In the wake of adam schiffs private testimony taking in the deep bunker in the capital. David i find that fascinating. We have heard from republican after republican that this is so unfair. Now it is not clear that trump wants it in the public. Erik the republican messaging has been all over the map. Lately they have been congealing around the idea that Mick Mulvaney and the other lower people in the state department came up with the scheme of ukraine on their own. You are hearing that a lot from ,ark meadows and jim jordan trumps chief defense lawmakers on the hill. They are saying they presume there was a quid pro quo, they presume a tide between the as in the investigation into the bidens and trump had nothing to do with that. David it is interesting you point that out. I noticed in the bill taylor transcript of his testimony, he said he did not know the president was responsible for this. He knows Rudy Giuliani was, but he did not know whether the president was involved. Could that be part of a defense by the white house that if something bad happen, it was not the president itself . Erik it seems they are trying to look for Plaza Building i ability. The democrats keep going back to the for plausible deniability. Keep going back to the transcript and state is impossible to say the instructions were not coming from the top. David now lets get our brexit editor edward evans in london. It sounds like Prime Minister johnson is having a tough time adding his campaign going. Glitches along the way. Edward that would be putting it mildly. Boths been a week for parties both parties would rather forget. The Tory Campaign has been hit by resignation. The first minister to resign during a general election in more than 100 years, and gas. Jacob reesmogg saying people who died in a fire not exercise common sense. Equally, on the labor side, they have been hit by resignations. Leaderson, deputy labor resigning, and allegations of antisemitism ingrained in the labour party. David one of the things that struck me is senior members of government got stuck on a train platform and cannot get back to london, which you say was inconvenient and does raise the question of should trains be privatized the way Margaret Thatcher did it, or do they want to go back to the public sphere, the way Jeremy Corbyn thinks they should do it. Edward maggie never privatize the railways. It was the one privatization she even shied away. It was john major who did that. David well done. I got it wrong. Edward it is an experience many british commuters will be alltoofamiliar with, the image of a vignette that sums up how the campaign is going despite half of the british the sight of half of the british cabinet on a platform on a dark night. It shows you in one place and sums up the campaign not running on the tracks of the moment. David exactly. Thank you for the clarification. I was thought it was Margaret Thatcher. That is edward evans in london. Now lets bring in Damian Sassower from Bloomberg Intelligence on the latest trade headlines. It is fascinating. The markets were doing well and then President Trump said im not so enthusiastic about this rollback of tariffs. Everyone was suspecting the u. S. Was eerily quiet throughout it all. What is most impressive to me about this data was the negative base effect. 2018, go back to october experts were up 14. 8 . It was that much harder for them to beat expectations this time around, and yet they did it. Only 9. 9 to 3. 9 yearoveryear. Is Southeast Asian region picking up the slack for u. S. Exports declining. What it tells me is if you look at the pboc, they said the vix below seven for the first time in as long as i can remember, since we broke through the seven handle. Look at yesterdays msci, adding a whole bunch of shares into the em index. A shares weight up to 4. 1 . You should see positive momentum on the back of capital flows into the country. David is china trading as an emerging market at this point . Damian not at all. The definition of an emerging market, you and i have gone back and forth. China is not an emerging market. People try to put in that bucket. For me it is about see manufacturing bottom in china for us to see a if you just look at the pboc, they are extending themselves a bit. They are cutting rates. They have lowered the mls. They still realize there are real problems at home and they need to stimulate their economy. David Damian Sassower, always great to have you with us. Now lets to get on those markets and see how they are reacting to the top stories. Joining us is abigail doolittle. I got ahead of myself, and looking at the chart, the markets took a hit when trump said not so fast on the tariffs. Abigial right now we are barely moving on any of the major averages, but we did take a little leg lower because it was President Trump saying the rollbacks that folks had been expecting, the u. S. Had not agreed to. It is a continuation of the trade narrative where one week it is bullish for the markets and then the next week it is neutral or could even turn bearish. Until we have a deal, there is no deal. That is something we could assume. Investors, based on the fact that stocks are flat, the s p on pace for its fifth up week of a row. They