Green shoots rhetoric. What makes it interesting going into november, the financials had already been up 30 out of the march low, plus the yield curve has, in. The yield curve has come in. It is puzzling why the banks are up so much. It has to do with the narrative of the traders and investors buying cyclical stocks on the potential for strong recovery. Guy i will cheat david i will cheat. You and i talk when we are not on television. What is going on with the yen . Abigail those are some of my favorite conversations because we can move back and forth. The yen does bring attention to itself over last year. It is up about 4 . When you have stocks at alltime highs, you have bonds at record highs, although folks will say the fed the yen is a pure play haven. Over the last year, up about 4 . Some traders might like the fact that stocks are higher, but theyre probably hedging for the possibility there could be choppiness ahead. That is true for the vix. The vix is still above 20. That is in its historically elevated range. Traders are on alert for the possibility of some sort of volatility ahead. The question is whether it will be a normal coolingoff or could it be something bigger . Guy david we will find out. Abigail doolittle reporting on the markets. Congress is back in session with a full agenda, including funding the government and the stimulus bill everyone seems to agree as needed but no one can get done. To take us through what to expect, we welcome greg valliere, ags investors chief u. S. Policy strategist. Lets talk lets start with that stimulus. Everyone seems to agree we needed we can ever get there. Greg i think there is a consensus we do need it. You saw photos of people standing in line for food. You saw Unemployment Benefits ending on december 31. There is a crucial need to get something done. David at the same time, there is a question of do we take half a loaf or insist on relevant. This was the backandforth through the summer between nancy pelosi and Mitch Mcconnell. Do we know where president elect biden is on that question . Greg i think he would take half a loaf. There is a great deal of dissension over Nancy Pelosis unwillingness to compromise. Now something paltry like 1 trillion would be sufficient. Her idea of getting 3 trillion is totally out of the question. If you did 1 trillion or 800 billion, you could feed people during the winter, you could give them Unemployment Benefits until the vaccines arrived. At the same time, will republicans insist on protections against liability . Greg that is a bait issue for Mitch Mcconnell. He wants that and the democrats want money for state and local government. With people like Susan Collins of maine being more powerful at after her victory, we could put a deal together in the next couple of weeks. David there is no deadline on the stimulus bill. There is a deadline on funding the government. Could those things come together. The deadline is december 11. Greg at midnight on december 11 a temporary spending bill expires. Theoretically we could wake up on december 12 with the government shutdown. I do not think that is going to happen. More and more people are saying since we have to pass this, lets put stimulus and virus stimulus onto the budget bill. I think that has a chance. David to what extent is the white house playing in all of this . President trump has not conceded , although every time he talks to cameras he is inching his way there. They will keep working until january 20. There are a lot of things he can still do. Greg there a lot of things he could do. He is playing a lot of golf. He will need to get more involved. Itll be interesting to see tomorrow when secretary mnuchin testifies before congress, i think you might get the green light from the white house to keep negotiating. That would be a very positive sign. David what about Foreign Affairs . That is something the president could do things and without congressional support at all. Greg the biggest wildcard is geopolitics. We saw over the weekend the assassination in iran. Netanyahu knows he has carte blanche, that trump would not try to stop him in the next seven weeks. I worry about the persian gulf, i worry about china. I think geopolitics is a risk in these next seven weeks. David he mentioned iran and the assassination of a nuclear scientist, apparently by the israelis. Iran came out right away and said they should not get in the way of possible talks around the biden administration, is that a runaround President Trump . Greg it could be and that is what everyone is speculating on. Want toyahu and trump make things more difficult for biden or could biden play his cards and get something with the iranians. That will be an ongoing story in the spring. David back here we have the leadership of the Economic Team for president elect biden, led by janet yellen. How difficult will it be to get confirmation in the senate of these people . Greg she will be a breeze. There is a woman who might have some trouble who has been nominated, but i think janet yellen has widespread support in the markets, on main street, on capitol hill, in academia, i think she will sail through. David what kind of timing we have on this . We have seen administrations having a difficult time to get all of their people up and place to get running by january or february. Greg i am sure some of this will go into the new year, but on most of the big nominations, especially janet yellen, i think a moderate republican like Susan Collinss going to be very powerful. David it is interesting, because she did surprise a lot of people in her victory. How can she use that