Than 60 of soybean exports before this whole trade war began. Futurespy have rebounded from two years of losses. Trade tensions have appeared to thaw a bit. President trumps tweets earlier that he will sign phase one of the trade deal on january 15 may open the door for more american exports to china. Vonnie thank you. That is renita. Thanks for the entire markets team for the bridge throughout 2019. Our guest,us is eddy. And here with us in studio is bloombergs mike regan. We added 5. 9 trillion dollars in value to u. S. Stocks, to the s p 500 in fact. Hard to believe that number even exists. Mich there it is. One of the real Amazing Stories about this year is the everything rally, whether it be oil, gold, havens, treasuries. The treasury etf is up about 9 for the year. 15 for the year. The Bloomberg Barclays aggregate bond index is up 9 for a return for the year. It is rare to see a year like that were basically everything performs. I think part of it is the fact that we have this historic low unemployment rate. , investing. Aving joblessgo back to those numbers. Those are staying low, people are not looking at investments as a saving account and pulling out of it, that kind of explains this rally. Romaine eddie, for those folks out there that are maybe trying to figure out where to reallocate their money and pick out the right sectors and the right stocks, are you buying into this idea of a growth story and the idea that maybe it is time to jump back in little bit heavier into cyclicals . I think there is a lot of strength. The federal reserve, we are starting to see the effects of the feds recent rate cuts trickle down to the economy. Just look at the housing sector. , thetly, the homebuilders Confidence Index was at a 20 year high. Significantly revised the outlook for 2020 significantly higher. They said there is particularly a dearth of housing at the low end. I think there is a lot of opportunity within cyclicals, which have really not done that terribly well. It is not difficult to find yields over 3 or 4 in the area of the market because stocks like exxon, you can get 5 yield on that. Think investors are wise to make sure they get appropriate exposure. Vonnie how much cash are you holding or how much of your portfolio will you be shifting to cash . As little cash as possible. I would not want to be left out of this market right now. Year, we have apple at a record high on the year, Companies Like lululemon. There were a lot of people who came into this year who really sort of misjudged where the economy was, where the market was. Do you think that some of these gains simply frontran where we are in 2020 . It would be hard to imagine another year like this, a 30 gain back to back. Romaine they are rare, back to back gains. Michael i look at sort of what happens after big gains like this year. Usually have strong gains Going Forward for several years. Com experience in the late 1990s sort of distorts that. Of beget further gains. The question on everyones mind right now, how much valuation expansion can the market tolerate . The Earnings Growth right now, looking like 9 . A lot of that is backloaded toward the end of the year. Quarter inve a week terms of Earnings Growth. Keeppeople be willing to pushing these valuations higher in the nearterm, expecting that payoff down the line . Vonnie do we see as much volatility next year as last year . Eddy it is hard to get less volatility. I think there will be more volatility, particular as we head toward election day. There are things we just do not know about, and that is what the market does not like. Romaine we are going to leave it right there. Happy new years to the investment manager, eddy e lfenbein, and of course, our own mike regan. That does it for the closing bell. Whatd you miss . Is coming up next. We will be looking at the key charts that defines last year. This is bloomberg. Live from bloombergs World Headquarters in new york, happy new years. I am romaine bostick. Vonnie i am vonnie quinn, in for scarlet fu. Joe weisenthal is off. Romaine the dow, s p, and nasdaq all finishing in the green. Last market close of the year and decade. Beststocks with one of the years of the decade, the s p 500 to a 29 advantage. Says the phase one trade deal will be signed january 15. Roaring into the 20s. Bitcoin has risen 9,000,000 since 2010. Can the digital token keep it up this decade . We enter into a new decade, it is time to look at the highs and lows of this years market. Here is bloombergs abigail doolittle. Abigail when a year in 2019 for stocks. The s p 500 rallying to the best year since 2013. It was an even bigger year in some cases for bonds. This chart is the negative yielding debt around the world. Muchin 2015, not so negative yielding debt. Go, yields above 10 trillion. At one point this year, there was 17 trillion in negative yielding debt. Bondwas just how big the rally was. Bonds are still in rally mode. This of course has had an influence this year. The fact that the yield curve inversion happened similar to what happened back in 2000, then 2006 and 2007. It tells you that investors are willing to receive less of a return for longer term debt. Each time, it has proceeded a recession on average by 18 months. We see that happening in 2008 and 2009 after the yield curve inversion. The yield curve inversion and 2019, it happened, so it is going to be very interesting to next 6, 12, 18 months, if we see a recession in the u. S. Year,p 500 gaining this the best year since 2013. Bonds, treasury notes, the best year since 2011. That has helped the classic 6040 portfolio. 