Transcripts For BLOOMBERG Bloomberg Markets Americas 20240713

With strict conditions will be allowed to compete under a neutral flag. Russia has 21 days to appeal the decision. Former fed chairman paul paul volcker is dead. He broke the back of u. S. Inflation during the 80s. Later, he led president obamas efforts to rein in the investment risk of commercial banks. That led to the volcker rule which the banks hated. Paul volcker was 92 years old. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im Mark Crumpton. This is bloomberg. Vonnie and at 6 00 p. M. In hong kong. 0 a. M. In im a vonnie quinn. Welcome to bloomberg markets. From bloomberg world headquarters, here the top stories from around the world that we are following. We are on the cusp of a busy week with a lot of potential catalysts from the fomc meeting to the looming americachina tariff deadline. Plus, the u. S. Winter flu season is off to its earliest start in more than 15 years. We will tell you how fact how vaccine experts are preparing. Brownbrown of bobby cosmetics will join on her latest venture. We also have lots out of washington, d. C. Kailey leinz is with us. Halfway into the trading day. Really range bound. Kaylee we are firmly in the red with the s p 500 and nasdaq. The dow is in the red by. 25 . It is on lighter volume than usual. Investors holding back on making any big thats ahead of a risk full of risk factors including decisions as well as a looming tariff deadline over the weekend. If the s p ends lower, it would be the first day that it is down. Up 1 9 10 of 1 for december. If we take a look at how december has stacked up historically, last december was a very ugly when leaving a bad taste in investors mouth. When you look at what history tells us, it may suggest we have more upside to go into the end of this year. Returns have been declining. The exception to the rule is a an is in years prior. Every year since 1970 prior to an election, the returns of 3. 4 . That could suggest we have gains to make through the end of the month. As for stocks not gaining, look at Computer Hardware Companies which are lower today. That is after a report that china is getting rid of approximately 20 million foreignmade computers and government offices in the next three years and replacing them with domestic ones. 5 . R by apple and Western Digital falling by nearly 2 . That is where a group of stocks are going up, departments store is higher. Nordstrom higher by 4 . Kohls and macys up 3 . This after data showed that a traffic is up by 1 10 of 1 in the last four weeks. That is good for these Shopping Center based socks stocks. Vonnie kailey leinz, thank you for the market update. We are seeing headlines from the doj and Inspector General report. The horowitz report. It is on no bias or spying against the Trump Campaign. Majors the fbi made a mistakes surveying carter page. This is the longawaited horowitz report, michael horowitz. The report has been released. It is the report on fbi surveillance around the 2016 president ial election. Once again, it is talking about major mistakes in the carter page surveillance, but also saying the fbi probe into Trump Associates was justified. And the watchdog is urging a review of all officials working on the page case. We will have more on the details in a few moments. With u. S. Stocks edging lower, we are joined for Market Analysis by head of global equities, whose firm manages 1 trillion. How important is this week for where you position yourselves from next week onwards . A lot of information coming out this week. We think the key issue right now is that markets have priced in a lot of the optimism. Yes, there has been good news recently, fantastic employment report, Economic Data stabilizing. We are negotiating tariffs. 2019 has been about valuations driving markets higher. What we think will drive markets in 2020 is Earnings Growth. With that coming in at the midsingle digits next year, we think market returns will be lower Going Forward and we see a lot of volatility with inflation data coming out. Tariff, fed, and the deadline of december 15. Vonnie by the end of the weekend, we may be able to go back and focus on fundamentals. Is that too much to say . Saira i think that is the key Going Forward. Fundamentals are going to drive the markets higher. There is noise around the information coming out this week. What we are watching closely as the consumer which has been driving this bull market for many years, also inflation issues. We have seen average Hourly Earnings at the highest levels in a decade. All of that is key to watch and making sure the Earnings Growth stays intact in 2020 because we cant count on market valuations continuing to expand like they have this year. Vonnie where would you be looking to move money or to rotate out of . Cyclicals, they continue to lead the markets for probably the next quarter or two. If we dont get fast accelerating economic and Earnings Growth, we think the markets will shift to quality growth which is what we have seen for a long time. Also look outside of the u. S. We dont think the u. S. Returns will dominate next year. We think stronger Global Growth will help nonus markets start to perform at or than the u. S. Vonnie obviously, your equities, cio of global equities, but you must be keeping and i on bond yields even for no other reason then to see whether they are outpacing the yielding stocks. Saira i mean, the bond yields the yield curve has been telling us a lot of information it recently. It is