comparemela.com

Hours as we await the next jobs number. Time now for global exchange. From london to berlin and washington come our bloomberg voices are on the ground with this mornings top stories. We begin with irans response to claims that the ukrainian passenger jet crashed in tehran was shut down. The head of the countrys Civil Aviation authority said this on state tv. Law, i said, based on the there is full coordination between our air defense and civil system. Are Aviation Personnel and defense personnel sit sidebyside, so it is absolutely impossible for such a thing to happen. Alix for more, we are joined by stuart wallace, Bloomberg News director for the middle east, joining us from washington. What is the latest . Stuart tehran came out with that, and they are sticking to its story. They continue to stick to that line despite just about everyone theye world saying that have reasonably good intelligence that there was at least a possibility that airplane was hit by a missile. That hasnt been confirmed, but clearly, in the context of what is going on in that region, the continued uncertainty about just what happened will confound people. So we got every government trying to step back from a conflict come about at the same time, youve got this argument brewing about what did have a do that airplane. Unfortunately, it may take months for that to come to light and for us to get confirmation on what exactly did happen. With the black box, they probably can get at the core data. The problem here is it is subject to very strong sanctions, so there is some doubt as to whether every party is going to be go is going to be able to participate in that investigation. Right now, the world watches and waits whether we can get a more definitive answer. Alix thank you. We want to stay in aviation because we are awaiting airbus order numbers for 2019. They could come today or monday. What are we going to be looking for . Reporter we are looking to see how many planes airbus delivered in 2019, as well as how many orders theyve got. Will stop producing the 737 max this month, essentially all eyes. Are on airbus airbus all eyes are on airbus. Airbus has struggled with production of the 320 series because of the focus on the more expensive and longer aircraft. Essentially, we will be looking to see if airbus can meet its delivery target that it set last year, which was for it hundred 60 aircraft, for 860 aircraft. Reporter thank you. Alix thank you. We turn to boeing now because newly released messages reveal a pilot saying the 737 max was designed by clowns supervised by monkeys. Our Bloomberg Opinion columnist joins us from berlin. That was a taste of some harsh rhetoric from employees. Walk us through what we learned and the significance Going Forward. Reporter some of these emails are really appalling and display a real callup alere a real cavalier attitude toward safety, disrespect for the regulators whose job it is to ensure the aircraft that boeing builds are safe. After the two fatal crashes involving the 737 max, we know that is not the case. Boeing is desperate to get that back in the sky. To do that, it needs the goodwill of regulators. Frankly, right now it is not going to have it. These emails show that boeing really went out of its way to regulatorsnes and main dating simulationbased training for the 737 max. That would have been very extensive and timeconsuming, but if you ask the public, would they like their pilots to have throw training in a simulator, they of course are going to say yes. The fact that you have employees trying to block that is really disconcerting. Other employees in the email talk about how boeing is trying to rein in costs, going with cheap suppliers, and even ask at one point, would you put your family on someone who was trained in a 737 mac simulator . I wouldnt. Really difficult for boeing, who really wants to get their plane back in the skies. Alix really unbelievable. Thank you very much. We turn to the United States and politics. President trump was in ohio for a Campaign Rally days after heightened tensions with iran. The president readded the need for the president reiterated the need for peace. Pres. Trump we seek friends, not enemies, but if you dare to threaten our citizens, you do so at your own grave peril. Alix putting me now from the white house is kevin cirilli, bloomberg chief washington correspondent. What were some of your takeaways from the rally . Kevin first and foremost, President Trump saying there needs to continue to be terms oftion in iran, but then diving into politics in his first rally of the electionyear, taking on democrats, who last night passed out of the house of representatives a largely symbolic resolution that would toit the president s ability bypass congress on military strength. He said he feared the democrats would have leaked into the media. The president also saying he prefers to run against the current front runner of the race, former Vice President joe biden. Timesd he would say nine at the debate, wheres hunter biden, referring to the Vice President s son. The president speaking candidly and brashly heading into this reelection campaign. Alix thank you very much. We want to stay in washington because markets are awaiting u. S. Jobs data come out and a half. Analysts are estimating 160,000 jobs added. Michael mckee joins us now. Give us the read on what to expect. Michael it could be interesting because at 8 30, we get the numbers. Either there will be some sort of anomaly that will get peoples attention, or everybody will have moved on because this is expected to be a steady as she goes report. Only 106 2000 jobs created is better than you would expect at this time in an expansion. It would be down significantly from the prior month, but that was seen as an outlier. Do look for revisions, however. What are we really going to look at . It is going to be Hourly Earnings. Take a look at where we are with that. Earnings, like the Unemployment Rate, have flattened over the last year. Not bad, but not improving, either. Are we going to see any change this month or going into the 2020 year . We will see. That could influence the fed, but the fed says it is on hold unless we get some sort of major change, so look for some sort of major headline, or look away today. Alix Michael Mckee, thank you very much. Stay with bloomberg for complete coverage and analysis of the jobs numbers. We will have larry kudlow, u. S. Economic council director, at 9 30 a. M. New york. Speaking of jobs, this may be one of the most eyecatching help wanted ads in recent years. Pick 100,000 to manage a taco bell. They chain is going to test out higher salaries in chains and the midwest. Like a lot of restaurant companies, taco bell is hoping to try and find new ways to recruit and keep workers. Coming up, much more on your morning trade and analysis of the markets in todays first take. This is bloomberg. Alix time now for bloomberg first take. With me from our inhouse team of wall street veterans and insiders, carl riccadonna, alsont cignarella, and with us, Constance Hunter, kpmg chief economist. Happy jobs friday. Carl, im going to go to you first with the call on jobs. Carl we are above consensus. Consensus is about wondered 60,000. The trend with the last jobs report of the decade is about 185,000. We are looking for 205,000. I think a couple of factors help us. Temperate conditions should support the construction sector. Manufacturing, any downward trajectory may be benefited by a positive trait headline. Also, leak thanksgiving should help the Retail Sector. That we are looking for a massive not that we are looking for a massive resurgence, but it should push us towards the end of the spectrum. Constance we are about 100 to 165,000, but the question is when the do the benchmark revision next months, does that get revised away . So we think the numbers qs higher. When we thick about when it is going to be revised, if it is the Retail Sector where we have an ou where we have an outside number, we will have to rethink it. Vincent the street is looking for about 180,000, a little bit above consensus. To Chicago Fed National activity index, a nice bump in november. Whether or not it will show up in december, at may show up a little later, but if you had to bet higher or lower on jobs, i would have to be on the higher side. Alix are the markets price for that . Some say the markets are outpacing all of the economic fundamentals. What are you hearing on the street . Vincent you look at record highs in the equity markets, i think this is the trend. No one wants to stand in front of that. The interesting take is where the dollar is. You and i have been talking about this since the beginning of the year. Didnt like the short dollar trade, and it is now bucking that trend. The people who are going to bit spanked is in the fx market, the rate market, and the equity market are going to cruise along. Carl earlier this week we were pricing in geopolitics and oil issues. Since that have sort of abated to some degree, i think we are looking for a relatively healthy economic condition. Just to take the backdrop, we are looking at an economy that grew 2. 