We also have to tightly look at oil. Tom i have never seen an earnings season like this. You have to go back to early 2009 or 2008 for the excitement and mystery of what we are going to see. We have those layoffs, citigroup, and now jpmorgan. On a small number of people. Francine yes. We will be bringing you the very latest off the bloomberg. Lets get straight to bloombergs first world news. Nejra thanks. More turmoil for the brussels airport, only this time it is a walkout by air Traffic Controllers. The airport is already reeling from the terrorist attacks that killed 16 people. Todays labor strike is disrupting flight that the hub. It began over a dispute over the working age of Traffic Controllers to 58. Syrians are voting today in parliamentary elections. Some 3500 candidates combined for the 2500 parliamentary seats. President Bashar Alassad voted early in the elections, which are taking place in government controlled parts of the country. Now to brazil, where the Vice President is drying up plans to form a transitional government. Dilma rousseff sharpens accusations that he is the mastermind of a coup against her. A crucial Impeachment Vote is looming, set for sunday. Meanwhile, the Vice President is focused on reforms to stem the worst recession in brazils modern history. If you want to earn more money, it helps to be a man with rich parents and attend the London School of economics, according to a study of 2600 british grott graduates who tracked them after where the Vice President is drying up plans to form a transitional government. Dilma rousseff sharpens accusations that he is the mastermind of a coup against her. Leaving. A gap in annual earnings between the children of wealthy backgrounds and those from powerback backroads was 11,500 from an. Men. R im nejra cehic. Tom thank you. Lets look at equities, bonds, currencies, commodities. An interesting nuance. Three days in a row, dow futures up. Not near record highs but many stocks breaking up. Strong, reverses a strong euro for two days and pulls back with nymex crude up from the afternoon yesterday. I noticed that the german 0. 52, a numberis grinding lower. An important check. Lets look at european stocks. We opened quite a lot higher on the back of commodities that are gaining 4. 3 with some betterthanexpected news from china. It was strengthening for quite some time and now we have a little bit of relief. Tom lots of relief with range imf leading this weekend there will be announcements from that and the press conference will have a lot of important interviews on economics in the weekend. Where are we right now . Every once in a while it is good to take a longterm view. This is back to eisenhower, lee churchill. We go with the inflation this is the governments 10 year yield in the United States and then down we go, the great disinflation. 2 , is end of the year,. 2 and we rolled over to 1. 7 we continue this longterm n. F flation fo francine filter circuit everything this is the one that takes the best look. This is a very important technical level. We mentioned yesterday but the u. S. Benchmark above the 200 Day Moving Average for the First Time Since july, 2014. This is as u. S. Production continues to decline. Markets ticking higher, and yet there are still so many concerns. If you listened to the imf, there were more risks than just six months ago. We are joined by the Blackrock InvestmentInstitute Global chief investment strategist. Great to have you. We were looking at inflation charts, oil charts, and you have brexit and geopolitical risk. Is there anything that you think we shouldnt be so pessimistic about . The imf cut growth forecasts. I should big clearing a sweet spot for the market and you have downl growth stabilizing to the levels of growth that most people have been forecasting francine but given the Central Bank Policy it is nowhere near as high as we were expecting. Growth is sufficiently strong to remove the risk and the concern of the markets which they had only six or eight weeks ago. Enough asnot strong to be driving any concern about the fed raising Interest Rates in the near term and it got global Central Banks easing. You have to sweet spot for Financial Markets back in the 90s it was called goldilocks. We are in a sweet spot where some of the concerns that have been worrying markets chinese evaluation, the european Banking System, oil price those were big concerns in january that have diminished and the Global Growth outlook looks good enough. I think the transfer rkets is higher. Tom when i look at the idea of where are we now, come on back to this chart this is 15, 30 years of disinflation. Richard, in your study, is there any successful reflation that doesnt involve seismic events like war . Everything we are talking about it surveillance is a policy to reflect do i have that right . You are seeing huge reflation policies in the u. S. We have seen massive quantitive easing and we are now seeing that up from the ecb. When you look at history im not sure how hopeful it is, this unprecedented environment. You have got to consider some of the risks. We see a number of risks out there and people are focusing on less, which looks much focusing on the european banks that has diminished candidly. Risk is the risk that inflation picks up. We dont know how this plays out. We are throwing a lot of money problem and the fed has signaled that it is prepared to tolerate higher inflation at least in the moment that is something we need to watch closely. Tom as a Global Investment strategist, how do i deal in bonds . How do i collected coupon and sleep at night . I think bonds play number of roles the traditional role i aill think is to