A bny mellon forecast really concerned investors because deposits, both interestbearing and noninterestbearing, will be lower. So the next earnings quarter is in doubt. Not so for Morgan Stanley. That stock is getting rewarded. Here in europe come of the equity markets dont look as exciting in the United States as we are tracking now towards 30,000. Hints that may be more stimulus is on the way. The South African rand taking a hit today. The reserve Bank Delivering a surprise 25 basis point cut. , this isd bombardier kind of a joint story. Bombardier being pummeled today, mainly around the airbus aircraft, basically a narrowbody shorthaul aircraft. Bombardier may walk away from that project. Muchs not really reacting to this today. The expedition was that airbus was ready for this, but it seems like the market wasnt. Basically, the rampup of this aircraft costing more. Is worried that this may affect the turnaround planned, and thus may walk away from it. That stock down 35 . Vonnie lets get to our first guest for more on the impact of the phase i one trade agreement with china on the markets, currency markets in particular. We are joined by jane foley, rabobank head of fx strategy. Is this broadly seen as positive or negative, this phase i deal . Guest i think we had the Market Reaction really over the last few months that had been building over the course of last year on hopes that the trade deal would mean that we wouldnt have that negative pressure on economic growth. Optimism has been building since the end of october. I think the question now is that now that we have the trade deal signed, will we have over the the shortfalls that we are hearing about in the phase one . Will they come to the fore . The market will start wanting answers as to whether or not phase ii can really be signed. Will those questions come up before the november election or after . I think if they come up before, certainly theres a risk that some of the optimism we have been seeing in markets in the last few months of the year and beginning of this year could get lost. Vonnie briefly, i want to break some news. Has concluded that the office of management law on withholding aid to ukraine. Once again, the white house ukraine aid freeze violated the law according to the federal watchdog gao, the Government Accountability office. We will bring you more details on this story when we have them, but once again, the white house found to have violated the law ed aid to ukraine. Do you see the market moving all because of trade negotiations, or is this something that is just being manipulated separately . And i dont mean manipulated in the local term in the political term. Economistsu ask about the outlook for chinese growth, china is still expected to slow down this year. We had a more optimistic forecast from the vice premier in china yesterday, but even so, i think there is a market view out there that even if we havent had the trade negotiations over the last 18 months, china would be slowing. If we do have another stage of tensions between washington and china, and that is quite likely there is still hawkish commentary in washington, within some of the u. S. Generals about chinas military prowess if we do get more of those tensions, the market will begin shavenk that is going to even more off of chinese growth, and that could stimulates the renminbi to push lower again. Guy good afternoon. Lets talk a little bit about your call that the fed is going to cut aggressively this year, your banks call. Todays retail Sales Numbers look pretty good. They point to a decent and strong consumer story over christmas. The philly fed nubbers. 2 stabilization within manufacturing. Numbers pointfed to stabilization within manufacturing. Do you still feel that way . Jane clearly, todays data is good. The consumer is in really good shape. We did have some disappointing numbers on wages last week in the payrolls report, but not enough yet to judge that that is falling into the consumer space. Clearly, we do need more buildup of evidence before it looks certain that the fed cut Interest Rates, but that is quite interesting with respect to the u. S. Dollar. Even though last year we started off with a much more bearish forecast for fed rates then the market consensus, we were very bullish on the u. S. Dollar. It is quite interesting to see the transition between what the outlook for the u. S. Economy is to the dollar, and we are still a little more bullish on the dollar this year despite our dovish view on the fed. Guy what about the ecb . Christine lagarde speaks tonight in frankfurt. We have the accounts today, a big policy meeting next week. Where there hints in those accounts that the ecb may be willing to go a little further on the easing story . Jane jane i think it would be surprising if the ecb shut the door to further easing because if you look at fundamentals, particularly at inflation, with inflation this subdued and the euros own, it would be perhaps full hardy for the perhaps full hardy perhaps foolhardy for the ecb to signal that that door is shut. In theeen some slow down Employment Situation in germany. As long as concerns are out there, i think the ecb has