Of a tough winter ahead for the u. K. Lets check the markets. Weve got bonds on offer, equities crashing a bit catching a bit. The s p up by 1. 33 . Lookuro is catching a bit, at what is happening with brent. Bumpy all across the products. Trading,where we are on the upside. Alix, i got the time right eventually. Alix good thing you caught it. Cases on the rise over in europe. You wound up having a paris looking at restrictions on bars. It all depends on government. Boris johnson expect a very tough winter ahead. The chancellor did warn the country. Have a sacred responsibility to future we need the public finances strong. Through careful management of our economy, this conservative government will always balance the books. Ive never pretended there is an easy cost free answer. Hard choices are everywhere. Alix joining us now from copenhagen, is the saxo bank cio. A democratic sweep, a blue wave. You want to buy value, so you will rotate out of the u. S. And by europe and buy europe. Do you agree with that . The Technology Sector in the u. S. Will be the hardest impacted by the increase in tax rate from 21 back. Companies, the faang this will take about 10 of the expected earnings off and the that hasink saved most of us are coming to play, the fiscal spend in the u. S. Will be enormous. Be more in, it would a landslide, a magnitude much much higher. I agree with that. Guy it is not going to be a great brexit deal, but even if you get a deal done, does that add to the impetus to buy europe . That deal being done, a blue wave, to both of those things come together to produce a decent rally for european equities . There is a lot of unfinished business. The eu budget is not in place either. Months, we will most likely have a trade deal lite between the u. K. And the eu. We will have the eu budget in place, and inside that, they will be fiscal ammunition that could be used by the commission, not only in the already in place budget but over the next coming years. I do see that the fiscal spend in europe will be tied tight. You see germany again. Certainly over the weekend, and as you go into the race pretty soon, i dont think europe is backing down. The only concern is the increasing complications. Alix how do you square that view with the rising covid cases and more extreme regional lockdown measures that could be coming, in the Consumer Confidence hit that could come out of that . Steen and if you look at the retail space today, and the date that comes out of europe, it is pretty clear that this prolonging in support of the lower part of the recovery as we use the shape of k, people losing jobs, they are beginning and that is what we see in retail spend. So far, employment is not an issue, i think it will be in 2021. Covid19 is not in the cards for the market. I am concerned about that. What also concerns me is the fact that if you look at the banking index, the stoxx 600, it is on the floor. It is at the alltime low that we have seen. We see that the bank sector is doing poorly, which reflects the fact that income in 2021 despite all of this fiscal stimulus, it is on the back of a spent by the banks and a very low earnings retention from them. Everything is not blue skies. I really think it is a relative mixup, where you sell the technology in the u. S. Based on biden and you buy the value in europe based on fundamental cheap terms and spread terms. Guy europe has long promised this trade, and never delivered it. The u. K. , i describe i have heard described as a value trap over the last few weeks. Why is this time going to be different . Why is the u. S. Investor, do you believe that this time, i am not going to get my fingers burned . Mainly because of the dollar in my opinion. I dont see any suggestion or hope that the world can extend itself and survive without a weakened dollar. The world growth outside the u. S. , one of the trends we have seen over the course of the last week is the relative outperform of asia. Whereas europe is still bountiful, it is pretty clear that asia investors are taking money back from the u. S. And into the asian assets, but over, i agree with you, this is years of underperformance. If you believe that biden is a shoe in, i think the tax rate effectively on the faangs, which have been the only out performers this year will come back to roost negatively for the u. S. Investors. Alix what happens if we get a contested election or President Trump wins . That implies a stronger dollar as a safe heaven a safe haven. What happens then . Steen then we will have a negative risk off turn, and that is my main take on the u. S. Elections. The last couple of elections, i had a very strong feeling what was going to happen. This time, my strongest feeling is that it will be contested. Normally under november 4, the morning after, we would have a new president. This time, we certainly will be doing all the mail and votes, we will have one week, potentially all the way to the inauguration. I think the nervous time will be from november 4 into the inauguration, but having said that, i would rather be in european equities, but certainly you are right to point out that they will be under very high volatility concerns and acknowledge something that will make me go into that