are more constructive on the possibility of a deal. David we could go up and down and all around on the trade deal. Give me Something Else that could drive the markets. We are through the earnings season. Cannot look forward to those anytime soon. The markets have to have Something Else to trade off of. What will it be . Abigial it is still related to earnings. The earnings season was better than feared. A small earnings season a small learning session. The expectation is going ahead that we will come out of the earnings recession. For that reason, investors may be willing to put some skin in the game and buy stocks. Plus the fed, there is a sense the fed has investors back or the Investment Community back on cruise control. David let me go off script and maybe be unfair. How correlated is the market . Is it reacting to macro factors such as the fed an trait or is it more differentiated . Abigial and earnings season it tends to be less correlated because your reacting to be individual stocks. Today stocks are flat. That does not mean we are popping higher. They put up a solid quarter. David the movies came through for disney. Abigial and of course disney plus next week. As we come out of earnings season, it will probably become more correlated again as it is more of the macro factor backdrop. David thank you so much to abigail doolittle. Right now we will turn to Mark Crumpton with bloomberg first word news. Warns natopompeo risks becoming irrelevant. That is adding fuel to the criticism of the transatlantic alliance. Secretary pompeo says nato would lose significant if its 29 members do not contribute enough to the common defense. He made the comments on a visit to berlin to mark the 30th anniversary of the fall of the berlin wall. Hasns air Defense Force shot down what it called an unknown drone over the persian gulf. That is according to its state run news agency. The report did not say whether the drone was a military or commercially available device. Local authorities claim the drone belong to a foreign puncher he and parts of it had been recovered. They say it violated irans airspace. The United Nations highest court says it has jurisdiction in a case wrought by ukraine against russia. The International Court of justice will examine allegations that russia breached treaties on terrorist financing and racial discrimination. The prime one is accused of arming rebels in Eastern Ukraine and raining and the rights of ethnic minorities following its annexation of primary. Its annexation of primary of crimea. In alabama, Jeff Sessions will give up the senate seat he gave up will run for the senate seat he gave up to become President Trumps attorney general. He says he remains a strong trump supporter. He resigned from the cabinet last year after months of insults from the president , most having to do with sessions recusal from the investing into russian interference in the 2016 election. Global news 24 hours a day, on air and tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. I am Mark Crumpton. This is bloomberg. David . David thanks so much. Coming up, the law of unintended consequences. Could Elizabeth Warrens wealth tax drive billionaires where she does not want them to go . This is balance of power on Bloomberg Television and radio. David this is balance of power on Bloomberg Television and radio. I am david westin. Elizabeth warrens proposed health taxes making waves from wall street to Silicon Valley. The candidate is doubling her initial tax rate as a way to Fund Medicare for all without raising taxes on the middle class, something she has promise not to do. This could have unintended consequences, benefiting private equity. Bloombergs brandon kept coded is here with his story. Explain why this might drive people toward private equity. Brandon the idea was to assume 6 would not be a barrier. If youre not making more than 6 , your wealth will go down. Lets look at Capital Market assumptions. You look at gmo and blackrock and jp morgan. If you look at those and take it at seven years, 10 years, there is one game in town and that is private equity. Wont date evaluate whatever the value is in the private equity and impose the wealth tax on valuation Brandon Brandon . Sure on that valuation . Brandon sure, but the goal is beating that 6 . David under that analysis, the government would get the money. It is not really tax avoidance. Brandon is the idea of where you put your money to be that 6 . David a different form of a search for yield. You need higher yield if they will take your wealth away. Brandon that is why we draw comparison to looking what pensions are doing in a low Interest Rate environment in consideration of their own risks. Does that suggest other alternative investment . It is not just private equity but particularly higher reward. It depends brandon it depends which capital adjustments you are looking at. Things like that are also there. Private equity is the one that seems to be across the board that shows up above that 6 threshold. David thanks so much to bloombergs brandon. For policy and politics we welcome our panel of brian murray, founder of rick byrd strategies and president of and basils michael, former executive director of the new