And germany extending it until 2021. Good morning. Incremental news around trade and the coronavirus is helping some of these assets continue to trade to the upside. He stoxx 00, up. 6 . U. S. Yields are 70 basis points, a little bit has changed there. Looking ahead to the fiveyear option of 51 billion. Then the australians were able to sell 21 billion aussie dollars smashing records. Folks at Jpmorgan Morgan say we could see 100 if shinzo abe bow out. W. T. I. , this is a fivemonth high. Remember that the hurricane is likely to hit some of americas largest Oil Refineries which would imply a shut down for months. 18 billion in potential damages. Coming up, trading the from the economy for the first time. European Exchange Traded funds are attracting the nasdaq. They have attracted more funds this year than funds tracking the s p 500. Lets get to the first word news. Get you to some of the other stories were watching. Germany is extending the job program that kept millons on unemployment. Now they will be provided until the end of 2021. About 5. 6 Million People were on it, down from 7 million in may. The Republican National convention was capped by speeches from pompeo and melania trump. The department prohibits political activity while on official travel. We had a third night of unrest in wisconsin. The governor has declared a state of mrnl after businesses were vandalized and several uilding were caught on fire. Blakes lawyer said it would be a miracle if he ever walks again. English children over the age of 11 will have to wear facemasks if their school is in a high risk area including when moving around the area. It wont be required in the classroom. It will be up to the school to decide if they are necessary. That was your first word news. Now lets get back to some of the market action. The rally is hitting a bit of a pause. A point to reflect the s p and nasdaq. Larry kudlow praised the stock market at the Republican National convention. Lets get your initial read on the day we had overnight and the fact that risk assets are still pushing record levels rs especially in the u. S. Equity. Definitely. We have had further con frmation the policy fake confirmation to provide the stimulus, the numbers coming out of germany and the g. D. P. Numbers showing the commitment they have in terms of providing stimulus programs. This will continue whether it is going to be the u. K. , the u. S. , i believe the policy makers are significantly convinced that it is hard to avoid any social tensions that mass unemployment would cre. Create. Now it is going to be more of often rather than a vshaped recovery. Because we have a significant number of s. M. E. s. Which rely on the broader economy. I appreciate there is a lot of cheering on of new stimulus package fwuss rational side in me asks the question these are staggering amounts. Who is going to pay that back and when . There is a very interesting philosophy. The school of thought. In their view it is not a matter of debt and deficit. This can be expanded as long as there are no inflationary issues. In my view, i expect inflation to come back. People may say well, we have the global crisis, stimulus, inflation was never a problem. I think this time it is different. Number one, we have receding globalization. Costs are go up. Whoever comes into the white house i think the tensions with china between the u. S. And china are likely to continue moving forward. Third in terms over the massive stimulus, it is uncomparable to what we have. Rasmussen but not least, it has not been directed only at the banks but more broadly. I believe inflation is going to be coming back. Onwards. But 2021 you look at where investors are positioned and they are long and excessive, 120 trillion yielding less than 2 . That means they are betting on they are not betting on inflation. That means there could be quite aggressive repricing. If your kind of scenario does play out. I agree with you. I think the market has been very much focused on the yields and there has been a significant trend in momentum towards that. However in my view, as inflation works to gradually start to reappear, would expect a the yields in the companies to start rising but we do within a fixed income market u. S. High yield. We went positive back in march before the feds announcement. Going back to the point of inflation, i think it does not mean that the Central Banks are going to be raising rates in the interim. I think they will accept some signs of inflation. They will be stickier this time round. I think it will be stickier rather than transient this time around and it will have an impact on the Government Bond yields. Sure. We have news of course that the chinese are reported to be set to buy a record am of american soybeans after reaffirming their condominium o to stage one of the trade deal. This is an upside scenario that probably wasnt really priced in. Your take on that . Might be just political. Potentially. S. , helping President Trump to get his ratings up ahead of the elections. If that were not to take place, i think that could be an adversity for trump to rattle the cage of china. Also expect to come through in september and october if differentials between trump and biden do not narrow. I think that would be an issue going forward. Really appreciate your view. Always a pleasure to catch up. Up next, were going to be getting into a conversation with the after the Company Posted a quarterly loss due to the pandemic. That is next. This is bloomberg. Economic finance politics. A saudi arabia billionaire reported a loss 1. 3 billion saudi riyals. They are known for a wide assets. O of run me through the highest priority for you in terms of making changes to your portfolio to make sure that you are in a better position to weather some of the changs that are let yet to challenge s that areyet to come. Thank you for the interview. I think that the Companies Invested in 14 sectors and 14 sectors diversified sectors over the economy of any economy. The thing is having to strange our portfolio is really not because we believe we are the covid19e here is this is an especially temperature that i can no one seen before. This is first time that the whole world is facing one enemy. It is the disease. Everyone is focused on the right medication. To counterattack this nbelievably dangerous disease. Focusing now to cut any to reduce expenses, to control or slowdown on capex. So youre controlling the cash flow to have company which is in an excellent position. Yusuf you mentioned your operational cutbacks. What about locking in some of the more profitable investments. Is that on the tabble . Actually we do not have a timeline. It is actually the performance of that investment eths. So yes, everything is on the table. Appearance around for 40 years. We are just going wait for the right prices of our investments to some of them and maybe in some areas we might actually cease our investments. Yusuf you have seen this rally in tech stocks in the United States and other parts of the world. Do you think they are overvalued