It is election day in the u. S. 226 million americans cast their ballots in one of the most among jewish u. S. President ial elections in recent history. One of the most tumultuous u. S. President ial elections in recent history. Hillary clinton held a narrow lead in most preelection polls. Her campaign has and armed by federal probes into her handling of classified emails, questions about her familys foundation, and public doubts over her trustworthiness. Republican real estate magnate and reality tv star donald trump, defeated 16 primary opponents and promises to drain the swamp of washington corruption. He has faced criticism for his treatment of women and denunciations of immigrants. We bring you the analysis you need on this historic day. I am joined by bloombergs politics and economics editor, Michael Mckee. In london, we are joined by Alexander Friedman for the first half of the program. Alex, good to have you on the program. First, lets get to the bloomberg first world news. This is nejra cehic. Nejra production declined more than expected in september. Production fell 1. 8 from the previous month. The reading, which is typically volatile, compares with the median estimate for a 0. 5 in a Bloomberg Survey of economists. That the latest sign europes biggest economy slowed last quarter. Opec has raised its forecast for Global Oil Demand next year and through the end of the decade. According to the producer groups annual world oil outlook, demand will reach 95. 3 Million Barrels of oil a day in 2017 as the organization anticipates cheaper crude will spur consumption even as Economic Growth slows. Chinas exports fell for a second straight month in october on tepid global demand. Overseas shipments dropped to 7. 3 from a year earlier in dollar terms. Imports slid 1. 4 , leaving a trade surplus of four to 9. 1 billion. The yuan has depreciated since last august, but failed to boost exports. The u. K. Chancellor, philip hammond, is facing a 25 billion pound hole in the public finances following the brexit vote. That is the warning from the institute for fiscal studies. Its a diminished growth will result in 31 billion pounds of lost tax revenue only partially offset by a 6 billion pound reduction in spending. News 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. I am nejra cehic. This is bloomberg. Francine this is your data check. You are seeing Less Movement than the last 10 days. A hint of caution. Gold still rising. Volatility down a touch, 0. 03. Here, 220 6y million americans eligible to vote today, one of the most divisive president ial elections in living memory. The leader inherits leadership of the biggest of the country and its global role in geopolitics. Lets see how the candidates and their supporters made their final appeals to voters. Hello, pittsburgh. Mr. Trump florida is my second home. If hillary wins in North Carolina, she is president. Mr. Trump in one day to you believe this one day, we are going to win the great state of North Carolina. President obama michigan. This is the most consequential election of our lifetime. This is obama tomorrow is the election, but that is just the beginning. We have to heal this country. Mr. Trump we are a divided country. People do not realize we are an unbelievably divided country. President obama it comes down to you. It is out of my hands. It is in your hands. Vote. Get your friends out. Every single vote counts. We have a great panel of guests today. Joining us from london, Alexander Friedman. In new york, jim, chief global strategist at offshore group. And politics editor Michael Mckee. Mike, lets kick it off with you. Today, we find out. There are battleground states. The polls are closed. It seems like clinton could win this. The way. Breaking, she will be able to win this possibly in the east coast, like her husband did in 1992, before it got to the midwest. He had almost accumulated enough votes to win. First results are in. Donald trump has the early lead. There are three small towns in upstate New Hampshire. You should go while you are here in the United States. Its still not harts location, and mills field vote at no field the three towns vote at midnight, according to tradition. Trump disfavored, though hillary is still favored in the polls overall in New Hampshire. You heard tim kaine say that you should get out and vote. You should get out and vote. It is very important. 200 35 million americans eligible to vote. Only 129 million voted in the 2012 president ial election. A turnout of 54 . The brexit vote, which we covered in london 72. 2 voted. You do not want the brits to embarrass us. Get out the vote. Francine the number of people who turn out at the polls is quite low compared to most western countries. Alex, you have money in the game. How do you hate yourself before we find out the news of this election . Of peopleink a lot are taking risk of the table. Lets unpack the four scenarios that are relevant for investors. The most extreme is trump wins and i think you see a selloff and pretty much all risk assets. The only thing that probably goes of our government bonds, cash, gold, maybe swiss franc, yen. The second most of stream is, nobody knows who wins. You have the same result in terms of markets. More likely scenarios based on the polls are hillary wins. The question is, does the senate and the house shift . It does not look like the house is going to shift. The senate is really the question. That exposes where the market could have some slight downside against what is already baked in. Even if hillary does win and the senate stays divided, and perhaps on the republican side, i think there is a limited risk rally. High itust 3 off the the s p. Maybe we see a little bit of relief, but not much. Mike historically, we have seen the markets move on the election, and often