomberg surveillance. Good morning. Good morning, bloomberg surveillance. Rubel went to 64. That is a spike in weakness. It has little bit of a bid right now. Different institutions in russia affecting the rubel, but 64 is a very weak ruble. We need a morning mustread. Shinzo abe writing the prime ministers of japan writes Quincy Krosby this is interesting to me because japan has not had a monetary problem but a demographic problem. This finally seems like its ready to take on a demographic problem japan has. There are other ways to do it in one way is immigration and making it easier for immigrants to come in, which japan has been loathe to do forever. Women have been, basically, kept at low levels and they need to have more babies because you to bring up the population down support the older ones who are retiring in droves. It is a natural solution. But you have to give the women the jobs and you have to supply babysitting for the babies. Universally, this is a tough problem, allowing women to work and families to grow. This is a poly issue policy issue we have not done well. If you look at scandinavia and germany, that a better take, particularly, scandinavia. The fact is, this is one they need the population. They need the income from the younger ones to help support the older ones. And they live a long time in japan. In the u. S. , at least we have a much more open immigration policy than japan. What theyre asking for in japan, sounds like a much taller order. Nominal gdp under 1 gets your attention to show the challenge of the demographic economics. Stan collender when you hear people in the media say, it is like japan, how do you respond to that . That america is becoming like japan or europe is becoming like japan . Do you believe it . No. There are 70 structural differences between our economy and their economy. There are so many structural differences between our economy and their economy. You have done this for years in washington. How do you respond to this malarkey . Did i editorialize there . Malarkey is a technical term. Jargon alert. Please, thank you. In washington, yet people responding to soundbites as opposed to facts. The facts seldom get in the way of the soundbite. Really. Im sure you are shocked at that. Another thing that came out of the oped, with the id is open to moving the Transpacific Partnership forward. What is left unsaid is japanese farmers are really going to have to accept the terrorists are going to go away. You were there this year. Is that something they are ready for . It takes a very long time to get anything done in japan. I can remember the state of washington apples, the negotiations, you wouldve thought it was Nuclear Disarmament talks to get South Carolina rice into japan to get apples. It you know what happened, when the country collapsed, suddenly, they opened up much more quickly. That is rapidly not as rapidly as we would like but much more quickly. You have investment banks. You never had that. As the new progresses, if they cannot get the economy going they will move. Futures just went green while you were talking. There you go. Moving the market higher up to positive two from negative three. We will continue with the risks internationally. Joining us from Eurasia Group as we look at a troubled europe. Stay with us. Good morning, it is bloomberg surveillance. If it is tuesday, it must be taken at all. They will try for a launch on friday. This is mr. Musk and a private effort to put things in space. They will put this things up with a couple tons worth of stuff laser equipment, i dont know books from the Economic Association . They are way too heavy. And try to take a rocket and capture it in the ocean so they can reuse it. That is what is fascinating, this is not the last time you will see that rocket and that is what is different. Like theres a tesla x rumored to be there. Do you think elon musk is on hand for this . I dont know. There it is. This is just further proof that iran musk is a bond villain. Even his name sounds like it. I know. We will give you coverage on friday. Lets save ourselves and go to top headlines. The sun appoints got Capital Management has been charged with murder. 30yearold thomas burke, junior shot his father in the head and then staged the scene to look like a suicide. The younger gabbert was arraigned in manhattan criminal court, being held without bill. Trying to expand the official intelligence technology. The social network is buying an 18monthold startup that force hundreds of applications to detect spoken words. Mark zuckerberg has been stepping up investment in research and Artificial Intelligence since last year. Threetime cy young winner Pedro Martinez among several retired big leaguers awaiting a call from the hall. The Baseball Hall of fame announces Election Results that are today. The former Boston Red Sox ace is among 17 valid newcomers. Others include Randy Johnson [no audio] these are three diffe