25 last year, probably about 2 in the current year. Inflation is relatively acquiescent, so that is a favorable dynamic for the fed to just stay on the sidelines ahead of the election. Alix or the headlines. You can go either way with that. [laughter] alix has no one mentioned wages . We are five minutes in. Its wages that are really going to matter at 8 30. Constance it is because we are having this divergence between the supervisory and nonsupervisory workers. It is a good thing because we havent seen nonsupervisory workers rise that quickly, and of course, we have a lot of issues with wage disparity in our country, so this is hugely beneficial. It is a function of the very long expansion. A midexactly, and this is to late cycle type of development for the labor market. By no means, dont quote me on late cycle, but this tells us the cycle is indeed advancing, maturing, and you are starting to see the Income Benefit spread further through the income demographic. Vincent i would be curious what both of you think because this is not my wheelhouse. Do you see that continuing, where we see a continuation of hikes in wages with low inpatient that spells welford opposable with low inflation that spells well for divisible well for disposable income . Carl we are seeing a much more modest diversion of that story. As the Unemployment Rate grinds lower, you should see this continue for the economy. The phillips curve is much flatter than prior economic cycles. Full employment is much lower than prior economic cycles. We can continue to run hot, but it is not scorching hot. Thingseps all of these relative. Constance temperate. A lot of these workers havent seen their wages go up significantly over the expansion. Vincent boy, i know that feeling. [laughter] vincent we are looking at that taco bell job. Alix you dont like getting up early as it is. Vincent tell me about it. Constance the point is that this is really good for working families. This is really good for the wenomy, and to carls point, are not looking at any significant overheating or wage pull inflation that is going to be detrimental. And remember, the fed has their symmetry. They would not be unhappy should we see slightly above 2 inflation for some time. Carl weve been undershooting 90 of the time over the last decade. Alix which is basically what we heard from evans yesterday. We had a slew of fed speak. I was also really interested in, i dont want to call them pessimistic, but i feel like there was a tone yesterday of, what happens in the next crisis . Forward guidance, more qe, the efficacy of Monetary Policy. What did you make of all the speak . Constance there was also a huge conversation about this out in san diego last weekend. This question of policy space is fedbig question that the needs to assure the public on the markets that they have the policy space. Are inclined to not go below the zero bound, you need to use a host of other tools to ensure that they do have policy space. But i should add, look what 75 basis points of rate cuts did in the last year to jumpstart the Housing Market again and help ease liquidity conditions here and globally. 19 97,t worked in 1995, 1998, and it looked like it worked again in 2019. Certainly come a conventional policy space, there is a lot less. We should be very cautious in assuming that quantitative easing gives us as much bang for the buck the next time around qe3ared to qe1, qe2, and because at the time, the fed was doing something while the ecb was making a mistake. The ecb had that false start for tightening policy. Constance but it made the feds job harder. Carl i think it made it easier because it allowed the fed policy to resolve any much weaker dollar, which is unusual for the u. S. Economy, but u. S. Exports were a major driver coming out of that 10 Unemployment Rate following the Global Financial crisis. Had everyone been easing together, you wouldnt have seen as significant a beginning of the dollar. It went to a three decade low during the process of qe. So ben bernanke talking about negative Interest Rates in california i think is an unhelpful development because we can look at the track record in europe, and negative Interest Rates have not been a successful policy. Sweden has abandoned it. I am optimistic that the policy alix well, hold on. While he said carl maybe they will pull the bandage off as well. Accommodative policy is not translated into the private sector, and you clog the plumbing, and it is not effective. Constance all he said was that we shouldnt rule anything out 100 . Carl and i disagree. He steps italy call it a failure he not try to use again should have called it a failure and not try to use it again. Say so basically, you can trade headlines, economic data, but it is global liquidity that has led the rally after you had the fed maker turn. Vincent yeah. I think a lot of people put all of their chips on the Central Banks adding liquidity, and that is why equity markets go up. Isaac this is going to end in a really bad way one day if we continue to follow this philosophy. This isnt what drives earnings at the end of the day. This isnt what drives profitability at the end of the day. I think this is a very simple approach to looking how markets react. Theres a lot deeper understanding of this. I thing Monetary Policy has become completely impotent at this point. You talk about what the economy did when the fed cut three times. Look at with the economy did when the fed raised three times. Was the equity market, but overall, the equity market took it pretty well. I think you need to look at liquidity aside. It is really a fiscal policy issue, and i think eventually, it is what it is. It is not a part of the conversation Going Forward. I think it is a back burner issue. Constance i disagree with that. There is so Much Research that has come out, whether you look now it the imf, with you look at work coming out of dollari. S. The bis, liquidity is driving everything. The two countries that are not dollarbased conduct trade with one another, not commodity trade, and price is in dollars. So dollar liquidity is super important. If you look at the value of the indexw dollar against global dollar debt issuance, although measures like global trade, if you map it against this narrow dollar index, you see a significant relationship. So dollar liquidity drives not just the u. S. Economy, but the global economy. Alix we have to leave it there. I dont want to, but we have to because they are yelling in my year. Really good conversation. Love having you on set. Constance hunter of kpmg, you are sticking with me. Any charts we are using throughout the show, if you go to gtv on your terminal, you can browse the features and check them out. Gtv. This is bloomberg. Viviana you are watching bloomberg daybreak. Shares of grubhub falling in premarket trading. The Food Delivery Service pushing back against reports that the company may be for sale. A Spokesman Says grubhub is confident in its growth strategy. On the run proving expensive for carlos ghosn. The bloomberg billionaires index estimating that is 120 million fortune shrinking by 40 . Is escape from tokyo to lebanon could have cost 15 million or more. Plus, he forfeited the 14 million in bail he posted in japan. That is your Bloomberg Business flash. Alix thank you so much. Cannot get enough of that story. Another story the caught my eye was a company rushing to borrow over the last week while they still can. This is the backdrop of the tensions between the u. S. And iran, and the worry that that could roil the markets. Investment grade firms saw 60 billion of notes in the u. S. This week, twice as much as a year ago. That spread of treasuries, 286 basis points, unbelievably low. In europe, you had junk bond sales set a weekly record at 88 billion, so the market wide open. Companies also refinancing leverage loans as well. Coming up on this program, former treasury secretary Larry Summers talks about semiautomatic stabilizers in tonights debut episode of wall street week. We have a sneak peek for you, coming up next. This is bloomberg. Beyond the routine checkups. Beyond the notsoroutine cases. Comcast business is helping doctors provide care in whole new ways. All working with a new generation of technologies powered by our gigspeed network. Because beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected. To do the extraordinary. Take your business beyond. Alix this is bloomberg daybreak. Checking on the markets about an hour roy from the jobs number. Somee seeing followthrough buying today. In other asset classes, taking a look at the bond market, looking at twostens spreads right at 27 basis points. Not a ton of movement. I want to highlight