827 return. T that is phenomenal for the clean portfolio. A banner year. Abigail romaine doolittle, happy new year. It has been a volatile decade for bitcoin. The largest digital token posting gains of more than 9,000,000 since july of 2010, climbing to as high as 20,000 in 2017 at its peak. I bought a couple of bitcoins for like a thousand bucks and sold them for like 1800 and i was so proud of myself. You bought them at 1000, it is currently trading at around 7,200. That would have been a great gain. Ofple talked about the cost storage, the cost of mining, all of that. View thatort of a when it hits a certain threshold, it costs minors to mind the bitcoin so at that point they dont make any gains. At that point, it is contentious. Still, massive gains. Romaine bloomberg pricing here is about 7,000. Well below its peak. A lot of people are talking about this thing called the halving coming up next year. In may. Miners get a certain number of bitcoins when they are mining them. When the halving happens, that reward gets cut in half. That is meant to increase the supply which presumably would drive up the price. A lot of people say the halving has already been priced and because we have known about it for so long. They use examples of prior halvings in the past couple of years, the price tends to rise ahead of the event, which is why some people think it might rise heading into may. A lot of investors say, we already know about this, it is priced in. Romaine bitcoin, at least in terms of the news media, did we start to feel larger sort of Institutional Investors get involved with this . Of a while, it was just sort folks on the fringes making money. There were a lot of skeptics and a lot of skepticism. That is a really contentious question. Romaine did i offend like half of our viewers . Is anyone even watching this on new years eve . A lot of people actually invested in the space say that there is that greater adoption we are seeing with investors coming in in greater numbers. If you look at the numbers, it does not pan out as well as some might lead you to believe there is the coin, than there is blockchain. There is a lot of competition probably more so in coins. There were tons of new coins coming out about a year ago, two years ago. It slowed down dramatically since the peak in 2017. The blockchain technology, there were tons of blockchain technologies. I went to a conference where people were proclaiming that blockchain actually is dead. There is a number of companies who were sort of the early adopters, the early starters in the blockchain space, who have shifted focus. It does tend to ebb and flow along with the actual price. They are saying, block chain is dead. We will see what happens in 2020. Vonnie that is phenomenal. Our thanks. She will continue to follow those stories throughout 2020. It has been a banner year for withrate credits, doubledigit returns. Distressed debt in 2020. That is next. This is bloomberg. Vonnie it has been a banner year for highyield. Returning more than 14 yeartodate i sat down with marathon ceos richard to discuss highyield heading into the new year. Thats have a listen. Returns are stellar this year. The highyield market is up 14 due to three primary reasons. Time last year, how cheap highyield had gotten when the markets were for sale. Lasts the tightening from decembers losses in the marketplace. The coupon. O about 4 was due to lower rates. The rally in the 10 year end fiveyear notes. So, without that wind to your back for next year, i believe highyield will struggle to make its 5 coupon, given how tight it already is, the index, and given that we believe that rates could nj little higher. We believe that highyield is fully priced in the current market, so fully priced that they are trading call base call base. Call price. I think the u. S. Markets will have a spirit upwards in growth. The fed did lower rates by 75 basis points, and that is beneficial. Even more important, these trade sos have now been settled the u. S. And china, mexico and canada, that is clarification for the market. Brexit now, the referendum that for us johnson has in the u. K. , all highly beneficial to global growth. I think the growth trend is firmly in place for 2020. I dont think it is going to be a growth recession. I think it is going to be in earnings recession. We are starting to see this past quarter of Earnings Growth being negative and i think we will see a couple of quarters of that through the early parts of 2020. As earnings go down, that will be a key point for some of these companies that are so over levered and have to service this heavy load of debt. Vonnie that was marathon asset animate ceo Bruce Richard asset ceo Bruce Richard. We got cccs blowing out recently. Romaine we kept talking about sort of that reach for yield, the idea that when you have this negative rate environment, that was the story not only of the year but the decade. This is where they looked. Isnie saying that the ecb going to come and he is convinced have a bring interestrate backup to zero. Romaine it is going to take some time to do that. It is not just a Monetary Policy move but, to a certain extent, it is a political move. In certain countries, that will be easier said than done. Innie 127 billion just november, and that was a high. Youve got to