mixed. We have seen it invert which is negative for the markets. We are more worried about this inflation data causing the yields curve to not invert and maybe because inflation and potentially not 2020 20, but the fed to think about potentially increasing rates of inflation if inflation bubbles up like we are seeing signs of. Vonnie vonnie you mentioned there will be synchronous Global Growth. Are you looking at any particular area geographically speaking in terms of something attractive . Saira yes. In germany, bottoming Economic Data. We think european cyclicals can actually continue to perform well. We are relatively positive on china now for the near term if tariff negotiations continue to go well. Longerterm, we like brazil, strong reform story there and india where we think there could be rate cuts and earning revisions are starting to look more positive. That is a longerterm story. India tends to be a more defensive play because it is not as dependent on the rest of the world as other emerging markets. Vonnie fascinating. Thank you for joining us. Saira malik, cio and head of global equities. For more on those headlines, regarding the doj report on the fbi surveillance around the 2016 election, we have Josh Wingrove joining us. White house reporter. If you headlines are quite surprising, explain to us how these came out and what was surprising to you. Josh this report has something for everyone. If you felt in the impeachment process but it feels like democrats and republicans are talking about different sets of facts and things, we will see more of that probably with this report. The headline finding will be celebrated by democrats. It shows the fbi was justified in opening the investigation as to whether russia colluded with the Trump Campaign were figures in the campaign to impact the 2016 election. Trump has denied this repeatedly and it is now they are black and white. The report also says there was 17 significant omissions or errors made in applications related to surveillance of carter page, a trump aide. That is being seized on by the trump administration. We have william barr rejecting already this report saying those errors are the fire under the smoke that the president needs to see. This longawaited report, doesnt mean the end of the trump worlds pursuit that they believe something happened here. We will probably see democrats sees on the first part i mentioned, the fbi was justified in doing what it did. While republicans will seize on the second part, saying there were errors. Vonnie thank you for that. The horowitz report out and we can dissect it throughout the afternoon. That is Josh Wingrove and washington, d. C. We are going to come back in a moment. And speak withbo speak with bobbi brown. This is bloomberg. Is bloomberg markets. Im vonnie quinn. The changing face of beauty. Bobbi brown has medics has been a household name since the mid1990s paid 30 years later, it is tackling beauty from the inside. Launching a wellness line and sharing her philosophy, hosting a master class. You see pictures of some of those master classes right there. Having just watched them, im pleased to welcome bobbi brown into the studio. Welcome. You have had a phenomenal career. You have already launched and walked away from a multihundred Million Dollar business. What is evolution 18 and why now . Bobbi evolution 18 is a wellness brand that are supplements that women can take so you can get beauty from the inside out, which is what i believe in as well as what you put on your face. What you putting your body makes a big difference. Vonnie what are in the supplements . There are huge controversies now about various different supplements and fads. And you have to ask, why do you need something beyond minerals . Bobbi they are supplements. I am now a health coach. What i learned, the better you eat, these are supplements. They supplement your diet. There is collagen and they are way protein powders, things that make you feel better that taste good and it helps your skin, your nails, hair. It just makes you more beautiful. Vonnie mistakes that most founders make. You have probably come through a lot of. What did you learn from bobbi brown has medics that you will bring with you through evolution 18 and will improve evolution 18 . Bobbi that is a great question. No one has ever asked me that before. What i learned, building a brand, i understand what my customer wants. I understand what women need and men too. Everybody wants the same thing, they want to look good, feel better. Vonnie what are their primary goals of these evolution 18 products . Is it antiaging, is adjust to have a glow, are there various ones . Bobbi im not someone that believes in antiaging. I think that word should be dropped. Having glow he skin, you can get that with makeup, you can have it high have it by healthy you are. Teach people not just to take supplements, to be better, but to change her diet and your habit and your lifestyle. Vonnie obviously, smaller brands have been eat have been being eaten up by larger browns brands. One is like kylie jenner acquisition, more than 1 billion. Are you surprised at how the industry has taken off . . Or did you expect this to happen 20 years ago . Bobbi im not surprised. I think right now the industry is interesting. There is a lot of opportunity for people to create something that is different. The whole idea is not to do what everyone else is doing. I think these young entrepreneurs that have hit the mark, kylie being one of them, is