power . Greg senator collins is personally friendly with joe biden. The republicans respect her greatly. She has good support back home. She has a new sixyear term. , ihink on issue after issue would watch Susan Collins as an indicator of what we might be able to get your might be able to get. David thanks a much. That is greg valliere. Coming up on Austan Goolsbee of the university of chicago and on the biden Economic Team and what it takes to put together a stimulus that works. David this is balance of power on Bloomberg Television and radio. We turn to Mark Crumpton for bloomberg first word news. Mark Angela Merkel says there is still no deal to resolve a standoff with poland and hungary and theyre valve to veto the eus spending package. She says she vows to work for an agreement. Both nations leaders are discussing next step after delaying the eus sevenyear budget, including 300 million in pandemic a joint though dara is requesting clearance for its mo derrida is requesting moderna is requesting clearance for its vaccine from the fda after it showed 100 efficacy against serious cases of the disease in young and old alike. Is likelyys the fda to review the data in mid december. President Trumps Coronavirus Task force is promising a rapid rollout of vaccines to millions of americans by the end of the year. The Surgeon General jerome adams expects most americans to have access to a vaccine by early in the second quarter. He says the government hopes to quickly ok request from two drugmakers for approval of the vaccines. He will halt Indoor High School sports for the rest of 2020. The move reportedly comes after more than 28,000 new covid19 cases were booked in the state in the past week. Meanwhile, the Positivity Rate in new york city has climbed above 4 . Global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. I am Mark Crumpton. This is bloomberg. David thanks so much. 12 years ago president obama came to office with a struggling economy and fought to get a stimulus package despite the global hurdles. Austan goolsbee was a key obama economic advisers and saw what it took to get that done. He is now a professor of economics. Welcome. Great to have you. There are some parallels in what we are seeing right now with a struggling economy, the need for stimulus, the political difficulty getting it done. What advice would you give to the Incoming Administration about how to do that effectively . Austan i do think there are some parallels. If only Mitch Mcconnell was a thorn in the side of both of those. Was lets don 2009 some, and if things remain bad we will do more good Mitch Mcconnell we will do more. Mitch mcconnell saw to it there would not be more. If you look at the incoming biden administration, they will probably put his unit get focused on trying to get as much direct relief as you can as early as you can because the economy needs it. 2009, thatnce is in was traditional stimulus. The u. S. Government is going to spend money to try to get growth jumpstarted. This is different. This is a temporary wave that has spread over us. We basically need to figure out a way to hold our breath for six to eight months until the vaccine can be widely available and we can go back to doing what we are doing before. Our goal is to try to prevent permanent damage, which is little different from stimulus. I hope they can agree to do something. We need the money right now. David that goes to a question that has been pending since july 41st when the supplemental Unemployment Benefits went away. Do you hold onto the full loaf or take half a loaf. Thus far nancy pelosi has come down from her 3. 3 trillion, but she still insists on a lot. Would you advise the incoming president to take what you can get was lameduck session . Austan i guess i disagree a little bit with the premise of that question. We need as much as we can get as soon as we can get it. My perception of what is happening is not that the democrats are holding out. Inis that once again, like 2009, Mitch Mcconnell has decided a deal is not favorable to him before the georgia runoff elections. It is not primarily a dispute about the size of the rescue, it is about one side not wanting there to be a bill at all. I think if mnuchin and pelosi were the only two deciders, they wouldve been able to reach an agreement. They were close on numbers and how long it would last. Politics of this thing is complicated in the lameduck. David that is sobering. If it is a question of not giving the other side credit, that suggests we will not have anything until the new year. Austan i am quite afraid of that. The unemployment money ran out. The cares act money, there was a ppp program that was going to help give a lifeline to small business. That money has run out. Week,easury, you saw last they will withdraw the money for the fed main Street Lending facility. That money is not going to be there. I think this issue, we are inches away from having permanent damage that we did not have to have. Should find that sobering. David talk about the permanent damage. There is a great deal of hope a vaccine is coming. It is not here yet. It will probably be the middle of next year. We need a bridge to get there. What kind of damage can happen in the meantime . Some people might say lets wait, we will get the vaccine and will be ok in the long run. Austan we need the bridge. The alternative is falling down in the water. There are millions of businesses around the country that i would say they will go bankrupt, but Something Like 90 of business closures cannot afford to go through bankruptcy. They shut the doors and they are never heard