wonder where that will go last year. Way down there balance sheets. A lot of folks are saying we could see a flow out of fixed income, and that could go back into equities. You are seeing some of these gains of the year. The world index, we talk about what is happening, obviously this includes the gains for the u. S. 2009, the best year in the decade. While a couple of the top names are u. S. Stocks like roku and snap, you have some asian companies, you have shopper fine you have shopifiy. In 2020, you have to start looking a little bit outside of the u. S. Borders. Vonnie it has been a good year for emerging markets as well. You have to go to emerging markets as well and make sure you get china right on that one. Coming up, it will be a new year with a new signing day for phase one of the china trade deal. This is bloomberg. Lets get the first word. We begin with a first story that is developing. President donald trump on twitter saying that iran will be held fully responsible for the attack on the u. S. Embassy in baghdad. Forident trump blaming iran an attack on the compound. The iraqi militiamen and their supporters venting rage over u. S. Airstrikes. They busted through the compound s main door and set fire to a reception area. Wednesday, in indiancontrolled kashmir, Text Messaging Services will be restored following a monthlong communications lockdown. They are concerned separatist will use the services to organize protests. Also to be restored, Broadband Services in government run hospitals. In france, the government hopes strikes against pension reform plans may be winding down. Services around practice improving slightly. Macronpresident emmanuel s annual new years speech. Chancellor Angela Merkel of germany delivering her new years eve speech, pushing for more action on Climate Change in the next decade. Ms. Merkel acknowledging the shortcomings of a climate package. Global news 24 hours a day on air and on quick take by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. This is bloomberg. Vonnie some headlines now out of north korea. We were anticipating a speech and new years address from kim jongun. He is adopting a hawkish tone. He is saying that the world will witness a new strategic weapon. He says bolstering north korean deterrence depends on the United States, and he will steadily develop weapons until the u. S. Drops its hostile policy. He said he will never barter the security of north korea for anything else. But nevertheless not to be dismissed. Romaine some breaking news with regards to the u. S. Approached iran. President trump tweeted that iran will be held fully responsible for the lives lost for any damage occurred incurred at our facilities. He is talking about the u. S. Embassy in baghdad which suffered some damage as well as some other issues. The u. S. Basically saying that iran is responsible and President Trump saying that they will hold he ran responsible should that pan out. Avin cirilli, can you give us little update, what is going on with the situation right now . Kevin a fluid situation as just in the past hour, the president tweeting out what he called a threat. Protesters storming the Baghdad Embassy in iraq. Whiches at a time in tensions have severely escalated between the u. S. And iran. From the sources i have talked with at the state department, they have deep concerns over what theyve usa troubling situation of iran using expansionary policies into iraq as it relates to these protests and other developments. That is why i am told that President Trump in part decided on that airstrike on sunday. The protests today at the Baghdad Embassy, the proiranian protesters saying that was in response to those airstrikes. Hook is the special envoy to the from the United States to iran and he says sanctions are incredibly likely. Vonnie kevin, it is the end of the year and there is a lot of hawkish talk from a lot of leaders. People whatng the they are supposed to be representing, sort of a reason. What does that mean for the First Quarter of 2020 . Kevin on the trade front, you have the usmca. When the Senate Returns, they will advance that President Trumps desk. President trump tweeting that the u. S. China phase i deal will be inked. On foreign policy, uncertain surrounding north korea and of course iran. On the political front, of course buckle up for the election year. And dont forget about that impeachment trial. Romaine there is an impeachment trial that is supposed to take place sometime next month. Do we have any sense about whether mcconnell or nancy pelosi have sorted out what is going on there . Kevin no, but i expect more when the Senate Returns next month. Vonnie Kevin Cirilli reporting from washington. From new york, this is bloomberg. Look at what for a stories are trending across the bloomberg universe. Terminal users reading about the richest man in asia, with 30 to test an Online Shopping who is starting to test an Online Shopping portal to compete with amazon. Promising free Home Delivery and a return policy that asks no questions. It is currently available in only three neighborhoods surrounding mumbai. Bloomberg. Com has a story on netflix which had produced all of its studios this year with 60 new releases. This is after relying mostly on television. 