On. The s p 500 is still down. 9 . The nasdaq has crawled back to unchanged. The Dow Jones Industrial average, the worst performing index today, 1. 4 down. Click to move in treasuries. 63 basis points on the 10 year. A risk off move today for whatever reason. Of the headlines today is wells fargo, planning to cut thousands of jobs this year. The move may set a precedent for the Banking Industry that has been resisting layoffs. Joining us now is hanna. How many layoffs do we see from the likes of wells fargo every year . Hanna thank you for having me. Wells fargos headcount has stayed steady over the past decade, even as peers have trimmed down. Around america was 300,000 people in 2010, now around 200,000. Wells fargo is steady at about 260,000. People are expensive. Wells fargos expenses has been an issue for a long time. Vonnie primarily where well those cuts come from . Hannah there have not been any plans finalized yet, but the cuts will be broadbased. They are looking at cuts that could be in the tens of going to, so it is not be from one specific area as much as across the firm. Vonnie surely, that also entails the closure of branches, smaller headquarters across the country. Hannah definitely. As we have seen in the past few months, the world is changing in people uselp how banks generally, so something to look out for. We should mention, they had done pretty well in the last earnings report. Wells is reporting their next quarter earnings next week. Into how get an eye bad things are for them and across the industry. Last quarter, they set aside a huge amount for loan losses. This quarter is expected to be even worse on that front. We will see just how bad things. Re next week in the coming weeks and months, we will get an idea of how many job cuts there will be, and where they will come from. Vonnie wells fargo does not have any comments on this right now, but why are their compensation costs higher than their peers . Wells fargo has kept their headcount steady in recent rs have beene working to trim their headcount down. Issues inhad their recent years, the fake accounting scandal, and then a bunch of issues that push their expenses through the roof. On the headcount and generally speaking with fines, legal costs. They have a new ceo that took over in october, and he has been doing a review of the entire firm. He will be coming out with his conclusions at the end of the year. Vonnie well to serve as president to other consumer facing banks . Cushion ifm a little they want to make some headcount reduction themselves, but dont want to look bad during a pandemic. It definitely could. A lot of the big banks have been holding off on job cuts through the pandemic. Wells fargo, that cannot last forever. Especially with the federal coming up,tress test there is a formula and how much they could pay out with their dividend. If or when other firms are affected, certainly, this is something they will look to. Vonnie great reporting their. There. That was bloomberg hannah levitt. Now lets get first word news with Mark Crumpton. Courtthe u. S. Supreme says a new york grand jury can get President Trumps tax returns and other financial records but are now has blocked house subpoenas for the documents. That is likely to prevent their public release before the november election. Justices ordered lower courts taken look take another look at the subpoenas. The president responded in a tweet this is all a political prosecution. The missing mayor of south Koreas Capital reportedly embroiled in Sexual Harassment allegations has been found dead more than a half day after giving his daughter a willlike message and then leaving home. The ap report says Police Located park wonsoons body near a restaurant in northern seoul, more than seven hours after launching a search for him. Meteorological experts say there are Signs International efforts to curb Climate Change are not working. United nations Weather Agency says the world could see annual Global Temperatures breaking a key threshold for the first time years. Coming five Scientists Say average temperatures around the world are climbing because of manmade greenhouse emissions. Global news 24 hours a day, onair, and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im Mark Crumpton. This is bloomberg. Vonnie this is Bloomberg Markets. Im vonnie quinn. Programheck protection reopened monday morning, the same day the Small Business administration disclosed data, companies thatr got bailout loans, sparking scrutiny. Neil borofsky was the special. P. In 2008. R t. A. R he is currently a partner at jenner block. First off, what grade would you ppp, as it has been handled by banks so far . Neil that is a tough one. The reason it is hard to give a letter grade, in some ways, its been successful, saved a lot of businesses that would have otherwise failed. Impact, f that from a front perspective, from the perspective of taxpayer money only being used in the way the framers of the law originally intended, it is probably closer to a d. Ofnie you have the likes food cart vendors, carnegie hall, the guggenheim, the rotarian groups, the church of scientology all applying to the same program. Should they be given equal status . Neil it is tricky. There were Certain Industries that were not supposed to receive funds. Hedge funds, lobbyists. It looks from the list that