Forward today. I think lisa is going to talk about it. The last moment i saw as we wait for washington to awake this morning with the president nudging away from the republican reticence more towards the place of Speaker Pelosi. I have no idea what that means. After what we went through yesterday, we are littered literally we are literally monitoring when does the president wake up and advance his campaign through any actions throughout the day. Jonathan we understand there will be an interview at 8 00 p. M. Eastern on fox news. 1 3negotiations for me, the of the negotiations that really matters and has hardly moved, Senate Republicans and leader mcconnell. Where are they in this . Weve heard from mnuchin, from the president , from Speaker Pelosi. Mcconnell is on the sidelines. Hes the guy that finalizes that deal. Tom this is really important, and it goes to what axios said about the republicans really fighting for their lives, having to do with attorney general barr and all of that. These republican senators, whether they are running for election or not, are complete we focused on the next one he five days. The next 25 days. Jonathan and we are focused seemingly on the next headline. Market participants hate it, but it is another morning of it. Lisa and it probably will be for the next few weeks. 90 pelosi will be holding a press conference. To your point nancy pelosi will be holding a press conference. To your point, unclear how she will move this in a meaningful way, given that it is the distance between the president and republicans in control. Hostingt trump will be what he calls the biggest radio rally in history with rush limbaugh. He doesnt want to participate in debates, virtual debates. He wants rallies. How effective will this be in drumming up supporters when some of these polls seem out of his favor at this point . Jamie dimon is going to be speaking at a Fund Management industry event. Very interesting to see how he characterizes the recovery ahead of earnings next week. They have been cautious when it comes to how much money to have set aside to cover loan losses, and yet the recovery has continued to surprise to the upside. Jonathan earnings season sneaking up on us all. Your price action shaping up as follows. Equity futures fading off of session highs just a little bit. Fiscal talks, we have been turning the volume up and down on the same song for the last three months, and i am not sure what progress we have made. In the bond market, yields come in two points to 0. 76 . In eurodollar, we reclaim a 1. 18 handle. Bond levels, record lows, italy, spain. The covid cases in spain and france, the restrictions getting a little bit tricky on the continent. Tom we just saw that come across to bloomberg, on the government of spain acting against the government of madrid. These are the socialist leaderships of the nation going after the conservative leadership of madrid, saying we are going to shut things down. I would bring it over, before we get to the optimism on the equity markets, to what we heard in the last hour. Deutsche bank with a roughly 3. 5 down for four quarters, and up for the next four quarters, so a flat u. S. Economy for eight quarters. He made clear stimulus was needed. Jonathan lets get to the optimism of the moment with ben laidler, Tower Hudson Research ceo. We all set up and paid attention. A q4 melt up, why do you see a q4 melt up on the cards . Ben i think weve all been distracted by the election. Weve followed the upgrade and some of these gdp forecasts. We discounted a lot of the election, and what its done, the concern on the election has whoented a lot of investors are still pretty cautious from repositioning as they would normally be doing in the fourth quarter. What i think is a big growth , you havent seen that reallocation trade. I think it is coming regardless of who wins the election. Growth,5 plus earnings and some segments of the economy or some segments of the market, the more cyclical ones are going to see a lot more than that. Have been looking at the spx chart, and theres been two glorious opportunities for march to tell ben laidler hes wrong. Where do you find the courage, and i will get the cursor out 3 or onere on july october 2 does ben laidler find the courage as we correct . You never rally remorselessly. The incremental data point is going to continue to be positive. Guilty of cutting estimates too far, getting to bearish. That is what happened in march, april may. Now we are in the middle of a gdp upgrade cycle, which italy is going to need a bit more fiscal stimulus, and i am sure we will talk about that. But the incremental data point is positive. Back in april, we were looking at a 12 months forward earnings outlook. Toont think we are going get more fiscal stimulus. There are some segments of the market which have drastically higher, dramatic operating leverage to all of that. They really havent done so far. Tom im still looking for an entry point. I dont care what ben laidler says. Would you like on a friday how i used the simulcast cursor to nail down those pullbacks . Jonathan nice. Well done, tom. Lisa, help me. [laughter] lisa anytime. Talk about this pessimism baked into the market. Yet we see all of the Economic Data showing the steepest recession possibly in history. The nasdaq