Both engines of the u. S. Economy running at full steam. As for the stock market, were seeing a mixed picture. Ny gain would be a record the s p and nasdaq are seeing some weakness here, individual stocks seeing weakness, having to do with earnings. 3 . Ave pepsi, sales down the shares are pairing their decline. Earnings beat estimates. Sales are weaker. Digging more into that and our stock of the hour segment. One of the worst performers in the s p 500 has paired some of its decline. That company posting sales that missed estimates as well. The ceo is making more optimistic comments. And office depot fell 78 . This is a preliminary view as the Company Looks to make an acquisition. It is going to buy congee column compucom. We are also watching the situation in puerto rico, in the wake that puerto ricos debt would be wiped out even as his budget chief says those, should not be taken literally. Here in the bond insurers seen in steep decline. Cells themselves self plunged. Record low here for that. On the here the decline president s comments even amidst trying to walk them back or moderate them in some way. The market is not reacting to that moderation but rather the initial comments. Ending he nine day winning streak coming to an end . Dax rising to a new record after yesterdays holiday. Spain. Ll about we are down by 2. 4 . Biggest decline in 14 months. Membership saying nothing will deflect them something up a republic. Nightngs criticism last of the illegal referendum was no reference to the Police Violence , giving a00 injured free bar to state forces as they try to shut down the secession. Clearly an impact on stocks and bonds markets. He yield has risen this is the spanish 10 year. The yield is now the highest since march. It is risen by 13 basis points since july. Catalonian officials continue to amide a defiant tone favorable data, services to the to prevent yields from rising for the second day. First company to announce it is moving out of catalonia following that illegal independence referendum that pushed spain into a political crisis. Move to agreeing to madrid from the catalonian optimizearcelona to relations with investors. It has 35 employees. Million value of 61. 1 euros. Following the referendum, look we will talk in more detail about the aftermath of the referendum later. It is fascinating. Another process underway is the race for a new Federal Reserve. Janet yellen is in the running , kevinith kevin warsh powell and gary . Gary cohn. Choice of the president and the administration and the decision is up to them. There are candidates whose names are in the newspapers. Appropriate for me to get into deciding who is going to be the next chairman. Would disagree with you but the basic idea here of if we have the turmoil in america and the economic uncertainty, will that migrate towards a more rulebased system and away from discretion over the coming years . The attraction of a rulebased system is large. In practice you would find yourself having to define the time when it is appropriate. Even such things as three hurricanes in a row, which is not a huge surprise but it happens. And the many other things that will change policy. I think rules are a good taking ofto the basic where you want to go. Lets get rid of the central bank. , do we need abook fed chair like chair yellen, who 1936 . Ad we have a number of candidates who have probably not even gone through those key chapters. They should read the whole book. What happens when the Interest Rate gets too low . It is worth reading even today what is in there. Up,hould we have a new set a nonmonetary fed chair who has a vice chair of your capabilities or do we need to have that monetary expertise . In my tombs as governor, having the basic economic theory and experience increases selfconfidence about what you are doing. Is it essential . I doubt it. Very smart people can figure this out. But is it helpful . Very much so. Vonnie that was the Federal Reserve vice chairman Stanley Fischer speaking with bloombergs tom keene. To talk about the expert interview. You did get great thoughts on what might be changes forthcoming for the Federal Reserve system should somebody who likes rules be appointed. That is a possibility. You would not believe what goes into preparation for these mr. Fishers assistance, you cant say should be thick John B Taylor of stanford. What i heard clearly is he is concerned about crisis and shock. Visibleirman fisher was in the financial crisis of 97 and through the financial crisis we just lived in for a decade. This is a guy who knows you have to be there for the standard deviation move. Towns whoalk of the is going to be the next fed chair. All the talk in the last 24 hours has been about jerome rsh. What doevin wa you think he would think about either of those being the next fed chair . He would never say that but those are two people without the background of a monetary economics phd. These are people that are very different. Each of these list of candidates this morning all have different attributes. To lump them even into groups of