diversify player really Important Role francine you dont move money . You make a bit of money, but you need something in your portfolio that will go up with the rest of the market goes down. That diversification role, for having long bonds, there are other areas which i think are interesting like that. In the u. S. , its a really attractive place to be, coming back to that inflation risk we had earlier a big gap between actual and implied inflation. There is a lot of good deflation fears still in the market, and we think that may come out francine you are hedging everything. When volatility is back at low levels, i think the primary role is fixed income place in your portfolio. You will not be making big returns Going Forward so you have to inc. About where the risk return is most attractive. Increasingly we take fixed income outside of the u. S. And nondollar looks more attractive because you have the ecb on your side. You have much more aggressive quantitive easing that increase is not just the volume of qe but is moving down the spectrum. Look, where do we think the risk reward is most attractive we look at nondollar. But your point i think it will be very hard. When weascinating time begin serious coverage. At imposing will be with us on friday. Coming up, a brutal quarter for all of global banking. In this hour, we begin with mr. Diamond in jpmorgan we will go beneath the headline data, coming up. Francine its a busy day when we talk about markets and finance im Francine Lacqua in london. Lets get to the Bloomberg Business flash. Nejra thanks. Is filing for chapter 11 bankrupy protection. In joins at least four other companies who see the bankruptcy of the industry as they in do t intertougher environmental energies and a glut that sent ailing steel met steel for tenure lows. Trades were suspended immediately. Jp morgan chase has reduced headcount it is Wealth Management unit according to a person familiar with the matter who says that 30 positions were eliminated or 5 of the jobs this comes as the bank tries to refocus on serving clients with higher investment thresholds. More evidence of stabilization in the worlds secondlargest economy the exports have jumped the most in a year and narrowed. Overseas shipments were up 11. 5 in march from a year earlier compared with a 25 slump in february. The trade surplus decreased to about 30 billion. Thats your Bloomberg Business flash. Francine lets get more on this with the chief asia economist for Bloomberg Intelligence who jointly from beijing. When you look at chinas exports, they are dumping the most in the year. That tells us that they are doing too badly and it is stabilizing but we cant really read into it, can we . , i would quibble with the message we are getting from the headline numbers for a couple reasons. First, the growth rate is really being flattened. There was a huge slump in march, 2015 that is really pushing up the numbers were seeing now. Secondly there is a big holiday affect that pushed some shipments forward into march. How do we see past that . We look at the growth rate as a whole and if you look at that what used he is chinas exports still down 4 year on year. Some of the Growth Numbers have onn pretty good but based we stillt numbers think china has some fairly significant challenges to face. Francine so what youre telling us is that you cant read that the chinese economies are faring better than expected. What are we expecting from gdp figures . Expecting 6. 7 year on year growth when the gdp data on friday. That is based on our monthly gdp tracker we look at a range of indicators, bundle them together to give us an overall reading of the strength of the economy. That is pointing to 6. 7 growth, down from 6. 8 at the end of 2015that is based on our monthlp tracker we look at a range of , but still within them governments target range of 6. 5 . Tom lets drive it forward to friday. There was always a message at the world bank imf will be the message of china in the hallways of the imf . Thats an important question. Whats interesting is that the inss view on china has changed. If you look at the china theyast back in 2015, what were looking at is the ushaped pattern for growth they expected a decline in growth in 2016 to 2017, that a recovery toward the end of the decade as china benefited from a reform dividend. Trying tolater forecast they raise the forecast for 2016, but that has come at the expense of a continued slide in growth in the imf forecast for china back to 2020. That really gels with the message were hearing from other analyst concern that china is buying a shortterm boost to growth by allowing more rapid letting but they will be a price for that Going Forward. Tom with all the research you china feelble, does like it is part of the dialogue of the new mediocre or do they feel removed from it, where they dont have to partake in the debate, the discussion, the discourse over a slow Global Economy . Well, if you look at some of the concerns about the Global Economy and Global Markets in the last six months, a lot of them have originated in china, first with the collapse of the equity markets and then with the mishandling and the shift of the more Flexible Exchange rate. A lot of the turmoil that was derailing Global Growth in the beginning of the year does have its origins in china so i would think china does not regard itself as exempt from that discourse. Francine thank you so much. Tom orlik from beijing. Our guest is still with us when you look at china, have you read it . Investors have a little bit more faith in the system than they did two months ago. I think the tone, not just youw, is improving dont want to see too much focus on a new