election with that slight underweight of equity overall. Guy yields backing up today. We have backed up quite a long way. We are in 70s in terms of basis points on u. S. Treasuries. A year ago, that would have sounded low. Does that trend continue . Because think it does, it really reflects two things. It is the embedded entropy of the system, and it is the fact that although inflation is subdued while in europe we talk about deflation, it is the fact that inflation is based on expectations, and as money continues to flow from the fixed Income Bucket into these inflation lingers in commodities, it will continue to see Expectation Inflation go up, and that will be in place on the short end. After 10his flipping years, going significantly off. As you indicate, we see a recent high due to those increases. I think it reflects the volatility and the underlying nervousness in the market. Much can that and will that spread to european bonds . Steen i dont think it will move a lot. It is contained, especially the 10 year. I think that is one of the areas that the Federal Reserve will try to keep under control. If you look at the 30, i think the change will be significant. Europe is under a negative Interest Rate that continues to be in play. The u. S. Will see a rising Interest Rate, so that differential will certainly increase during more nervous volatility expectations, during the election cycle. Guy weve got powell, lagarde, looking forward to those events as well. We will be covering those excessively tomorrow. Steen, we appreciate your time. Steen jakobsen of saxo bank. Coming up, we are talking covid, we are going to be joined by the European Commission executive Vice President. We are going to be talking about a whole range of issues. Competition will be one of them, but covid affecting the competition outlook. That conversation is next. This is bloomberg. Guy live from london, i am guy johnson with alix steel over in new york. This is the european close. The Eu Commission president has tested negative for the coronavirus, after selfisolating. We will talk about this with our next guest. We are joined by the Commission ExecutiveVice President , margrethe vestager. Commissioner, you very much for your time. I want to start not by talking about conversation margrethe it is a pleasure to be here. Guy about the president. I am wondering if the commission is being affected by this, and whether or not the commission needs to rethink the way it does business in terms of in person meetings. We have been rethinking the way we do business since the first day. A full season of virtual meetings. I think it shows that it is for everyone, sometimes for everyone to be in contact with someone who tests positive, i think we can all do our part to make sure that the spread is as limited as possible. Alix for you, is it business as usual . We are concert were getting concerns about how the government can efficiently function. It was not a test, it was real life. We had Virtual Commission meetings, we could make the preparation and make the necessary enforcement steps and execute decisions. It is long tested, and it works. Guy lets turn and talk about competition policy. Hasou think covid19 accelerated your concerns, around the concentration of power in key industries, particularly the Tech Industry . Margrethe to some degree, yes, but one of the most important learnings from the covid19 crisis is the fact that we had a dependency on single suppliers, and we dont want to experience that again. It took a lot of effort to make production of protective equipment increased in europe, in times when we could not have that imported from other countries. We have learned a lot. More can you give us perspective on that . One of the things that we saw was this single supplier dependency, and a lot of businesses make their own decisions to make sure they are not in a situation in the future, where if one country closes down, that closes down their own production. The thing the business communities are really taking on board, but also some sushi some strategic industries. Governments are rethinking, we in the commission are doing updates of our industry strategy, to make sure we get this integrated, that sometimes we need to do more to make sure we have the necessary to make sure people can feel safe. Have theissioner, you Digital Services act and new competition tools coming in. You spoke at the beginning of this conversation about getting used to doing things virtually. We rely on the Tech Companies and away we have never relied on them before. Why do you need these new tools, and you think that has been a further concentration of power, within that particular space that requires them . Margrethe it is something we have been preparing for, for quite some time. We have done extensive concentration. We think that now is the time to make sure that society and democracy catches up with big tech. The last time regulation was 2000. Was in now is the time to say with success comes response ability, transparency, that people who deal with a digital giant, that they know what are their obligations, it also their expectedhat is to be when you deal with a digital giant. That is important, because for business, you are more than