We are up for it faangs really driving that. We are up 4 . Usually a useful indicator in terms of risk sentiment. A clean kind of number actually providing one message from the market, confusion. The german tenyear guilt, we do have a bid on bunds, but the move particularly at the 30 end of the u. S. Curve really quite stark today, a big flattening of the curve. Alix it all depends on where we are in the u. S. Election. Nick wadhams of bloomberg joins us now. Where are we . Wheres michigan . Wheres wisconsin . Where is pennsylvania . Nick joe biden leads in wisconsin and michigan, and it looks like those numbers will hold. Wisconsin aspects to make a call later today, although the margin is so narrow that there will likely be a recount. President trump leads in pennsylvania, but both sides say they are confident that they will win that state. Essentially we are doing right now is playing a waiting game. There are states like nevada, pennsylvania, georgia where it is still going to take a while for these ballots to be counted. It could take days, for example. North carolina, some of the ballots dont have to come in for nearly a week. It is definitely a waiting game. But if you look at the blue wall states, the states that joe biden needed to win and unseat donald trump, it looks so far like things are trending in his direction. His Campaign Says it is confident it has a path to victory. The president meanwhile expressing doubt about some of these numbers because he jumped to an early lead, but as absentee balance were counted, joe biden absentee ballots work on did, joe biden started to grebe ahead to grebe ahead. Ahead. St to creep this just looks like the normal ballot counting process. Guy thank you. Nick wadhams joining us on the latest on become. Joining us with more on the markets and the uncertainty, bilal hafeez, macro hive ceo and founder. You. E start with we seem to have this retrospective review of what the market actually wanted. It now seems the market wanted divided government all along. Bilal i think everybody in the market, analysts like myself are very good at coming up with russian eyes asians of what is good for markets with rationalizations of what is good for markets. Stance was to do nothing around the election because it would be chaotic. I think theres no edge in trading around waiting for the dust to settle. But i think there is a lot of rationalization around stocks or so i around why stocks are so high. Alix there is still the virus going around, still work from home, virus cases moving higher in the u. S. I want to get your take on how much of which is leading to the nasdaq is leading is leading the nasdaq. Toal stocks really started rally a few days ahead of the election, when people were still expecting a blue sweep. , tech has tended to outperform nontech as well. The one thing i would say in terms of the gridlock is there were concerns around tech regulation if there was going to be a democrat clean sweep, so now with a senate unlikely to flip the democrats, that is now off the table, so that is a great environment for tech stocks. On top of that, yields falling as well, so that is good for tech stocks as well. I think it is a confluence of all of those forces. Weve got these covid concerns, and on top of that, no chance of tech regulation. Christine, what do you think divided government potentially means for the rest of the world . Christine i am looking across the board at 30 year treasury yields, and that tells me everything i need to know. The u. S. Yield is down about 13 basis points at the moment, but that is not contained to the u. S. Everywhere across the board in the developed markets is down across the gertie across the 30 year sector. These hopes for the deflation trade and for a quick and speedy route to stimulus via a blue wave, that is off the table now. What a divided government really means is a slower progress on this front, which means we are not going to get that quick revival of inflation that a lot of bond traders were banking on prior to the election, and really the collapse in the u. S. And everywhere else following that speaks to that. Alix i hate to ask, but how low can yields go here . These are very with the moves we have seen over the last 12 hours very with the moves very whippy moves we have seen over the last 12 hours. Bilal we have to get some sense of who does win the presidency, what happens during the lameduck session into year end, whether congress is able to pass some kind of stimulus or not. Is it 500 billion . Is it 1. 5 trillion . Depending on these parameters, the fed could really step up, and this could move bond yields down to a 0. 