monetary phd, no monetary phd. It is more nuanced than that. Did you get any sense of what you might have learned about inflation, inflation dynamics and how they have changed . That was the beginning of the discussion. He made clear the old models hold true. They need to be amended. This is someone with great respect. Vonnie thank you. Which youve interview can check out online and later on today on bloomberg television. Time to check in on first word news. President trump on his way to las vegas to meet with First Responders. Authorities have released photos from inside stephen Paddocks Hotel room. The woman described as pad exgirlfriend return from the philippines. She was met by federal agents. President trump is suggesting puerto rico Government Debt could be wiped out to help the country recover. He told them that the country owes a lot of money in debt. Commentked back the saying they would not bailout puerto rico. President Vladimir Putin says russia may extend a deal with opec to curb oil supplies through the end of 2018. Who spoke on a panel putin spoke on a panel. We do not know yet whether we are going to extend it. Overall, towards a minimum of 2018. In the u. K. A heckler at the conservative party firedence noticed she was. Global news 24 hours a day powered by 2700 journalists and analysts in 120 countries. Vonnie thank you. Coming up, former equifax ceo Richard Smith back on capitol hill today testifying before the Senate Banking committee about the massive data breach. You can watch the full hearing on the bloomberg. This is bloomberg. Bloomberg. Mark live from london not, im mark barton. Vonnie i am vonnie quinn quinn. This is bloomberg markets. It is time for futures in focus. Vladimir putin says the agreement with opec to stabilize the Global Markets could last through the end of next year. We have inventories at the bottom of the hour. What are traders looking out today for . Good to be here with you. For thatrs are looking lead into the commercial, any news coming out of the cooperation between saudi arabia and putin out of moscow, that is big news for us. As we see the dollar move to a weaker position and Energy Crude Oil coming off we believe the momentum is down to the short side. That is key support. We had a triple top there a few weeks ago. They believe we are going to see 49 trading today. Vonnie how about those inventories . What if they surprise . What a crazy surprise on that. That is not great news for u. S. Crude investors. Up 27 and ation half percent. We are seeing that pulled back hoping it creates an increase. What people are paying attention thatnventory is making mute right now. Surge inan unexpected gasoline inventory. Still ahead, the financial d bracing for big interview, that is next. This is bloomberg. Vonnie this is bloomberg markets. Mark good afternoon. 3 20 here in the u. K. The anc id for many global think rry thing fink of blackrock says he is not anxious about the new rules. It is creating more transparency. We need more transparency. By unbundling. Correct. Us. thank you for joining brokerage research, some say the amounts of research on Smaller Companies might contract. Do you share that analysis . What is good about the separation of this and the research is the results in a more deliberate consideration. Is this valuable of for my Investment Strategy . It will result in better consideration. My portfolio with this research . Mark the you think Big Companies will squeeze out those smaller houses by cutting prices . How it willo see develop. This is a new market. Clear that it will be against the small advantage. They provide a product that will benefit the Investment Strategy. We are seeing mark we are seeing pricing for Bond Research coming down. Are you worried that it is a race to the bottom when it comes to pricing . Thehat were seeing now, consideration of costs for the research of people need to find a new price. There will be further adjustments but if we search the value for improving the performance of the Investment Strategy, there should be a price for that. Lets talk about dark trading. Tweaks coming that will satisfy those exchange concerns . Whats what were trying to theeve is moving trading to. Arket to reduce the dark parts as a regulator you always monitor closely how that is implemented. If you see risks of unintended consequences, we will subsequently adjust. They are being basically used. They would be used for multilateral trading. We have closed the loophole. Be limits onould these new types of dark trading venues . What we are trying to achieve is bringing more trades to the market. If we see that objective is not reached we will look and our toolbox how to adjust. Maybe with q a or a guideline, or a change in technical standard. Are you going to issue guidance on the National Authorities should act towards Market Participants that are not fully method ready on january 1 . To 2014. Oes back the legal text was already available for three and a half years. We suggested to the politicians , but itd the timeline is important that we stick to it. Level