york fed policy. Adjusted rate of return is where it comes down, and they will find ways to move the money, they will move into other places where they did not get calculated on a regular basis. Maybe put the money in day one, you do not know the value of your real estate until day 20. When you put your money and certain things and theres no Expiration Date on the funds, that money can sit there and they will not get the money. David basil, lets turn to you on this. There is a lot of uncertainty about all of this. The one thing that seems to be clear is Elizabeth Warren is feeling some heat to make her numbers add up. She keeps saying i will not tax the middle class, we will have medicare for all. A lot of people are saying the numbers do not add up. Now she has doubled her rate and saying we will find a way to tax all of you guys. Being the political person in the room, i understood everything that was said earlier. I would concur that if you have the ability to move your money, that is what will happen. The challenge Elizabeth Warren has to face is that if you remember on the debate stage when asked how we would pay for your plan, she was not able to do that. In the for the sake of expediency, she does come out with this plan that i do not know is fully thought through. Having said all of that, i do not think that is where most of the concern over her plan is going to be in terms of taxing the wealthy. It is not around that. It is around the folks that have private health care. Are they going to lose it . That is where the conflict is. At the same time they want the government to take in more money and spend it. Who is better to spend our money . Ourselves or the government. She is finding a way to spend more money, for the government to control more of what we spend. David we have two issues. I do not to give up my private insurance. On the other hand, do we want the government controlling everyones health care . At the same time, most people agree it is wrong that the number of people are insured, they did not get coverage. The republicans have not gone up with a plan for universal coverage. There are many ways to try to do it on a state basis, but not the federal basis. You let the states determine what they can do. Why does the federal government tell every state what they should do and how they should do it . What about all of the men and women who work at Insurance Companies . What happens to all of those companies in those jobs . That is a part of this economy that is not being answered about. Fine, but part of the answer is states have not done it. We have been doing this for a long time and we have millions of americans that do not have health coverage. May be on a local level they do not want the government to control it. They want to get people out of emergency rooms. Let me go to that point. Issue after issue, on health care or education, which is what i study and research, the states have always asserted their rights against the federal government to promote their own policies. That is true, but when has the federal government stepped in . Whether there is a national interest. Whether it is the new deal, the Great Society in terms of ending poverty, the federal government has stepped in. You are the guy with a phd. Believe that part. David and the g. I. Bill. Enormous infrastructure and education was built up on the g. I. Bill. So there is an appetite for this. There is an appetite for this and i think there is a growing consensus that capitalism as we know it is not working for everybody. We can chip away at health care. But why is there such a backlash about warns plan. Part of that is they dont want it. It is not exactly that. Is ideal for everyone to have a car in their garage, but if you cannot afford a house, why do you have a garage . David their objections to elizabeth warns plan. Youve just illustrated two of them. That does not mean there is not a problem to be addressed. On the republicans proposing any way to address it . It is much more about state rights. The federal government has grown too much. We saw obamacare. We had attacks on people that cannot afford insurance. Lets tax them even though you cannot afford insurance. That was the obamacare problem. There is no alternative republicans are putting forward. They hate obamacare, but the Affordable Care act has proven to be resilient piece of legislation. That is what we are hearing from democrats and republicans right now. That was all passed with democrat votes. It was not a bipartisan bill. That is part of the challenge. David is it unfair to say that when the republicans went after the Affordable Care act, they paid the price the midterm elections . There was an issue. They did it because they found one tweak, the preexisting conditions, but it took the democrats that many years years to do it. That shouldve been taking care of. Republicans have the wrong message at that point. That does not mean the Health Care Plan has to be changed and brought back to where Elizabeth Warren wants it. David what happens to suburbs on tuesday . Hempstead, long island, we won that. Winchester, we won that. In certain parts of the country, no question. All politics is local. We cannot beat somebody with