6 mark at the very least. Just following on from the first question they asked about post rationalization, are we seeing today a reversal of some of the positions that have been put on over the last few days in terms of the tech sector. The end of year tax selling logic seems to certainly be there today. Below are for longer rates logic seems to be there as well. What do you make of the rotation back into tech . Is it just a combination of factors, and is it sustainable . Bilal that is a great question. All of the factors that you mention definitely play a role. What we have been observing over in markets live, more than anything, is the fact that tech has become a haven this year for other reasons apart from related to those in the election. These are companies with big Balance Sheets and large stores of cash that have really proven durable this year in the pandemic era and work from home era. That is why investors have tended to flock to them. They are no longer just a pure growth play, but really the shelter that investors were looking for runs everywhere else, especially your more traditional cyclical stocks, travel, airlines, what have you. Tech was one durable sector that withstood all of that. This is also a reflection of that trade, in addition to all of the other factors we have seen related to the election itself pertaining to regulations, for instance. Alix i wonder how much of the move is pricing in a contested versus a delayed result election. Delayed a very different than someone that will take a long time. Bilal absent kristine absolutely. There is a big difference between a contested election and a delayed election. The difference between those two would really be the time that it takes to get the certainty because if we are talking a delay, maybe it will be a matter of weeks. If we are talking a contested election, and judging by how it played out in 2000, then we are talking towards the end of the year, which of course, if markets were to choose between weeks are towards the end of the year, they would choose the shorter timeframe of the two. The virus narrative is still there, and the cases are picking up in the United States. Do you think there is an argument that says that if we do get a President Biden, regardless of what happens in the senate, that biden is going to take a tougher line similar to the one we are seeing in europe in order to deal with that virus . There have been accusations leveled at President Trump that he has not done enough. Do you think President Biden would do more, and is that a market event . Bilal that is a really good point, just for context, if you look at deaths per capita, the u. S. Is in the same ballpark as the u. K. , spain and france, although lots of people like to point to trump as the u. S. Being an outlier. It is really kind of in the same ballpark as some of the european countries. That said, i do think President Biden would probably have a clearer, consistent message around how to deal with covid, and he would more ably come up with protocol for consistent measures across the United States. Halt the spread of the virus, should think. Alix thank you. Bilal hafeez of macro hive will be sticking with us. This is bloomberg. Bloomberg markets ritika lets check in on the bloomberg first word news. The race for the white house may be too close to call for days. There are still millions of ballots to be counted, and there are close contests in five key states. Joe biden has 238 of the 270 electoral votes needed to win. President trump has 213. That didnt stop the president from climbing victory and threatening to challenge the results in the nations highest court. Pres. Trump we will be going to the u. S. Supreme court. We want all voting to stop. We dont want them to find any ballots at 4 00 in the morning and add them to the list. We will win this. Ritika the president did not offer any evidence that wrong going that wrongdoing had occurred. The democrats had hopes of recapturing the senate, but those chances have diminished after republican victories in iowa and montana. Republicans now hold a 5347 senate advantage, and almost everything would have to go and ther the democrats undecided seats for them to win a majority. U. K. Prime minister Boris Johnson set to push new coronavirus lockdown rule through parliament today. They will take effect at midnight, and force the closing of pubs, gyms, and nonessential businesses in england. 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. Thank you very much, indeed. Those new lockdown measures coming to the u. K. Tonight we have seen Weak Services sector data coming through. The u. K. Reporting 492 additional deaths from coronavirus over the last 24 hours. Remember, we have a bank of england decision tomorrow. We are not going to get that result at seven a clock a. M. We are now going to get that result at seven a clock a. M. At 7 00 a. M. Bilal hafeez of macro hive is still with us. We are getting a bank of england right decision tomorrow, and more from the chancellor. What do you think the bank of england needs to do tomorrow to deal and counterweight what we are seeing as a result of this additional lockdown . Isal i think the key thing that bank of england will likely increase its program by 100 billion pounds to just over 800 billion pounds in total. One reason obviously will be to try to lower Interest Rates, but the other is the lockdown will projectead to higher deficit from the u. K. Must of the bank of england almost mechanically will need to absorb that, or yields could start to rise. I thing that will be the main thing they could do tomorrow. They will probably also revised down some of their Economic Projections as well. They were expecting a stronger q3, and it actually turned out q4 will probably be negative, so we get this