welcome to be successful, with success comes response ability, and that time has come. Alix on the flipside, you also need European Technology ofpanies to play catchup, which there is a big way to go. How should countries be spending relief money, or how do you ensure that you will have Technology Companies compete, even if you are successful in stymieing google, or facebook or apple . Margrethe the next phase of digitization, with 5g being rolled out is very much on the businesstobusiness side of digitization. We expect to see a lot of that, and europe has a very Strong Industrial culture and Knowledge Base of engineering, also when it comes to digitization. Need is what created the digitalnts, a real Single Market and a Capital Market that will support the necessary scale up. We now have the framework in place. Now we need to make it work. Guy do you worry that in this age of covid, that it will create an even more uneven platform in europe . Germany has the capacity to spend much more than greece. Do you think the digital haves and the digital havenots will be even further apart . Margrethe this is exactly why we want Member States to spend 20 on Digital Investment. It is needed in every member state, no matter how advanced you are. Minds, and wes will make a certain proportion of our investment, we will make sure that is digital. That is absolutely needed, because if not, there is a higher risk. If you look at the budget, it is by now almost 3 trillion euros. Willing toes are support businesses and workers, that is very unevenly distributive and this is why right now, we are trying to figure out how much of that budget has actually been paid out, how much has been used because part of my responsibility is to prevent the unleveling of the playlist of the Playing Field and make sure we have the integrity of the Single Markets. Alix what is the priority with all of that . He will also need state aid to rebuild things like travel, leisure, airlines and to bail them out while we are in the middle of covid, in addition to spending a huge amount on Green Infrastructure and then there is this. How do you prioritize how that state aid goes to italy or france . Margrethe we have different measures because it is for Member States to decide how they will spend taxpayer money, if a Company Needs to be supported. Only if that support will unleveled the Playing Field, if it is a giant company with huge market share, when we come in and say you need to take measures in order to make sure that competition is not disturbed. The other side of the recovery is that we have this incredible , and 20 billion euros of that should be used for Digital Investment in the coming years, and i find that to be very important because in europe, we need to do things in common. It is not enough that every individual member state recovers on their own. We are so intricate so interconnected when it comes to how we trade, it is important that we also have this european perspective and how we recover. It can be investing in digital capacitiese of our like the highperformance computers, there are numerous things to do. The point is we should get it going, because we may be in a pandemic, we also need to start the recovery for people to see that their jobs are being preserved. Guy you brought up 5g. How is americas policy toward huawei affecting competition in the Telecom Space in europe . That is difficult to see. The tale of spectrum for all is affected by this issue of security we made with Member States an assessment of the security of the network in every part of the 5g vallow five chain. 5g value now, Member States can use this toolbox to legislate, but also telike demands of the mitigation providers, to make sure they have the right relationship with those who provide hardware and software, and that perspective is extremely important for us because 5g will be the data backbone of industrial technology. It is important that this will be safe, so the telcos in europe are invested in many different ways, merely by the effects of what we do europe. Alix huawei being stuck in the middle of the u. S. China trade dispute, how deregulation market and grow Certain Industries when there is not a Common Thread between china, europe and the u. S. How do you avoid getting caught in the middle . Difficult to be caught in the middle because china and the u. S. Are very different. ,e see china as a competitor but also a partner when it comes a Climate Change but also systemic rival because china is not a democracy. That is one of the fundamental differences because we feel we share fundamental values when it democracy, free press, critical media and this is why we dont find ourselves in the middle. We find ourselves in a different position with china than the position we are in with the u. S. Guy a complete change of subject, do you think there is fair and even competition in the Digital Games market . We are watching very carefully, apples case with epic games, and epics concerns around the way apple treats it in the revenue it derives. Are you comfortable with the way apple handles that . Margrethe it is difficult to say specifically, but we have had a number of concerns, sufficient concerns to open cases with apple pay, and two cases