nobody. Matt slater in yorktown is doing great. Out in hempstead, you saw those good two democratic almonds in new york. All i would say is momentum. That is the word of the day. We had a good day, and if you look specifically at the democratic primary, those results help joe biden. Hast of his voters that he tied to his electability argument. David momentum is obviously very important. You have the standardbearer to take you there . Is it Elizabeth Warren or joe biden . That is the unknown question. I always tell voters, anger only gets you 49 . We have to embrace our candidate to get to 51 . We have not. Net candidate. David i think President Trump has gone a long way on anger. Motivation and excitement is what it brings. It brings momentum, it brings motivation and a reason to go to the polls. What we are talking about is when people are demotivated to go to the polls, they do not have excitement about somebody, when theyre voting against somebody, theyre less likely to go vote. David i feel like they are pretty excited, particular right here. Many thanks to our panel. Great conversation. Still ahead, President Trump versus vaping. The president s latest proposal to address a national epidemic. This is balance of power on Bloomberg Television and radio. David this is balance of power on Bloomberg Television and radio. I am david westin. Time for the stock of the hour. We are looking at Tobacco Company altra which is trading slightly higher even after President Trump says he will be raising the age limit for vaping. Kailey leinz is here to explain. It is clear there is an epidemic of teenagers in the country. Is it hurting all tria . Kailey they have a 35 stake in juul and at the time they bought it it was worth almost 13 billion. They have since had to take a 4 billion right down because juul has lost so much in the vaping crisis. If you look at the statistics, especially how popular it is among the youth, university of michigan has done a study that among 12th graders, 11 were vaping, among 11th graders 12 . It is taking hold among young people, especially the flavors. To give juul some credit, they are trying to make nice with Public Opinion and regulators. Just yesterday they decided they will not sell the mint pods anymore because those are popular among younger users. That is also almost two thirds of their sales. They are taking a financial hit. David rumors are the fda may get it in secret sell ones that taste like tobacco or menthol. This was part of a diverse it tatian a diversification effort by altria. What is plan b . Kailey they also have a stake in a Canadian Cannabis company. What may gain some more traction is aikos, with a the exclusive rights to market in the u. S. It is Phillip Morris tobacco heater. It does not burn and it is not a vaped. It is an alternative to both traditional tobacco cigarettes and to the likes of juul, which are vaping products. They are now marketing it in the u. S. Altria decided not to merge with Phillip Morris. They decided not to come back together again in parts of because of the hysteria around vaping. They do have the rights to market the product. That may be the way forward. David truly interesting. Great reporting. That is kailey leinz. Coming up, the view from kiev with the read on how the impeachment inquiry is affecting the Country Congress was trying to help. This is bloomberg. David from new york, this is balance of power on Bloomberg Television and radio. Im david westin. For bloomberg first word news, we go to Mark Crumpton. Mark boeing thought it was close to a safety update to the grounded 737 max jet but problems with the stimulated simulated flight delayed for months. In resembles the problems that caused a pair of deadly crashes months earlier. Boeing was forced to overhaul the planes flight computers. President trump is set to rewrite the rules on vaping. He announced plans for new regulations today on ecigarettes and vaporizers in the United States. Oute are going to be coming with a very important decision on bait in. We have to take care of our kids most only so we will have an age limit of 21 or so. We are coming up with something next week. Mark meanwhile, the head of the White House Domestic Policy Council calls the fda regulation of tobacco a huge waste of time. He says the agency should foc ae politician as the defense minister in his caretaker government. The move appears aimed at shoring up opposition to attempts by his chief rival to form israels next government. Benny gantz is trying to piece together a Coalition Government after inconclusive elections in september. Netanyahu has since failed to do so. Lawyers for brazils former president da silva has begun legal procedures requesting his release from prison. The move follows a Court Decision that a person can only be in prison only after all appeals to higher courts have been exhausted. Since 2018 detained after being convicted of corruption. Global news 24 hours a day, onair, and tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. Im Mark Crumpton. This is bloomberg. David thank you so much, mark. We have a bloombergs. Carl icahn is said to plan a proxy fight at occidental petroleum. He was critical of the ceo and the management about their