2019 seems to be the year that the streaming company has finally become a movie studio. Toy filmmakers turning to it get their movies made. Quick take by bloomberg has reported that some researchers want to label food with the amount of exercise you would need to do to burn off the calories. They say this would help fight obesity as some say this would be a more effective way than is putting the calorie class calorie count on the product. Vonnie thank you. Democratic president ial candidate Elizabeth Warren says she is no enemy of capitalism but the u. S. Economy is working better for the rich that it is for regular americans. Senator warren spoke to Joe Weisenthal on december 4. Senator warren i am a capitalist, but markets without rules or theft. Part of those rules are that everybody is supposed to pay their fair share on taxes so we can reinvest it in opportunity for all of our kids. That is what a to send wealth cent wealth tax is. Your first 50 million of accumulated wealth, free and clear. Your 50 million and first dollar, you have to pitch in two cents. Joe you say you are a capitalist. There are numerous people, probably many uber tv viewers, who suspect other many bloomberg tv viewers who suspect otherwise. I dont put a lot of weight on these predictions, but under a warrant administration, would the performance of the stock market be something you care about . Senator warren what i care fort is in economy not just the millionaires and billionaires, but for all americans. What is happening to working families across this country . It has been a generation and very little growth in income. At the same time, families are squeezed for housing, health care, child care. Families take on more and more debt, they are squeezed harder and harder. By the way, that is part of why i want to see a wealth tax. It is what we can do with that wealth tax, how we can invest in an entire generation of young americans. A technicale question about the wealth tax. There are people with over 50 billion 50 million who have a lot of their money tied up in a liquid stock. I always hear people in Silicon Valley talking about this. It applies to one of your rivals, our owner here. A wealth taxvy against somebody whose ownership is tied up in private shares . Can givearren you them a chance to see how it works over a period of time but you can just say, we can do it because it will be a problem to selloff some of my stock. Keep this in mind. Pay99 in america, they 7. 2 of their total wealth and taxes. Toptop one to of 1 0. 1 , they are paying 3. 2 of their total wealth in taxes. Asking them to pay two cents more means they are still not carrying a fair share. Romaine that was u. S. Democratic president ial candidate Elizabeth Warren speaking to Joe Weisenthal. That was back on december 4. They quick note, michael bloomberg, the founder and majority owner of bloomberg lp, the Parent Company of bloomberg news, is also a president ial candidate. Out there right now, real estate markets in the u. S. Showing fresh strength. Home prices rising at the best pace in five months. Values index of property increased 2. 2 from the previous year. Lower Mortgage Rates and a stronger labor market have helped consumers stay upbeat. Oil prices up about 34 this year. They have been bolstered by fresh geopolitical tensions in the middle east. Chinas tencent looks at 10 of the Worlds Largest music company. The deal at 34 billion will allow them to increase their stake to up to 20 in the next year. They have been trying to cash in on the soaring value of the music business and it could help give universal better access to china. Sticking with entertainment, we mentioned a little bit earlier, netflix has been making their own movies for years, but 2019 was sort of the year where so much of their content was their own films. This was not just little hallmark holiday movie type films, these were big features, the irishman, the kind of stuff you would normally see in the theaters. Vonnie we spent a lot of the year talking about viacom cbs, who would want their plans on some of the studios still up for grabs, when actually the sort of silent contender was netflix building their studio from within and adhering to its own rules, not even worrying about how long those movies play for in the theaters. Were one of the few people to watch the irishman all the way to the end. Vonnie there were a huge number of people who watched it but they do calculated based on even the first two minutes. Romaine there was a great story about how netflix has really changed the economics of hollywood. That was one of the big stories over the decade. A best picture oscar would really benefit the company enormously. Valley, uberilicon and postmates have sued the state of california, alleging that a labor rights law is unconstitutional. On the phone is bloomberg legal reporter joe rosenblatt. What is the state of california saying is exactly unconstitutional . Uber andactually postmates has joined it a lawsuit to say that the California Law is unconstitutional. Very briefly, that law, signed by the governor in september, says that workers can really generally only be considered contractors if they are performing duties outside of the usual course of a companys business. It adopts a more straightforward test for which workers qualify employees, meaning they get overtime, health care, business expense reimbursements. These are all things that uber does not want to pay. Economy all the Gig Companies dont want to pay that. They are claiming that the law is unconstitutional. I understand from a business perspective, but the legal argument, what exactly