was put out that some of those companies that technically looked to be ineligible got funds. That is a problem. It is also supposed to go to companies that needed the money. About on theng brakes, about to go to bankruptcy, and we dont know their internal finances but it seems unlikely that a law firm that pays its partners on the average of 3 million per partner really needed these funds, but nonetheless took it. It is hard to know without the details but it looks like it was not as evenly played as it should have been. Vonnie if the spirit of the law was to keep people employed, what is the problem with these organizations taking money alongside food cart vendors and very Small Business owners that only hire one or two . They violate the law by applying for the program and taking the funds. That is number one. There is an ethical component and one that reeks of hypocrisy. If a law firm or Company Knows that they dont need the funds, anyur firm did not take government money, we have not been laying people off, because from an ethical perspective we dont need the money. To have a couple Million Dollars in free government money, but there is an ethical component there. And then there is also the hypocrisy. These antigovernment, whohandout organizations go on and on about how evil government is for helping people , and we have to have small government, finding out that they are first in line with the tin cup to take free money is pretty disgraceful, even if not illegal. Vonnie we did have several highprofile libertarian organizations like the americans for tax reform foundation, the Rand Institute of santa clara taking money. That thesoning was government shut us down, therefore, this is reparations. Tell us why that is problematic. The federal government did not shut down anything. You hear that, and it sounds like a bunch of malarkey. Does this mean they now support the idea that if government takes away business for something, they are always in favor of getting money . Do they believe in reparations for descendents of slaves . It just shows you that these nonprofits what is the price to sell their soul and believes . Apparently 150,000 to 300,000. It is just greed. It is greed and hypocrisy. Again, doesnt violate the Program Rules . No. But it really brings into question and shows you the importance of transparency in these programs. A lot of these recipients did not think that they would be exposed. The treasury secretary said that it would not happen, but under pressure and lawsuits and when you have transparency, you not that they did anything illegal but those hypocrites, maybe they will have some sense of shame. Than 20 of the recipients that have been disclosed. There are still a lot of entities out there that we dont know about because of this opposition to transparency. That is why it is so important as these programs go on, taxpayers have a right to know what is going on with their money. I have been saying that for almost 12 years, and it is just as true now. Vonnie needed that this had to be done quickly and there was the possibility that nothing would have gotten done at all and people would have been starving how would you have instigated quick oversight . Neil let me be clear, as i said in the opening, this program has been a godsend. It would not have had impact it did if it had very tight antifraud provisions on it, all of these different types of screening mechanisms. I am sympathetic to the fact that they had to get the money out to as Many Companies as possible. From an oversight perspective, a couple things. Sonsparency from day one, you could adjust the policy and implementation of the program as it goes on. When you have transparency and oversight, you can learn things. Its you see there are classes of recipients that are inconsistent with the spirit of the rules, you can amend the rules as you go along. Also you need to have strong oversight from day one, from a deterrence perspective. If everyone knew from day one he would be disclosed, that sunlight is the best disinfectant. It can help chase away potentially. Now some will be shameless. When you see members of congress have applied for the program, candidate level officials, family members participating these people are likely immune to shame, but it seems like others who dont need the money or it is not appropriate get chased away. Does so much good when it comes to government programs. Vonnie talk about what we could put into place now. Obviously, a lot of confusion over oversight. There was an oversight board. Now the program is open again. What would be the one or two things that should be done . Should there be a czar . Be 100 ere should transparency, a commitment that every participant is identified with the terms of their loans, all of that should be public and available to taxpayers. It is their money, they have the right to know that. You could further empower the resource agencies to make sure they are out there providing the level of deterrence and investigations for those of using these programs. We still dont have a full head of that Oversight Commission after President Trump fired glenn fine. We only have an acting chair. We need a permanent chair. We need to protect our overseers. The fact that President Trump inspectorfour generals in rapid succession puts a chill over the watchdog community. Passing