to leave that door open. Particularly given the hike we saw in sweden some weeks ago, there is a lot of talk as to whether or not the ecb really has enough room to cut again, but i think at this stage, with lagarde having only just taken the reins, shes got a lot of work to do to fix the divisions within the ecb board, etc. I dont imagine that she wants to close off her options at this stage. Vonnie the january 30 boe meeting is now definitely live, which was something that hadnt been considered up to fairly recently, perhaps even until mark carney readied the market for a lower set of projections for economic growth. Where do you see the next boe move, and what will it do to sterling . Jane well, i do think sterling is perhaps vulnerable. Cable has been below and above 1. 30 level. I think the risk is that it tends to be below. Just 1. 3 , the manufacturing is weak, and signs that the retail servuy the Retail Survey had a weak period as well. We have the risk that we could have a rate cut, if not in january, perhaps in may. And then, of course, we have the possibility that there will be more focus on the politics as well. Lull in political tensions in the u. K. Since the election. We know that brexit will happen on january 31, but only then can they start to talk about the future arrangement. We had some posturing on both sides, and it seems that there are going to be significant gaps on various issues around regulation, fisheries, the rights of eu citizens living in the u. K. It is quite possible that those tensions could also chase cable a little lower from february onwards. Guy bit of a surprise out of south africa today. The reserve bank cutting but when he five basis points. Was it a surprise to you cutting by 25 basis points. Was it a surprise to you . Jane it was a significant surprise to almost everybody in the room. The governor has a reputation of being extremely cautious, a credible reputation, so the market was not poised for this at all. The press conference was also extremely short, so perhaps we dont have all the answers as to why they moved today, and hence you have the reaction in the currency. Vonnie jane, thank you for joining us today. That is jane foley, rabobank head of fx strategy. Lets check in now on the bloomberg first word news. Heres viviana hurtado. Viviana hows impeachment managers returning to the senate floor to read out loud the articles of impeachment again president donald trump. Afterward, Supreme Court justice chief john roberts will be sworn in to preside over the trial. U. S. Retail sales rising 0. 3 in december. For all of 2019, the value of retail sales increasing 3. 6 . Consumers remain the primary driver of the economy, benefiting from a strong leader market. Phase one of the trade deal between u. S. And china bringing clarity. Companies like visa and mastercard moving a step closer to gaining access to the chinese payments market. Some doubts remain. We end first word in russia, where authorities are moving quickly to make Vladimir Putins vision a reality. His new choice for Prime Minister pledging to make changes in the cabinet. That happened one day after putin shook up the government, asking for a constitutional overhaul that could allow him to stay in power after his term of inice ends in 22 any for 2024. 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. Guy thank you very much. Coming up next week, its that time of year. We will be live in davos. This week, a big week for the banks. Next week, a massive week for interviews in the world of finance. , theyllon, mr. Gorman all be joining us live from the swiss alps. Looking forward to that. This is bloomberg. Vonnie live from new york, im vonnie quinn. Guy from london, im guy johnson. This is bloomberg markets. Lets check those markets now. Abigail doolittle has all the details. Abigail theres a risk on muthu markets after the signing of that phase i trade deal between the u. S. And china risk on mood to markets after the signing of that phase one trade deal between the u. S. And china yesterday. Russell 2000 joining in, up 1. 3 . A bit of a move lower, take a look at the shanghai composite. During the asian session, chinese stocks not reacting favorably to the signing of that deal, but not a huge loss there. Here in the u. S. , it is risk on. Lets use the imap in the bloomberg. All 11 sectors are higher. Consumer staples and utilities near the bottom, among the defensive sectors. 1 , bouncing back from yesterday. Consumer discretionary also up 0. 7 . Yesterday, after defining of that phase one trade deal come of the chip sector come a very sensitive to china via the supply chain, sold off of the lows. Today reversing that, up 1. 5 . We also had a move lower for soybeans, some of the other commodities. Take a look at this two day chart of soybeans, down 2 . Traders want more details on when and how china will buy 30 billion of ag goods over the next two years, if it will happen. Vonnie Abigail Doolittle, think of her that. Abigailvestor doolittle, thank you for that. Activist investors are joining. Orces on a bet on tax refunds tom farley will become chairman of global blue. Silver lake agreed to buy control back in 2012. This deal would value global blue at about 2. 