consideration of a Playing Field when you postpone deadline that we have done is very important. Mark oceans of new data, what are you going to do with that . There is a lot. Someday do we need to determine what kind of trades might be exempted from this. The method will expand the data available. In these parts of the markets there is a risk of market abuse. Mark thank you for joining us today. Be sure to watch our show on Financial Regulation arrington weekends on bloomberg television. Vonnie really enjoyed that. Another great interview. Hurricane relief efforts and much more, this is bloomberg. Are you on medicare . Do you have the coverage you need . Open enrollment ends december 7th. So nows the time to get on a path that could be right for you. With plans including aarp medicarecomplete insured through unitedhealthcare. Call today or go online to enroll. These Medicare Advantage plans can combine your hospital and doctor coverage. With Prescription Drug coverage, and extra benefits. All in one complete plan. For a low monthly premium, or in some areas no plan premium at all. Other benefits can include 0 copays for an annual physical and most immunizations, routine vision and hearing coverage, and youll pay the plans lowest prescription price, whether its your copay or the pharmacy price. Or pay as low as zero dollars for a 90day supply of your tier 1 and tier 2 drugs, with home delivery. Dont wait, call unitedhealthcare or go online to enroll in aarp medicarecomplete. Sfx mnemonic im bonnie klein. There moments away from notice states earnings. The United States earnings release. Surveys are calling for a drawdown. Lets get to julie hyman for the data. The drawdown bigger than anticipated. 6. 0 Million Barrels of the crude drawdown. It was larger than anticipated. 1. 6 Million Barrels. A big drawdown in crude. A climb in gasoline inventories. A big drawdown in crude, that was perhaps not as much a shock. The real surprise is the. Rawdown in crude inventory the initial reaction is positive in on the minds of traders saying opec production cuts could last through the end of next year. They will see if it can be sustained in the wake of these numbers and the crude drawdown. Oil at 57are seeing a barrel now. Donald trump is on his way to nevada in the wake of the deadliest u. S. Mass shooting in modern history. The president was in puerto rico where he offered assurances to the u. S. Territory not just in cash but also potentially in debt release. We have to look at their whole debt structure. Money on wall street, we are going to have to wipe that out. I dont know if it is goldman sachs, whoever it is my wave goodbye to that. Joining us now, we have the phone. R via the taliban is doubled in the last 48 hours. Have you got to all points of the island . Thank you for the opportunity. Regarding the official death toll we did have an increase. We are at 34. During those deaths were the storm. They were just not identified and certified yet. It is not something that is occurring. Some have. 16 for aeen stuck at couple of days. We have to make sure we get the most recent data certified. Vonnie he told foxnews something would have to be done about your debt. I am sure that came as a great relief if you werent questioning. Did the president say anything directly . We did speak about the debt. I mostly spoke about the hurricane disaster and the inorts that are needed health care, efforts we need for housing,tal aid and the disaster is now estimated at 90 billion in puerto rico. I did listen to his comments. That is the president s opinion with respect to that. The government of puerto rico is in a title iii proceeding. I really cant comment on that. Vonnie the president is known for being able to do deals. It did say that. Do you have any hopes the president might be will to do something about this . 74 billion of debt plus whatever you end up incurring now. Flex my focus now is to make sure that the assets and resources we need to get in puerto rico are in place. The president has been helpful in those administrative decisions. Every time we have asked for something they have delivered but it also has to go to congress where an aid package will be developed. There has been a lot of bipartisan support to get this going. It is sustainable, it has the necessary funding for puerto rico to recover. That is my focus now. Im not really focused on debt issues now. Vonnie lets talk about that aid. It is not going to be a bailout but they are working on a package which would be 29 billion. That includes aid for harvey and irma, and some aid for western wildfires. It doesnt seem like it would be enough for order rico to recover given the estimates of tens of billions necessary. How much do you need from congress . They put initial money out so that these operations can start being executed. We feel that we are going to ofd the down payment 1015,000,000,000 dollars. The damages are more extensive. Harvey was 100 billion. Irma the 45 billion. That whathink director mulvaney is talking about is the whole package but rather the initial