Several sessions this week where weve broken even are gone higher on the session. Today looks to be no different. 3010 is where we are at, up two points. The 10 year yield is back at. 83 . That is a major move in treasuries. The yen has moved two big figures in the last session alone. One of the major rivers in the s p 500ay, ceepo today, cboe. It got a downgrade at bank of America Merrill lynch. It is now a sell. Guy we are continuing to see rotation in the equity market. German tenyear now at 48 basis points despite the cut yesterday from the ecb. European equities grinding higher, but that is not the story. It is below the surface. This move into cyclicals, this move into banks continues in europe. People are selling the big bond proxy names. Trading nestle, etc lower. This is a big unwind from what. We saw in. August the pound continues to catch from what we saw in august. The pound continues to catch a bid. 1. 2 440d now trading at on the idea of a hard brexit beginning to fade a little bit. Vonnie i want to break a headline here. The London Stock Exchange is up 3. 75 in london as we learned that the Hong Kong Exchange is said to be planning to pitch a bid directly to lse holders. The lse board decided against accepting the hong kong bid. It wants to continue with its refinitiv deal. Hong kong is not happy about that and is going to pitch directly. This would essentially ask the shareholders of lse what they want to do. We will be speaking about this with an Exchange Reporter in just a little bit. Sticking with markets more broadly, we are joined by bruce bittles, baird chief investment strategist, from sarasota, florida. We are seeing a huge move in treasuries, obviously in global fixed income, and grinding higher for u. S. Equities. What should your allocation be right now . Bruce i think theres a lot of discussion about the u. S. Falling into recession following europe, and i thick a lot of that is now fading. Defensive sectors that have been so strong since february continue to be relatively strong, but now we are starting to see cyclicals improve, including the energy group, industrials, and financials. Now we have almost everything in gear for the very first time in quite a while. I think that is a very bullish configuration. Vonnie at the same time as we are seeing increasing recession talk, we are also seeing data brca positive. Yes, manufacturing is in slow down mode, but today, the consumer is holding up. What do you see the u. S. Economy see for the u. S. Economy . Bruce the consumer has everything going for it in terms of what they are spending. In that regard, the economy is doing better. Weve got full unemployment, weve got full employment, rising wages, so i suspect Consumer Spending will remain strong the remainder of this year and Carry Forward well into 2020. Guy how on earth in that environment is the Market Pricing as many rate hikes as it is right now . You just give me a list that tells me the u. S. Economy is in great shape. Theres one bit missing, and that is the Manufacturing Sector , but nevertheless, we have 25 baked in next week. That . O we get beyond is the market getting too far ahead of itself when it comes to the fed . I dont think it is getting that far ahead of itself, although i will say this. The fed has sent strong signals they are going to raise they are going to lower the fed funds level 25 basis points next week. I think the fact that the stock market is close to making new highs and weve got a Labor Department that is very strong and rising wages, a 50 basis point cut is very unlikely. What might happen is this. The Federal Reserve board will lower rates to any five basis points next week. Then perhaps lower another 25 basis points in october. But i think, given the strength , given theets strength of Consumer Spending, and given the levels of confidence in the economy, i think it is not a certainty that they will lower rates in october. Guy where does the stock market go . Where does the u. S. 10 go if we get a trade deal, even an interim trade deal that we were talking about yesterday . Bruce we are talking about valuations and Interest Rates. When you look at absolute valuations, they are probably the highest weve seen. When you look at relative valuations relative to bonds, stocks are very cheap. I think the rise in Interest Rates has sent a signal that the not going tois fall into recession in on a 19 or 2020, and i think that has boosted confidence in equity markets. Vonnie do we stay above 1. 80 on the 10 year . The spread is wider, and the twoyear is at 1. 75 . Where is fair value for yields right now . Bruce fair value is right around 2 , so i wouldnt be surprised if we had a touch more to go in terms of yield on the upside. What happened with the bond market, we got severely oversold. There was almost panic buying in august in bonds and in early september, so you had a situation where fear was overtaking the markets. We are finally seeing a reversal 1. 