the type of legislation thats been proposed that would protect them from indiscriminate termination because they are doing their job, that is another way that we can have more protections as more money is sears out, and we need watchdogs keeping an eye on our money. Vonnie what is your sense about whether it is fair that Portfolio Companies of private equity firms got into the program as well . Small offices, dentists, small doctors. Bill ackman came out and said these Portfolio Companies are going to zero, and now they have all been rescued, but they already have their protector, their private equity on umbrella. Should private equity have gotten this bailout here . The board affiliation rules that the sba had that were supposed to limit how much Portfolio Companies could get, counte the 500 employee includes all the different Portfolio Companies that the private equity has controlling interest over. There were some builtin protections there. The fact that there is private equity behind it does not mean that the company otherwise would have laid off their entire workforce during the shutdown. Qualify, andwise that was the decisionmaking process, i have much less of a problem with that. Assuming all the rules were followed. It is better to have those people employed been laid off. In those instances, it doesnt bother me as much, assuming all of the rules were followed. Vonnie a slightly separate ap and its landlord, a potential precedent. Gap will not pay its landlord and times square. Who should be liable, the landlord, retailers . Unfortunately, since i am at jenner block, because we are mixed in and some of this litigation, probably best for me not to comment. Vonnie thank you so much. Neil borofsky, former tarp special inspector. Manhattand, hotels are getting creative to spur demand. How one company is navigating the pandemic. This is bloomberg. Bloomberg. Vonnie this is Bloomberg Markets. Im vonnie quinn. New York City Hotel struggling to navigate the pandemic are doing anything they can to drum up business. For some, it means pitching their rooms to people stuck at home. E, ceo of Safety Organization joins us now. Tell us about some of the ideas that you have had keeping everyone working there, the hotel afloat during this time. Amir thank you for having me. Andaw the manhattan hotels, we were part of the reduction at the end of march of 2020. We said to ourselves, how could we be innovative, think about the next demand that we will see . We see it in the Office Spaces as well as hotel owners, and we think the need has shifted. We want to be ahead of the curve. With our program, b will essentially provide we will twontially provide programs. The program is called your place. It will include two initiatives. One is a day trip. Four individuals who want to retreat, have a luxurious environment in this time, to escape from the stress that they just be there and enjoy what the hotel has to offer, the view of manhattan and so on. On the work side of it, we have two segments. Individuals would like to be more productive when working from home. You have a fullsize desk, fast internet, printers, all of the office needs that they would need. On the other side, corporates who are not ready to come back occupancy and would be able to take a floor, few rooms in a the hotel. Basically bring the people there. Doing . How is business we have seen people moving about the city again. Is that helping business . Occupancy rates that have been discussed in the media, we are talking about 40 occupancy. The actual trend in travel, leisure and business, is much less than that. Of 40 is including a lot programs that the city is offering like homeless shelters, for health workers. Ofn we look at the occupancy actual traveling, we see a 5 to 10 occupancy the last couple of months average. In order for us to stay in business, to think more innovative, that is my we started those programs through the short and medium term, for us to be able to be there, to actually stay in business. The hotel stayed open in this time. Vonnie the very best of luck. We always want to see business survive. The Sapir Organization ceo. A little bit of an Informal Group but powerful these days having shaping the regions economy and also brexit negotiations. There has been a bit of a raise for this including from italy and other candidates. Didates. You doing okay . Yeah. This moving thing never gets any easier. Well, xfinity makes moving super easy. I can transfer my internet and tv service in about a minute. Wow, that is easy. Almost as easy as having those guys help you move. We are those guys. Thats you . The truck adds 10 pounds. In the arms. Okay. Transfer your Service Online in a few easy steps. Now thats simple, easy, awesome. Transfer your service in minutes, making moving with xfinity a breeze. Visit xfinity. Com moving today. Mark im Mark Crumpton with bloomberg first word news. Has been found dead more than half a day after giving his daughter a willlike message and then leaving home. The ap reports that Police Located park wonsoons body near a traditional restaurant in seoul. Den hills near the Supreme Court says a new york grand jury can get President Trumps tax returns and other financial records but for now has blocked house subpoenas for those documents. That is likely to prevent their public release the or the