w shaped path. Is this going to be the mmt experiment now . Is this one we are really going to see it when we go into these second rounds of lockdown . Bilal i think it depends on their language around how they describe this all, but this is as close as you can get to mmt without calling it mmt. You start to increase your qe programs to match an increase in fiscal deficit numbers, and this is happening in almost everywhere around the world. To some extent, you could say the earlier qe programs were like that as well. The key thing one needs to work out is will they ever exit, will they ever unwind their stock holdings. At this stage it is hard to see them doing that for the next four or five years. In that sense, we could prospectively dna prospectively be in a mmt environment. Qe now the purpose of basically to keep the markets calm so the government can issue . And if so, if qe is starting to lose its effect, do we then moved to a yield curve control which would be almost a more overt way of making that happen . Bilal that is a very good point. I think the language central bankers have been using is they have been urging finance ministers, Prime Ministers, or president s of their countries to engage in fiscal policy. Almost every credible institution is talking about fiscal policy because, as you rightly point out, Monetary Policy is less effective. So there is a strong case the central bank does want to accommodate that and make it easier to happen. In terms of the next steps for central banks, as you point out, qe is one, but yield curve control is the next step. The bank of japan has done this for a number of years. You have someone but the rba, the reserve bank of australia, already engaging in that. That would be one of the next steps. There is an alternative to all of this where we follow the path of china. The pboc has not done as much in terms of qe or rate cuts. Instead, they have been very smart about giving credit to different parts of the economy. Recently they did a Digital Currency program, where they gave Digital Currency to all of the residents of a certain province. That Digital Currency could only be used to buy things in certain shops, so it was very targeted in the way of introducing credit to the economy. That could be the curveball in all of this, whether other countries around the world do what china is doing with Digital Currency. Alix and also what they are doing with the virus, asia setting down in a way we did not see in the west. Just going to have the best and most firepower to fight the virus, lackluster growth . And how does the dollar factor into all of that . Bilal overall, north asia i think is the standout here because theyve dealt with the virus very well. Particular china has a lot of firepower, and they know how to run a variable state directed economy, whereas western economies are just learning to do all of that. I think they are the leaders of the pack here. That said, they still depend on global demand. They still depend on u. S. Growth , and there is that caveat. After that, i would say europe probably stands out a bit more than the u. S. As far as the fiscal policy side. I think europe ironically has more slicks ability on that side, especially germany, who has been much more jim u. S. Has more flexibility on that side, especially germany, who has been much more generous on the fiscal side. It is generally a weak dollar environment, but i think at the moment, i would probably play that more against the asian currencies. I would expect the renminbi to do well, the japanese yen. The euro today is doing well, but i think the euro is a bit trickier because europe is at the center of the second wave right now. Low,inflations are very and it needs to be stepping up its pepp program, so that might limit euro gains. Guy just looking more broadly, particularly at transatlantic relations, there was this expectation that a blue wave would benefit europe, both from a political point of view and i Financial Market point of view. European equities were excited to rally at the value trade really kicked in. That is the exact opposite of what we are seeing today. Youth think there is any juice left in that narrative if we do get divided government in the states . Does europe rally . It does not seem it will rally in the same way the u. S. Does, certainly as that tech narrative is developing with the nasdaq up sharply. Bilal i think the main thing with a divided government is if biden is in power, that presumably means there will be improved multilateral relations between the u. S. And europe, which at the margin, could be positive for u. S. Stocks. Aside from that, i think there is a general beta, even if tech stocks are doing well in europe. I think outside of that, really it is a covid scenario that is much more important for european stocks than whether the u. S. Is a divided government or not. Alix always a pleasure to catch up with you. Bilal hafeez of macro hive, thanks a lot. This is bloomberg. Ritika it is time for the Bloomberg Business flash, a look at some of the biggest business stories in the news right now. A big victory in california for gig economy giants such as it were, lyft, and doordash. A ballot measure willig them to them