go in the other direction. Fundamentally, how are we set up to go into 2017 once this is out of the way . Alex i think fundamentally we are set up for the fed starting to tighten, Inflation Expectations rising against full employment. As a result, the drag a bit on the equity side, probably in the u. S. Specifically, more upside in equities. In europe, based on valuation. The continued volatility risk in europe around the italian referendum, french and german elections, etc. On the fixed income side, probably a shift more towards low duration carry instruments like catastrophe bonds, subordinated debt, those kinds of things. Francine what do you make of the markets question mark you have been in gold for quite some time. Everything seems to be pointing to a clinton victory apart from gold. The markets are betting one may, but still making hedges. Jim everything seems to be putting to a clinton victory. If you look at the pundits, the betting markets, and the Financial Markets, the election was over two weeks ago. It is a very close race. I think we will be up late. Francine you do not believe the polls, or the turnout will be greater . Both. The polls over simple democrats. Among the democrats, they do not tell you, you oversample africanamericans within the democratic sample. There are a certain number of white democrats running for trump. That is the biggest factor 2012 versus 2008. The 5 million evangelicals who did not turn out in 2012. If you are going to use 2012 as her baseline, that is a skewed baseline. They did not go for romney because he was a mormon. If you go down to the ozarks and talked to in job evangelicals, that is what you hear. The betting odds are saying 89 probability of hillary. That. S take it is the wisdom of crowds. They do not understand behavioral psychology. Trump thats for every hillary that. The hillary bets are bigger. Wall street big shots that 10,000. 50. Better bets so the book is give hillary short ons. Is 41voting booth, it because of the betting markets . Francine we are going to put this out on a chart. In the past, we had two competing charts. Peak performance over the last three months. That would point to a trump to a Trump Victory. But this is employment. Every time employment goes up, the house or the democrats, if they are in, stay in. It is usually good for the incumbent party if the economy is doing well, and the economy is doing relatively well. To billmes Carville Clinton its the economy, stupid. This year, it is not. It is unusual. We are seeing very strong Consumer Confidence numbers. At the same time, people are saying the country is on the wrong track. It is hard to reconcile those thoughts. What it does is, we take the economy out of this in terms of the Immediate Impact of the latest data. Jim this is the worst economic recovery in history. I disagree with mike. 2 growth for eight years. The trend was 3. 5 coming out of the recovery. 5 as we go through 1990 1983 and 1996. We are not even close to that. The Labor Force Participation as well. You cannot use this statistical science. His recovery is unlike any other recovery. Francine another graph showing the percentage of people under the poverty rate. That does come down. We will get to those in a second. Alexander friedman and Michael Mckee here with me. Stay with us. We have plenty more coming up. This is what we are looking at. We are looking at the economy and brexit. Any lessons we can learn from that . You can follow the Election Results on your bloomberg. , stay withight here surveillance, because we will be talking about election day. Pharma one of the sectors most likely affected by the outcome. We will be speaking live to the ceo of glaxosmithkline. He is in india, traveling with Prime Minister theresa may. The final bloomberg poll gives Hillary Clinton a two point lead, but how accurate will those opinion polls prove . And how should investors position themselves . The feds future on the line how the election will impact the worlds most important central bank. Francine this is bloomberg surveillance. I am Francine Lacqua in new york city happy election day. I will talk about the policies the candidates have or have not outlined. First, lets get straight to the Bloomberg Business flash. Investors are pricing in a victory for Hillary Clinton after one of the most divisive u. S. President ial campaigns in recent memory. The poll shows clinton leading 41 . Donald trump 44 to the poll was conducted before fbi chief james comey said clinton should not face charges related to a personal email server as secretary of state. Acta monte dei paschi. A binding offer for its nonperforming loan platform from Service Credit management. The italian debt Servicing Company said in a statement without disclosing a price. Fortress Investment Group also made a binding offer. Representatives declined to comment. Credit agricole says thirdquarter profit doubled from a year earlier. Frances thirdlargest bank saw net income climbed to 1. 80 6 billion euros, in line with analyst estimates. Bond trading income surged. The lender promised a stable or rising dividend for next year. Deutsche post thirdquarter profit has jumped more than threefold. Operating profits surged, beating analyst estimates. The rise comes as the male ail operatorm recovered from costs at its Freight Forwarding operator a year ago. A race fiscal forecast. Operating profit will probably drop to 16. 