interesting. Vonnie also what is interesting is the trend seems to have been, for a long time, toward more. More colors, more makeup, extra, thicker, deeper. You are the opposite of that. Do you think at some point, people will be done with this instagram culture of caking makeup on and go for something more subtle . Bobbi i think the world is a big place and there are women that want that instagram look and there are women that dont. The women that want to look like a better version of themselves, there is a big audience for that. When i was shooting master class, i got really lucky and really deep showing people how this is of the simple things make a difference. How to choose the right foundation, those are the things people want to learn. Vonnie also one that resonated with me as you dont have to have everything down but if you have a nice nail bobbi yes, you got that. Vonnie thats all you need. Bobbi you have Everything Else done just fine. Vonnie the team here is wonderful. What is your goal for evolution 18 . Bobbi my ultimate goal for evolution 18, it is a baby, is to grow it and just be the most authentic great brand out there. Vonnie where do the supplements get made . How could we get some . Bobbi they are made in the u. S. And you can get them at evolution18. Com, walmart, kohls. Vonnie congratulation on your new venture. Hope you come back and visit us further down the road. Bobbi thank you very much. Vonnie that is a legendary bobbi brown, the founder of bobbi brown cosmetics. Still had a come of the flu goes beyond the fever and runny nose. It is costing billions of dollars of every in every year paired what you need to know about this years influenzas virus. We discussed next. This is bloomberg. Vonnie this is balance of power. Bloomberg markets. Im vonnie quinn. In the united kingdom, polls show Boris Johnsons conservatives are likely to win a majority in thursdays election. No one is rolling out the leader of the opposition labor party, jeremy corbyn. He is 70 years old and one of the oldest firsttime prime ministers. He wants to bring a number of industries under public control, among them, rail, water, Energy Production and mail. They would raise the minimum wage and spend more of the National Health service according to labour. He wants to attack multinationals, workforce and operations in the u. K. Workers would get up to 10 ownership in their companies. And, corbyn proposes a windfall tax on Oil Companies to be used to fight climate change. Thanks are a target too. They are calling for policies designed to curb their power and redistribute wealth. The tax would be expanded and bankers bonuses would be restricted. That is your bloomberg quicktake. It is time that time of the year, flu season. This year, almost more than other years, the disease is worth taking seriously. The flu is taking a stronghold in the southern u. S. And showing up in different strains and art that are not usually seen. Joining us with more is codirector of the Johns Hopkins center of Influenza Research and surveillance. And director of the center for emerging viruses and Infectious Diseases at the Johns Hopkins Bloomberg School of Public Health. Thank you for joining us. Why is this years influenza so dangerous . There are two things that are happening right now that cause us to be concerned. Number one, the number of flu cases that we are detecting is higher than we would expect to see at this point in time and any average year. In the strains causing the flu are ones we normally not see until the end of the flu season. Those two things are causing us to be wary about what is happening and what the beginning of the suit of the flu season will be like. Vonnie if we look back at the 20172018 flu season, there were 61,000 total deaths and 810,000 hospitalizations. It is not something to take lightly lately. There are humongous consequences to not getting vaccinated. Do vaccinations work . Are they enough . Dr. Pekosz vaccinations do work. The flu vaccine we use right now is not the greatest. But it can provide on good years up to 60 protection from influenza. Importantly, it also provides significant protection from hospitalization and from death from influenza. It is those extremes we are worried about in terms of our annual flu epidemics. I think flu oftentimes is not considered as serious of a disease because we hear about it all the time, we hear about it and annual epidemics. The numbers you quoted should bring home to people how serious it is. Vonnie and vaccinations have prevented an estimated 6. 2 million influenza illnesses last year. That is the positive side. Why are we seeing such an outbreak so early and so strong this year . Dr. Pekosz it is a little bit difficult for us to know why. But it is not uncommon for us to see influenza peak at different parts of the country at different times of the year. We tend to think about flu as one sort of simple homogeneous disease. Four different viruses can cause influenza. Youre vaccine consists of all viruses. Hose if you look at the maps in any year, you can see that influenza peaks at different parts of the country at different times of the year. A is a disease that really is very surprising thing in terms of what strains appear and where in the country it can appear as well as in how severely epidemics can be. Something we dont understand that well. Vonnie it is fascinating that the symptoms of the disease and so Much Research needs to be done. Tell us why we should disbelieve people who say dont get the