is the ground that stands on, especially when you consider that california and some of the courts in the u. S. Have kind of said that they really are employees . This law goes into effect tomorrow. If you thought california was maybe more progressive than the rest of the United States, this makes it even more so. If you talk to lawyers on both sides of the argument, those representing workers, those representing uber or Companies Like uber, they will tell you that this law will be tough to get around. They are attacking it on various fronts. The legal argument is a constitutional argument. Uber and postmates are saying it is an equal protection claim and they are arguing that california cannot deny anyone equal protection under the law. There been some industries that have been exempted. I can give you examples. But the upshot of the argument is that this is an unfair, arbitrary, illegal, unconstitutional targeting of dased company of appbase companies. Vonnie what is next in court and how far could this escalate . Joel we will see what the court has to say. What is next is uber and postmates have asked the court for an order to block the law. That is not going to happen tomorrow. But we will see very soon what a court thinks of these arguments and whether or not uber wins what it is asking for witches initially in order blocking the law from taking effect while the parties fight it out in court. So next up is a court hearing. We do not have a date on that yet. Vonnie how does it fit in with a Ballot Initiative to overturn that law as well . There is a Ballot Initiative to overturn the law. That will be on the ballot in november. This is another front. Uber isfront in which trying to stop or at least change this law. The chances of success, it is early, but my sources say it is a long shot. That courts generally recognized that legislative line drawing is inevitable and legislators have to be able to tackle problems in pieces, and even if you dont get it exactly right the first time around, it is a messy process, and courts are generally deferential to legislatures in that way. From what i can tell so far, this lawsuit will be reached. Vonnie thank you. Going,up, going, going, gone. Former nissan Ceo Carlos Ghosn has successfully fled japan and returned to lebanon. This is bloomberg. Vonnie the former head of nissan and renault, carlos ghosn, fled almost roundtheclock surveillance from the japanese government ahead of two trials in tokyo. He is charged with financial misconduct and rating and raiding Corporate Resources for personal gain. Someed lebanon and at point it was not a secret any longer but what was a mystery is how he got there. We just saw a report from dow jones talking about how this was weeks in the making. Theyre reporting sort of agrees with others that we have seen that his wife, who has been very vocal and has come to bloomberg television, the idea that she have that she may have played a role in orchestrating this. The authorities do not mess around. We all may remember, the head of communication was put in jail. Toyotas president came forward to speak on her behalf and there was very harsh treatment. The idea that, for months, he was not even allowed to speak with his wife as one of the conditions of his bail, to go from that to escape is incredible. Some of i think we have the interview that his wife did with scarlet fu. They have destroyed our lives and we are scarred forever, and over what. Who has won in this . Nissan, you saw how badly they are doing. Japan, the reputation has been ruined. I dont know what foreign businessmen would think twice of working in japan after what happened to my husband. Herine she said she wanted husband to be tried in france. He said he would demand to be tried there. Dealing with nissan, do they need this headache right now . Absolutely not. Ofs has all been a sort ugly ordealf the that played out over the last year. France is of supposed to look out for his for its citizens in these kind of situations. You can kind of count on the japanese government to try to bring him to justice. It is kind of terrifying that they would speak like that because he is accused of really messing up the lives of shareholders, and one of those is the french government. Renault has also found some wrongdoing as well. The defense that this is all a sort of conspiracy to take him down, but renault also fired him after this. This is something to watch going into 2020. Vonnie still do not miss this. Most markets are closed tomorrow for new years day. You can be keeping those resolutions instead of trading. Romaine when you come back, the numbers for pmi and manufacturing data out on thursday. Vonnie that is all for whatd you miss . In 2019. Romaine Bloomberg Technology is up next. Have a happy and safe new years eve. This is bloomberg. Whether youre out here on lte or here on a wifi hotspot, Xfinity Mobile has more coverage to keep you connected to what matters most. Moooo. Thats because its the only Wireless Network that automatically connects you to millions of secure wifi hotspots and the best lte everywhere else. Save up to 400 a year when you switch. Plus, unwrap 250 off our best phones. Click, call or visit a store today. Taylor i am taylor riggs in San Francisco in for emily chang, and this is Bloomberg Technology. Tech domination another runaway year for tech companies. Plus, bearish ipo. 2020 brings the promise of debuts from Companies Like airbnb, palant