is up 28 year to date. I am looking at the s p up more than 8 . Where is that pessimism youre talking about . Ben you had 80 billion come out of equity mutual funds since the bottoms. You look at the American Association of individual investors, 40 our bearish six months into the rally. Famouslook at the robinhood Trading Volume chart, and that is basically the lowest it has been since march. I look at the vix. Six months into this rally it is still above average, and futures are going higher, not lower. I can go on and on. Theres very few indicators that actually tell me people are positive. We have a composite Investor Sentiment indicator which is nearly at contrarian levels at this point, and that is given a 12 month return. That is part of the story as we rolled through the election. Investors are going to be forced to allocate on the basis of a 14 month view into 2021 of significant growth. Thatthat is jonathan is what i think sets you apart right now, the fact that you dont think this is election dependent. Why dont you think this is election dependent . Ben i think we price quite a lot into the election anyway. Historically, i think we overdid elections. Back in 2016, if you knew that donald was going to win and you thought the election was really important, you would have loaded up on energy and financials, and would have had it handed to you. [laughter] tom ive got one final question e, and i cant say enough we are getting him, but i cant say enough about ben laidlers calls here. The money question is, for those who are fortunate enough like jon ferro to load the boat on amazon and apple, do they sell dleres to go to the lai rotation, or hold them and use new money . As ihink it thing about it as a versus cyclical. They may underperform for a quarter or two, but ultimately i think they are going to be fine. The story is just a little bit different. I think the reoperating ever lived the reoperating leverage is on the cyclical side. We have a reopening basket that will move things on the work from home tech names, and it is where all the earnings upgrades have been coming from. I think we will get a double surprise of the top line improving, potentially catalyzed by vaccine or not, but all we are missing are a lower cost being taken out. Once the kospi starts to get going again, i think we will be stunned by the degree of earnings upgrades we see. Because investors have sort of been held back by this very boring debate on fiscal stimulus and are we going to get any, the election, second wave of vaccines, that has stopped people from going into those cyclicals, so i think you see a huge opportunity there. Jonathan it is a boring debate, but it is basically the program at the moment. [laughter] lets just call it what it is. Lisa you are not wrong. Tom are the pubs closing early . Jonathan the pubs are going to close in scotland. I can tell you something this morning for all of us in london. Theign, dollarchina, chinese currency reopening on the mainland with some real strength. Policymakers seemingly tolerating that strength, too. Tom it is a two standard deviation in renminbi strength. We talked to hsbc about this, and they are modeling further strength in renminbi. Jonathan we can talk about that a little bit later with john normand, j. P. Morgan head of cross sf in the middle strategy. The equity market on course for the biggest week of gains since late august, up almost 3 on the s p 500. From new york, this is bloomberg. Ritika the Nobel Peace Prize has been awarded to the world food program. The United Nations agency was honored for its efforts to combat food and security around the globe, especially in conflict zones. Foodyear, the World Program helped feed people in 80 countries. Treasury secretary Steven Mnuchin told House Speaker nitze pelosi the administration now once an agreement on a largescale relief bill. Earlier this week, the president pulled his negotiators from talks on thumbprints of legislation. Louisiana is bracing today for hurricane delta. The storm has picked up strength and is now i category three, with winds up to 120 miles per hour. It is expected to slam into an area of louisiana still recovering from hurricane laura. Shuts forced companies to down almost all Oil Production in the gulf of mexico and most of the gas output. China has joined the World Health Organizations vaccine effort, filling a void in Global Leadership after President Trump spurned the program. The kovacs initiative the Covax Initiative is designed to give lower Income Countries access to vaccines as wealthier nations. Links could break a stranglehold on the market for Data Center Computer components. Global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. Im ritika gupta. This is bloomberg. Sen. Mcconnell i have said wearing a mask and practice social distancing is the only way we know of to prevent the spread until we get a vaccine, and weve practice that in the senate. Youve heard about other places that have had a different view, and they are paying the price. Jonathan what does he mean by those other places . We will get to that in a moment. From london and new york, good morning. Alongside tom keene and lisa abramowicz, im jonathan ferro. Two hours and 12 minutes away from the opening bell, equity futures a little higher on the s p, fading from session highs this friday morning. Up on the week by almost 3 . Futures up 14, we advanced 0. 