90 in termsto of the yield on the 10 year. Vonnie your reaction to the ecb policy announcements yesterday. It was a pretty big bazooka. Would you be interested in dipping into the economies like spain or Portugal France . Portugal or france . Bruce we are very interested in going overseas. Weve just been waiting for the economies over there to stabilize. The recent data shows maybe we are starting to see the beginning of that. Are lookinghat, we at yields on the benchmark 10 year german note. If that would climb back into positive territory, that would cause us to move more aggressively into europe. Guy what about the idea of germany delivering fiscal policy . The ecb plan is almost dependent on the fact that we need to see germany spending money. We need more german debt in the market for the ecb to buy. Do you think germany is going to spend money . To big would that be for you put more money in europe . Germany has toy, use fiscal policy, but i think theyre going to have to go that route particularly since they are so dependent on manufacturing, particularly in the auto sector. Eventually, germany is going to move in that direction. If they do, that would be a positive develop and not only for europe and germany, but also the u. S. Guy can i come back to the trade war . If china and the United States get a deal done, what does that mean for the market . What kind of levels would you expect to see in fixed income and equities . Bruce what weve seen lately is the market is responding to the softer rhetoric by both the u. S. And china. That is allowing the averages to break out from this range weve been locked into since july. Now the s p has climbed above 3000 for the first time in a couple of months. Said, going forward, i think the markets may take a more cautious approach in terms of trade simply because of the many disappointments we had since march with trade. My suspicion is eventually we are going to get a deal. It would be very bullish for the markets if we see a deal either late this year or early next year. I certainly could see it traveling up to 3100, perhaps. Vonnie 3100 on the s p. Bruce, always great to speak with you. Verse battles, baird chief investment strategist bruce bittles, baird chief investment strategist, coming to us from saratoga. Here with the first word news, ritika gupta. china agreeing to buy additional soybeans and pork, that would also be exempt from additional tariffs. Negotiations are set to resume in the coming weeks. Consumers are a bright spot in the u. S. Economy. Retail sales rose in august by more than expected. Shoppers kept buying things online. The value of sales was up 0. 4 after an upward revised 0. 8 increase in july. British Prime MinisterBoris Johnson heads to luxembourg monday for his first facetoface talks with European Commission president jump log juncker president Jeanclaude Juncker. Says punt mr. Leo varadkar large gaps remain but irish dkar saysister leo vara large gaps remain between the two sides. Global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. Im ritika gupta. This is bloomberg. Vonnie coming up, plowing ahead. We work is not backing down from its ipo plans. We look at the changes the company is making in order to counter doubters. Thats next. This is bloomberg. Vonnie live from new york, im vonnie quinn. Guy from london, im guy johnson. This is bloomberg markets. U. S. Indices getting close to some alltime highs. We are close, but not there, are we, emma chandra . Emma close, but not there yet. We are looking at the s p 500, ever so slightly into the red after opening in the green today. We are seeing more solid gains for the stoxx 600. Also got the nikkei representing asia. The s p still well above 3000. We are also headed for a weekly advance, the third consecutive weekly advance for the s p 500, the fourth consecutive weekly advance for the stoxx 600. You mentioned we are close to record highs. If we switch up the board, we can see just how close we are to that high that was set in july of this year. Just about 10, 15 points away from that high set on july 26. 3025. 86 toing for hit that record high. If we dont hit that today, there are lots of catalysts next week, not least the fed meeting. The british pound headed for its best week since mid july over reports that we may be getting closer to a deal before that brexit deadline of october 31. Finally, i wanted to highlight the lse. That is higher today after it rejected the bid from Hong Kong Exchanges. They have since come back saying they will maybe take it directly to shareholders, but we are still looking at a gain of some 2. 7 for the lse. Pg e also rising today after it is said to settle with insurers for some 11 billion for the wildfires of 2017 and 2018. Finally, smile direct club, one of our newest public companies, gaining today 6 or so after it plunged 28 yesterday following its ipo. Vonnie wework has picked the nasdaq is the venue for its embattled leasing. The startup is also making changes in its Corporate Governance to address investor concerns. Joining us is our bloomberg senior reporter. Are there enough changes made to satisfy investors . Reporter that is the question on everyones lips this morning. Clearly theres a lot investors did want to see, with a shrinking of the multiclass structure. Weve seen a bunch of other things, including adding an independent director. The board will have the ability itremove adam neumann if chooses, and his successor