with the app store. The way people are being treated, that competes with apples own services, so we have a number of concerns with the way apple does their business in these specific instances. Alix commissioner, we appreciate your time. European Commission ExecutiveVice President margrethe vestager. As we continuee into the election, it is going to be a convergence of restriction on Tech Companies, no matter where you are. It is going to be interesting to follow. Guy interesting to see how much of that risk is currently priced in. On both sides of the atlantic and on both sides of the pacific as well, because it is interesting to see the chinese taking a look at android. Quick look at european markets. We are certainly seeing a selloff in the bond market as well. The ftse 100, the dax, all climbing. Individual stocks we are focusing on as well. We will deal with the details of those, plus Charlie Evans from chicago. This is bloomberg. So youre a small business, or a big one. You were thriving, but then. Oh. Ah. Okay. Plan, pivot. How do you bounce back . You dont, you bounce forward, with serious and reliable internet. Powered by the largest gig Speed Network in america. But is it secure . Sure its secure. And even if the power goes down, your connection doesnt. So how do i do this . You dont do this. We do this, together. Bounce forward, with comcast business. Guy welcome back. 30 seconds to go until the end of regular trading here. We have traded in a relatively tight range, but it has been one that posted higher toward the end of the day. 8 10 of 1 . 0 up by the euro is all about tight ranges. I we about to see a breakout . Stateswave in the unit with biden at the front of it would potentially see a trade towards europe, certainly jp morgan talking about that, and goldman sachs. The dax up by 1. 15 . Some individual stock stories in all of those markets that are worth digging into. Lets show you what is happening with city world. It down really badly today. Basically i think we can blame bond for this, the James Bond Film has been delayed and as a result, theyd made the decision that theyre going to be shuttering most of their cinemas on both sides of the atlanta. Of the atlantic. Andgree this is a pumped Engineering Company but it is selling its oil business to caterpillar. The stock has jumped really strongly today, trading above 14 1400 today. Trading at 16 . So today is a really critical day. A French Private Equity Company had decided that it is not going sewer for the stake in that is owned by energy, another french utility. We basically dont have a competition here because is trying to buy at and now it looks see what energy does, they have until the end of the day to make a decision on what it is going to do. Hopingly the market was that potentially we could see some competition in terms of acquiring that. That is not going to happen, so it is going to be interesting to see what energy does. We will see where we get the energy news. Lets talk about what is happening with the single currency. The next 24 hours a really interesting in central banking. We are hoping to be hearing from Charlie Evans very shortly from chicago, theoretically in chicago. Nearlyo is trading at one. 18 right now 1. 18 right now. Powellw, we also get speaking, but we also get lagarde and the chief economist. It is this whole debate taking place right now about the relationship between lagarde and lagarde and the some economist, which in cases seems to have contradicted christine lagarde. There is that tension that now exists at the ecb, and i think tomorrow is going to be fascinating. Alix we will get to that and break that down in just a moment. I want to update our viewers. The White House Press secretary tested positive for covid19. She will not begin that quarantine process. Another example of how covert is spreading throughout the white house. We have had some Senate Republicans come down with it as well. What that means for government functioning, how does it all work, all of this while President Trump is still at Walter Reed Hospital. We are waiting to get an update from his doctors over the weekend. There was speculation he could come home today. That is now up for grabs, until we wind up hearing from his doctors. To your point, back to the eurodollar, the way it affects in the u. S. Is if the narrative is that you dont get a contested election, and you dont get President Trump, therefore that is dollar negative with more stimulus from biden. If you still have President Trump able to win, you will see a stronger dollar as a safe haven bid and that is playing out in the dynamic as you also have a dynamic in europe, and how that is playing out within the walls. Guy there is this whole debate around whether or not the ecb is acting with one mind, in this whole idea that we are going to get more stimulus possibly coming toward the end of the year. The inflation story in europe, very weak right now. We saw that negative spread. Is there this risk that we dont have a phd in terms of the way that lagarde is running those press conferences . A lot going on, on both sides of the atlantic. Of, fedd speaking officials are going to have to wait to see the inflation rate rise above the 2 target. That is