election. Totices ordered lower courts take another look at the congressional subpoenas. The case tested President Trumps protection from lawsuits while in office. Nancy pelosi had this reaction. Here we are, the president s appointees had to clear that he is not above the law. The path the Supreme Court has laid out is one that is clearly achievable by us in the lower court, and we will continue to go down that path. President trump responded in a tweet, this is all a political prosecution. The Justice Department says it no longer supports roger stones request to delay the start of his prison term by 60 days due to the coronavirus pandemic. He is due to begin his 40month term next week. Convicted of lying to congress during the russia probe. The Justice Departments reversal comes todays after stone asked President Trump to commute his sentence. Florida is still being hit hard by the coronavirus. The state reported new records in covid19 debts and new hospitalizations to date. Died in theians past 24 hours, up from 48 the day before. The states Positivity Rate jumped to 18. 4 . Florida has had more than 232,000 cases. Global news 24 hours a day, onair, and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im Mark Crumpton. This is bloomberg. Greg im greg bonnell in toronto. Welcome to Bloomberg Markets. Vonnie im vonnie quinn in new york. We are joined by our bloomberg and Bnn Bloomberg audiences. Here are the top stories we are following from around the world. U. S. Jobless claims fall by more than expected last week but further declines are in question as states walk back reopening plans amid a surge in new infections. Greg the oecd latest report on the u. S. Economy. We stick to laurence boone, the oecd chief economist. Vonnie National Security concerns over huawei and tiktok. Trumpl discuss the administrations potential ban on chinese owned companies. Lets have a look at the major averages. We have seen some weakness, definitely some risk off sentiment. Of course, it comes back to covid19 and the pandemic, a sober reminder today about the fact that we are seeing a rise in cases in florida, texas, the number of people who died in florida hitting numbers that are troubling. A reminder out there that as the economy reopens and we hope to get this strong rebound, the virus has not gone anywhere. The dow is down a little more than 1 . Almost. 75 . Own if there is strength as it has been through the pandemic people are going to tech names. The nasdaq in positive territory. When we talk about those weekly jobless claims starting to ease, that was a nice way to start the day, despite the fact that we have 19 million americans out of work, but at least it was not getting worse in the claims. But then we had wells fargo come out and say they plan to cut thousands of jobs. This raises an interesting line of inquiry. We have seen the initial jobless hit and the on assignment numbers spike from covid19, but what is yet to come . Frances donald is with manulife asset. We have talked about this before. We had a hard hit to the economy out of covid19 but we could still see trouble ahead. That is certainly my view, that we are dealing with a series of shocks. We are seeing an evolution of the challenges ahead, and the biggest evolution is how people respond now that we are seeing a surge in cases in certain places of the united states. It is wanting to say that we will see certain businesses shut down, but on what i worry about more is how this changes the demand side of the picture. What happens to the confidence level of u. S. Households . Will they not want to go to the stores outside of their home . We are seeing the bleeding is slowing but there is still a sizable wound that has to be healed. 18 million americans need to be rehired. Cases anda surge in we have ongoing bankruptcies from key names every day, im a little worried that it will take a sizable amount of time to reduce that 18 million number. Nothing is more important than getting americans working back in the system, that is the most important policy goal. We think about a second wave of not only the virus but people losing their jobs as Companies Like wells fargo look at how you operate during a recession, we start to think about government spending. We are all looking for stimulus now. Next even get to that stage of stimulating the economy . When i see this morning, 18 million americans unemployed, the biggest risk that i see is on a planet concerns. Do we get an extension and what does it look like . The problem in the u. S. , it is not that we will not hire these individuals. We believe 80 of them will be. It is how long they stay unemployed and do they have the support . Not just to pay the rent and bills and avoid ramifications in the financial system, but also do they raise their savings rate, do they choose not to make larger investments as they are unemployed . We know the fed is concerned, the longer it is you are unemployed, the harder it is to get back into the system. If we see this continued pace we have about a 3 decline in continuing claims at this pace, it will take a year and the how to employ all of those 18 million americans, and that is an optimistic scenario. That will create problems that will bleed through globally as well. Vonnie how does a body, federal reserve, central bank, deal with Something Like start stop