will be chosen by the entire board, not just to directors and his wife not just two directors and his wife. Guy do we have any idea at what price there will be demand for an ipo . Illian theres got to be demand, it just depends how much. Thats what the book runners are going to be able to price when they launch on monday. We understand that they are aiming to target the week before rosh hashanah, which is a jewish holiday, which i think is the weekend of sen. Burr 23rd, the end of that week. Ofi think is the weekend september 3, the end of that week. It is unclear how receptive adam neumann has been. The dynamic is very interesting. We reported that softbanks stake is obviously larger than his, but that his could actually ratchet up if the stock hits various valuation targets over time. Guy do you think they are being freaked out by what happened with smile direct . Gillian a little bit. That was obviously a huge signal. That ipo priced above its targets range, and then dropped. It was the first ipo to do that. Vonnie obviously it is not trading, but bonds are trading. What can we tell from the trading of the bonds right now . Gillian the biggest bond holders absorbing the changes. I think funds are up. Vonnie the main traded one in my bloomberg right now, if you guys want to take it, it is higher. Gillian so i think they are taking it is a strong signal that the company is willing to make these adjustments to its Corporate Governance structure to appease the investors. Now it will look a little more like any other public company. One other thing i didnt mention earlier that i think is notable to investors, the newman famil s voting power was 20 to one. It is now going to decrease to 10 to one, about half of what it was in 2018. Adam, heng becomes of becomes mattel he incapacitated or dies, that will drop to becomes mentally incapacitated or dies, that will drop to just onetoone. Guy if they cant do the ipo, where does the ipo what did they need, 3 billion where does that money come from . Gillian we reported that theyve held talks with softbank. It would likely be some sort of structured deal. It is unclear exact a what that would look like. Weve reported that this ipo, as long as they raise at least 3 billion, they will get another 6 billion in a credit facility, contingent on an ipo at any valuation as long as they raise 3 billion. We will see. Vonnie gillian, thank you. Great reporting. It will continue over the weekend. That is bloombergs gillian tan. Still ahead, the bitcoin race takes a new turn. We will dig into our weekly etf friday segment with bitcoin, next. This is bloomberg. Guy from london, im guy johnson. Vonnie from new york, im vonnie quinn. This is bloomberg markets. Its time for our weekly etf friday segment. One of the first bitcoin etf launched a new big going this a new bitcoin fund this month, but there is a catch. Reporter they are launching this fund that trades otc under rule 144a. Only institutions can buy this that have assets of 100 million. So this isnt in for any retail investors. They are trying to push the envelope a little bit. They want to show the sec that the etf like product can work with the bitcoin etfs. Tores three people trying launch an etf still that are waiting on a move from the sec in the next month. This is basically any way to push that envelope to get them approved. We put those approval changes around 30 right now. A few Different Things have spurred our optimism. Still likely it will get denied, though. Guy they are kind of pushing the rules to potential he a bricking point. Are others doing similar things . Is this happening elsewhere in the space . James weve seen this happen specifically in the marijuana etf space. Mj was actually a former latin America Real Estate fund. Basically, they just changed the strategy to marijuana and kind intockdoored their way launching a marijuana etf. Werenally, marijuana etfs not allowed to invest in multistate operators because they are federally illegal. Another bit of a gray area. The third option is the Grayscale Bitcoin trust. Theys a private fund that went and listed otc, similar to what van eck is doing with this fund. Tc . Nie as a prospect for gb james it is doing really well, but the prospect for van ecks depends on how it does in the next month. If it doesnt get approved, we see a little more prospect for van ecks products getting assets because it is four institutions. Premium. Es at a huge so it might be beneficial for them to use van ecks product. Vonnie james, thank you. James seyffart there with etf friday. London Stock Exchange group has rejected the offer from the Hong Kong Exchange, but there is a develop. Now the Hong Kong Exchange is going to go directly, according to sources, to shareholders. In other words, maybe going hostile, according to sources to bloomberg. Bankrupt california utility pg e has agreed to pay 11 billion to settle insurance claims from massive wildfires blamed on the companys equipment. The settlement covers 85 of the case that pg e faces. A court still has to approve the deal. The clock is ticking at general motors. The contract with ud United Auto Workers expires saturday at midnight. Leaders from around the country will