according to the chicago fed president , charlie evidence Charlie Evans. He now joins us with michael mckee. Michael thank you president evans for joining us today on Bloomberg Radio and television. You are talking about years before we get inflation because we just dont have a lot of growth right now. The story has been that the economy slowed from august into september. What do you see from your perch in chicago . Charles i think the economic recovery has been pretty good. In fact it has been quicker than i was expecting, back in june when i submitted a forecast. Normaluite nervous about recovery, where we get back to the level of where we were going in 2022, and sometime and then we see it doing better than that even though covid caseloads have been pretty high we have continued to be able to grow through this. The last implement report was a little more modest than many were expecting, so they were questions so there were questions on how quickly we would recover after this and i think we are trying to figure out where the labor market is going to settle out, how much improvement we are going to get in terms of bouncing back from when we were closed down, and how much recessionary dynamics we are still going to be faced with, sometime in the spring of next year. That environment, i think inflation is going to be weak. We could get some relative price changes, which would lead to higher inflation for a time, but i dont think that is likely to be consistent persistent. Michael what our district leaders telling you about growth and employment . Charles it depends on the sector you are in. The Manufacturing Sector has been able to get back to 95 . They figured out how to produce safely, in an environment where they are not dealing with the enduser directly. They are just trying to figure out how to engineer a safe environment where everyone is socially distanced, and then different goods are easier to produce than some others, but they have largely figured that out. Remotely, youk have a lot of National Service businesses, where people are working from home. That is where i am working most of the time when i am not in the studio. Then youve got people dealing with end users directly, consumers, entertainment, travel, leisure, restaurants, and all kinds of things. That is much more challenging. I think state and local governments are kind of disadvantaged because tax revenues are down and they have to balance budgets. There are concerns that that employment numbers are not going to be as high as we want them. They have to balance the budget by laying off a lot of workers, but is going to be a challenge. I think everybody is struggling with the same kinds of issues. You might have a local employment environment because youve got the right industries. That is just a happy thing, if you are finding that but nothing is happy in this case, but you are better off. Michael one of the big concerns out there is the end of forbearance and the increase in defaults. Commercial real estate impacts. What are you seeing from there . Charles that is a great question. As i was finishing that last response, i was thinking from all the National Service type is in his is that youve got workers, working at home, they probably have a lot of office space that is lying vacant or 10 occupied. When i talk to Different Financial Services providers or others who brought back maybe 10 or 15 of their workforce, you have a lot of empty office space, and what is the future going to look like . I think real estate values for office space are going to be challenged until we get on top of the virus and therapeutics. I think those are concerns. Michael you said this morning that you anticipated more fiscal stimulus. Have you modeled what happens if we dont it . Some picture of what we could see if they dont provide additional stimulus . Charles i am hopeful there will be more fiscal stimulus and if ive got like 1 trillion which is not as large as some proposals. At think if you take that away completely, that reduces aggregate demand by quite a lot. That means the road back in terms of employment is going to be a lot harder. I cant begin to guess how this is going to work its way out. Timing is important for a lot of people, who are facing rent payments, mortgage payments, cant go back to work and what type of unemployment relief they might be facing. Whether or not businesses can reopen or if they have to close permanently. If it came in the First Quarter and it was substantial, that aggregate demand would probably still be strong and would not affect my National Outlook that much, but that is where the discomfort with all of this plays out, because i can talk about National Unemployment coming down to 5. 5 at the end of next year, if things go well, but that could mean that there are large segments that have much higher unemployment, that are struggling to get back to work, to put food on the table, and pay rent. It is very uneven and there are many disadvantaged sectors and workers, which is a challenge for everybody. Michael if we dont get stimulus, if the economy is slowing, is there anything more the fed can do to stimulate the economy, or with Interest Rates at 0 , you have pretty much done what you can. Charles we will use all of our tools available, and we will be paying attention to the state of the labor market and where inflation is. At the moment, i think we are still trying to figure out where the recovery is going to sort of stabilize, and terms of what normal recessionary dynamics might look like. If we were to get additional stimulus, if we were to see continued recovery, if we got the unappointed rate down to 5. 