the german bund market. Youre looking at 18 basis points. Major had a great call yesterday. He actually thinks they are cheap at this level, the really interesting call there as well. Putting me now, a very special guest, david westin, anchor of numbered balance of power, and a anchor of bloomberg balance of power, and a new program airing tonight, wall street week. With me still is Constance Hunter of kpmg. David good to be with you again. Ishave this new program that from a different time, and we will go over things in finance and business and things like that. The first one will air tonight at 6 00. We sat down with Larry Summers, the former treasury secretary, very concerned about secular stagnation. We are going no place fast. We are not getting the growth we should given the monetary conditions we had. So what do we do about it . Semiotic stabilizers, what are they . He actually explained what they are. This is what he said. Larry blanchard and i were talking about, when we discussed semiautomatic stabilizers, was the idea that rather than relying on congress to organize itself to act each time there is an economic downturn, we should woulde with rules that lock in changes in spending. Vincent the thing i find david the thing i find interesting about this, this is a political point as much as it monetary point. We cant count on congress, so lets agree in advance on medically that they kick in when there is a downturn. Alix could you give me an example of just how he was talking about it . It is not political, so you would just pass a law, and then if the unlimit rate went to this percent, you would have this kind of tax break. Is that the idea . Lara if i could interject here constance if i could interject here, one rule is that if the unappointed rate ticks up a certain number of percentage points, that basically say and are in a recession, so that is what would trigger the automatic stabilizer. Thats exactly right. And then automatically, larry went through it, put money in peoples pockets. You invest in infrastructure. You agree in advance, this is what we do if we have a downturn. That is the theory. Alix is it going to work, Something Like that . Hadtance first of all, we 150 billion of fiscal stimulus in 2018 and another in 2019, and that is about 70 of gdp, and you can see it increased Government Spending and gdp. So yes. The question of will it work, we will have to define what work means. Will fiscal spending increase gdp . Yes. What we want to do to get out of secular stagnation is make fiscal investments that are going to not only increase gdp in the nearterm come about that are going to increase productivity in the long run, and that is whether or not to spend i dont think is a difficult question. How to spend is a very difficult question. Vincent this is exactly the point that Roger Ferguson makes in the program. It is not just whether you have fiscal stimulus or how much, but what you do with it that really makes a huge difference whether you have the effect you want. Alix what we were talking about with the panel, where they for it . Vincent i think everyone thinks that david i think everyone thinks that if there is a downturn, we dont have too much leeway left on Monetary Policy, so we will have to have fiscal. Not everyone agrees on what you should be doing with it. But i think everyone agrees you got to have fiscal, and it is not just the United States. We have a bigger problem in some ways in europe. Constance constance i would agree with that. Alix it dovetails with what we were talking about earlier, how much runway you have for Monetary Policy. You have a fed paper the other day that i thought was pretty staggering. And immoderate recession, he said, you could see 0 maturities for one to seven years. What do you thing about that . Constance well, i think this depends on so many other factors. If we were to come up for example, get a productivity surge over the next decade as a result of Artificial Intelligence and machine learning, really becoming more widelys first more widely dispersed through the economy, then we dont need to be having this conversation. At also depends on the level of the downturn and the type of downturn, where is the locus of the downturn. Everybody has a danger of anchoring to the most recent experience, which was the Global Financial crisis. At our next downturn is not a financial crisis, if it is they run of the mill, gardenvariety recession, i think we have enough policy space. The issue is if we have a financial crisis, we are going to need fiscal policy regardless. We needed it previously. Everyone is looking at this in absolute terms, which is surprising to me because everything is relative. Yes, the fiscal policy space is limited, but we dont have very high inflation. We dont have very high growth. So do we need 500 basis points of rates to cut in order to make a difference . I go back to look at the impact of this 75 basis point cut. Its been pretty significant. David the other problem, as i understand it, as you cut rates, people save more. Up oblem cereal the problem Larry Summers next we have is that it is not going into productive usage. That is part of the problem. So cutting rates may have a reverse effect from what you really need. Alix for the semi automatic stabilizers you talked about, is that mmt . I feel like he would ardently say no, but isnt that basically what we are talking about . David kailey i think that david i think that mmt is basically how you finance the physical part. Alix but in theory, you would have to finance the other medic stabilizer. Isnt that the world we are finance the automatic stabilizer. Isnt that the world we are living in . Constance this is really dangerous territory. It really depends on how the money is spent and its efficacy. I think that is what it all comes down to. This is where we get deep into the political. David it is political. Isnt the irony that almost everybody agrees infrastructure is a place to spend money . That would increase productivity and growth come up and everyone agrees that is the answer, and no one can get there. Constance i think what we found in the crisis is there just arent shovel ready projects. While everyone agrees on infrastructure, that is a long runway. When you are in economic crisis or severe economic downturn, you dont have that kind of runway. You just need to get consumption going again. You need to get businesses investing again right away. That is, for sure, a great use spend on money to infrastructure, and that has longterm positive benefits, but it is not a quick fix if you are in a severe downturn. Alix before i let you go, david, what other stuff did you guys talk about . What were some of the highl ights . I feel like ive been through this with you a little bit. David because i can so on everything. At the end, we talked about carlos ghosn. This is what happened in the week, so you have to talk about carlos ghosn. Larry summers was very measured, as he is. He said he is a bail jumper. Hes following in trumps footsteps. So it was unplugged Larry Summers. Alix you got to love unplugged Larry Summers. Thank you so much, david westin. Really looking forward to watching. Two and into Bloomberg Television this evening for wall street weeks first episode. More with Larry Summers and Roger Ferguson at six clock p. M. And all throughout the weekend on Bloomberg Television. Now we want to give an update on what is happening outside the business world. Viviana hurtado is here with first word news. Viviana iraq moving forward with the demand for u. S. Troops to leave, asking the u. S. State department to decide the mechanism for American Forces to leave. Iraqi lawmakers calling for u. S. Soldiers to leave after a u. S. Air strike killed a top iranian general. Iran coming on western governments to prove their claims that the ukrainian jetliner was shot down. The leaders of the u. K. , canada, and australia say they have intelligence showing the plane aash near tehran was hit by missile. You are about to see a flash of light right there. This reportedly shows the moment the missile hit the plane. This is video obtained by the New York Times. Bloomberg has learned a u. S. Spy satellite detected to missile launches not far from the crash site. Clowns and supervised by monkeys, i direct quote about the 737 max from a boeing pilot. What . Ess it is just one of the negative comments in the batch of internal messages boeing released. Company employees discussing their deep unease with the plane. Global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. Im Viviana Hurtado. This is bloomberg. Alix thank you so much. Constance hunter of kpmg is still with me. I just want to get your take as an economist. Lets hypothesize on this. If we dont get the 737 backs in the air, what is the gdp impact . How do you look at it . Constance it is pretty significant. Weve begun to do analysis because there are what we call mold