be in detroit this weekend to either agree to take a proposed contract to their members for a vote or go on strike. That is your latest Bloomberg Business flash. Still ahead, it was the first debate showdown for joe biden and elizabeth warren, but there were no major knockout blows, at least between those two. The race for the democrat nomination, next. This is bloomberg. Sen. Harris weve got a guy in the white house whos been radical on trade policy. He conducts trade policy by tweet born out of his fragile ego. We have to recognize President Trump has protrude an arbitrary and haphazard trade policy that has had victims on both sides. Sen. Warren our trade policy in america has been broken for decades, and it has been broken because it works for giant multinational corporations and not for much of anyone else. Sen. Booker i agree with those who have said this haphazard trade war is hurting american families. When i first got into this race, higher number President Trump said he would like to see me make a deal with president xi jinping. I would like to see him make a deal with president xi jinping. [laughter] is it just me, or wasnt that supposed to happen in april . Vonnie that is from last nights debate. Kevin cirilli was there, and he joins us now. Many things on the agenda, including gun control, background checks, climate, and all sorts of other issues. Health care and trade really did dominate. What were the main takeaways in terms of personalities for you . Kevin in terms of trade policy, this was a warning shot to president xi jinping, who has touted that he is playing a long game, a marathon, so to speak, with u. S. Foreign policy when it comes to negotiating with the Trump Administration, but theres not much daylight in terms of policy tactics. Virtually every single one of the 10 democratic president ial candidates on that debate stage last night here in houston saying that they would utilize tariffs as a negotiation tool. So that is on the policy front. On the rhetorical approach, the personality approach, theres night and day between those candidates and how they would negotiate from a rhetorical stance versus what the Trump Administration has done. On that debate stage, it was absolutely a divisive battle as the front runner, joe biden, continued to draw, for the first time directly, contrast with Senators Elizabeth Warren and bernie sanders. Afterwards in the spin room, virtually all the consultants i was chatting with suggested that those top three candidates largely remained unscathed from last nights debate. Guy kevin, why didnt warren go after biden more aggressively last night . Kevin because i dont think she thought she had to. Elizabeth warren, after covering her over the last eight years, has been an incredibly disciplined politician, even when she was running for senate against a republican darling at the time, scott brown, when she defeated him. She feels she is able to carefully continue on with her espousing progressive policies, and that she doesnt off bidend to run supporters at this point in the race. There was more pressure on the lower tier candidates, kamala harris, pete joe to judge pete buttigieg, beto orourke, and others. It will be interesting to cf any of those candidates get a bump in the polls in the days and weeks ahead. Vonnie kevin, where did the candidates shake out . There was obviously a protest at one point in the room for biden. He didnt seem to make any major mistakes. Did he come out of this all in one piece and still at the top of the polls . Kevin i think he does. Campaign isbiden flexing its political muscle this morning. They feel they had a strong showing. Hes going to continue to fund raise. You saw that their political elbows were sharpened leading into the debate and some other attacks against debate in some of their attacks against lisbeth warren. Against elizabeth warren. Vonnie kevin, thank you. Guy lets turn to british politics now. The chancellor of the exchequer says hes increasingly optimistic about getting a deal with the eu, and he surged both sides to knuckle down. He spoke to bloombergs maria tadeo in helsinki. We want to have a general election. I hope it comes sooner rather than later, but when it comes to that election, the conservative party doesnt need an alliance with any other party. You asked me about the brexit party. We will certainly not be having an alliance with the brexit party or any kind of arrangement at all. Maria i want to ask you about that deal. You said many times this is do or die, but we still went to get this deal. Your european counterparts would argue we havent actually seen anything new for weeks. Can you still get this deal done . Chancellor javid negotiations are ongoing. Theres actually a lot of work being done on both sides. I am feeling increasingly optimistic. Theres still a lot of work to do. I think people understand we do need to end this. We plan to leave on october 31, and we will leave with a deal, but it is also understood that whether it is a deal now, if it is a new deal outcome, eventually we will need some kind of deal, so i think it is in everyones interest that we get on with it and struck a deal asn as we can. Maria lets talk about