at this point . For sure. For sure. Everything in my opinion is overvalued. It is due to huge sums of money that the government in United States has actually helped the markets with. I think the Election Year is ding to maybe some kind of doubt what is going to happen. Who is going to win . What party and so on and so forth. Actually we believe that the markets are really combube rant in the United States. Europe, we believe europe is actually a much better place to invest in at this time. Due really reduction of a lot of the great companies, share price. Yusuf where exactly in europe are you looking to find some opportunities . Do you have any more details on that . No, i dont actually. Basically were looking in the. K. And in the eurozone. Europe just now. Basically were looking for Something Like said 14 sectors is a huge number of sectors for any company to invest in. Yusuf what is your read on the economic recovery . Is that going to be ahead in the rest of the world or in line with the rest of the world . What are you hearing from some of your peers . We also have High Foreign Exchange reserves. We have low cost of production. All of this should add to the speed of recovery in saudi arabia which would add a lot of benefits. Yusuf for investors, specifically in your shares, any guidance on the dividends . Yes, we are maintaining our dividend policy for the whole year of 2020. We are going to review this again. As usual, we do that every year. Not because of this exceptional year. This would gain and happen, is unbelievable. We dont expect this to continue forever. We believe things will be clearer. There will be hopefully a vaccine and well go forward hopefully. Yusuf thank you very much for making the time. Great to see you. The c. E. O. Of kingdom holdings. Coming up, as hurricane laura bears down on Oil Refineries in the u. S. , what is is industry doing to weather the storm . This is bloomberg. Yusuf youre watching surveillance. Lets get into the story around hurricane laura. It is bearing down on key refining facilities on the u. S. Gulf coast. It is forecast to become a category 3 storm when it comes ashore on the texaslouisiana coastline on wednesday. The industry is ready. We are very prepared for this hurricane, seemingly moving into the houston, southwest louisiana area. There are big, huge refineries down there. Several other important pieces of our oil and Gas Infrastructure are down there. We have a Specialized Office here at the department of energy that is directed by an assistant secretary that is responsible for our response. Their teams are already evaluating this and working closely with the industry. We feel that the industry is very well prepared for this type of storm. In addition to that, the president has directed me to make available the petroleum reserve. Thats what it is there for. We are doing all that we can to ensure that we are capable of doing that immediately following storm. We feel overall were very prepared. At this point well have to just watch and wait and see where the storm ends up. Lets move out to california where there have been these brownouts. It has been very hot. What is going on there . Is there some more fundamental problem . Absolutely. No question about it. California has a long history of Getting Energy policy wrong. You may recall the blackouts, the brownouts from 2001. There is a market issue back in that point in time where people were manipulating the market but they were manipulating it because of the wrong policies that california chose to implement at that time. Were seeing some of that replay today. What california has decided to do is move to a 100 Renewable Energy generation world. The challenge with that is when the wind doesnt blow and the sun doesnt shine yet people want electricity, it is not there. Their overall strategy is to borrow electricity or buy it from the neighboring states like arizona and nevada. The challenge with that strategy is when it is hot in california, sometimes it is it is also hot in arizona and nevada and they may choose to keep their base load power and keep their little bit because they like their hospitals to run just fine and airconditioning to work there as well. So there is nothing to sell to california. That leaves california in the awful position of having to turn off the lights in certain parts of the state in order to meet their energy needs. That takes us to the fundamental fork in the road between democrats and republicans over renewables and relying on fossil fuels for Energy Dependence that i just described. There was a study in june that said 60 of americans were really concerned about climate. Democrats and republicans see this very differently. Can we have a bipartisan Energy Policy in this country . Sure you can. Natural gas is a very clean source. Were developing technologies here at the u. S. Department of energy to make it cleaner. Were developing technologies to make carbonintense fuels like coal cleaner. We have had Nuclear Power for the last seven years which is entirely emissions free. You can do both. You can have a Renewable Generation base. You just have to choose to do it. I think that is what the fundamental problem is in places like california. They have relied too heavily or focused too heavily on Renewable Power like wind and solar at the exclusion of some of this base load power which you absolutely need in todays world to ensure that you have the energy you need when you need it. President Trumps Administration has done a fair amount in trying to really as i say reinforce Energy Dependence in the United States. Relying on fossil fuels. What is left to be done . He is reelected . What is on your agenda . We need to continue to build infrastructure. We have done a great job increasing our production. Making ourselves energy independent. Relying on fu technologies like horizontal drilling and fraking to allow us to increase productionor these resources here in the United States. Our challenge today is getting the product to market. It is building Pipeline Infrastructure to get its to the oceans and coastlines. It is building export facilities that that we can make this oil and gas available to the rest of the world. They are going to continue to use these types of fuels for the foreseeable future perhaps as many as ho50 years out. Yusuf that was the u. S. Energy secretary. Coming up, were going get into everything you need to know from the e. T. F. World. This is bloomberg. Yousef welcome to bloomberg etf iq europe. We will be your guide to the regions Thriving Market and Exchange Traded funds, everything you need to know about the funds and the flows. Yousef european etfs tracking the nasdaq have attracted more money this year than the s p 500. Asre is a goldrush and etf, Exchange Traded funds now hold more bullion than central bank except the fed. Who is making the money . Robotics and ai. Europes Retail Investors pour money into etfs. We will ask if they are a good way to target the trend. European investors have been piling into an Exchange Traded fund that tracks the nasdaq