1 . Eurodollar holding onto a 1. 18 handle, despite the concerns on the continent. Tothe bond market, yields in 0. 77 on the 10 year. These lines stood out for me in the last one he four hours. I havent been to the white house since august 6 because my impression was their approach as to how to handle this was different than mine, and what i insisted we do in the senate. Just a little bit of daylight between leader mcconnell and this administration. Tom i wonder if you are going to see more daylight when beleaguered senators fighting for their lives, even the ones not up for reelection, you wonder what the tone is going to be. Awould note the real yield at 0. 97 , a deeper real yield. I know you will expand on this from london. Jonathan thank you very much for the plug. I appreciate that. Tom you are going to tape that at 10 a clock p. M. , which is great. Jonathan . I [laughter] [laughter] wish i could jonathan i wish i could. [laughter] tom we are thrilled that Kevin Cirilli was catered out of park city. Back ongoing to descend the strangest washington i can remember. An open question, what will you friday . N this crazy kevin first and foremost, whether or not the Airline Industry package includes additional funds beyond just the airline relief, but also how republicans are going to be talking today about President Trump will also be very much on my radar. Senate majority leader Mitch Mcconnell, for him to go to the microphone and really take direct questions as it relates to mask wearing, not just at the white house, but also at the signal lessa about the political theater and more about the majority in the senate he is trying to protect. Tom is it under threat . Can you tell us with your travels to the west that the risk to the republicans of becoming a minority in the senate has increased . Kevin i think there is a palpable angst amongst many of the republicans i talk with that they are staring down a blue wave. To some extent, that is typically normal, in the sense that any party that is Holding Power typically feels that way. But this is what i would say. When you had republicans expand their majority in the senate, democrats expand their majority in the house, the republicans felt that with trump at the top of the ticket, they would be able to continue to hold the senate, as well as the white house. That was the general thinking a year and a half ago. That has significantly changed. However, they steal feel the president is able to attract Republican Voters in parts of states that otherwise wouldnt be drawn to even go to the polls, and they are hoping that will benefit them. Jonathan i want to lisa i want to go back to this idea that Mitch Mcconnell publicly seems to throw shade at the white house and President Trump for the protocol they did not follow with respect to covid. This highlights the growing daylight between the administration and republican leadership. How much does this imperil any negotiation for fiscal support, given the fact that republicans cant get on board with one cohesive message . That leadernk mcconnell has at times i dont want to say spoken out, but he has really not been onaid to speak his position whatever the president is tweeting. That is the pattern we have seen from leader mcconnell. I think the republican viewpoint is that democrats are being unreasonable for trying to spend so much money when there is already agreement on a host of different issues. Democrats argue that this is a dire situation where there needs to be more funds allocated. Jonathan one line that stood out for me is a big portion of republican senators that think we have done enough aid. That was leader mcconnell yesterday. Surely that is the bottom line here. We go nowhere. Kevin exactly. I think when you have the stare down between Speaker Pelosi and leader mcconnell, these are two incredibly skilled and gifted politicians. Neither is blinking. I think what is interesting about the airlines is that it allows for President Trump to say he did not cave to Speaker Pelosi, and it allows Speaker Pelosi to say she did not cave to President Trump. Tom 25 days to the election, it is what you dont do. Who is most advantaged by not doing stimulus . Kevin you know, honestly, i think it is the far right who are concerned about the budget and in billy conservative districts. I think someone in the deep red rural districts where covid hasnt had to the Health Impact it has had on some of the other cities, i think their constituents would be more concerned about government spending, so i think from their viewpoint, from their perspective, that would be a win. Kevin had Jonathan Jonathan a late night jonathan kevin had a late night. Couldnt make it to the bureau. [laughter] kevin thats not true. Thats not true. Jonathan the truth is what i say, kevin. Lisa oh, dear lord. Jonathan the average pole right now for joe biden, almost 10 points. Tom i dont buy it. Jonathan thats ok. Im just going to read out the numbers. Hillary clinton four years ago, with this much time before the election, had a lead of just over five points. So almost double that for the former repeat the former vp joe biden. Florida is still there, right after california and texas. We were