pandemics, infections that have businesses closing down as soon up . Hey open that is what we could be looking at in the u. S. For the next several months. Frances chair powell has use this fantastic metaphor, that when you are walking through a dark room with a lot of furniture, you walked slowly so you dont bump into anything. When you have uncertainty, you dont make Big Decisions quickly. They have a little bit more of an advantage over the federal government, in that Monetary Policy takes about 15 months to work through the real economy. They can stay on hold and do nothing for a prolonged amount of time. They dont have to worry about adding too much stimulus. They can lean on the side of dovish nest. When we have 0 inflation, month over month inflation, we should not be thinking about the fed raising rates. I dont have the fed raising rates for at least five years, and i feel confident about that. Federal government, we have to make sure that they are online. Most economists would tell them that the risk is premature, we are moving the stimulus. The markets would respond poorly if we dont see a generous unemployment extension. Vonnie i have to ask you about the canadian economy, its ability to repay the borrowing happening as a result of the coronavirus. Canada is facing all issues that all global governments will be facing, they are paying for the pandemic. Canada is one of the standouts in the Global Economys oecd. Bond markets are looking at these countries from a relative basis. One country that should be more nervous is the united states. Ratiosll see debt to gdp rise to the highest on level going back to the 1800s. For me, the bigger investment story is we may have countries that will see deficits and global debt rise, but what really matters is the u. S. Deficit blowout. In that case, a weaker dollar. Is doing, what that with the u. S. Blowing out as fast as it is, it is dollar negative. Vonnie thank you for joining us, frances donald. Of course, we have canadas jobs tomorrow. Economists that we surveyed are looking for a gain of 700,000. Coming up, we will speak with the oecd chief economist they onlyoone on my see a gradual recovery from the pandemic. This is bloomberg. Ic. This is bloomberg. Vonnie this is Bloomberg Markets. Im vonnie quinn in new york. Alongside greg pennell in toronto. With the pandemic sending waves through the economy, the oecd is. Or different scenarios. Joining us now with the details is the oecd chief economist and director laurence boone. The latest survey of the u. S. Says that while a lot has been done, and it is great that we could have a gradual recovery, why isnt it possible that we could rebound quickly here . Laurence two factors make it difficult. The first money is we dont really know a lot about the virus, we dont have a treatment, vaccine. That is the only way that you can protect people, by using physical distancing. This will impair a number of sectors like travel, hospitality, entertainment, leisure activities. We will not get back to a 100 economy but just 90, 95. Some states are having trouble containing the virus, so in you need to take more stringent measures of confinement to let the infection rate declined, which means shutting down the economy a little more. It will be difficult to get back to 100 economy. Vonnie one of the recommendations in the latest report is lowering regulatory barriers. The oecd says that could energize the recovery. Why regulatory barriers . Are in a phase where some states are working, some are less so, we need to see the Unemployment Rate declined very fast, so you would obviously need to ease canitions so that somebody go and work more easily. That, you needo a labor market that is not hampered by the regular things. The u. S. Has one of the highest rates of occupational licensing in oecd countries, but it also is different from country to country. If you are a nurse in one state, you cannot necessarily work and another one. Sometimes that applies to professional life. Flower shops. We are streamlining these types of barriers to help more mobility in the job market and accelerate the recovery. As we try to model out in the coming months and years as to what the Global Economy looks like, how hard is it to wrap your head around the idea that Certain Industries will be changed forever, Certain Industries may not be able to move along . Bewas nice in my industry to able to go home and broadcast from home, but others dont have that luxury. Laurence absolutely. This type of crisis, they dont create revolution but accelerates trends. There are a few of them that we see. The most impactful one is the thing that is happening with digitalization. Can betivity digitalized, you can work from home. If you are in a service industry, you may have to work late. Homesountries have care for people, and they had done badly in this crisis. [indiscernible] we will need to find a vaccine or a treatment before it starts functioning. Ask if i was going to this is a time at which you really see the differences between how economies are set up, what they prioritize. Do you notice that things are more difficult in the u. S. And they would be in certain european countries, because of how it is set up . Laurence i would say two things. Governments,cd they have learned from the financial crisis and have really helped their economies