money is that will be put forth so we can get things started. This is not a bailout. This is an emergency situation. Was eight months into the administration i am implemented significant fiscal constraint. We reduce the budget in puerto rico. Cognizant that this is a different scenario in puerto rico now, full support needs to be given. Vonnie on that note, it is impossible to collect taxes now. It ise thinking earlier, a burden of the debt repayments and debt servicing hasnt shifted to main street given so investorsis held by that depend on sales. This is a reality we are looking at. In puerto rico we are not going to have much revenue in the coming months while we restore basic infrastructure. It is going to be hard to get resources flowing. Not only recognizing that there ,as a Natural Disaster here based on fiscal fragility that we had. Some considerations need to be taken in terms of how we are going to get revenue. Effortsw a lot of our are being directed to laying out what that path is. Vonnie of course. In the last few years, 10 of the population has migrated. Have you any estimates for what maria might cause in terms of migration which would impact the viability. If we want to avoid a humanitarian crisis, if we want of thousands,eds if not millions of Puerto Ricans flocking to the United States, because all we need to do is jump on a plane, we need to take serious action. Services, online as soon as possible. If that does not happen, i am beend the exodus that had of significant tear to our economy will increase. Governor, you will need to regain access to Capital Markets eventually. How do you anticipate being able to do that now with the question of the debt burden hanging over you . You are not waiting for President Trump to do something. Again, access to the markets is important. It always has been important. That is why we wanted to be transparent and have title vi negotiations, have discussions to see what the task forward is. Scenario brandnew where there has been major catastrophic disaster here in puerto rico. To rebuild. To need based on that restart, essentially our economy itself. What thecan iron out initial conditions for the rebuilding process are going to notit is it really does been to discuss what the transitions opening to the markets are. We dont have the closure to the markets. One of the things that we are asking congress is to consider the treasury. Vonnie you just got cut off. One last question. It does seem goes to ask these questions when you are trying to rebuild an island that has been your home. We have lost the puerto rico governor. We do think the governor for all of his time and wish them luck with the continuing recovery efforts. Rex tillerson is expected to deliver the state Department Speech shortly. We are going to monitor that for headlines. E will see what he has to say joining us for more on todays andington, d. C. Action, other headlines, we have kevin. Diverse diverge you first into what this might be about . I have reached out to those connected to the state department. So far no comment. A lot of anticipation for what Rex Tillerson will say. He has been the speculation of many news reports, particularly about his role within the administration. Vonnie following yesterdays visit puerto rico, is the president getting ground with the people of america that have not been supporting him . Whats the president will meet with First Responders and police officials, and victims of the tragedy. Following President Trumps visit to puerto rico. In terms of puerto rico, we are anticipating the budget director to send a proposal of sorts to capitol hill with regard to an aid package. We just heard in your interview about what the puerto rico governor is looking for in the cost estimate he has put on it is billions of dollars. That exceeds the 70 million of debt puerto rico has incurred but quite frankly it looks like the debt is not on the president s mind despite his notet chief saying we are going to bail puerto rico out. He made that comment following the president s interview with fox news. Vonnie thank you for joining. Mark. To preventg catalonia from breaking off, how will political and certainty discuss disrupt european economies . We discussed, coming up. Vonnie live from new york, im vonnie quinn. Mark and it is 3 46 in london. Plenty of questions facing the eurozone economies. Spain trying to present catalonia from breaking off. It,ing us now to discuss thomas meyer of deutsche bank, thefounding director of frost Bank Research institute. Thank you for joining us. We have data showing the economy picked up in september, Services Better than expected. New order is rising at the fastest pace in six years. Offthe ecb afford to hold beginning the tapering process . , they are last showing some intention of recovery. Information has remained reviewed, but it could creep higher. Inflation rates that no longer is dealing with negative territory. Ecb toe has come for the taper. Sequencing. Talk it will start next year. What is sequencing . When do we get the announcement . When does it