all shaped by 2016. Whatever anybodys political persuasion is, we need a confidence building reset in the , maybeso maybe in 2024 when we are doing this for years from now, we will have greater confidence. Wonder howakes you vulnerable this market shift is. Tom absolutely. Jonathan for contested election and the potential blue wave. Tom you are doing the math to see if i am out the door for four from now the door years from now. Jonathan tom, that is dark. Have i ever said that . Tom no, but i can see you are thinking. These are grim questions. Jonathan i was told when i signed up for the show, i know you dont like him much. We will be there for you. You can drink on set. But you are stuck with him. Its ok. [laughter] tom ok, good. Jonathan this is bloomberg. Are you frustrated with your weight and health . 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Jonathan from london and new york, good morning. This is bloomberg surveillance , live on bloomberg tv and radio. Alongside tom keene and lisa abramowicz, im jonathan ferro. Your price action this morning shaping up as follows. Equity futures adding some weight to the rally of the week. In the fx market, eurodollar 1. 18. Chinese currency strength is the story this morning. Basisr yields in two points. The spread between the United States and germany, the 30 year spread starting to open up again. One to watch on tens as well. In europe, we talked about it briefly at the top of the hour, greece, italy, record low on yields on the periphery. Tom we can talk about this with john normand in a bit, the disinflation in europe versus the inflation in the u. S. Is really quite something. This is really something, to get him before the publication of Jp Morgan Research on friday and the institutional note monday morning. He is head of process asset fundamental strategy. The theme for me this morning is with the junk condition in the jump condition in renminbi, what is the correlation right now between the asia indicators and the standard 500 good news . John i think theres a reasonable correlation because both of these are moving on the prospect of a Biden Victory and i think a sweep. Is positive for the s p and for asian assets, to the extent you and mucher geopolitics more domestic stimulus. The price action across markets this morning is very suggestive to me of the sweep. The only thing that stands out is the fact that bond yields arent moving that much, and that is going to take conditions out of how bullish you are that people are also focused on now. Tom the expectation game is a movable feast. How far out are the markets pricing . Are they pricing it out and wednesday, to november 3, or into q2 of next year . John i think they are pricing out into the mid part of next year, if not beyond. The simplest way to think about what is going on in markets is they are moving from a fixation on a growth slow down which started in august and september to the idea that the cycle will be rebooted. We will talk about an extension that is going on for quite a while. I think if we follow the normal cyclical path, that strength will extend well into next year if we get more fiscal stimulus. The market is looking quite far ahead in terms of what the stimulus does to the cycle prospects. Jonathan lets talk about how far ahead this market is getting itself at the moment. This new narrative is pretty young. A couple of weeks ago, i had a series of guests on this program who would turn around and say contested election is a risk. Now we are talking about a blue wave. How vulnerable is that narrative . John to me, the vulnerability is not really around the contested election because i feel like the polls are shifting so far in favor of biden that any claims of fraud are going to be dismissed fairly quickly if the margin is very wide. To me, where you have the vulnerability in terms of narrative shift is the possibility that maybe the senate doesnt flip, so if biden is the president , but there is no change in control in congress, we are still dealing with the same impasse around fiscal policy we are dealing of this talk all about a reboot of the cycle will collapse. So you have to watch this race closely in terms of what happens with the senate. You have the risk of a decent slowdown in the u. S. Economy and unwinding of the optimism that has been lifting markets over the past couple of weeks. Jonathan youve talked about the vulnerability of the narrative. Lets talk about the market areas that might be negative. Curve steepener, inflation breakevens, china equities, bond fx. Where are you uncomfortable . John the only when i am comfortable with is owning asia on the equity under currency side, because i do have the condition that biden will end up winning, and i think that is supportive of these politically driven trades like owning asia. All of the other trades you mentioned, this to me is quite conditional on the sweep because that to me is the only political outcome that gives you some guaranty of meaningful fiscal stimulus. I would still become for the bull with the asia recommendations as long as bidens president. I would not be covered with the other stuff unless we get the sweep. Lisa i am looking at the number of job cut announcements day after day. Mediaday, at ts warner announced thousands of layoffs. Today, loreal