influenza vaccine, it will give you the flu. Dr. Pekosz the vast majority of people who get the influenza vaccine get the influenza shot which is an index and into the arm. That vaccine is made up of killed virus and that virus is taken and ripped in half, and the other half is put into part of your body, that the influenza virus never sees during its normal infection. There really is no chance that you can catch influenza from the vaccine. You can have the modest side effects of the influenza vaccine which is redness of the site of injection, people complain they cant lift their arm up all the way without pain. But those are good signs. Those are signs that the vaccine working, that your immune responses kicking in and you are generating that protective immunity that you need to fight off influenza during the flu season. Vonnie the other reason is the greater good. Healthy,cide if we are we dont need the virus because we could be carriers and they are unhealthy among us that would be affected by that. Dr. Pekosz absolutely. The groups that suffer the most from influenza are the very young, those above the age of 65, and people that have medical conditions such as asthma or Heart Disease or diabetes or obesity. It is those same groups that the flu vaccine does not really work that well in. If the healthy population would take a higher level of the flu vaccine, then we can provide that herd immunity that would have the ripple effects of protecting those other more vulnerable populations from influenza. Vonnie very briefly, how far are we from eradicating influenza . Dr. Pekosz over the past three years, the National Institutes of health in the u. S. Has really invested a large amount of money in what they call the universal flu vaccine project. That is designed to make a vaccine that will protect against more strains of flu and will have at least a fiveyear efficacy. Clinical trials are starting year. We are hoping over the next year or two, we will have some sense of how far we are away from rolling out a better flu vaccine. Vonnie our thanks to dr. Andrew pekosz, codirector of the jon hopkins excellence and surveillance and director of the center for emerging viruses and Infectious Diseases in the Johns Hopkins Bloomberg School of Public Health. The Bloomberg School of Public Health is supported by the founder of bloomberg lp and bloomberg philanthropies. Omberg philanthropies. Here, it all starts with a simple. Hello hi how can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone wifi up there . Uhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your local xfinity store today. Mark i am Mark Crumpton with first word news. The fbi acted properly when it began a broad investigation into whether thenkennedy donald trump or people around him conspired with russia to interfere in the 2016 election, according to a new report from the justice departments Inspector General. The report finds the fbi had an authorized purpose when it opened the probe. President trump and allies have alleged he was targeted by politically motivated spying in an effort to undermine his candidacy and his presidency. The trumphas learned administration and House Democrats are on the verge of announcing a handshake deal on the u. S. Mexicocanada free trade agreement. Mexicos negotiator returns to washington today. Leaders of canada, mexico, and the u. S. Signed the agreement which would replace nafta more than a year ago. Cnbc is reporting that the white house and democrats have reached a deal that they vote possible on december 18. The saudi government killed three people at the Pensacola Naval base friday, apparently going on twitter before the attack to criticize you as a port of israel and accusing america of being antimuslim officials are treating the shooting as an act of terrorism. The will determine whether killer acted alone or was part of a larger plot. The man was in the u. S. To learn to fly and was killed by sheriffs deputies during the rampage. The Supreme Court with a controversial kentucky law known as confirmed consent that requires doctors to perform abortions to first show the woman an ultrasound and give a detailed description of the fetus, even if she does not want to listen. The justices today rejected an appeal by the states only Abortion Clinic and three doctors who say the law violate their free speech rights. Global news 24 hours a day, onair and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im Mark Crumpton. This is bloomberg. Bloombergve from headquarters in new york, i am shery ahn. Amanda and in toronto, i am amanda ling. Here are the top stories from around the world. Busy on the cusp of a week, fomc to the looming u. S. China tariff deadline, how investors are positioning. Repo blowup is not over. A morning that the funding issue in september was not just a hiccup, and says europe could be next. Tv ads on the decline, global tv Advertising Sales fell almost 4 , the steepest drop since the depths of the economic recession in 2009. Lets start with a quick check of the currency markets as we got this media reports that there was an agreement reached between the white house and the democrats on that trade deal. The house could vote on it on december 18, according to media reports. Not a lot of reaction. So far, this was pretty much anticipated eared we had seen Speaker Nancy Pelosi reviewing changes to the agreement that was reached with the mexican counterparts. They put it on paper over the past week. But today we are expecting lighthizer