that no deal scenario. I know you said ne leave. That is imperative. The Prime Minister has also made it clear this is do or die. What if we get to that point where it is no deal brexit . Is the logistics of it actually possible . Many people would tell you it may not. Possibleactually be legally . Chancellor javid we would absolutely be making sure that all the laws are followed at all times, and at the same time, i think it is right for us to say we have a policy to leave on october 31, and thats what we plan to do. We will have to see what happens after we get to the european council. I am going to be absolutely clear in the Prime Minister gets to the council meeting. He absolutely will not be asking for any kind of extension in that meeting. He will be hoping to strike a deal with his partners. Guy that was the u. K. Chancellor of the exchequer sajid javid speaking to maria tadeo in helsinki. Bloomberg has learned that the hedge fund started by a group of former Deutsche Bank traders that once managed 6. 4 billion is planning to shut after getting hit with a fresh round of investor redemptions. Joining us with the latest on this story, bloombergs hedge funds reporter. Good afternoon. Why is this a surprise . Reporter it is not really a surprise as such, if you look at arrow grass. They had been bleeding assets for the last few years. They suffered another one billiondollar redemption request in the third quarter. Assets under management was depleting rapidly, and they have a large team of 100 people are working in london and new york. Once you go below a certain level, it becomes difficult to run the business. Of course, they could fire half the people and manage the costs and still run their business, but their performance was not rate either. Return is lowe single digits. To be fair, they havent lost money ever in a calendar year, but this year they were down a little bit, 2. 5 . Vonnie what shocked me was it blamed centralbank policies, even though hedge funds in total have had positive returns this year. Obviously other hedge are navigating this new environment, except is not new. Weve had this kind of centralbank policy for a decade now. Nishant that was their explanation to investors that after 11 years, their style of investing maybe doesnt suit in so their firmcle, was apparently designed for a Business Cycle running into a five to seven years, but as we know, this cycle has run into well over 10 years, so that is definitely creating some problems for some hedge fund managers. But you are right, this year hedge funds are up 7 . Some are up more than 20 . There are a lot of people still making money, and it seems that overall, the industry in terms of performance is coming back. Vonnie deshawn Kumar Nishant kumar, great story there. Opec is a surplus. The iea executive director fatih birol, and of course, energy secondary Rick Perry Energy secretary rick perry, will join us. This is bloomberg. David we will talk now with u. S. Energy sec. Rick perry, as well as the executive director of the iea, fatih birol. They are both with us from washington. Welcome, gentlemen. Lets start with the announcement today, 110 million for research having to do with coal, how we can use cold better, more efficiently, and do less to the environment. We have a decline right now into the capacity of coal across the country. When will this come into effect so it might deter or delay that reduction in capacity . Carbon capture utilization concept has been around for a while. We are starting to see substantially more interest in it, particularly with some of our partners in the middle east, for instance, who would like to be able to have an alternative to some of the fuels theyve used in the past. Being able to use coal in a clean way. When using about this Technology Going into china, which, by the way, their emissions are like years as the last few weve seen the United States lowering our emissions by i want to say somewhere close to 25 to 30 in the energy sector. So this has some really great news for the world and the climate when it comes to being get this technology to its material level and getting it spread out across both china, india, and those places that still use substantial amount of coal. David if the goal is to have cleaner emissions, is this the most costeffective way of doing it . Are there other alternatives that would be more costeffective, for example, renewables . Sec. Perry fatih birol will tell you the most caustic the most costeffective way is nuclear plants. It is the cheapest and best for the climate out there. David lets turn to you on that subject. Is that the best way . Fatih there are different ways to reduce emissions. There are many clean air technologies come about the Nuclear Power plants in the United States are facing serious challenges. They are at a certain age, and a premature closure of Nuclear Power plants may well be a major problem. On top of that, i look at all of the technologies we have in hand. The existing Nuclear Power a very costeffective option, but we also need solar, wind, Carbon Capture and utilization. Ll of these technologies we cannot afford to exclude these clean technologies. David on the subject of nuclear, we