from state law requiring f their workers will exempt them from state law requiring most of their workers to be fulltime employees. Chinas suspension of ant groups 35 billiondollar ipo is just the beginning. Beijing wants to rein in the fintech empire controlled by jack ma. It plans to discourage unders from working with ant, calling for platform operators to provide at least 30 of funding for loans. That would render many of ants existing transactions noncompliant. Bmw has reaffirmed its guidance for the full year. The pandemic keeps hurting business in europe. B w thirdquarter sales beat estimates. Bmw thirdquarter sales beat estimates. That is your latest Bloomberg Business flash. Guy we are near session highs as we come towards the end of the day. Still no resolution over in the United States when it comes to the election. Nevertheless, some clear trends are starting to emerge. One of those is that we are seeing flatter curves. The other one is that health care is charging ahead on both sides of the atlantic. Health care in europe is up by 4. 27 . Technology is up. Europe doesnt have much technology. It is technology and health care that are really driving these markets. A complete flip of the reflation trade we have seen over the last few days. Thanks down today here in europe by 1. 31 . The miners also getting back some of their ground. The european close is next. This is bloomberg. [ sigh ] not gonna happen. Thats it. Im calling kohler about their walkin bath. My name is ken. How may i help you . Hi, im calling about kohlers walkin bath. Excellent happy to help. Huh . Hold one moment please. [ finger snaps ] hmm. The kohler walkinbath features an extrawide opening and a low stepin at three inches, which is 25 to 60 lower than some leading competitors. The bath fills and drains quickly, while the heated seat soothes your back, neck and shoulders. Kohler is an expert in bathing, so you can count on a deep soaking experience. Are you seeing this . The kohler walkinbath comes with fully adjustable hydrotherapy jets and our exclusive bubblemassage. Everything is installed in as little as a day by a kohlercertified installer. And its made by kohler americas leading plumbing brand. We need this bath. Yes. Yes you do. A kohler walkinbath provides independence with peace of mind. Guy we are still trying to figure out what in the markets that was writ large across the European Equity space. It turns out a divided government stateside may be a good thing for equity markets worldwide. Certainly we have seen that on both sides of the pond a similar drive in terms of the sector breakdown. Finishing up 1. 94 on the stoxx 600 and it is on good volume worth bearing in mind. Money pouring back into equity markets. Lets break down the other asset classes. Eurodollar also delayed. Eurodollar oscillating. I think the eurodollar has emphasized the confusion today. 1. 16 handle, 1. 17 handle. We are seeing a big move in the bond market. Flattening on both sides of the atlantic. The big move to the back end. Brent crude also on the move, up 2. 42 . We are seeing the story developing across a number of asset classes. Individual markets across europe , let me talk to about the narrative. And the daxe cacs all up. In terms of the sectors that have driven the markets, the two clear ones that have driven the narrative on both sides of the atlantic, europe does not have much take but it does have a lot of Health Care Stocks and that has been where we have seen the real gains coming through. You can see on the grr sector, the Health Care Sector in europe up 5 , a real turnaround and a drive forward for that sector. Technology, not much in europe. What there is is trading upwards. Unsurprisingly given the flattening curve, we are seeing the banks taking a battering. Down sector down 1. 3 . Lets turn back to the president ial election and what it means for u. S. Eu relations. German minister spoke to bloomberg and ward about protectionism. We believe we should have a level Playing Field between the most important trading countries , and we believe protectionism has notateralism survived the response to the challenges of our time. Senior fellow at Carnegie Europe joins us now. I am trying to understand if a Trump Presidency means more protectionism, more tariffs, and if a joe biden when means a rollback of those measures. You have clarity yet . Lets deal with the trump issue first. There will be more protectionism, more trade issues , more distrust between the eu and the United States. This means europe cannot just sit down and wait for the next four years for a new president. It has to seriously deal with modernizing multilateralism and not complaining. If there is a joe biden presidency, you have to be very careful. Yes they supported a joe biden presidency, but if joe biden does enter the white house, it will take time. There will be wrought lots of reflexes and thinking there will be lots of reflexes and thinking but this will be the time to europe to spin out what its actions are. Guy absolutely. It would be likely given the state of play that a Joe Biden Administration would have a lot to deal with at home. Europe needs to stand on its own feet. My question is is it capable of doing that . Judy