6 billion, yse listing. H an n congratulations on the deal, tom. How did you reach that valuation given that to really, the only metric we have are the global blue revenue by 2021 . Tom as a financial matter, you can look at comparable companies. We are valuing this business at 12 times forward enterprise value to ebita, but quite a conservative valuation for a business that is growing 8 yeartodate organic, 42 percent margins, highly cash generative. If you compare it to other , it is aompanies significant discount. Equally interesting for me is thinking about the strategic stability for the business. You mentioned luxury travel, consumer data, the ability for more consumer marketing. Just the crossborder payments nature, which is the most lucrative area of payments. This business is writing a sweet spot for us, and for a fintech like us. Sonali the last time you were with us almost two years ago, you mentioned that you would be able to do something with 10 billion to 15 billion in enterprise value. This is 2. 6 billion. Do we see more acquisitions ahead to grow this business . I washen i was here, thinking about it in the green room, we thought, well, we want to do a fintech business. Got to have a little bit of structural growth that can create value for investors. When you were introducing it, i never thought we would have the dream team of jack ma, silverlake, dan loeb, jack stern. Yes, m a is certainly part of the strategy, but the business is growing, so we dont have to do m a. We can be very opportunistic. We have run Public Market m a plays that have made lots of money for investors in been helpful to our customers, so that will be a part of the strategy, and we think the business will be able to do that. Sonali you have some very powerful coinvestors. What do they bring to the table . Tom let me just enumerate them. It is a hugely strategic business, perhaps the most impressive Financial Technology company in the history of the world for those who follow it closely. It brings tremendous expertise, and a customer race and a chinese Customer Base that is growing more and more, shopping luxury more and more. The third point is investing incremental 100 million, so incrementalting in 100 million, and some new investors for far point. When you tally all of that up, it is a 1 billion investment, a real validation of this business in the deal that we struck. The second major Fintech Acquisition we have seen this week. What is wall street not getting about technology that is making these up and comers rise so quickly . Tom fintech is hot. We are seeing it everywhere. Payments, connecting banks in the case of plaid, consumer marketing in the case of honey, self billing to paypal. That is the exact reason dan loeb agreed to partner with me in the first place. Hes a pretty smart guy, for three decades among the smartest stock pickers and all wall street. Its precisely because fintech is positioned to invest in all of finance right now. Guy ive seen the kiosks down at the airport here in the u. K. But as you say, fintech is super hot right now. Any resistance about going public . It hasnt exactly been the greatest year for Tech Companies going public. Tom not at all. Silverlake has been excited about it the entire time. The ceo has been excited about it. These are Public Markets people. Years, ran for six tripled the stock price while he was there. Silverlake has many investments in public companies. View being public as helpful for a variety of reasons , one of which is to have an additional currency, potentially to do acquisitions. But no, there really wasnt resistance to going public whatsoever that i picked up. Sonali you used a very interesting model here. Does it allow companies to go public with more debt . Is that part of this . Tom no, the market will bear what the market will bear with respect to leverage. In our case, it is quite conservative. I think we will be 3. 2 or 3. 3 ebitda. En 3. 3 times spac enables is really simple, a known fixed proceed amount at a known price. T also involved expertise i will be going in as chairman of the business. I certainly have a lot of Public Markets experience. Ofre have been a number spacs. Draftkings going public was also a spac. They work. Vonnie im sure youve thought about this, what happens to this kind of business in a time this type of business in a time of currency not leaving, of global recession . Luxury is not there in the amount they were. Tom great question. Over the longterm term, this business grows. That is the beauty of structural growth. Other people for that term around. There are middleclass, wealthy people in emerging markets that want to travel and spend. That is the 8 yeartodate, 10 Revenue Growth over the last 10 years all of that is really favorable. If you look at recession, the business actually grew through the recession. I think it was up from percent was up 18 over the worst two years. Please dont quote me on that figure, but it was up during the recession. An emerging market and the value of your currency drops dramatically versus the hero, you may not choose to go to shop still issei to thep the lycee champs