buyers. Every person you employee employees other people. Call multipliers. Every person you employ s other people. They dont want these very skilled workers going to find jobs elsewhere. In ahere this to pan out worse scenario, we think it is possibly 40 to 60 on gdp, so it is a shock to exports. It is a shock to the local economy. Then it really just depends on how quickly these workers can integrate within the rest of the economy. Alix i wonder on the longer term, prices. Boeing has had some Pricing Power among the supply chain. Lessons, is that that a disinflationary impact . Their supplier says, no, i am going to make you charge this much. Constance anytime you take economy andf an demand remains the same, that is an inflationary impact. I think youre thinking is along the right lines. Specifict studied the elasticity of demand in the Aerospace Industry so far, but that is the right way to think about it. Alix how do you think this all winds up playing into 2020 election risk . Bull riskn unhedged you have an unhedgeable risk. How do you thing about some thing like that . Constance i think Something Like boeing is not really a political issue. Alix i dont know. You start closing plants and lays off workers, but your point is noted. Constance this is what we would call an exogenous risk. Recessionsery often, come about because of a confluence of exogenous risks. So if we were to add this to our list of possible exogenous risks, it is just part of that mix. I think historically, the biggest danger for incumbent president s is if you see a downturn in gdp growth while youre trying to get reelected. Alix i really appreciate you and with us this morning. Constance hunter of kpmg, happy jobs friday. , but concentrated power means for companies and investors in our weekly go Bloomberg Businessweek feature. If you have a terminal, check out tv. Scroll through, check it out. This is bloomberg. Viviana this is bloomberg daybreak. Piper sandler says teslas Growth Potential in china means the stock is undervalued, raising the target to 553 a share. That makes Piper Sandler the most bullish among forecasters tracked by bloomberg. Since the start of the year, tessler shares have risen more than 14 tesla shares have risen more than 40 . Tesla shares have risen more than 14 . Imbe on a hurtado Viviana Hurtado. Turn now to our weekly Bloomberg Businessweek feature. First up, the big three of the index funds have seen glorious success with unintended consequences. Then, a degree in economics is becoming less and less blacktive to graduates. And bloomberg travel guide. Need somewhere to spend those 30 returns from that index fund . Joining us is joel weber, Bloomberg Businessweek editor. I love this cover, like ultimate domination with these funds. With a sweet Little Piggy Bank where most of us hold index funds. Index funds are one of the greatest financial innovations in history, and they have made a lot of people really welloff. With that comes this other hidden thing, worldwide last 11, index funds passed trillion. If you think about it, other people are voting on your other people are owning on your behalf, and that is the tension here. Alix if you dont want an index fund to vote on something you dont want, you dont want it to lose something, it is a glass halffull. Joel they cant manage like an active portfolio what is in the index. Things like Climate Change have become a real topic because they are just going to own the index, and yet climate activists say you are not doing anything to solve the worlds problems. But so is this a good of a good or bad thing . Joel we are just ambivalent, saying that this is a thing. Big tech has been in the headlines is a topic of concern for regulators. Common ownership is also something that is a concern for regulators in washington. Antitrust about indexes is going to be an ongoing topic. Alix lets get to our second story, which is black economists are looking at 50 years of economic bias within the fed. We heard that this week from brainerd. Joel this is peter coy, who went to the Economic Association in san diego. One of the topics was led by janet yellen, and it was about the dearth of black economists. Over the last 10 plus years, overall black graduates are getting more and more degrees except economics. It has continued to drop. It was a moment to get a lot of smart people together to say, how can we attempt to move the needle on this and get more black economic degrees . Alix any solution . Joel no, but theyve started talking about it. Alix and we are looking at the best locations to go in 2020. Constance take all of those joel take all of those earnings and figure out where to go. 24 destinations in 2020, really driven by some analytics we got from google which allows you to see what the cost is at various times and how that overlays with the recommended points in time to go there. It is not just about having a wish list of places. It is actually that maybe there are some pieces that might be better right now. Alix like what . Joel i really want to go to guatemala. Theres a buried city that is coming online that has been two decades unearthed, so it seems like a way to get to the jungle and not just see jungle. You can actually see some ruins that have never before been seen. Alix give me another example of the best bang for your buck, and also a cool place to go. Joel budapest has come up is a really interesting place to go because theres a Food Movement there, the bathhouses are really interesting. That is one where you can get a pretty good roi. Alix really good stuff. Thank you so much. Read all these stories and more on the latest Bloomberg Businessweek on digital and new stands now. Women on wall street, we focused on the ceo of one of the Largest Health care companys. She spoke to selina wang about what it is like trying to run a business is both a foreigner and a woman. When i would go back to the states, i would be asked, what is it like to be a woman in business in china . The best answer is i dont think i was seen as a woman. I dont think gender was the first thing that popped out. Being a foreigner in china at the time was like being from mars. It was wonderful being a martian because people didnt have expectations. I could do what i thought i wanted and needed to do without people thinking you cant do woman because that is not how they saw me. Alix really interesting commentary. Ing up, houck healthy coming up, how healthy is the u. S. Economy . And if you are jumping into your car, tune into Bloomberg Radio on sirius xm channel 119 and the Bloomberg Business app. This is bloomberg. Alix time now for traders take. Joining me as vincent cignarella, voice of the bloomberg audio squawk. You teased it earlier, looking at Chicago Fed National activity index. Vincent it actually leads gdp. It is a better indicator of where the economy is going as opposed to jobs, which is a lagging indicator. It also leaves the job data. This is a really busy chart, but if you look at it, you can see the chicago fed is in negative territory, but that is on a three month moving average, the blue line. Higher. Moving back the recent print for chicago fed, which was november, beat estimates. Is expected to be minus three. It was plus 0. 5. If i had to flip a coin and see this november data may be leading the december jobs data, if i had to put a trade on it, i would be more concerned about jobs data beating then missing, based on what the chicago fed is telling me. Alix is that priced into markets . With the Short Covering we saw on the u. S. Dollar andy run and iran dollar tensions . The dollar Vincent Vincent the dollar is still bid, and if it breaks through, i think we could see the dollar higher. I think the dollar will moderate. A divergent way to play this is to sell the bloomberg Dollar Dollar index, buy the ice dollar index. If you are wrong, you will be hedged. If you are right, the bloomberg dollar index will probably outpace. So you are well hedged both ways. Alix interesting call. Also wonder into the jobs numbers where the risk is going to be. And the rates and affects market in the rates and affects market, not the equity market . Vincent where we are going to be at 4 00, i think the dollar and may be the 10 year treasuries, we will play it for an extended time. Alix good to see you. I missed vincent. Vincent i did too. Great story to tell you off the air. Alix tease. [laughter] alix vincent cignarella, things a lot. Coming up, jobs to coverage continues. Raine of Fs Investments lara rhame of Fs Investments, Subadra Rajappa of socgen, and Meghan Greene of Harvard Kennedy school will join us. This is bloomberg. Alix welcome to bloomberg daybreak on this friday, january 10. Heres everything you need to know at this hour. The boeing 737 that crashed in iran was shot down by a missile. Evidence indicates that the plane was shot down by an iranian surfacetoair missile. Law, i said, based on the there is full