fast, helping people, firms. That is very impressive. Different economies are affected in different ways. Emerging market economies, which are highly dependent on commodities, were devastated by the crisis. In the recovery, this is weak. We did a lot of flexibility for the recovery to be fast, and at the same time, a lot of health protection, so households can go out and consume again. This balance will be difficult to find. Greg when it comes to the years ahead, when i look to the financial crisis, the criticism was always that governments may have showed up right away with stimulus, but they therew the weight onto central banks, and they needed some help. Is there a danger that governments run out of the firepower for fiscal stimulus, and it all gets thrown into the Monetary Policymakers laps again . We have seen is monetary and Fiscal Authority working really hard to help their economy, now working hard to find some vision, which is good. Both policies have different objectives. Monetary policies is looking at financial stability, making sure liquidity is flowing, but it cannot make out looking it cannot decide to invest in one sector versus another. That is for fiscal policy. We both at the moment because this is the biggest shock for a century. It is one that will last for a long time. Virus, to live with this this 90 economy for quite a while now. For thank you so much taking the time to join us and give us your insight. Laurence boone, chief economist at the oecd. When we come back, we will talk about trump versus huawei. What the Administration May be plenty for the chinese tech giant, and what that could mean between washington and beijing. This is bloomberg. Greg this is Bloomberg Markets. Im greg bonnell in toronto. Alongside vonnie quinn in new york. We have reports of Trump Administration is finalizing rewardingeping certain contracts to firms. Joining us now for more on this is nick wadhams. Lets talk about what we saw today, the sanctioning of a top Chinese Party official. Thats right. The administration announced today what amounts to sanctioning the highest level Chinese CommunistParty Official ever sanctioned by the united states. This is the communist Party Secretary from the shin zhang province. Broader effort to pressure china on all fronts but it is hard to stay in the degrees to which this will infuriate china. Bureau member of the that is essentially the u. S. Cabinet. A very senior official. It comes just one day after chinas foreign minister delivered a speech that essentially called for better ties. Safe to say that has not gone over well in the u. S. Just another in a litany of actions the u. S. Has been taking against china. Vonnie we hear the u. S. Is ready to bar federal companies linked to huawei. How serious is that . Nick that is a huge deal actually. Defense contractors, the state in panict have been mode because of this provision that was written into the National Defense authorization 13,that comes due on august that basically bars and u. S. Company from doing business with Companies Overseas that have ties to huawei. If you are a federal contractor doing work with the u. S. Agency for International Development in africa and you partner with a local telecom that has huawei in its system, you are barred from doing that business. This is something that is actually under consideration, a number of senators, including republican ron johnson, who are trying to undo this provision. It is this ticking time bomb that comes do august 13, and it will cause chaos in the contractor community, if it goes into effect. Talk about the sensitivities around everything that seems to be chinese tech, we have President Trump threatening to ban tiktok. What is the concern, can he follow through . Nick great question. The president said he was weighing the possibility of banning to talk. Furyurse, that would cause in millions of teenagers across the nation. The question is how he would really do that, and whether that would raise censorship concerns. That they are question for the is, and the administration is concern over americans private information, the data they would submit to tiktok. E, aok is owned by bytedanc chinese company, who essentially uses that information to develop ai machine in china. There is a lot of concern about what happens to that information, whether it can be turned over to the Chinese Communist party. Again, you are seeing this fit into a broader system where the administration is finding all sorts of pressure points to push against china, but whether they can get china to do something about it is entirely different. Vonnie thank you so much, nick wadhams. Much more Bloomberg Markets next. This is bloomberg. It is 2 00 p. M. In new york and 7 00 p. M. In london. I am taylor riggs. Caroline i am caroline hyde. Filing front and limit. Initial jobless claims falling comeuts as more pain is to with fresh plans to lay off tens of thousands of workers. Strong enought today to lift the s p 500 into the green. Coronavirus spreads across the sunbelt. Oil below 40 per barrel, rebounding from yesterday. At president ic aim trump. Democratic nominee joe biden set to unveil his plan this hour. How the former Vice President plans to hit his part hit the president on the economy. That and so much more coming up. You take a look at where we are with the s p 500 and