is going to be Closing Stores and laying off 400 workers. At what point does this matter to your overall bullish thesis . John i dont think it matters if we get additional fiscal stimulus because i do believe part of the reason we are getting these layoffs is because of the income support that has been moving from washington to mainstreet is starting to dry up. I think if it is replaced, there will be job losses in some sectors, but job gains and others, and i think you will see a continuous move down in the unemployment rate. Without the stimulus, you have to extrapolate in terms of job losses and the loss of momentum in jobless claims. You have to be concerned about what that means for markets. Lisa meanwhile, as we talk about your High Conviction trades, your highest conviction was that joe biden would win the presidency in the United States. When you look at market positioning, how high is the positioning right now that that will be the outcome . Positioning ishe suggestive of a broader election outcome that controls the senate, too. Can is the only way you have the interest in curve steepeners. Bywould only be validated the sweep. I think investors are definitely leaning towards that, and obviously the risk is that they could be disappointed. Jonathan one of the trades you think could be insulated, regardless of if we get a divided government or not, is the long china trade right now. Dollar china making a move overnight. Your thoughts on the chinese policymaker, how extended that trade can get . John historically, they dont tend to let the currency appreciate more than high Single Digits in any given year, so this is always going to be kind of a lower beta ethics trade relative to what you might achieve in equities if you are bullish on the cycle, relative to what you might achieve in equities if you are bullish on china specifically. But i do think there is a bit of room to go on this. China has a surplus. Theres a structural flow into bonds and stocks. My guess is there have been some clients who have been less interested in investing in asia over the past few months, thinking that trump could get reelected. My guess is if you do have biden as the president , regardless of congressional outcome, you will see some position covering and some moves back into china. Tom one of the great debates here, we talked to matthew luz etti at matthew laz Deutsche Bank recently, we are in a flatness slow down, and there is the debate of economic recovery into next year. Should our listeners and viewers just discard the present and the past, and just be laser focused on what is out there in 2021 . Is that basically the emotional exercise . John theres always an emotional component to investing because investing is done by people, and people cant help but be emotional. But it is important to remember what is the big lesson of the post gse ashby post the post gfc experience. The policy mistake was to let fiscal policy tightened for about three years in the u. S. That was part of the reason you had such anemic growth in the u. S. After that crisis. I think it is worth remember in that if fiscal policy inadvertently tightens, you will repeat the anemia of the post gfc years. Under a different set up in washington, we can avoid that. Within the glide path of the 10 year yield, what is the important statistic for the 10 year yield . What is the point where 10 year yield begins to signal issues to you . Were to me, if 10 rates close to 1. 5 tom that high . Wow. John yes, we would have to question if this is doing potential damage to the recovery. Course, the catalyst of getting to 1. 5 is less worrisome, but i think the market should be very comfortable with a 10 year rate up to 1 , maybe even 1. 25 percent. After that, i think it is still too fragile a recovery think that that is helpful. But i think the fed probably has some internal sense of what a helpful level of yields is versus not helpful, so i do have some confidence that the Asset Purchase Program would be adjusted to make sure that rates dont stay at an unhelpful level for very long. I think this problems manageable. Jonathan john normand, great to catch up, as always. John normand of jp morgan. Looking at the 10 year yields this morning, 0. 77 . A long way away from 1. 5 . Tom imagine what a 1. 50 u. S. 10 year yield does to your austrian 98 year piece. Youre going to be down 30 on price. Jonathan i thought you bought that . I thought you but austrian the ration . Austrian duration . Tom no, even that is too long. [laughter] jonathan a fair point on what we could see on the Asset Purchase Program. Cleveland fed president Loretta Mester mentioning this week that maybe they could start buying at the long end, and i think that is what john normand is talking about. If you do start to see that move through 1 , one part through 1 , 1. 25 , 1. 5 , the fed has the flex ability to come back in. Lisa at this point, buying more bonds, what are they going to do with respect to the recovery . The earningsat yield in the s p 500. It is about the least versus the 10 year it has been in months. Theres a question of how much the riskier assets get challenged. Tom im just triple leveraged, allcash. [laughter] jonathan every single day. To lisas point, dallas fed president Robert Kaplan speaking overnight on bloomberg, making that point. What does more qe do . Coming up on china, leland miller, china beige book ceo. Good morning to you all. Heard on bloomberg radio, seen on bloomberg tv, with equity futures plus 16, we advance their. 