have a new oil minister in saudi arabia. You will be going over and visiting with him. What about nuclear and saudi arabia . Are we in favor of saudi arabia gaining the ability to enrich uranium, which raises questions in that part of the world . Selman binn salman is a fine man that ive known for some time. Hes bringing a lot of expertise. His predecessor was a dear hadnd of mine, who also extraordinary history of working in the energy sector. With specificity, the United States obviously is the best place for the saudis to go. I think it is the best place for the world to see saudi arabia working with because we have the strong nonproliferation position. The kinghether it is of saudi arabia, the crown prince, they both want to send the message that saudi arabia is going to be leaders in the world in technology. One of the ways that you lead the world in technology is to have a strong nonproliferation agreement with the United States and the International Atomic energy agency, and that is the conversations we are having. We think it is very important for whoever is going to be building Civil Nuclear plants in the world that they work with the United States, work with Companies Like westinghouse, which has the finest technology. They build the best reactors in the world. Bring that technology to the forefront. Bring the relationship with the United States. I think it is in saudi arabias best interest to do that. I think it is the worlds best interest to have our nonproliferation position front and center. David lets turn for a moment to oil. We had an estimate from the iea about a supply glut. At the same time, your estimates were different from the eia in the United States. The eia was worse by some 200,000 barrels a day. Is it typical to have that kind of spread in estimates . Of course, because you have to sprint you have different assumptions of the future. One of them is cost. If you are more optimistic about Global Economic cost, we have different Global Demand expeditions. But the direction is the same. The difference is about one Million Barrels per day, but both organizations do expect that this slowing down of oil thend is the result of slowing down of the global economy. On top of that, we also see still substantial amounts of oil coming to market from production in the United States, and addition of 1. 3 Million Barrels per day. Substantial amount of oil also out of the soap had of the socalled opec . Russia is coming to the markets, which will put downward pressure on the market. David for Bloomberg Television and radio worldwide, we are speaking to the secretary of energy in the United States, rick perry, as well as footy be role, executive director as well as fatih birol, executive director of the iea. Theres discussion of removing iranian sanctions to get president rouhani to the table to discuss a larger deal. Have you penciled out for the white house what that might do to the inequality between supply and demand, what it might do to supply . Sec. Perry what the administration is interested in is sending the message to iran that we expect you to be good citizens of the world. There are activities you are involved with that are not acceptable, whether it is developing mediumrange ballistic missiles, continuing to Fund Terrorism in that part of the world. Those are activities that President Donald Trump is not going to accept. He sent a clear message through his negotiators, and i hope our friends in the world, whether in the European Union or right there in the middle east, will stand with us, demanding that iran come to the table and make the changes that clearly send a message that we are going to be good neighbors, we are going to be good citizens of the world. Until they do that, they can expect the United States to have very strong sanctions against tom, and we will continue hold forth on that in a strong and powerful way. David you have sanctions in place also with respect to venezuela. As i understand, the waivers on that with respect to oil services expires at the end of october. That will be up to the treasury, of course. What recommendation are you making to them about whether they should be extending . As i understand, it would have dire effects on the rigs in venezuela. Sec. Perry the dire effect has been on the people of venezuela. I think thats what this administration, and obviously having cuba and russia, china to some degree, but the two farmers that ive mentioned here having the biggest effect in that part of the world. The United States interest there is to bring prosperity to that part of the country. The Current Administration in venezuela has shown that they either dont want or cannot manage that country in an efficient way. I wod suggest until you see a change of leadership in that part of the country that the sanctions will continue to stay in place. The message will be sent that if you are going to do business regime, theree will be a price to pay. David finally, theres been estimates by the global everyion on climate that dollar invested returns Something Like four dollars in benefits. The diff elements in Coal Research should be done the developments in Coal Research should be done . Clean i think we need