5 by the end of next year, those are circumstances where the fed, we are in the ballpark of what we can deal with, inflation could be moving towards our 2 objective, and things can be improving. I think we will have lower for longer Interest Rates, for quite some time. It will probably be uncomfortable for many people. We just need to get inflation up to 2 and beyond. We need to ensure that the labor market continues to improve. Fiscal support would be extraordinarily welcome. Continued business investment, businesses deciding they have figured out how to grow in this environment, and bringing on more workers would be very welcome, but it is going to have to play out, and the virus spread is going to be continue going to continue to be important for some time. Michael said you can not be timid in terms of trying to get inflation above 2 . What does having inflation above 2 for some time mean to you . What does not being timid mean . Charles we have to overshoot 2 for sure. If we dont get inflation to 2 this cycle, or if something happens and inflation doesnt get to 2 , our credibility rests on achieving our dual mandate objectives and 2 is an important part of that, especially when we have been under running that for so long. We have to cross over beyond 2 with some momentum, so that we get up above. I would be pleased if we could get core inflation up to 2. 5 for a time, because that would indicate that we are really balanced in our perspective, and we are able to provide as much accommodation as the economy needs, and it is with our objective of achieving 2 on average, because we have experienced inflation of 1 for periods of time. To. 5 is not even a large number. Michael should we have some kind of rule where you target a specific level of inflation . Charles our current statement gets us very far along the path of very effective forward guidance. We have indicated that we certainly expect to keep the 0. 25 . Ate at 0 to it is competently on track. Stille get there, we can increase rates and be accommodative. The first few policy moves are still a very accommodative monetary policy, especially the labor market when we finally start raising Interest Rates, so we have the elements of our past threshold, forward guidance, i just dont think as long as we continue to speak strongly about meeting our objectives, overshooting inflation, there is not going to be any concerns that were going to preempt that, i think we will be fine. Michael speaking of your accommodation, large corporations can access credit markets easily, but Smaller Companies are still having trouble. We are being told that there are a lot of banks at this point that are not interested in making loans to those companies, so how big a risk is that to the economy, and what can you do about it . Importantt is very that the Banking System be extremely capitalized and safe and sound and that the credit mediation process can go forward at this time, when it is really important, essential businesses that are creditworthy, i can continue to have positive growth , andiences over the future are worthy of loans. When i talk to bankers, they are willing to make loans to those types of businesses, because they can be profitable for them. I think in the current environment, where there are these disadvantaged sectors, and it is not clear how the virus spread might affect their future earning capabilities, evaluating underwriting those loans is more difficult. The main Street Lending facility helps out a little bit, but it has to be the case that the bank really thinks that the loan is thehwhile, and that borrower can pay it back, because they are going to hold part of that risk, given the way that they really are. It would probably modi it would probably be more effective if it was more of a grant like nature to provide relief for Small Businesses that are still creditworthy and can continue to survive through this difficult virus situation, because a lot of people really need grants. For debt is not necessarily what they need, in order to survive and thrive, going forward. When i talk to bankers, they are willing to make loans and they have a lot of reserves and deposits and the only way theyre going to make earnings is to make loans, but we are at that point in the cycle where there is this difference of opinion as to whether or not the Business Enterprise is really as strong as most people would like. I know that when i am in it, i want to have every opportunity possible, and we are all trying to make that the best situation for everyone. Michael Charlie Evans, the president of the chicago Federal Reserve bank. Thank you for joining us today. Up fromre going to pick that conversation, getting his gauge on what is happening in the wider economy. Michael mckee, thank you very much. Let me just wrap up with european equities. These