alizes that summer. Vonnie guy final quick question guy final quick question for me. When you look at how fintech is regulated on both sides of the atlantic, the u. S. Versus europe , europe has a different approach. London is certainly going to get pretty different pretty quickly once brexit has happened. Is the approach better on my side or on your side of the atlantic right now . Here in london, we are trying to figure it out. Tom ive learned to be really double medic in my career, having run the New York Stock Exchange really diplomatic in my career, having run the New York Stock Exchange. Backfires. I was i will tell you that this regulated, and in some cases heavily regulated, that doesnt really negatively impact the business at all. The regulations are well known. This business started 40 years ago. There were no back taxes 40 years ago. Sweden and permitted that. Sweden implemented that. Now there are 73 countries was back taxes. It has grown up with the regulatory regime, so it has become second nature. It is not a particular concern. Vonnie we have to leave it there, but thank you for coming in, and congratulations. Tom great to be back here. Thanks for taking interest. Vonnie we are going to find out from you what you are going to do next. Our thanks to tom farley, far point acquisition chairman and ceo, global blue chairman as well, and thanks to bloombergs sonali basak. Next week, we will hear from the finance from in davos. We will be asking whats next for negotiations between the e. U. And the United States, also the outlook on brexit and u. K. Negotiations. This is bloomberg. Vonnie live from new york, im vonnie quinn. Guy from london, im guy johnson. This is bloomberg markets. Lets get the first word news with viviana hurtado. Viviana the impeachment proceedings against President Trump resuming on the senate floor. Several House Democrats will read out loud the articles of impeachment after the Supreme Court of impeachment. After that, Supreme Court chief Justice John Roberts will be sworn in to preside over the trial. The Government Watchdog Agency says the white house broke the law when it withheld money appropriated by the u. S. Congress for ukraine. Whats next for President Trumps efforts to change the economic relationship with china . That is the question being asked after the u. S. And china side phase one and china signed phase one of a trade deal. The big issue, chinas government subsidies for business. That has been put off for phase two. Says ther of hong kong country, to systems status can continue. Many see beijing trying to tighten its control. When it comes to luxury items, hong kong topping the list of the worlds most expensive cities according to research from swiss bank ileus bear Swiss Bank Julius baer, looking at things such as fine dining, hotel suites, and luxury cars. 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. Vonnie thank you. Shares of Morgan Stanley opening with its biggest rally in three years after the firm joined rivals in reporting a massive surge in bond trading revenue and boosting its profit target. Senioran, Jmp Securities research analyst, has downgraded p securityyan, jm Senior Research analyst, has downgraded Morgan Stanley. The downgrade when everyone else guns blazing . Devin clearly, we were early on that. Is we want to find names today, and it is not a negative call at all on Morgan Stanley because we really like their fundamentals, but we want to find names that are detached from the equity markets or Interest Rates. The reality is s p 500 was up 33 last year. The Interest Rate environment is mixed, but ended the year on a better town. That gives me a little more caution, whereas the upgraded Goldman Sachs, the thought there is they are in the early innings. It was not a negative view on Morgan Stanley at all. The outlook today was a little bit better than we even thought, so mea culpa there. Vonnie we will see how it all plays out. Dont apologize in advance. From bnyake any cues mellon on deposits . The outlook for that is not so great. Across the board, that doesnt just affect the custodians. Devin its a good question. I think the deposit story for all these is one where the markets are going to alltime highs, so in that backdrop, people are heavily invested in the markets. Ont can have a negative view the near term deposit story. On the deposit side, youre getting the benefits of higher markets. The way i look at it, that is a natural hedge versus a negative story, but something we are looking at for everybody. I think for Morgan Stanley specifically, i actually think it is a good story because they are going after a lot of new Customer Acquisition opportunities. One of the big parts of todays call was talking about one million customer stock plan participants that they think they can convert over to Morgan StanleyWealth Management customers over the next five to seven years. That is a big number if they can execute on it. What weve seen in these numbers, does it justify the 70 rally we have seen for the sector in the Fourth Quarter . Walk me through what the running for the numbers looks like, how much more is priced, and what you expect for the sector