3 billion for the year in the in march, an improvement on the forecast in august. That is as the yen rally stopped short of the levels toyota had projected, with a sales slowdown threatening its position as the worlds top carmaker. That is the Bloomberg Business flash. Francine thank you. Lets turn to a sector that might be better off with donald trump, pharmaceuticals, after Hillary Clinton complained about drug prices. City group cut its rating on u. S. Health care, saying there could be pressure to curb prices. Is the ceo of glaxosmithkline. He joins us from india, where he is accompanying theresa may on her trade mission. Thank you for giving some of your time to bloomberg. How has it gone so far in india . As it been as smooth expected . Quick thanks for the time today. It is a good atmosphere yesterday. There was certainly a lot of engagement around how the two countries could Work Together to streamline trade between them, regulatory dimensions, that kind of thing. From my perspective, obviously, i was not in all of the detailed discussions. From my perspective, it was a good atmosphere around the place. Francine what would you advise her . What is the next step forwards . How could she get proper trade deals and was against countries who think there is no brexit plan at the moment . Andrew i think the u. K. Are working very quickly to put together the areas they want to focus on. Essentiallyities to an opportunity in the pharmaceutical sector, i think for the u. K. Regulatory agency to cooperate and build in reciprocal operations with india is tremendous. If you think about the role of indian pharmaceutical manufacturers in the Global Supply chain of medicines and some of the issues which have popped up with companies here, there is a great opportunity for the selfinterested in india to connect with the global regulatory framework. I think the u. K. Could be fantastic for that to happen. There are precise ways the u. K. Can help countries like india, which ultimately unlock the opportunity for these conversations. It is very early days. Obviously, none of these things are going to get going until after brexit happens. Francine regardless of who wins the election in the United States, you think there will be reforms on u. S. Pricing . I think there will be continuing pressure on drug price. I have been saying that for a long time. This year today, we are seeing prices in the u. S. Down 2 . We are seeing negative price evolution in the u. S. We think that continued pressure is likely into the future. Actually, i think a lot of people fixate on the political dimension of what might happen. It is also important to remember that the marketplace has itself put in tremendous mechanisms in place to ensure it is getting good value for money. If you look at the consolidation of the market over the last few years, whether it is hospitals, introduction of Accountable Care organizations these are mechanisms in the market which have just come in in the last two or three years. They are going to be key futures key features in the future. That is driving pressure on the system as well. I think regardless of the outcome tomorrow, the reality is it is going to be even more important for companies to demonstrate they have innovation and good value for money price. Francine you are expecting more regulation or a new regulator, as Hillary Clinton has proposed . Andrew i am sorry. Could you repeat . Francine are you expecting more regulation within the next 18 months . Andrew not especially. I mean, i cannot rule it out, of course. But i think we for sure will see more of what we have been getting, in terms of market pressure. It may well be that we see more of the demonstrationtype projects, such as the part b project, which has been unrolled in the last nine months. Specific areas for focus and change. We will have to see what the new Administration Things beyond that. I think there is an awful lot of momentum in the marketplace which is bringing more discipline to pricing, making people more accountable to demonstrating value for money. That is going to deliver a lot of what people want to see. Francine do you think who is better for the Pharmaceutical Company . Is it as simple as clinton bad, trump better . Andrew no, and i think i am going to at this point it is so close to the decision, i am going to plead the fifth on that one. Thanks very much. Francine i understand. Politically sensitive. Do you think it is imperative that the medicines regulator stay in london . Not think it is imperative. I think it would be very good if it did. The reason i think that is because there would be tremendous disruption for its physical movement. Clearly, the regulator could be located anywhere. But it has become very competent. The staff, many of them will want to stay in london. A top to bottom organization, for that to be moved means a lot of staff have to change position. Those who dont leave have to relocate. This is a regulator who is keeping and i on the health and safety of hundreds of millions of europeans. You do not want them with their eye off the ball. So honestly, while i can understand the emotional reaction of why it should move to europe because of brexit, i think the selfinterested decision would be to leave it where it is, because you have got a tremendously competent organization doing a terrific job. We should think very carefully about disrupting it. I think realistically you cannot move it without disrupting it. Francine thank you so much. The ceo of glaxosmithkline speaking to us from mumbai. Safe travels. Diplomatic. He would not say if he would rather a trump or clinton presidency. The markets zigzagging in this unpredictable election. Lets get back to alex and jim. I first wanted to show a graphic that shows gdp growth, year on year, depending on the last administration. Lets bring that up for you. It is one of my terminal charts. You were pushing back, alex, against something jim said, which is we are seeing growth in the u. S. , but it is not policy growth. Alex i guess the ascension out there is, if we could just returned to what growth should be, there would be less social strife and everyone would be in a better case. It gets too, what shou