major acquisition, what theyve been doing. Now it appears he may be following through on his criticism by launching a proxy fight. You can see the stock is up about 2 now. It is responding to the news that carl icahn is planning on a proxy fight to take over control. We have seen a transcript of one phone call that President Trump had with president zelensky. Now it turns out there is a second transcript from last april. Mr. Trump says he is willing to release that one as well. It may be hard to remember through all of this, but congress was trying to help ukraine by providing military aid. For the perspective from ukraine, we Welcome Global analyst Michael Bociurkiw. Welcome, michael appeared great to have you back with us. We dont hear about how this ukraines point of view. Michael good to be with you. On the surface here, everything is really quite calm, but zelensky was out earlier this morning speaking at the International Forum with jack ma, giving the typical promotions, that a lot of things are happening, but speaking to sources here, there is real chaos inside the administration of how to deal with this erratic trump Foreign Policy and also with the widening scandal coming out of washington. The big problem they have here, on the monahan, they are trying to promote ukraine as a Tourist Destination and so on, but on the other hand, every time trump opens up his mouth about ukraine, they describe it as an area of corruption. It is very difficult without a specific strategy to overcome that barrage of that pr. David lets talk about what gave rise to all of this. I understand it was military aid thing provided by the u. S. The ukraine does have a Large Russian bear that can flex its muscle over there. Is the military aid flowing from the u. S. , and what is the security situation with respect to ukraine . Flowing,the aid is these things do take time. A lot of the aid was for weapons, which ukraine has been dating for for a long time, including under the obama administration. They will need to be Capacity Building going on with military. As we speak, it is an extremely sensitive time. I cannot overemphasize it. There are party talks now involving ukraine, russia, and European Partners to finally bring peace to Eastern Ukraine. Ceasefires,en two engagements that have been successful, but because it is such a sensitive topic here in basically granting semiautonomy to the areas of ukraine occupied by russian rebels, that zelensky seems to be backtracking a bit and going slower. If i could add one more thing, it has always been the case in negotiations with russia, that ukraine has always counted on the backing of the united dates diplomatically, will luke perry, and with nato. That seems to be slipping away with the Trump White House and there is a lot of anxiety about what to do next. David we are talking with Michael Bociurkiw coming to us on the telephone from kiev. Lets turn to corruption. That also gave rise to this exchange that we know about between President Trump and president zelensky. As i remember, when president zelensky was elected, he was an outsider. Is he addressing the corruption . Right, thereare were two planks to the main platform, to bring peace, and to drain the swamp. He loves to use trumps term there. Of course, easier said than done where everything was controlled by crooked oligarchs, and the system in place for a long time. Slowly, progress is being made. I dont think International Donors or the public is pleased say,e pace, but i have to in this whole call that you refer to between trump and toensky, trump suggested zelensky to be corrupt, as a favor, but these bidens under investigation. Its a real problem for this administration. They are basically dealing with a president who is dealing with Foreign Policy as if he was dealing with a casino transaction and atlantic city, lobster mentality, very transactional monster mentality, very transactional. David where are they looking to for Foreign Direct Investment . Michael all over. Especially the United States. Today, that is the big buzzword. There are so many engineers, specialists graduating every year, so the costs are low. Jack ma pointed out that energy costs are low today. The problem is you also have a brain drain. A lot of people are leaving for better salaries or for the first or second age funding. The other big thing here that china is looking at is agriculture, pork, week. As we speak, china is trying to purchase a huge Aerospace Engine manufacturing here in ukraine. They produce engines for helicopters and aircraft. The United States is blocking that because they think that could be technology put to bed uses, sold to russia, that sort of thing. Ukraine, as it matures, is getting caught in these geopolitical flights, even over 5g, whether huawei should be allowed in. Not an easy path to navigate for such a young presidency. David always hope to have you here, Michael Bociurkiw. Turning the screws on big tech. One of President Trumps big supporters in Silicon Valley discusses what congress is getting wrong with possible tech regulation. Scott mcnealy joins us next. This is balance of power on Bloomberg Television and radio. David this is balance of power on Bloomberg Television