still to come. Devin it is interesting. Financials have been a little bit detached from the broader equity market, so financials have really lagged if you go back and look at performance over the last several years. What happened over the course of last year was people thinking that the macro backdrop was deteriorating, the Interest Rate story got quite a bit worse in the middle of the year, and then the last quarter or so, you had this really big, broader equity market rally, and a bit of moderation on the Interest Rate view, where people started to feel a bit better that we are not going to have as many fed cuts as previously thought. That all makes sense. Financials are actually still quite low versus the broader markets. The s p is above average. Our view is that there is still opportunity. We want to be really selective here because we are over 10 years into an economic expansion. That creates a little more risk to things potentially going wrong. We think there is some complacency out there. The other thing that makes us a little cautious is because of that, people are not going to be paying the multiples that i think they would pay if we were earlier into an economic expansion. That kind of keeps a little bit of a cap on the upside potential. Again, that is where we want to find idiosyncratic stories that may be are a little bit detached from making a call on just equities or just on Interest Rates. That is where we point to the Goldman Sachs upgrade we just made, several others across our coverage, but we are trying to be really tactical in what is broadly a good equity market, but theres also some complacency in it. Guy are there bigger opportunities further down the cap scale . Are there bigger opportunities in the regional banks . Devin i dont focus so much on the regional banks, but i do focus in what you would call smaller midcap stocks. There are some areas in that that are pretty attractive. Steeple financials is a company we let quite a bit, a smaller brokerdealer. They are trading at a pretty low multiple, get organically, they are really accelerating the expansion of their brokerage force. They are doing quite well in investment banking. Theyve got a lot of business momentum themselves, but they arent getting as much credit as some of the more mainstream names. Some of the m a Advisory Firms, you look at a country like a comedy like evercore, the stock a company like evercore, the stock underperformed because they didnt have a great 2019, but you cant have the view that the equity market is going to remain constructive and that the economy is going to remain healthy, and yet the m a backdrop is not good. So i think we are also hearing that from firms like Morgan Stanley a jp morgan that have already reported that m a is expected to be good. If it is, that is also true for evercore. Trading revenue was great across the board. It was a blow away quarter. Do we need to see that continue to see the banks hold out with this kind of performance . Devin you go company by company, finding the ado credit finding the idiosyncratic stories, fixed income as a business that is going to ebb and flow. The previous quarter was pretty healthy. You do need that to continue to support some of these stocks. Others that are focused on newer initiatives, like goldman, for example, and even Morgan Stanley, which is much less fixed income centric then some of the large banks, i would say Morgan Stanley, goldman, the story is about consumer and some of the newer business initiatives. That reduces the need to rely on businesses like fixed income, which are going to be volatile, but also dont have a lot of inherent growth left in them. I want to focus on areas that have a lot of growth, and people may be arent fully connecting the dots on what is left. Vonnie im looking at raymond james, apollo, evercore, greenhill. What happens with those . Is it a fight to the death . To some of them need to get together . Will they be able to compete with these banks that are in transformation . Devin we look at it as a barbell. You have a few of the biggest, best banks, jp morgan, Goldman Sachs, Morgan Stanley, and they are all ticking market share from some small firms, and from some of the european banks. You see it in the data. I think that trend continues. If you are a smaller investment bank, you need to be really good at one or two things and have some differentiated value per position to clients. You listed a few companies. I think the ones you listed do have differentiation, or are in areas that are more of a settler more of a secular growth mode. M a advisory has very compelling growth. Business, are in that some of the independent Advisory Firms are really wellpositioned for the next 5, 10 years. They will be able to compete. They are not going to be gobbled up or pushed aside by some of the bigger banks. It is a relationship business, and a business that, longerterm, is growing at a really nice pace. Guy ive got a couple of quick questions. Does the Strategic Advisory business compensate for the ipo business this year . You mention some of the european banks that are losing market share. Are they based in germany . Jane devin [laughter] some