begin . Understood later this month the ecb would give us details of how they will proceed. Year,ginning of next there is speculation. Understood thing in the open. What is coming in our questions from the political side. Thatve passed the risk france might be governed and be taken out of the euro. We have a sigh of relief we now have a more euro friendly french president in macron. We have Political Risk coming up again. For the information of the new aalition they may bring back force into the German Government in the form of the Free Democratic government. Said theyleader has would not go along with all the things that are in mind. Catalonia then periphery is anything but stable. The impact will be to bring back Political Risk. Course withng up of the italian election which is very contentious. On whethereen debate the ecb can expect itself to move as loosely as it would like to. , thee the italian spread spanish is only at 1. 32. Is spain less of a risk . At this stage i would not say it is a serious risk of breaking from the euro. But the events have shown is a further weakening of minority isernment, of that this. Aising doubts of uncertainty they will not way in consolidation. It is too high for comfort. These are certainties of the Political Revolution that could weigh on the spreads. Vonnie you wrote a book on the future of the currency and the euro is trading at 1 17. What does where does that go . Ihe u. S. A ministration think the market now may well continue above and the risks of the euro. The risks of the euro are no longer financial. He has monetary transactions. I think they are under control. The Political Risks are not under control. Mark thank you for joining us. The former dutch bank chief economist, founding director of the research institute. U. S. Secretary of state Rex Tillerson scheduled to deliver a statement shortly at the state department. We are monitoring for headlines. This as we head towards the european coast. This is bloomberg. Mark live from london. Vonnie this is bloomberg markets. Time for our stock of the hour. Shares of pepsico trading lower after the company beat earnings estimates. What is happening . They did eat earnings estimates but they miss revenues. The stock is all over the map. Down just fractionally. Perhaps investors looking past the slight revenue risk. We have a great graphic that illustrates this drop, down 3 on a yearoveryear basis. The first time we have seen this happen in nine quarters, that is the snack business. This next offsetting beverages by 9 . Miss is pretty big. Year to date 34 of their total revenue. He had to keep the beverages growing strong. [inaudible] bloombergop into the and look at the equity of relative valuation function it is trading 19. 9 times. These blue dot signaled relative discount it is playing out. Vonnie thank you. Mark great stuff. Coming up, following stocks. 35 minutes until the end of the session. Germany is at a record. This is bloomberg. Consumers who want to continue that protection will have to pay for it. The best thing a consumer can do is get the lifetime lock. Im asking a question. Your offering free credit monitoring which you say is worth something and are offering it for one year if consumers wanted for more than one year they have to pay for it. Is that right . Yes. The most in Consumer Debt but they will have to pay after one year if they want to credit monitoring. That could be a lot of money. So far, 7. 5 Million People have signed up. Vonnie we are going to go to the secretary of state Rex Tillerson. To serve as secretary of state. President trump us America First agenda has given voice to millions who felt completely abandoned by the political status quo and who felt their interests came second to those of other countries. President trump us foreignpolicy goals break the mold of what people traditionally think is achievable on behalf of our country. We are finding new ways to govern the deliver new victories. Our job is to achieve results on behalf of america and we are doing that. We have created a International Unity around our peaceful Pressure Campaign against north korea, including influencing china to exert unprecedented economic influence on north korea. And rallied muslim majority nations to assume the responsibilities for stopping terrorism. Nato members are now contributing more to shared security. Our approach to south asia and specifically afghanistan means building upon our relationships with india and pakistan to stamp out terrorism and support the Afghan Government and and providing security for their own people. s fraudulent caliphate in iraq and syria is on the brink of being completely extinguished thanks to an aggressive new strategy led by the president. While does what we have done as aed, we have team. Secretary mnuchin has levied economic sanctions on north korea and related entities. They must decide where they will do business with north korea or the community of peaceloving nations. Ambassador haley dispirited in success passing the toughest sanctions yet on north korea. General mattis and i