individual number, you need the context. At the beginning of the year we were worried about a chinese recession. Ist you have seen since then measures put in place both to stabilize the currency, which has been very successful, with very notable change. The broad Economic Data has improved from a very low space its not just the export data, its the ppi data to consecutive positive data coming out it all tells you the same picture was that the chinese pol francine how do you measure whereith young china, they see growth as an approach . We analyze all the Internet Data to get a signal about whats happening in the chinese economy as we do in every economy. With china there are the right questions in the official data but that analysis has been telling us consistently that china is in a slowing growth environment but not falling off a cliff and it continues to tell us that. The evidence we are getting still seems like it is Slower Growth for china but far from the hard landing many people were predicting. Francine thank you so much. We will be talking about Bank Earnings and about brexit concerns. Coming up, the imf director of monetary affairs. The interview is in the 10 00 a. M. Hour, 3 00 p. M. Here. On friday, we will bring you live coverage of the Spring Meeting in washington. Francine welcome back. Today in about an hour and 20 minutes, jpmorgan will report earnings to kickoff the earnings season. This is what i picked out for our morning mustread this is what we heard went into mediation he is talking about the financial industry his main assumption is that there is so much interconnectivity that if there is something systemic it will be dangerous for the will economy as a whole will stop we are back with our global chief investment strategist when you look at the investment landscape and when you look at the Banking Industry, it doesnt feel any safer than it did in 2008. I think it does. You have that increasing with the regulation, but that regulation is having the impact of making the banks much safer than they were previously. Banks are typically holding 60 more capital today than they and balancesly sheets today are as strong as they were 80 years ago. They face profitability challenges that i think that Systemic Risk is much lower. You see that in the markets where they continue to operate very heavily. Tom yeah, but the summary of that there was that oped the other day from the esteemed professor kaufman, they will all turn and utilities. I dont want to talk about individual banks, but if the Banking Industry that means we care about our away and are we. I dont see that. You are searching to see them behave more United Utilities but when you think about the returns you will get from banks going over, the role dividends will play being much more important in the future, you think about pricing and book value rather than earnings becoming more important you start to think about them in the context and they become more attractive investment thanks have been the worst performing sector in the market and they typically trade at. 7 times book. They will return more capital in the form of dividends and in and an environment where payout ratios are very high as the are one of banks those sectors where they still have the potential to rise. Up next,e taugh we look at the u. K. Political landscape. Wednesday, thursday, friday the imf meeting with the outlook yesterday. Francine lacqua fell off her chair in i thought brazil was really something, francine. Francine the u. K. Politically, the imf said it is not that popular and they say they are getting it wrong. Tom lets get right to brexit. But first, the first word news. Nejra thanks. Saysouth korean president they are boosting visibility in todays parliamentary election but exit polls see the Party Falling short of a majority stop South Koreans are voting to elect a new parliament two years before the next president ial election. So is limited to one term her party needs to gain a key majority. Of Republican Voters think the candidate with the most delicate after all the state candidates should be the nominee, even if he doesnt have the majority. , justing to a new poll 40 think it would be acceptable for the delegates to take a different candidate. Organized crime prosecutors have rated the panama law firm seeking evidence of Money Laundering and financing terrorism will stop this follows the leak of millions of documents about tax havens set up for wealthy international client. The attorney general said it also searched other subsidiaries but the firm has denied any wrongdoing. Business groups from britains biggest trading partners are voicing their support to remain in the european. They say it is good for trade and investment ahead of the vote on eu membership and camerons government is arguing that peoples jobs depend on remaining in the 28 hundred block. Journalists 2400 and 150 news bureaus around the world. Francine thank you. Lets get more on this we are the Blackrock InvestmentInstitute Global chief investment strategist thank you for coming in. We killed the u. K. We covered the u. K. Election for a long time. I know there are serious concerns, but do we really worry that it will happen . Generally in referendums, what happens is the status quote position experiences the majority and the status just of the status quote. If it was going to happen i think we would need to see it quite a bit further ahead than they are currently. Its clear that momentum is with brexit. It appears to be with brexit old,t across from young to and if we are being honest, the campaign hasnt taken off. I think there is an increasing chance that we could see the british vote for brex