coordination between our air defense and civil system. Our Civil Aviation personnel and air defense personnel sit sidebyside, so it is absolute impossible for such a thing to happen. Alix iran fights back and says these allegations were psychological warfare. Taiwan goes to the polls on saturday to determine the future of the worlds only chinese speaking democracy. Do they want to keep the status quo under their president , who has angered beijing with her proindependence minded policies . Or do they want to go back to the old nationalist party, which better and stronger ties to Mainland China . Alix taiwan picking sides between a global power struggle between the u. S. And china. Pres. Trump the economy is strong, wages are rising, and americas future has never looked brighter. Alix President Trump doubles down on the economy at a rally ahead of jobs friday. This is expected to be a steady as she goes report. Only 160,000 jobs created is better than you would expect at this time in an expansion. Alix fed Officials Say the economy and Monetary Policy are in a good place. One message describes the 737 max is a plane designed by clowns overseen by monkeys. Alix more than 100 pages of messages and memos that reveal pressure on employees and customers to avoid initial training. Some of these emails are really appalling and displayed a sort of cavalier attitude toward safety, a disrespect for the regulators whose job it is to ensure that the aircraft that boeing builds are safe. Alix boeing has committed 5. 6 billion to cover the cost of the planes grounding, and that could double if pilots need Simulator Training before the 737 max lies again. An unbelievable story. In the markets, you had a record close for the nasdaq, the s p, and the dow jones. Now s p futures are up by zero 0. 2 . Would by yields pretty much going nowhere. It was a very tumultuous week. Oil now looking at its worst week since july. Would not have expected that statistic on monday. Joining me for the hour, lara chief u. S. Nvestments economist. Happy new year. Happy friday. Lara happy new year. Alix is there anything else on your radar this morning . Lara i think equity markets have continued to soar. Weve got pe multiples closing in 18. 5 . Bonds still really range bound. That was a theme we saw last year. I think on the back of all these fed speakers, we are going to have to see how things are evolving geopolitically. If the equity and bond market stories are going to do continue to diverge. Alix thats a really good point. We are just under a half hour away from the u. S. December jobs report. Economists expect to add 160 thousand jobs, while unemployment stays steady at 3. 5 , and wage growth at 1. 5 . Joining us are Subadra Rajappa, socgen head of u. S. Reits strategy, and megan greene, Harvard Kennedy School Senior fellow. Usually it is all three of us on set, but megan, you are in london now. What is your expedition for the jobs number . Megan i think this jobs number should be pretty decent. What could keep it lower is the ism nonmanufacturing Employment Index tanked pretty much, so theres also some seasonality issues just given that christmas and new years were in the middle of the week. Figure ise headline the least interesting part of the jobs report, and the wage growth is much more interesting. Even though we got a phase i one deal supposedly, it is too early to see that feedthrough into the report. The jobs report should be performing a little better, but there should be upward pressure off of wages, as has been the case for years now. Subadra we had a very year last year, but we are at or close to full employment. My focusadline number, is going to be on wages. As we start seeing wage pressures eat into corporate profit margins, that is eventually what leads to a slowdown. Lara this finishes a decade where we had record breaking job growth. If we get a number on consensus, that means we had to. 1 million had to. 1 million gained. To me, i think theres a risk that the markets have grown really complacent with this and alix hasat, heard me say this before, the pace of jobs growth is going to grow. I think it might actually happen in 2020. Markets have to get used to numbers closer to 80,000 a month or even, heaven forbid, a month of negative job adds. And what would that do to expectation . Alix which jobs number do we fear . If we get 80,000, is that a bad thing . Are we at full employment and that is not bad . Subadra i am in the camp megan i am in the camp that does something we are at full employment, and we could still see on an mid fall further over the course of this year. 80,000 would be ok. Honestly, i think in terms of the headline figure for this jobs report, theres very little that would shock anyone or cause the fed to alter its course. Beat or a is a huge huge miss, it is one data point. In any case, there are a lot of other indicators that are both bullish and bearish for the u. S. Economy, so i think the fed is stuck on hold no matter what. Alix fairpoint. What do you see that says we might be a full employment . Lara we see the underemployment number continue to come down. Wage gains have been modest. Theyve been gaining some traction. But they are still far away from numbers that we really consider to be broadly inflationary. I think you would need to see some of that pressure, and i think as we dig into these numbers, we would need to see this broadbased gains. Every month theres been some jobs here, some losses there. We really would need to see these numbers that are just continuing to add jobs across the board. Alix s about her alix subad ra, and your world, what is in the market . Subadra the question is if it is going to react to a weak number. A strong number, you will not see a massive selloff. If we get a weak number, i think there is a chance, given the geopolitical environment we are in, we might see a little bit of a rally. To me it is somewhat asymmetric. Alix you are one of the most bullish on the street when it comes to bonds, but hsbc also getting in there. Cheapctually see bunds as right now. What do you think . Subadra i wouldnt call it cheap. Historically speaking, it is quite rich. Our call is for bunds to get to 50. Thats the world we are in, right . Where we are and where we are headed. The ecb is probably going to continue their Asset Purchase Program well into early next year. Under two circumstances, you should expect yields to continue to grind lower. Alix does that mean that we are in a world where markets are running ahead or running differently than the underlying data we are seeing . Megan yes and no. I agree that we will probably see Central Banks on hold, if not easing a bit further, if you consider the pboc in china that provides liquid of the background for the markets. I also think the data will continue to look decidedly meh, so to speak. It will neither be spectacular nor disastrous. We are all working towards potential growth, and that is what we should expect in the absence of any major monetary or fiscal stimulus. For the u. S. , that is around 1. 75 , for europe, 1. 5 , for japan, 0. 5 . We are seeing everyone slow down towards potential, but no one should be surprised about that. Alix meh, the official economics term they teach you in school, right . [laughter] alix so what we have seen jobsandforth between the data and liver per dissipation rate, where are we with that story and Labor Participation rate, where are we with that story . Megan we have seen the Labor Participation rate continue to pick up. This was Janet Yellens big plan when she was fed chair, to run the labor market hot. There is a chance we are starting to run out of road to run on that. Offar in this recovery, most the growth has come from labor productivity, and not total factor productivity. If we are reaching the ends of and we dont get any kind of major productivity growth off the back of technological advancement, for example, we are really out of road on this recovery, and we are just going to stagnate around potential. Agree with your outlook that we are all sort of converging at potential, but is that priced into the market . It seems like we had this compression in margins already. We seen Revenue Growth slow somewhat, and yet pe multiples continue to style rocket to skyrocket. Megan i think you are right. Particularly, equity markets are not in line with the view that we are slowing down. They are inline with the view that we are off to the races, so there could be a correction over the course of this year. In terms of the bond markets, yields have been rising a little bit. Are we going to get back to 4 bond yields on longterm government bonds . Theres no way. I think we are stuck in this lower for longer world that is sort of dictated by secular stagnation. I ascribed to that you. Alix we will definitely talk about that in the excitement. Lara rhame of Fs Investments, Subadra Rajappa of socgen, megan greene of the Harvard Kennedy school