5 . This is advanced 0. 5 . This is bloomberg surveillance. Ritika looks like the on again, off again talks for a stimulus bill are back on again. Treasury secretary Steven Mnuchin told House Speaker nancy pelosi that President Trump now once a comprehensive relief package. Earlier this week, the president ended talks and said they wouldnt resume until after the election. President trump will go on fox news tonight and get a medical evaluation. The doctor will be mark siegel, a fox contributor. He has previously speculated without evidence that biden is using drugs before debates. He has also said that House Speaker 90 policy should stop pontificating Speaker Nancy Pelosi should stop at the forgetting about the president s health. Attorney general william barr a probertedly said that on russian interference will not be released until after the election. For aicans were hoping political bombshell. Michigans governor blames President Trump for fostering hate groups hours after the fbi charged six people with trying to kidnap her. Governor Gretchen Whitmer says the president has given comfort to those who spread fear and hatred. The white house says he condemns all forms of hate. The Justice Department has sued yale university, claiming it illegally discriminated against white and Asian American applicants. They claim the school favored black and hispanic students in undergraduate admissions. Yale responded that it would not abandon its race conscious process. Global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. Im ritika gupta. This is bloomberg. I think the fed can do more, and i am sure we will look at all our options, but those arent substitutes for fiscal policy. Jonathan did message loud and clear from dallas fed president Robert Kaplan on the need for fiscal stimulus. Alongside tom keene and lisa abramowicz, im jonathan ferro. Getting you prepared for the Market Action this friday morning, shaping up as follows. Equity futures adding some weight to the s p 500, plus 16, 0. 5 . Market, john normand, i line in the sand for jp morgan, 1. 50 . Our tolerance for higher yields seems to diminish. In foreign, they are zero dollar at 1. 18. The standout, dollar china. Thats got to be the currency pair of the morning. Tom theres no question about it. Normandspeaking to john on the correlating between all of these different asset classes. How about the idea of talking to someone with the ear on the rail . You can hear that train coming. Leland miller does that better than anyone in china. He looks at all of that exterior data all of that obscure truly beneaths the radar. What can you tell us about a china recovery . Leland we have had several china recoveries, and that is what people do not get right now. You have had the strong, surging rally that beijing likes to talk about, but that is only in the large firms, the biggest cities. Most of china is actually seeing a much more muted recovery, and the key thing here is that even though we are seeing increment of growth get better every month , we are still not seeing a recovery on year. So it is a happy recovery compared to the rest of the world. It is just not what beijing is actually claiming. Lisa there was a story today on the bloomberg about the golden week holiday, and how local vacationing in china has risen to about 80 of where it was last year. Still down 20 , but that is dramatically above the rest of the world. Can we view this as a dramatic for investors putting money into china, or is this propaganda hiding the pain you are talking about in other areas of the region . Leland i think the numbers are propaganda, but the things you are seeing in terms of travel israel. There is a Real Recovery going on in china right now. It is better than what you are seeing around the world because there solution to covid was so dramatic and so quick. What you are seeing is not propaganda. You are seeing a recovery. It is just that they cant just say we are doing real well, but not back to where we want to be. They have to say we are back to our old levels of growth. The streets talk about 5 growth in the third quarter. It is absolute nonsense. Jonathan the aggregate numbers are decent relative to what people expected nine months ago. As you pointed out, what many people are looking at in the developed world, europe, the United States, is a k shaped recovery. What you described was something similar playing out in china. Can you describe the differences between what we experience in america and what you see in china, beneath the top lines . Leland the difference is they got their stuff under control real quick, and we didnt. But i think the similarities also standout. If you are a connected firm, if youve got a lot of capital, if you are politically connected, you are going to do really well in this. Large firms see a strong recovery. That is why they are borrowing. ,f you are most of the country you are all over the country outside of the major cities, you are borrowing less, you are spending less, you are earning less, and you are really hesitant about what is happening