and his mexican counsel counterpart to meet in washington again. Meantime, strength for both the cad and mexican peso. The mexican peso rising against the u. S. Dollar. The u. S. Dollar remains pretty flat. Amanda, it is about sentiment across the broader market. Now that we have more positive trait headlines. Amanda and trade remains the focus. We have weeks of catalysts ahead of us, which is driving markets. We have weakness here, but s p 500 trading is about 20 below average daily volume. We have a lot going on, including the Federal Reserve coming up. I want to show you a read on leading Economic Indicators across Major Economies going back a few years. What we are beginning to see is a bit of an upturn here. In the corner of your screen is 2019. It start to bottom and turn up. Why is that relevant . We could be mirroring what we saw in 2012 and 2015. You get the dip and a little decline but then we turn back around and it becomes a late cycle dip. A reason for optimism perhaps. We need a couple more data points. That will also be factoring into what the fed is focusing on, the economy much in focus here. The federal open Market Committee is widely expected to keep Interest Rates unchanged this week. Kathy is chief u. S. Financial market. Lets start with where things sit in terms of reason for optimism about this economy. We have more positive data points. What do you think the fed signals this week about how it is reading and interpreting all of that. The fed is on hold. They signaled that recently with language and with the previous policy statement. The recent Employment Data that was stronger than expected i think topped the bloomberg range of estimates, certainly secures the fact that they are on hold. A little bit of weakness in the manufacturing area. That continues. Ism it also the ism connie mack nonmanufacturing was a little bit soft. For now, it is a wait and see period. Points, rates 75 basis and they want to see what the impact will be. Chart on thee gdp bloomberg is showing how the u. S. Ecodata as surprised to the downside recently. We are seeing a downtrend although still slightly positive. This is perhaps following europe going into the red. Jobsook at the positive numbers and Everything Else that came before that, weakness in ism nonmanufacturing, and you say we should be watching out for chair powell speaking this week. I want to see if he talks about the Downside Risks are less time they said the risks for inflation and economic theook were going to downside. Despite a stronger than expected november employment report, i would like to see if he is still concerned about the global slowdown. Tensions yes, maybe we have the usmca deal in hand or close by, for the phase i trade deal is still not in hand. And even if we got that, it is quite limited and there would still be ongoing tensions on the trade front between china and the u. S. Amanda talking to the canadian country head of blackrock, they are looking for what they would call healthy inflation in the year ahead. Where are you on the inflation outlook generally speaking . Healthyuld like to see inflation, but unfortunately, i think inflation will still struggle to get anywhere close target,eds 2 especially with the price index, the inflation measure they prefer. I think Companies Still lack pricing power, and that is just not going to change in the near term. Boost toere is a real economic growth, but we see the opposite. Economic growth is going to slow. That is going to keep inflation downside, note upside. Shery talking about inflation, the big headline today was former fed chairman paul volcker passing away. You spoke to him a few years ago and you were talking about the market risks, the financial crisis, as well. Talk about some of the biggest takeaways from your conversation and what you think his legacy will be. Oh, i think his legacy is that he has high integrity. He really believes in what hes doing and fights for it. We saw that when he slayed the inflation dragon in the late 1970s, and i think that carried through to the Obama Administration when they tapped him. Of course, he created the volcker rule, which has some contentious aspects to it for people on wall street, but nonetheless, integrity. I think he had a common sense approach really into his reasoning. Int really carried through the volcker rule and through his views on what was happening in the economy. He really wanted to understand todays Capital Markets and was concerned about the risks that the banks were taking and if it created Systemic Risk and crisis, as it did. It is his reasoning, his logic rooted in common sense, and really for good reason. It is where he thought policy should go for the betterment of our country and for citizens. Amanda and for those of us who know, even sitting down he towered over everybody, such a tall man, but also a towering figure in terms of what he brought to the world. At a time both the volcker rule and the Central Banks are being chipped away at here, two things he left as a solid legacy, your thoughts on the importance of Holding Tight on those things . Yeah, he definitely exhibited independent thought, and i think that is at the heart of what we would like to see the Federal Reserve continue to exhibit and hold onto. No doubt about that. He engendered criticism when he raised Interest Rates to nearly 20 in the early 1980s. There were two downturns that ensued after that, but he did slay inflation. It went from 60 all the way down to 4 when he left the fed in 1987. Interest rates fell from about 20 to 6. 