it is not. Nice to hear you. Certainly economically, trade wise, reach out to likeminded partners, canada, singapore, australia, new zealand. As you refashion multilateral, do not sit around. Do these trade agreements we recently did with canada and do them quickly. Europe it needs likeminded partners. It has the talent, it has people , and people and the other countries to do this as well. Guy there are a couple of narratives developing in europe over the last few years. One of which is we would like to see more regulation. The other is we would like more sustainable economy. Joe biden would push both of those narratives and push them strongly. With a divided government he will find that much more difficult. Is that going to make it more difficult for europe to push those narratives as well . Judy i have a slightly different take. Eu and the government should get out of this washington bubble and the obsession with the white house, whoever is in the white house. Reach out to the governors, reach out to the senators, reach out to the mayors, reach out to california, reach out to states and engage there because the support for Climate Change is strong in the United States. It is so constipated, they forget the bigger picture. This might be a simple question, but why is that not happening . Judy it is because of inertia. Push, and political and it isdeas expanding the lobby. Lobbying not good at for their own interest. They lobby for their own interest inside the you, but now it is time to use the lobby for the car industry. Just get our act together and sell what the European Union means and may be optimistically for once could bring a lot of support on board. Guy we are in the final stages, we hope, of the brexit negotiations. Would it be worth a Trump Presidency there is still a path to that would it impact the negotiations . Judy if Prime MinisterMaurice Johnson is in such a Boris Johnson is in such a mess over his relationship with the European Union and negotiation, i do not think so. We are talking about mid november to wrap this up. In the unitedrry states would be debilitating waiting for carry in United States would be debilitating. This is bilateral between london and brussels. In germany, because Angela Merkel is key on breaking the deadlock. Guy we are going to leave it there. Residentpsey, non senior fellow at Carnegie Europe. We are wrapping up the session in europe. Equity markets on assaults on a solid standing. We finish near session highs. We did see a little tick higher in the ftse session during the auction process. A positive session in europe. Health care the primary driver. This is bloomberg. Karina this is the european ritika this is the european close. I amro two group to live in the principal room. I am ritika gupta. Coming up, former xerox ceo. This is bloomberg. Lets check in on the bloomberg first word news. Joe bidens chances of an Electoral College victory are getting higher as boats come in. He got more breathing room by winning in arizona, state President Trump one in 2016. Joe biden could win even if he loses pennsylvania. He would need to win michigan and wisconsin as well as nevada. He has a razor thin margin in nevada this morning. President trump would have to win four of the five battleground states that are still undecided. Georgia, north carolina, michigan, pennsylvania, and wisconsin. He won them all and 2016. The president has a lead in georgia but joe biden is gaining ground as boats from democratic heavy urban centers come in. Earlier today President Trump claimed fraud and said he would go to the Supreme Court. He would not be allowed to go there immediately and it is not clear he has an argument that would affect the outcome. His argument might focus on whether the ballots that arrived after election day should be counted. Global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. I am ritika gupta. This is bloomberg. Alix thanks so much. Breaking news we are monitoring as it relates to the vote count. The michigan secretary of state Jocelyn Benson is holding a virtual briefing. She says tens of thousands of votes are still being counted and they could have results by friday or sooner. They are still counting votes at flint, detroit, and kalamazoo. Georgia officials now saying they expect all votes to be counted today. They have about 200,000 ballots left to be counted according to state officials. As of right now, joe biden currently has 238 electoral votes versus President Trumps 213. Trump casting doubt on the counting process in a series of tweets and he will go to the Supreme Court as he tries to hold on to the early leads. Joining us is mark alexander, Villanova Law School dean. Is what willo know be the case that could be brought to the Supreme Court . Can you walk me through what the technicalities are . The principal is in america we have a great tradition where people cast their votes and we count every vote. The first thing that has to happen is the process has to run. We can never stop votes before they have been counted. If they have been counted, there could be a question of whether margin that is small or there any irregularities which then could be involved in a state court. That is a question of if could go