and radio. Im david westin. President trump doesnt seem to have too many friends in Silicon Valleys these days but our next as a describes himself raging capitalist and has been a consistent supporter of the president , even throwing him a fundraiser this fall. He is concerned about how congress is potentially approaching regulation of the tech sector. Mcnealy is with us, cofounder of sun microsystems. He joins us from palo alto. Good to have you with us. Explain to us what rex is. I have had a career of disrupting lots of industries, industry, all the industries that we disrupted with technologies, especially brokerbased industries. One of the last places that has not been disrupted is the real estate Residential Market with Real Estate Agents. It is very fragmented, very lowtech. Fees that you have to pay when you sell your house is among the highest in the world and has not changed in many years, even though on the buyer side most of the buyers are using the online environment virtual searching, doing a lot of the work that the Real Estate Agent used to do can now be done online. On the seller side and there is little work thats been done to solve all the problems of where i get my loans and mortgages, title, insurance, where do i get the pool boy, how do i move my stuff . Rex is hiring tons of engineers. I get a report every day. My stanford Computer Scientist is working there and there is a aiat team working out machine learning, big data, using that analysis to lower the cost to 2 versus the 5 to 6 of people are selling. Estatenk about a real agent, they dont share their data with their company because that is their secret gold. You have one person database. We are going global and deep and into all parts of knowledge about school systems, communities, where people are moving. We can do targeted advertising to people that are going through a life change. We have so much more information and can drive that into lowercost. We will basically turn that industry upside down. David you said at the top that you are a disrupter of sorts. How do you go about disrupting an industry, how do you get the word out, dislodge existing relationships . Here, andet on tv everybody should go to the website and sell or buy your house on it. I am listing my house on it, for instance. The second thing we do is be raise a lot of capital. Third, we have an unbelievable board of advisors on this company with people from mcdonalds, google, a bunch of other talented people who are helping us drive this into the market. Then word of mouth. This is growing quickly. We have opened up in just about all of the major markets in the United States. Its growing very quickly. The market has a tip to this kind of environment. We think we are going to be the market recipient of that tip, if you will. David you and your fellow tech people have taught us things and ashe network effect, a result, some companies have gotten awfully big. We have the alphabets and googles of the world, facebook, and there is a lot of push for regulation. Where are you on that, do we need the government to have some structure put around the Big Tech Companies . The government is here to help i cringe. I have become much more of a Smaller Government person the older i get. I have seen the federal budget go from 70 billion to 4. 7 trillion next year. I think we need to cut back on regulation. Congress moves at the speed of congress, not at the speed of the internet. They will get it wrong. I dont want to see private companies being managed, free speech being managed by the government through private companies. I have not been a favor of breaking up facebook. Thats not the issue. Time ago, you have no privacy, get over it. People in a lot of ways but its the truth. But if you are getting a free product from facebook, you are the product. You should not have an expectation that your data will be free. I tell my boys, anything that is , atured digitally with you digital tattoo, very hard to the race. The only people that have been able to erase anything worthy 30,000 clinton emails. That is the only thing that i know has been erased on the internet. Breaking it up will not be the problem. I always get frustrated with the phrase hate crime. What is a hate crime . A crime is hateful the matter what. There are Different Levels of hateful. Ont want the government we have freedom of speech. I think we need to get the political discourse off of social and onto a more neutral site. I have suggested that we need to forte the equivalent of npr that political conversation. Something that is a. Org, independent and open. David lets put aside regulation and the content of speech and talk about innovation. One of the concerns thats been expressed, if you get too big, it curtails innovators from competing with you. That was expressed in the old trusts. If you go back to standard oil, that was the concern, no opportunity. Are you seeing a curtailing of innovation and success . Scott that is a great question, a pertinent question. Facebook keepes me from doing in my life . There are lots of ways to take a picture of my dinner and share that. Am not feeling like i have loss of choice on where to post a picture of my desert. I have lots of ways of communicating with people. The people that might be upset that they have little choice our advertisers because Digital Advertising is, 347 is google and facebook, and they are gaining share. They might have a beef, but the consumer, you dont have to use facebook, twitter, you dont have to use google products. I dont use the google browser, for instance. I dont think innovation is , autonomousiotech vehicles or anything because of those companies. I dont think thats a big issue. David appreciate you being with us, very interesting. Coming up, the fall of the wall. We head to berlin as germany confronts big challenges 30 years after a Pivotal Moment in history. This is balance of power on Bloomberg Television and radio. 