all sticking with me. Coming up, how the fed might respond to accomack decline and to economic decline and what it means for yields. This is bloomberg. Alix a question we have been examining throughout the next two hours and will be part of the conversation at 8 30, is the rally economically driven, or is it driven by liquidity . Subadra, you see it in the credit market, the issuance, and also the uptick in the flows into highgrade. Is it a liquidity driven rally, or is it fundamentals . Subadra i would say the former, liquidity driven rally. Theres a lot of cash that needs to be put to work. The fed is easing Monetary Policy gradually by way of asset purchases. Qe, but it is not theres a lot of money that needs to find a home. Thats why youre are seeing this migration into equity and other risky assets. Lara i think that is maybe a really important question to ask , that they are trying to solve two different problems here. I think they are bending over backwards to say it is not qe, but an only four months, the putback months of trying to draw down Balance Sheets. I think we have to just recognize the impact of that is going to have on markets, whether explicit or not. It is happening. Alix this is around the time were certain economists will start jumping up and down on set and say, it is not qe. It is totally different. I get it, but does it matter when the dumb seat expands and equity market responds when the Balance Sheet expands and equity market responds in kind . Megan it doesnt matter except in the intentions of the fed, and in that sense it really is not qe. For the impact for the markets aside from the signaling effect, sure. It is absolutely increasing liquidity in the system. I hate to agree with one because that makes for boring conversation, but i do think it is liquidity more than fundamentals. As one bloomberg author wrote last night, the past five global or regional recessions have been caused by liquidity related issues and not fundamentals like wages and inflation. Alix so does this ever end . Megan, is this going to be our life forever . If you come inside to bloomberg and look at the Balance Sheet unwind and how fast and furious it has really been, how do we get out of it . Megan it has to end. Youve got minsky moments, which suggests you have to snap back at some point, but also, Central Banks dont love pumping liquidity into the system, and large part for political reasons, not economic once. They are worried about their own independence, so they will constantly try to get out of that. I dont think we can just rely on Central Banks to step in everything will time. At some point, they are going to have to back out of that, but they havent done it yet. I think this can last for a bit longer, certainly through this year. Alix it also raises the question of what happens during the next fed downturn during the next downturn. One wrote subadra, basically, you could see zero on one to seven years because at some point, the fed just moves to control what it can control. What do you think . Subadra absolutely. It is not just the fed. Mobile Monetary Policy come of key question is one of because it policy, the key question is one of efficacy. They are in a better position then in most countries to manage a downturn. They can cut Interest Rates, Forward Guidance, qe. But in the eurozone, it is clear that they just dont have enough tools to be able to bring back inflation close to 2 , and that is the reaction we saw with the sweetest central bank, where they raise rates because there is a sense that negative Interest Rate policy is not effective. Lara in that context, i dont see how, ending a downturn, i think the wellprepared i think the fed is wellprepared and wellpositioned to used Forward Guidance and qe. Alix megan . Megan i would disagree that the ecb doesnt have any tools because they have these tltros, which has introduced a second Interest Rate, which means you can benefit borrowers and savers at the same time, which is unambiguous stimulus across the board. They havent used it that way yet, but they certainly could. Other Central Banks could adopted as well, but one message that was resounding at the economic conference a few days ago is that Central Banks cant be holding the bag. We need other players to step in. It is something mario draghi has been saying, jay powell has been highlighting. There is increasing consensus that Central Banks cant save the day the next time around. Is onesion in the u. S. Recession away from rates being stuck at zero, and we dont want that. Lara i agree. I think this is going to be something that the next administration is going to have to tackle. Hopefully. It is something we heard five years ago, even 10 years ago, that we need other policy outside of Monetary Policy. But i think there is a difference between the fed projecting confidence in their tools. Of course we need that. We need that as the market. But the reality is, really we have already seen the limit of what that gives us, and how does it really trickle through to the boots on the ground in the economy. It is not always a direct line when youre dealing with liquidity. Alix i was struck by all of the fed speak yesterday, which i felt really echoed some of that. If you parse through it, we will do Forward Guidance, we will do qe, overshoot inflation, talking about lower bound, at some point we hit it. I think your point is there. What do you think . Subadra i think those are all valid concerns. I think they are sort of looking towards the longer term. Saysams, at this point, theres a secular downtrend in treasury yields. I should say global bond yields, over the last several decades. Even in the near term, if you look at what is driving bond yields, you are looking at global qe, inflation undershooting globally, and there is demand for safe haven assets. Theres about 11 trillion in negative yielding assets, and that is going to bring investors to the safety of higheryielding assets like treasuries. I cant believe im saying that treasuries are a highyielding asset, but it is. I think that kind of demand is going to keep yields pegged and anchored for at least the rest of this year. Alix all of you are sticking with me. Much more coming up next. This is bloomberg. Viviana you are watching bloomberg daybreak. Eli lilly will acquires amira billion mily 6. 1 for approximately 6. 1 billion. Eli lilly says the acquisition will help expand its pipeline. In premarket, shares of dermira are rising. Grubhub pushing back against reports to come but be for sale. A Spokesman Says grubhub is confident in its strategy whether it makes acquisitions are not. Made by clowns supervised by fromys, a direct quote internal messages boeing released, discussing their deep unease with the 737 max plane and flight simulators used to train pilots. That is your Bloomberg Business flash. Alix there was one comment about jedi mind tricks. That was pretty intense. I have a chart here that shows boeing market cap as a percentage of gdp. What happens if this continues to get worse . Lara weve clearly already seen frommodest downside growth all of the claims that have been on hold. I think we continue to see that. I think you do get a strange impact. We could see the inventory numbers actually start rising again as boeing is sort of stockpiling these planes, and then drawing down as they get sold again. I think we are going to see reallocation of the companies that are being impacted. Those folks are going to find other jobs. There is thankfully a broadly strong labor market, so there will be reallocation of those orders. But there is no doubt that when youre talking about gdp slowing 1. 7 , it really starts to add up. Alix exactly. The question we were talking about on break, what happens if we just cant get out of 1. 5 , 2 growth . Things like this matter a lot more. Lara i think we all talk about the arc of our forecast over the coming year, but in the real world, nothing ever really generally settles in such an easy, graceful way. We could get bumps on the way down, and boeing could be a big part of that. Because of an inventory adjustment, it swings into negative gdp. We have seen that at other times during this expansion, but it makes markets really nervous, and could rattle valuations where they are. Alix lara rhame of Fs Investments will be sticking with me. We are just about four minutes away from the latest jobs number. Bringing you all of the numbers and analysis next. S p futures Still Holding onto some gains, up by about 0. 1 . The currency market continues to be about a stronger dollar story, with the exception of the aussie dollar and the cable rate. No movement within the bond market. 1. 85 on the 10 year. This is bloomberg. Alix we are just about a few seconds away from the jobs report for december. Not a lot of action. Off the highs of the session. Nasdaq following through yesterday. Bloombergs Michael Mckee joins us now. He is in d. C. With everything related to the jobs number for december. Mike . Michael a soso jobs report. 