are the final numbers, a little bit of a move down, but not much. We will carry on the coverage of the top of the hour. We will get a bit of postgame analysis. Jonathan ferro and i will be joining you at the top of the hour. This is bloomberg. Ritika this is bloomberg markets, the european close. I am ritika gupta. This is bloomberg. Ritika lets check in on the first word news. A member of President Trumps inner circle has tested positive for the coronavirus. The press secretary says she is not experiencing problems. Meanwhile, the decision whether to release President Trump from the hospital today will come in the next few hours. The white house chief of staff tells fox news the call will be made up of the after consultations with the president s medical staff. Meadows said the president continued to improve overnight. President trump has been at Walter Reed Hospital since friday evening. In the u. K. , Prime Minister boris is warning the public that a quote, very tough winter lies ahead. He says he accepts the people are angry with the way he has handled the pandemic. He tells the bbc, it is going to be a bumpy ride to christmas and may be bumpy beyond that. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by over 2700 journalists and analysts in more than 120 countries. I am ritika gupta. This is bloomberg. Guy thank you very much, ritika. The White House Press secretary positive for covid. Meanwhile, we are expecting doctors at walter reed to conduct hearing on President Trumps health. What do we know, what are we expecting . What we know is that the president from our sources, the president condition improved over the weekend and we saw him we saw him step outside for that brief ride to wave at supporters, and so we are waiting to understand whether or not he will be discharged. His chief of staff said that he could be discharged as early as today, but we are but we are not quite sure. In the meantime, we know that his press secretary has said she has since tested positive for the coronavirus. Alix thanks a lot, mario. Mario parker, from bloomberg. We want to get some analysis. Guest joins us now. The odds growth support for expectations, sets a backdrop of significant support for values and stock short terms. What are your calls . The gist of the call is you got two things working for you right now. If you go from a base case of almost zero in additional trillionish,1. 6 and the democrats sweep, you have a potential for 2. 5 trillion to 3 trillion. You are looking at 4 trillion of stimulus we are starting at zero. The Unemployment Rate is starting to come down, and the fed is expected to keep real es negative for as long that is important because the fed has made it very clear that they are not going to offset fiscal stimulus with tighter monetary policy. You have the fed underwriting what could be as high as 4 trillion in fiscal stimulus, you are going to have upside inflation expectation. Guy upside on rates. How inflationary could this be . Overdont want to get too my here. I think you would be on a much faster pace over the next two years. I wouldnt say it is inflationary. Make a lot of the inflationary plays which have been dormant forever. A fours essentially been letter word for a while now. Is it President Trump saying get it done, he also have Mitch Mcconnell on friday, like where is the movement . It seems to be on both sides. Senate republicans and democrats seem to be in agreement that fiscal stimulus is needed, that the American People need additional fiscal stimulus. We have seen layout layoff announcements increase. It seems to becoming from both sides, getting closer. There is an important reason why. There is the potential that if you dont get a deal now, that wouldve the democrats dont sweep or the republicans dont sweep . We will end up with no fiscal stimulus at all after the election. We will go from a potential for trillion dollars to zero eight potential for trillion dollars 4 trillion dollars to zero. Alix dennis, a good call, good to speak with you. That would be something that markets are expecting, or really price in to a trump win were nothing happens. Guy absolutely. Were going to find out the answer to one of those. We are respecting a briefing at some point from walter reed. Will the president be out today . Will that affect the election . Alix that wraps up for me and guy. Coming up, even weston, balance of power. He is going to be monitoring for updates from walter reed. This is blumberg. This is bloomberg. From bloomberg World Headquarters in new york to our tv and radio audiences worldwide, im david westin. Welcome to balance of power. We are waiting for another update from walter reed. The chief of staff said a decision will be made this afternoon on whether to release the president. The press secretary Kayleigh Mcenany has now tested positive for the virus. Rick, welcome. Things are developing fairly quickly. Whats your take on the white house and its handling of the crisis at this point . Rick hi, david. We all have our thoughts and prayers with everybody who has been afflicted by this disease and virus. And that includes the white house team, president , first lady, and a growing list of senior aides and probably junior aides, who have been i