there. When you look at our credit data, it becomes very clear. Outside of large firms, no one is borrowing more. Pentup demand across the board, every firm size, every kind of firm except large firms, pentup demand is falling pretty fast. Got a lot of firms questioning what is on the horizon, even though youve got these numbers that are looking pretty good. Jonathan you have said this isnt the recovery that the chinese coming this party is planning. Can you walk us through where you think they need to adjust policy . Leland they looked around and said, weve got a shut down economy. What do we want growth to look like at the end of the year . We will print those numbers and hope that the reality looks as close to that as possible. That is why even the biggest bulls were scratching their head when china released a 3 year on year growth number. Nobody was seeing that, anecdotally or otherwise, but china needed that in order to be able to hit the growth number it wants at the end of the year. They decided where they are going to be in the fourth quarter. We can tear you we can tell you where their gross numbers will be because they decided them a long time ago. They need to possibly claim that they are that strong. Lisa the question earlier is an important one. How much will the chinese leadership manages currency as it strengthens versus the dollar . That is really a question as the export import imbalance deepens in favor of china. Do you see them trying to come in with some sort of currency intervention if we get a much greater strengthening in the you yuan . In the leland the currency is constantly being intervened on within a certain level. What the Chinese Government would like is relative stability first, and then relative strength against the dollar. Everyone talks about the basket. What really matters to them is the dollar. That is what their mechanism is for ensuring stability. They want a slight upward bias to create purchasing power in china. That is there sweet spot. Dollarsee a falling which surges or dramatically diverging recoveries, and the u. S. Falls back into a second wave, doubledip recession, i think they will have enormous pressure to intervene because they want a stronger currency, but they dont want a superstrong one, so they are watching this closely. Jonathan great to catch up. Leland miller of the china beige book, thank you. The following headline come on microsoft to allow employees to work from home permanently. The word permanently is out there. Thatis coming from verge, microsoft is to allow employees to work from home permanently. Tom every company, every industry, and you know theyve got to revisit this, it is going to be fascinating to see if there is compensation differentials, if there are sets of people that say i really dont want to work from home, or i cant work from home. Fascinating social issue. Jonathan are you suggesting that permanently isnt that permanent . Tom no, i think it is all new. I think for everybody involved, the real estate people, the c class officers, but most , thetantly, the people burden of this pandemic on young has beenth children massive. Jonathan the commercial real estate spread seems to be getting a lot of attention. Lisa basically, manhattan rents are falling to the lowest since 2013. People are fleeing for more space. You do wonder, especially if youve got young kids at home, theoretically it might be a little distracting if you are working from home. Tom theoretically. Jonathan theoretically. Lisa you dont get watercooler discussions, snacks. Jonathan coming up, Michael Shaoul of market field asset management. Tom nailed it. Jonathan from london and new york, this is bloomberg. Are you frustrated with your weight and health . Its time for aerotrainer, a more effective total body fitness solution. announcer aerotrainers ergodynamic design and four patented air chambers create maximum muscle activation for better results in less time, all while maintaining safe, correct form and allows for over 20 exercises. Do the aerotrainer super crunch. The prestretch works your abs even harder, engaging the entire core. Then its the back extension, super rock, and lower back traction stretch to take the pressure off your spine and stretch muscles. Planks are the ultimate total body exercise. Build your upper body with pushups. Work your lower body with the aerosquat. The aerotrainer is tested to support over 500 pounds. It inflates and deflates in less than 30 seconds using the electric pump. Head to aerotrainer. Com now. Now its your turn to lose weight, look great, and be healthy. Get off the floor and get on the aerotrainer. Go to aerotrainer. Com, thats aerotrainer. Com. We are still in the greatest economic shock in over 50 years. I dont think the economy is going to be that strong next year, regardless of who wins the election. The numbers this year dont really tell us as much as we need to know about the future. The environment of high returns on low volatility of the last 10 years is really behind us. The fed has been flattening the curve when history says that we want a steeper curve. One thing i think almost everyone missed is that an economy adapts. This is bloomberg surveillance with tom keene, jonathan ferro, and lisa abramowicz. Tom
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