140 5000 jobs created. Unemployment unchanged. Participation rate unchanged. 1 ings a worry, up just for december. That leaves the gain at 2. 9 , that is down from 2018 3. 3 gain. Last months big jobs gain revised down to 256,000. Another 400 jobs revised away. 14,000 fewer jobs last month. Hours worked unchanged at 34. 3. Manufacturing was hit hard last month, losing 12,000 jobs. It may be because tariffs are beginning to bite. Primary metals makers lost 2300 lost 7200. Metals coal miners lost 1200 jobs. ,ome strengthen construction and retailers added 41,000 over the holidays. , 200r the Household Survey 67,000 jobs created 2 jobs created. Unemployment rate unchanged at 3. 5 . The u6 rate which includes discouraged workers is 6. 7 , a record low. Rajappa, andubadra megan greene still with me. Youve seen the dollar off the highs of the session. A slight bit in the bond market. Your initial thoughts . Lara this is exactly what we were talking about. The trend has continued. The fact that we have had a relatively solid continued job gains. Manufacturing, we have seen the sentiment numbers, we know that sector is under pressure. This is the hard evidence that reinforces a lot of the sentiment data we have been getting. Interest ist is of the average Hourly Earnings. We do have to be careful because we did have that funny christmas holiday. Retail is such a large amount of that hiring. There may be seasonality there. We have all been expecting average Hourly Earnings to continue to rise. This is a number that does not change anything as far as the fed goes. Hard to see markets taking on something and running with it. Alix megan, your reaction . Megan the only thing i would add is october and november were pretty exuberant. That was partly because of the g. M. Strike. This does give us a better picture on whether that was a fluke or whether this is a new trend. It seems like it is not a new trend. That is exactly what you should be expecting at this stage in the business cycle. This report was still pretty good given where we are in the business cycle. Average Hourly Earnings a little bit disappointing but nothing to write home about. Out a lotght to point of that might be retail hiring. Retail jobs are lowwage, low our sectors so if youre adding a lot of those it does not push up wages. Subadra it is a steady as she goes report. Job gains in that time in the context of the trend. My focus is on earnings. The bond market is reading this as runaway inflation. Curve isend of the rallying on the news. Probably going to come under pressure. They want to get ahead of declining Inflation Expectations. In some respects, i would say fed policymakers are probably looking at this number and going toward more accommodation than not. We also see the curve at 26 basis point. As the flatten are the path of least resistance . Subadra there is the expectation the fed will be on pause, so if there is information on the geopolitical side or misses on the inflation side you will see a rally at the back end and that is the bull flattener. Alix lara, what would be your biggest question based on the jobs number . Lara we have been living in this two economy world where we have a consumer that is resilient and businesses where sentiment is arguably lower than it was a year ago. The Services Sector sentiment is better, manufacturing sentiment is still depressed. We have this trade deal signing coming up. Markets are euphoric on the back of it, but to me it is cosmetic surgery. It will not change anything deep. Whether weto be seen get manufacturing recovering from this. How Business Sentiment does. Business investment is the question in the coming several months and for the year. Alix what shakes us out of this business stagnation, lack of ability to spend, and the sluggish manufacturing . Megan i think trade could play a real role. Not the develop ands we have seen so far. Even though we have a phase one is right that it will not fundamentally change our relations between china and the u. S. Or address intellectual property issues. There is still uncertainty. If we could get rid of that uncertainty, that will spur some investment. Now that the u. S. Will not be as focused on china, it will turn its sights to europe. There is more trade uncertainty ahead. If we could get rid of all of that uncertainty, then we would expect investments to come back and i would be more optimistic about productivity growth this year. I think is unlikely. Michael there is a couple points to be made. One is as megan said this is a better job creation number then you would normally expect at this part of an economic cycle. The fed will be happy with that. They will keep an eye on the wages. You have to wait for time to confirm wage growth has slowed. The big issue of trade uncertainty you have to wonder when you start to see big job losses we saw in manufacturing, particularly in areas that have been tariffed. We also saw job losses in electronics. Whether or not that changes the political calculation at the white house in an election year, especially with additional tariffs hanging out. Did they go through with that or do they reach some kind of minor agreement, declare victory, and go home so they do not create more job losses as we get closer to elections. Tariffs theythe are proposing is online from europe, so we should all stock up. Alix mike, that would hit you particularly hard. I want to see if we can dig into the wages. Is it broadbased or on lower paid workers like you are talking about in terms of temp hiring and retail . Michael it was broadbased but we did see muted wage gains in the higher pay category. Storymay be a categorical or it may be we are seeing no wage pressures because we are still able to find workers. 206,000r force group by. As long as we can keep pulling marginal workers in companies do not have reason to raise wages. We are talking about the difference between 2. 9 and 3. 1 . It is not a huge difference. It is if it is sustained over a long period of. Right now we have to wait and see if it is confirmed. Alix i have to make news. Ive to make something out of something. Lara this is just one of the wage numbers we look at. Productivity has continued. It has recovered somewhat. The fact that unit labor costs have continued to rise is something we are all looking at what we think about margins for the coming year and the margin compression we have seen so far. This was a surprise to the downside but there is a lot of other wage data out there. Low inflation on the one hand makes it hard for companies to pass any kind of wage gains along. Remember inflation is significantly lower. 1. 7 ,re deflator is inflation at 2. 9 means we are seeing real wage gains. You are threading a needle, but i think for companies they may still be seeing gains that will continue to cause them to have margin pressure. Alix megan, you want to jump in . Megan i thought i would throughout an interesting statistic i just heard. In the history of the u. S. We have never had such low unemployment outside of a year we had conscription, sending thousands of men overseas. That is astounding yet we still have wage growth of 2. 9 . That is incredibly lackluster. To go back to the question you asked earlier, i do not think there is any way we are at full employment. We do not need to worry about wage growth or inflation. We are stuck in this low inflation, low rate environment. Alix when do you have to hedge against inflation . You want to do it before you need to . Subadra i do not see the need. This is the problem the fed is grappling with. Not just the fed but global Central Banks. How do you get Inflation Expectations higher and sustainably close to the target . There are huge misses in europe and the u. S. , but it is keeping those expectations anchored is going to be tough over the coming year. If there are any misses, it will be a oneway street toward low expectations. Alix i appreciate the roundtable. Socgen, megana of greene, thank you. Lara rhame and Michael Mckee, you are sticking with me. Viviana hurtado is here with first word news. Viviana we begin with a flash of light adding to evidence of the final moments of the ukrainian jetline in iran. The New York Times says this video you see shows an antiaircraft missile hitting the plane from ground level. By satellite detected two surfacetoair missile launches from near the airport just moments after the plane took off. Iran calling the allegations a big lie. Iraq moving forward with the demand for u. S. Troops to leave. The iraqi Prime Minister asking the state department to decide the mechanism for u. S. Forces to leave. Iraqi soldiers calling for forces to leave after an airstrike killed top iranian general. Ispy birthday to kim jongun the president from donald trump to the north korean leader, the president asking south korea to deliver the message. It is the latest exchange of personal greetings between the two countries. They have been adversaries for decades. Global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. I am Viviana Hurtado. This is bloomberg. Alix a mixed bag when it comes to the job market, only adding 145,000 jobs in december. The surprise was the lackluster yeargrowth at 2. 