5 . He accomplished the goal. Of the country with inflation, and he withstood the criticism that he was keeping rates and policy too tight, and it carries through to the volcker rule. Again, thought there needed to be a separation of protect of proprietary risk away from the Financial Market and to protect the Banking System as a whole. , thankkathy bostjancic you. We also had jay powell put out a statement on the passing of mr. Mr. Mr. Vocal. Volker. He believed there was no higher calling than public service. He had the ideals of integrity, courage, and commitment to do what was best to all americans. His contributions to the nation left a lasting legacy. My colleagues and i of the Federal Reserve mourn this loss and extend our condolences to his family. Paul volcker passed away sunday at the age of 92. More after the break. This is bloomberg. This amanda according to reports, the white house and democrats have reached a tentative deal on the usmca. Our reporter has been following this. In terms of what we think is happening here, there were final negotiations going on that would have to happen for congress to ratify. Can we make any assumptions about what is being agreed to . Josh we do not really know yet. The reason theyre calling it a tentative will is they need five different sort of entities to signoff come all three governments, democrats ample oc, and labor leaders. Donald trump hopes the head of the aflcio was here earlier today trying to get blessing there. Once all five of those can settle on where they want to be, then we will have a deal. But things look positive. Sounds like we could have an announcement pretty soon here and they could potentially vote by the end of the year or early in the new year. But there were steel rules mexico pushed back on. So the final look is still a little bit fuzzy. Amanda i thought there were some procedural matters that needed to be dealt with even before that. If they actually happen reach an agreement by the end of the year . Josh cnbc reports they will be voting december 18, but we have not confirmed that. There is a question whether they would use the fact check trade law or just throw it up for a vote. It is still very live right now, but things are sounding more positive over the last one for hours than earlier. Picking up on some of the stuff we reported on the last couple of weeks, i would not blame everyone for tuning out a little bit, but one of the things that is supposedly gone from this is a higher patent standard for biologics. This was a big gift or they agreed on patent protection to heavyduty biologic drugs for a longer time. Sounds like they gave that away or abandoned that. News. T would be good this continues to be sort of elosi, trump, and mexico negotiations. Canadians are kind of at the sidelines. Amanda josh, thank you for joining us from washington. Markets andto the mayhem in the u. S. Repo markets in september. It apparently was not temporary. That is according to new analysis from the bank for international settlement. For more on structural issues found, lets bring in katie. What we were told was two big events, treasury auctions, not to mention Corporate Tax payments. They say this is more than a temporary hiccup. Some factors they cited our post crisis, the regulations make it so the banks have less ability to step into the market and provide funding. They also made the point that hedge funds are increasingly funding their investments through the repo market. So you have that added demand combined with banks not being able to lend as much. You are in this environment where these are structural issues at play. Happened lasthey time, it was fairly shocking. Everybody said it is just these two events coinciding, not a big deal, not systemic. But they say it might be systemic. When is the next flashpoint to watch out for . Next monday, december 16. That is when we get those treasury auction settlements and those corporate quarterly tax statements. Those were the two temporary factors that were, in large part, behind septembers play. The difference now is the fed has injected liquidity in the market, so it will be interesting if you still see rates spike even with these cash injections. Shery the fed is not really set idle. They have been proactive, injecting liquidity into the market. How has that worked out . The past three year and operations by the fed have been oversubscribed. We had a 25 billion offering this morning, and that received about 33 going dollars in bids, which is pretty dramatic. It goes to show investors are trained to lock in funding at these rates ahead of what could be a volatile year end. We might see rates spike again. Amanda do we expect any kind of official response from the fed to the report from the bis . That will be interesting to see. We have not heard anything yet as far as i know. We know the fed has been examining is standing repo facility and other things. The fed chair also said they are looking at some of those banking regulations and that those could be adjusted in the future. It will be important to watch. Shery thank you so much for that. Up, global tv Advertising Sales fell almost 4 in 2019, the steepest drop since of the economic recession in 2009. Details next. This is bloomberg. Omberg. Amanda this is bloomberg markets. Shery we have breaking news. Cnbc issuing a correction, saying the white house and democrats do not have that usmca trade deal. They reported earlier that there was a tentative deal