to a federal court. The first thing is we have to make sure all of the votes are counted. That is a process we are in the middle of right now. Guy what is the timeline . Mark we are hearing, as you just reported, the secretary of state in michigan is talking about the end of the week. Georgia today. Pennsylvania in the next couple of days. What we have seen is there of been so many additional mailin ballots and voting before november 3 that that is meeting a lot of counting being done at this point going forward. Some states count earlier and they count the early ballots before election day and some weight. We have to wait for some of these, two or three days to get final results. If if i understood alix i understand correctly, the issue is you need to count all of the votes, but that itself is the issue. When you take a look at pennsylvania and north carolina, they are counting the votes but theyre also putting the votes they are counting aside in case they get thrown out because it does not match up with the state legislature and what they are ordering counties to do. The market needs to know the intricacies to understand the ballast in the lawsuits against different areas. Can you help me understand it . Mark in pennsylvania there is a question of how long you count the ballots. The state Supreme Court decided the issue at the u. S. Supreme court said that ruling would stand. Pennsylvania has a clear rule in place and they would follow those rules. States to elections all the time, year after year. There is much more stability than one might believe. Theres a lot of talk about challenges, but the reality is states do this regularly and there is regular process. There is much more stability than we would be led to believe by people saying theyre all these irregularities. There always some things that go wrong, but in this case we let the process run and in the next few days we will have our answers. Guy once we have the answers on the count, what is the timeline for potential legal challenges . How long do you think they could last . Presumably state collectors december 14 have to make their calls. What is the timeline for getting these legal challenges in as they are resolved . Mark the timeline would be very quickly, and the first layer is it goes to a state court, at the state courts make their decisions as to whether there are any irregularities assuming there are irregularities, and i do not know we are seeing any indication there are. We are not necessarily seeing there are irregularities. If there are, it would be an expedited schedule, first round within a week, but no doubt during the month of november if there were challenges to play up during that timeframe. I think we will see there is a process that runs, challenge will be brought and it will be addressed fairly soon. Alix that sounds relatively optimistic compared to what the markets are looking accurate what kind of case has the best success rate of making it to the Supreme Court. If either case if either campaign were to mount the defense or offense of the what would it be . Mark if it is going to the u. S. Supreme court, there would have to be some kind of federal issue. In bush v gore they talked about equal protection because ballots were being counted differently in different counties. In context, the states know what they should be doing in light of that to avoid there being a problem. That is one of the reasons i am an optimist, but i also think in this context the courts have learned lessons over the years as to what is the appropriate thing to do in terms of when they review and how to decide election law issues so they do not go to the u. S. Supreme court because they do belong in the state because the states are the ones who make these decisions. If it were to go to the Supreme Court, would Amy Coney Barrett be involved in what role which he play . Mark she is a sitting would she play . She is a sitting justice on the court and theres a question if anything would cause her to recuse herself because of her recent nomination. The biggest question people would say is donald trump in nominating her said things like i want her here because i want the court to be able to take care of any election problems. Things like that. That is something where it is a political issue that the president cannot expect any president should not expect any Supreme Court to do his or her bidding. The reality is only if there is an actual reason she should not be involved, she is sitting, she can hear the case come in my expectation is if something goes to the Supreme Court she will be involved. Alix i wonder how that affects everything. I know you are an optimist at what if the Supreme Court ruled they would not issue an emergency stay, she was not part of that decision. If things get kicked back up, you can make an argument there is a bias on the court to a more conservative bench. What do you think . Mark in the specific pennsylvania ruling, the question is one of the principles of constitutional law. If there is an adequate state ground for ruling, that in fact the state decision should stand. That question was never addressed by any of the injustices. They had are you going to take it or not any of the justices. They had are you going to take it or not. If the Pennsylvania Court says we had our own state constitution that has a free and fair voting provision that says this is the right way to interpret our statutes, and that kind of context if there is an independent and adequate grounds , than the u. S. Supreme court should stay handsoff. Guy have to leave it there. Appreciate your time. Mark alexander of the Villanova Law School. Thank you. Ofre looking at live shots those being counted in philadelphia, pennsylvania. One of the five key states where results are still being tallied. Too close to call in the president ial votes. This is bloomberg. Ritika time for the Bloomberg Business flash. A look at some of the biggest is the stories. Johnson johnson must pay 2. 