9 year on , adding just. 1 . Youre seeing the dollar come off the highs of the session. Equity market sustained and the back end of the curve moving lower as the flatten her tics up in the u. S. Gigng up, the rise of the economy. We will speak to the ceo of handy, a company that is a onestop place for those looking for help cleaning their house. Bloomberg users, interact with. S on gtv all of the charts. This is bloomberg. Viviana this is bloomberg daybreak. Im Viviana Hurtado with your Bloomberg Business flash. We begin with the Biggest Discount airline in europe raising its profit guidance. Ryanair reporting a surge in lucrative lastminute things. The airline also says from a year ago reservations from january through april are up 1 . Over to the state of california where a court rules the state socalled new gig law does not apply to trucking companies. The judge says the law could have a substantial impact on trucking companies. The law would force companies to classify certain workers as employees. Before themay end up california supreme court. I am Viviana Hurtado and that is your Bloomberg Business flash. Alix the jobs number for decembers just out. 145,000 jobs added. Wage growth under 3 . Michael mckee looking at how the gig economy is shaping the jobs market. Discern too cannot much out of the gig economy and the Labor Department numbers because they do not track people who are working for Different Companies for a few minutes here and there. We do know the number of people who are working parttime because they cannot get any other jobs has declined, down 140,000 last month. The number of people choosing to work parttime was up 58,000. There definitely appears to be an incentive to go into this gate economy. The question is what you make of that Going Forward . There is an etf that looks at gig economy companies, the ones you know about. At this point it does not seem to be generating a lot of investor enthusiasm. Isis up recently, but it still below its original offering price. More people doing it and it does not mean a lot economic like ly. Alix i did not know there was an etf. Hanrahan,ned by oisin handy cofounder and ceo. Handy is the ondemand platform that connects people looking for Household Services with professionals. Can you help us answer the question . How important is the gig economy. Oisin if you zoom out and think about the last decade, we have drastically changed how we buy goods and services. If you think about all the things you need, ground transportation, food, the things delivered to your home. So many of these things are we are buying on mobile and online and those services are being delivered, a lot of them through the gig economy. We see in upward shift not in the minutes and hours and weeks and months, but if you look over the last decade we have seen an upward shift in pay workers. The average cleaner in new york earned 17 an hour. The average handyman earns 22 an hour. We see more and more upward pressure as the economy gets tighter and we have to look for more cleaners and handyman. Lara what about the wage side of that. What have the trends been like . How much negotiation is there . That is what we talk about when we look at big corporations and the labor they take on. Theres been a lot of talk about the unskilled labor set does not have a lot of Pricing Power. How are things different in the gate economy . Oisin you think about the Consumer Trends behind this. You have a desire for convenience. More and more people turning to technology and Online Services to get things done. The demand for these services on these platforms continues to go up week over week, month over month. As a result, the platforms are going out, we are turned on board more cleaners and handyman. Wage is an ever increasing we pay. You see prices, you see it in the price the cleaner gets per hour. The system increases the price. We increase the price month over month we pay so we have enough supply for our customers. Lara we are not seeing it in the Consumer Price numbers. That is one of the things a lot of us spend a lot of time thinking about. You look at the broadest measures of what the consumer pays and you are right. Our experience, things feel like theyve got more expensive. You look at the official data and it is not reflected. Alix how does that affect you in terms of competition . If you have demand rising but there is still competition can you describe how youve managed that . Oisin the consumer is looking for the most convenient place to get things done at the consumers are going to the platforms that are the largest. It is about density. If you want your home cleaned tomorrow at 9 00 a. M. , you need a platform that has cleaners available tomorrow at 9 00 a. M. If you want to get your tv mounted on a saturday at 10 00, you want to have a platform that says i have a handyman available to mount your tv. That drives more and more people to the platforms with the largest supply. Similarly, you have people who want to work on the platforms that are choosing to work on the platforms with the most customers. It is about aggregating density. It is not national density. We do not care whether we have cleaners in toledo or tampa. We only care about our own local markets. It is density by local market, by vertical. That is why we are fortunate to build a platform that has more of this density. Lara it sounds like for handy of competition on both sides. Competition to get the best and most efficient Fastest Service to the client and competition to attract gig workers. I know that is not easy. What do you do to make a handyman want to work for handy . Oisin you are absolutely right. It is about how you bring on customers and how do you bring on professionals with the best experience . That is about making sure they have access to incredibly flexible schedules, about competition in wages, about having policy that works for them, and a number of other things we have advocated for in terms of access to benefits, access to education and training , and a broader change to how the gig economy works in terms of classification. Thank you very much oisin hanrahan. Thank you very much. Lara rhame of Fs Investments, thank you for joining me on this jobs friday. Coming up, jobs, the housing rates. A wholesaler is shrinking in premarket trading after revenue miss. That is coming up next in technically speaking. If youre heading out and jumping in your car, tune into numbered radio on sirius xm channel 119 on the Bloomberg Business app. This is bloomberg. Alix time for technically speaking. Bill maloney, chartered market technician and voice of bloombergs equities quad joins me to check out traits for the day. You can check out bill on the bloomberg by typing in squa. Youre looking at intuitive surgical. What are they looking like . Bill the stock has been in a longterm trading range dating back to 2018. There may be resistance around 600. Above that look for 617. Another stock looking to break out. Alix what about tb home. Kb home. It missed on revenue. Bill down 3 or so in the premarket. A big run since 2018. Traditional resistance around 39, but it will have problems breaking above 37 to 39 level. Alix what about a low . What is the target level . Bill it will not be much. Maybe 35 or 34. Alix your last stock is beyond meat. Yesterday, up a little bit in the premarket. The downtrend since 240. Trading sideways for a while. Potential resistance around 96 to 98. Support around 70 to 75. It may be forming a bottom. Alix thanks very much. Setting you up for your traits of the day, bill maloney of bloomberg. That does it for me at bloomberg daybreak americas. Theng up on the open, white house reaction to the jobs report with larry kudlow. This is bloomberg. Jonathan from new york city for our audience worldwide. Im jonathan ferro. The countdown to the open starts right now. Jonathan coming up, payrolls growth trailing estimates. Wage growth disappoint. Equities up. The s p 500 closing out the week near alltime highs. With 2019 gains behind us, looking ahead to the beginning of earnings season. 30 minutes until the opening bell. Here is your friday morning price action. Up. 2 on the s p. 21. 1096. Tive the bond market all over the place. Treasury yields higher to 1. 86. Lets look at the price action. Later we will bill later we will be speaking with larry kudlow at 9 30 eastern. For more details on the payrolls report i am pleased to say we can bring in Michael Mckee, our International Politics our International Economics and policy correspondent. Run us

© 2024 Vimarsana

comparemela.com © 2020. All Rights Reserved.