30 years ago, the berlin wall comes down. Germany unified for the First Time Since world war ii, but the cost of integrating the soviet state does not come cheap. Picks up, Industrial Production takes off, and germany becomes the dominant comedy of europe. In some sectors, the world. Basfwagen, bmw, siemens, to name a few. January 1, 1999, the euro is born with European Central bank headquartered in frankfurt. Berlin loses its beloved deutsche mark, but germany becomes the chief beneficiary of the common currency. As german economic might grows, problems are emerging. Crisis, aegion debt hostile russia, the immigration crisis, brexit, and the u. S. China trade war sapping germanys export dominance. Manufacturing collapses, exports slide, and germany teeters on the edge of its first recession in more than six years. With merkel in the twilight of her power, germany aims to restore its preeminence. Builds on the government to spend its way out of the economic malaise. The question is even if the fiscal taps are open, would be enough to prime the onetime engine of europe . David that was matt miller reporting from berlin. Lets take a look at germanys journey since the fall of the berlin wall, and to preview what is still to come, lets welcome our guest from berlin. Quite an undertaking to put these two countries together. How much progress have they made in 30 years . Germany is one country and we have to keep this in mind. We have one language. That obviously helps integration massively. Germany is oneone has to say, when you travel through the east, you can see the country has massively changed. High unemployment, which we saw after the fall of the berlin wall has come down. The differences in on a plum are not that high anymore. You can see wealth is triggering through to the east. What has not been achieved is a east and west, people are feeling a part. Particular with eastern germans, they feel somehow left behind. This comes together with the trend of globalization. Big, International Companies which we just mentioned here, they are not based in east germany, they are all based in west germany. Eastern germans are still somehow feeling left behind and they feel sort of that the west is somewhat dictating where its going. David one of the things that we watch carefully with the politics in germany is the rise of populism, and that has certainly been a challenge for Angela Merkel. Is there a difference in the degree of population populism between the east and the west there is a difference. The east has not had that experience of immigration. It was a closed country. Even with just a limited number of refugees entering the east, it is almost too much for them to cope at the moment. Combine with this feeling of being left behind, the only bit they are getting from globalization is the refugees. They have the feeling that somehow the refugees get more than when they got after reunification. This is why xenophobia is building up in the east. Yes, it is dividing the country. Meid finally, it strikes that Angela Merkel herself is from the east. Has that may difference . Birgit it has not. Angela merkel has never made a big deal out of being from the east. She was aware, in order to be a successful chancellor, which she has been, she has to be sure that she represents the whole of germany. A out ofuld have made being an east german, the west germans would not have liked that. She always played that somewhat down. Now at the end of her 1ten ure, she is coming out more and said that east germans need to have more say in the country. David thank you so much. Jennen. Tr get ye this is balance of power on Bloomberg Television and radio. This is bloomberg. Sometimes your small screen is your big screen. And with the Xfinity Stream app, which is free with your service, you can take a spin through on demand shows, or stream live tv. Download your dvrd shows and movies on the fly. Even record from right where you are. Whether youre travelling around the country or around the house, keep what you watch with you. Download the Xfinity Stream app and watch all the shows you love. Jonathan from new york city, im jonathan ferro. Bloomberg real yield starts right now. Coming up, global Risk Appetite remains at the mercy of the next trade headline. Treasuries heading for a big week. Bond yields climbed to a threemonth high. We begin with a big issue. The global bond market shakeout. It feels that in the bond market yields could go higher. Beyondainly you can go 2 likely by yearend