are, but it is really across the board. , morgan. , goldman then you look at the products, and some banks have done better than others, but really, the u. S. Banks are taking market share from europe as a whole. It is a theme we think will continue, and it is a good story for u. S. Centric banks that are investing in their franchise while others dont have the means to potentially invest at the same magnitude. Guy just coming back to the other issue, evercore, etc. , does m a compensate for the ipo business . This hasnt been a great year for the ipo business. Im curious as to the balance of one and the other. Devin you go back to last year, and m a advisory fees for the majority of the firms focused their were flat to down a little bit. It wasnt really sincerely a great story for either, but one thing that keeps us constructive, if you look at m a or ecm underwriting as a percentage of market cap, theres always a relationship between equity markets and these businesses. We are well below historical averages. M a as a percentage of Global Market cap only gets up to about a percent in up to about 8 in peak parts of the cycle. Right now we are about 4. 5 , so that doesnt tell me we are at a stretched point of the cycle in terms of volume. Even though its felt like we at high m a come of the backlogs are supportive of what should be a very good year and that business. Vonnie thank you for being in the studio today. That is devin ryan, Jmp Securities managing director and Senior Research analyst. Guy another big day in d. C. Chief Justice Roberts will swear in the senate later this afternoon. More on that story ahead. This is bloomberg. From london, im guy johnson. Vonnie from new york, im vonnie quinn. This is bloomberg markets. Time for your stock of the hour. Heres abaco doolittle. Abigail we are looking at heres Abigail Doolittle. Abigail we are looking at canadas bombardier. The company says it will likely miss forecasts for the year that just past. Heres the plunge, pretty incredible, down about 35 . The worst down 31 , day going all the way back to 1988. Behind the likely sales miss, a number of factors. First of all, this is actually the ebit view, not going in the right direction. In 2018, the company made more than 1 billion in ebit. Flashed, the estimate to 4000 million million. Behind this, lets take a look at a number of factors that are going on here. As i was mentioning, this company is one of the only companies to make both planes and trains. We see calendaring rail projects hurting the company, eating some of that ebit and sales view. Also, timing milestone payments hurting them. Also, the delivery of some of their Business Jets pushed into 2020. They are also questioning whether they will stay in a partnership with airbus on their a220 jets. Lots of uncertainty here, but it is not new. If we take a look at an 18 month chart, this is just one piece of the picture. Shares over the last 18 months down 76 . Re is todays 36 come there is todays 36 decline. It will be interesting to see what this company does next. Vonnie Abigail Doolittle with our stock of the hour there. Thank you. The Senate Impeachment trial of donald trump to get underway about an hour from now, when house managers will come to the Senate Chambers and read the articles of impeachment in full. Joining us is bloombergs sahil kapur. At what point do we get into actual proceedings, and when does it take off . When does the speed accrue . Ahil today is mostly ceremonial day to kick off the process. The seven managers appointed by Speaker Pelosi will come to the senate and read the articles today. Later today, it is expected that chief Justice John Roberts will swear in all 100 senators as jurors in the trial. They will be sitting quietly for the duration of the proceedings, and over the coming days, likely after the weekend, is when things really kick off. Also, once things kick off today, the president is going to have the chance to respond. His legal team is going to be ,ble to make their opening case but the proceedings dont really kick off for the next few days. Guy weve learned over the last hour that the white house violated the law on withholding the ukrainian aid. Does this affect some of the moderate republicans . Does this affect their view on what happens next . They probably wont go too far on this, but maybe it persuades some of them that we need more witnesses. Is that what people are talking about . Sahil that is certainly going to be a big question coming up. For now, we know this is a momentous report in that it confirms by this nonpartisan watchdog, the Government Accountability office, which reports to congress, has said that the Trump Administration violated federal law in its withholding of ukraine eight. This is very significant because this is precisely the issue for which the president is being impeached. They can now say that the president not only acted with corrupt intent in pursuing a political favor from ukraine, specifically the announcement of an investigation against against, chronic against democratic frontrunner joe biden, but that he broke the law. Will it move moderate republicans . It will certainly be a difficult