and that there could be a floor vote in the house possibly on december 18. Now they say that there has been no agreement as of yet. The golden age of television is not translated into ad sales. Global tv advertising revenue has fallen almost 4 this year, marking the steepest drop since 2009 amid the great recession. For more, lets bring in our Bloomberg Media reporter from los angeles. It is not that surprising, right . So much cord cutting. We are now seeing so many different streaming services. What can we expect when it comes to these added sales . It has actually been remarkable that this is held up for as long as they have they have gone up for decades uninterrupted. For many years now, even though the size of the audience watching live tv has been in decline come of the ad sales have continued to go up because tv networks have charged higher prices. It becomes a matter of scarcity, but tv is still a really effective way of reaching a large audience at once. There is nothing that replicates the size of an audience that will watch either a tv show live on monday night or you can charge more and more for that audience. We have now run into this wall or the tv industry has where they can no longer charge quite enough to cover up for the decline in audiences. Shery one of the stories we have been watching and fold in front of us is the permanent disappearance of the revenue model. The ad pie keeps shrinking. If tv loses it, does not all go to digital. Is this the beginning of a Pivotal Moment . Tv has been able to hang on to a bit of a premium. Inthe ad dollars will appear other places. The global u. S. Advertising market has grown for 10 years in a row, at least that is according to the company that commissions this report. What you have seen over that time is that Digital Advertising has grown from a tiny fraction to more than half of the Advertising Market now. The global Advertising Market is almost 600 billion. Online accounts for more than 300 billion of that. Will there come a point when advertising starts to shrink . Probably, and that will probably correspond to some kind of recession. Advertising tends to be a lagging indicator of the health of the global economy. What we have seen is we have had now 10, 12 years of uninterrupted growth pretty much for the global economy, and there is an assumption that at some point that will end, and when that happens, you have to assume advertising will go with it. They television is not only medium that has been hit. Were talking about radio and print publications. Is there any traditional medium still growing at this point . Ooh, out of home advertising, group last year and has grown a lot. Companies still want to get the attention of people out in the world. At the same time that we have seen people spend more and more time online, we have also seen a surge in businesses that offer socalled experiences, like live music or food festivals. Out of home is sort of a corollary to that. And another reason that a lot of the Big Tech Companies that have driven the growth in Digital Advertising are among the largest advertising on billboards, the same companys, facebook, apple, netflix, google, they ranked among the 20 biggest buyers of out of home advertising. As we see the popularity of Digital Services jump, do you expect to see more of them toying with ads, including content providers that have not so far had ads . You have to think there will be more experimentation with advertising in online video. Yes, netflix is really successful and you have seen a lot of Large Media Companies now following them. Disney, comcast, at t, apple, but there is no question that theres market advertising on video. Youtube reaches far more people than netflix because it is free. You have seen Smaller Companies over the last several years like ku is a majoro, ro player, amazon, and i think you will see them a try Something Like twitch. You will see more experiments in advertising supporting video. You might see a premium on paid and less on adsupported. Much forank you so that from los angeles. The Hollywood Foreign press association nominating for the golden globes. You maye watching, watch a lot of streaming service winners. Three of the five movies are netflix productions. Great onhman was netflix. And looking forward to the animated series. Frozen 2 is also my favorite. Very excited. Live frome to come toronto and new york. This is bloomberg. I Mark Crumpton with bloomberg first word news. The fbi to properly when it began abroad best gauge and into whether then candidate donald or people around him conspired with russia to interfere in the 2016 election. That is according to a new report from the justice departments Inspector General. The 400 page long report finds the fbi had a quote authorized purpose quote when it open to the probe. President trump and his allies have long alleged it was targeted by politically motivated spying in an effort to undermine his candidacy and his presidency. The House Judiciary Committee today received a detailed summary on the impeachment case against president trump, as democrats prepare formal charges against him. The president and his allies lobbed fresh assaults on the proceedings they dismiss as a hoax and a sham. Democratic lawyers outlined the findings so far, saying the president s push to have ukraine investigate rival joe biden while at the same time withholding u. S. Military aid ran counter to u. S. Policy, and benefited russia as well as himself. The European Union says some of