all technologies to be part of the solution. There are many reports like the one you mentioned from united nations, different organizations, different countries, highlighting the importance of reducing co2 emissions. At the same time, the number of reports are increasing, but so are the global co2 emissions. Last year we have seen a year into global emissions increase to a record high, historical high. This tells me there is a strong disconnection between the on,rts, the targets and so and what we see in real life. Therefore, in the energy world, we cannot exclude any clean energy technologies. We have to invest in solar energy, wind, Nuclear Power, Carbon Capture, and Energy Efficiency to be able to have chances to meet our targets. Sec. Perry i would add that the u. S. Lng into the European Market in particular can have a big impact in europe as anything that is going on. Although we are 25 of the production of the worlds economy, we are down to 15 of the emissions now. The u. S. Is leading the world in the reduction of emissions, and we are doing it because of innovation. We are doing it because of the transition away from older and inefficient plants. We have seen a savings of 8 billion to the european lngunity because of u. S. That comes in and competes with, for instance, gas out of russia causing them to have to be more competitive with their pricing. The u. S. Lng, i would suggest, has been the real transformational issue and it comes to emissions, not only in the United States, but what can happen in europe and affect the rest of the world. David for Bloomberg Television and radio, weve been speaking with u. S. Secretary of Energy Rick Perry and iea executive ector fatty barrel executive director fatih birol. Thank you. Vonnie interesting to hear rick terry stotts. Hes been to hear rick perrys thoughts. Hes been a supporter of helping gas plants helping coal and gas plants throughout his tenure. Also hearing about sanctions on but as layla. Guy the eye on venezuela. Guy the iea has made it abundantly to your theres two more theres too much oil being produced. If you were to add back in iran, that is only going to compound the problem. The oil price at the moment looks in a tough place, and given what the iea has said this week, it is hard to see some upside coming through. However, if you were to see a trade deal, you would start maybe to change that supply and demand story. At the moment, theres way too much supply and not enough demand. It is going to be fascinating to see whether or not that trade deal, if it were to come through, would start to change that sort of supply and demand balance story. Chris kirsch joins us now out of the cme. It . Is the problem, isnt these guys can talk about what is happening in terms of nuclear and Carbon Capture, but when it comes to the crude market, it is really straightforward. A lot of supply, not much demand. Which way is the price going to go, chris . Chris i think you hit it right on the head. The fact that youve got players coming back on that are seeing , 600,000 barrels coming back online that were not expected, we already have a high supply, low demand situation. Ultimately see it going lower and testing that 53 support from early next month. Guy what would a trade deal due to that . Chris you could see an uptick. An 8 pullback in the futures over the last several days, i think you can get up to that 59 handle we were talking about just a week ago being a key pivot point to the upside. If a trade deal comes in, you could see a quick 10 rally, but that is not going to happen before the end of close today. Guy do you think the russians think the opec story is going to stick together . I was in moscow yesterday. They are really feeling the pain right now on the slower price. Chris i believe they are feeling the pain, but ultimately russia is used to pain, and i think they are not going to take s, andad by the new print ultimately you will see russia continue to cheat the system, as reports have come out and continued to put oil back on the market in a very aggressive way. Guy thanks for your time. Of bell curve capital joining us from the cme. Vonnie coming up, we talk more fixed income. Marilyn watson, blackrock financial head of fixed income strategy, joins us. Equities are marginally higher, but seeing major moves in bond markets around the world. The u. S. 10 year yield above 1. 80 today. This is bloomberg. Guy 30 minutes left in the trading day here in europe. Friday the 13th nearly done. From london come on guy johnson. Vonnie from new york, im vonnie quinn. This is the european close on bloomberg markets. Guy european equities, to be honestat a headline level just going sideways. Below the surface, things are interesting. There is a rotation taking place. Bond proxies continue to be sold. We were 70 on german 10 years not that long ago. We are at 44 right now, so a pretty big move. Bond proxies are being sold. Mining stocks doing well. Banks having a good session as well. Also happening with european stocks, the pound is up by 8 . We are trading 1. 2458. Some expectation with Jeanclaude Juncker and mr. Johnson having a meeting monday that progress may be made away from a hard brexit. Vonnie