1 billion to women in missouri over its baby powder. The Supreme Court declined to hear Johnson Johnsons appeal of a 2018 decision. Companiesfound the causeowder was a leading of Ovarian Cancer in women. Johnson johnson says it will appeal to the Supreme Court. The agency says the unidentified informant helped with the successful enforcement action. In the past month the sec has handed out more than 150 million bloomberg has learned plaal antir technologies is in discussion with the British Government the Data Mining Company could augment the trading system already in use in u. K. , which has run into some problems. Latir already on the coronavirus pandemic. Guy we continue to keep an ion what is happening with the markets. Markets digesting the growing prospects of a contested election and the fading prospects of largescale stimulus. The u. S. 10 year yield down, flattening significantly. Joining us for more on this very subject, ira jersey, Bloomberg Intelligence chief u. S. Interest rate strategist. What you make of the price action today . The curve flattening, the market not expecting stimulus, what do you make of it . Right. At is exactly we have priced out a lot of the blue wave scenarios, especially with the senate. Wins,less of if joe biden i do not think we get a return to where yields were prior to last night. To wind up in a new range until we get better clarity on what a stimulus plan would look like. His path seems to be slightly easier. The republicans looks like they have healthy senate. What will the three or four senators on the republican side, what will they need in order for them to vote with the democrats for a fiscal stimulus plan and what will that plan look like . There will be enough centrist republicans like Susan Collins and help push out a fiscal stimulus. It is not going to be of the size you would have gotten had there been this blue wave, and because that size will be smaller, that is what is being priced out of the market, this large fiscal stimulus seems to be off the table at the moment. Alix last night when markets were on the move i was i was reading a lot about who was doing the buying. Who was doing all of this . Ira all of the above. Short covering is a big part of the spirit is the long end shorts. When people get into curve steepen or and think 10 year yields or 30 year yield will move higher than five year yield , people basically by five year yield but sell 30 years. Now there unwinding those trades. I talked to an investor this morning who said i was short volatility but in steepeners, so these are trades that have worked out ok for them over time. They might have broken even on their steepeners, but they made money because Interest Rate volatility implied by the Options Market has absolutely plummeted today as well. Guy fed tomorrow. What does jay powell need to do . Ira i do not think he will say much of anything except reiterate what he has been saying, that they expect more stimulus and they think more stimulus would be helpful at this point. That is pretty much it. Itx we appreciate it right has been interesting 12 hours. Ira jersey of Bloomberg Intelligence. Bond on the move on the market with yields down 13 basis. That wraps it up for me and guide. Coming up, balance of power with david westin. He will be speaking to former new jersey governor Christine Todd whitman as the market digests the rate election, when we will get the results, who will it be and what does it mean for stimulus . This is bloomberg. From bloomberg World Headquarters in new york to our tv and radio audiences worldwide, i am david westin. Welcome to balance of power where the world of politics meets the world of business. For the for siebel future looks like the big story will be the outcome of the election and who wins the presidency. Before we get answers lets look at how markets are reacting. What are the markets telling us . Abigail interesting action. On the surface it is risk on, stocks sharply higher, the s p 500 up for a third day, the best three days going back to april. Investors piling into the risk of stocks. The nasdaq 100 up even more, up 4. 7 . At the same time you have this massive rally in bonds. The certainty markets are trading with relative to stocks suggests they are almost pricing in the markets believe they know who the next president is. You can also make the narrative around the 10 year yield dropping. The reflation trade is less off the table or not on the table. If the 10 year