question for a number of moderate republicans who hold the keys as to where this goes. , thosef Susan Collins who are thought to side with the president , but these senators have to face their voters come for reelection in the fall. Vonnie where are we are witnesses, and on this being 100 public and televised . Sahil we wont know what the situation is with witnesses until things get going. Senator mcconnell has not promised that there will be witnesses and has not promised that there wont be witnesses. We know what both sides are negotiating on at this point, or at least trying to make happen. Democrats are insisting that figures like john bolton and mick mulvaney, both of whom had direct involvement in the withholding of ukraine aid, testify. Republicans say if you want those people, we get people, too. They want hunter biden, joe bidens son, who has been a top target of republicans with their insinuation that there was some corrupt action going on when joe biden was Vice President and hunter biden was serving on the board of a Ukrainian Oil company. There is no evidence of corruption or criminality on the part of either biden, but that is where the debate stands. Mcconnell has not revealed much yet. Guy how long is it going to take . Sahil that remains to be seen. We will know early on because they are because there is expect it to be a series of votes, and democrats have the power to force votes on witnesses. Republicans are threatening to force votes on witnesses of their own if it comes to that. If there will be a deal early on the trial gets going on was his, there will be a series of votes in which members have to make their decisions, and it is yet to be determined where things come down. Guy thanks very much indeed. Bloombergs sahil kapur joining us from guy lets go to chicago. Time for futures in focus. Tradingino of path partners joining us from the cme. Lots of talk about enforcement on this phase i trade deal. If im a farmer in the United States, i want to know whether the rug is going to be pulled from under me pretty quickly. The market seems to be signaling that that is the risk. Bob i agree with that. I think farmers in general are pretty downtoearth people, and the people i talked to within the ag sector, when they look at this trade deal, they dont that theres anything to be done to achieve the numbers that have been promised. What is going to happen to the Global Supply of things like like wheats soybeans, wheat . A lot of it has to do with the ripple effects if china were to actually achieve the levels they are promising. Basically, farmers dont believe the trade deal. They dont believe the numbers in it, and they dont believe that even if it were enforced, it would necessarily have a positive effect across markets. Guy there are some that say that even if china stepped up and tried to buy what the deal talks about, that actually the u. S. Couldnt supply it. Do you think there is a story in that as well . Bob i do. I dont know that the u. S. Couldnt supply it specifically. Certainly, that would be a reason for china to go back to brazil and fill their quota, but they dont necessarily need currently the amount they promised to buy. Youre talking about stockpiling soybeans, brazils supply sitting there as well, but it will oversupply the market more than we are already oversupplied. Youve got farmers in the u. S. Trying to make that quota. What happens to the soybeans from brazil, for example . But happens to the wheat . Youre seeing a situation where youve got too much ag. It becomes like a crude oil oversupply. It actually hits prices and doesnt necessarily hit the farmers doesnt necessarily help the farmers. Guy in syria, this deal should be good for Global Demand in theory, this deal should be good for Global Demand. Isnt that good . Bob this relies on progress in phase two and potentially a deal with europe. The Broad Strokes of the trade deal have been priced in. So the demand has to start materializing. We are not getting that yet. We havent been able to break out except for geopolitical spikes. Vonnie bob, great to see you guy bob, great to see you. Vonnie. Vonnie later today, i am going to be speaking with the eu trade commissioner that just started the role in december, phil hogan, on his First Official trip to washington is eu trade commissioner. We will ask him about resetting trade relationships and how the eu is going to proceed with brexit negotiations. This is bloomberg. Guy dow 30,000, it gets a little closer. Investors digest the deal with china and look forward to washington getting usmca over the line. We could get a boat on that very shortly. Europe a little muted today. Impeachment taking the stage. Markets . It mean for we will be joined by pimcos Public Policy expert libby cantrill. And the South African bank cuts rates but when he five basis points. Is there more to come in what could be a critical year for president rapoza president ramaphsa president osa . We are counting you down to the european close on bloomberg markets. Guy lets take a look at where the u. S. Is tracing now is trading now. 700 points now the gap that separates us. Does this rally continue throughout must of this