from again. That is a space we do not want to have to go down. Light right now we are on and all the states and all the major cities. They are having revenue shortages like theyve never seen with expenses up dramatically because of the pandemic. They are going to have to start laying off policemen, firefighters, teachers, and a bunch of state services that we need at a moment like this. I think those are the big speed bumps that i fear. The virus is the boss. If you cannot get control of the spread of the virus until the middle of next year when the vaccine comes, there is going to be thousands, thousands of people who die unnecessarily. There will be tens of thousands of people who are hospitalized or suffer Permanent Health damage, permanently, unnecessarily. I Hope Congress does as big a package of relief as they can as rapidly as possible so we do not get people evicted from their homes. Millions of people will get evicted good david talk about the medium millions of people get evicted. David talk about the medium term. We have the key players in the Economic Team. A few other people, many of whom youve worked with. People are trying to read into it exactly how progressive the economic policies are going to be. What you read into it . Austan i found the team impressive. Janet yellen is a rockstar and wellknown. Down the line, if you look at the people they are appointing, they have experience, they are low drama people, i think the thematic focus, if there is a thematic focus, certainly at the council of economic advisors you have a heavy focus on workers with experience on wages, on training, on contingent workers, and it probably shows an emphasis on wages and workers. As to what does it mean for the agenda, of course all of that hinges on what happens in the election. Are democrats going to control the senate or not control the senate . That will have a heavy influence on what they can do with legislation. David you make an important point. The names ive seen, there is an emphasis on labor economists. Distinguish labor economists. At the same time, they have enough macroeconomists . Is that a possible weakness of this team . They could have problems outside the world of labor and you need. Crackerjackeed macroeconomists. Austan you always have to cover more topics as you have people. I imagine as they fill out the team you will have more focus on tax and budget. Several of the people they are talking about, jared bernstein, uche do have some Macro Economic exposure as well as labor economic. Janet yellen at treasury, serving as your babe ruth, gives you nobody knows more about macro, nobody knows more about international, about banking, than the former chair of the fed who is now the secretary of the treasury. I do think they got themselves breathing room for whatever other focus. Nobody will question Janet Yellens competence as a firstrate economists. There are other parts of the job, for diplomacy, how will she cover that base . Austan yes and no. The number two at treasury has a heavy international focus. She is known, unlike most, she has to be the most internationally recognized secretary of the treasury in a long time. From her connections to having been the fed chair, i would think the International Issues are not going to be foreign to her. They will be somewhat familiar. To the extent that in the last two weeks you have seen a blowup in the relationship between the fed and the treasury at a moment where you do not want blowups in the relationship between the fed and the treasury, that would give you some comfort. It is good to know the secretary of the treasury knows very well the issues of the fed is going to get along well. David she knows jay powell pretty well it is fair to say. Great to talk to you. Austin goolsby, professor of economics at the university of chicago. Plunge after gm scales back on a partnership. This is balance of power on Bloomberg Television and radio. David this is balance of power on Bloomberg Television and radio. It is time for the stock of the hour. Today it is nikola that entered a scaledback version of its deal with General Motors. Our colleague emma chandra is here. Great to talk to you. Abigail is a scaledback emma is a scaledback deal that scraps the key components. Gm will not be making an all electric pickup truck with nikola and not take an equity stake in nikola. Instead we have a nonbinding agreement to supply Hydrogen Fuel tech pure investors taking a dim view of that. Nikola down around 20 . 20 . Down 27 to the original terms of the proposed deal had been provide had been described as a game changer the companies, but now with dan ives saying this is a good supply deal but nothing to write home about and that is a sad indictment for the future of the company. All of this is catnip for shortsellers. They have been piling into the stock as it has been a rocky road since it went public. We have a bloomberg terminal chart which should show you how the Short Interest has surged as stocks have fallen. It is now the 39th most shorted stock on the nasdaq. Look at how it compares with its peers in the electric vehicle market. We have tesla, we have fuelcell, all of them riding the rally, gaining 200, 300, and the last six months. David not great news for General Motors it is fair to say. Thanks to emma chandra for that report. Next we will talk about President Bidens Economic Team and the implications for black and lower income americans with rishaad robinson, color of change president. The president elect made an issue out of trying to restore Economic Health to the more challenged parts of our economy. What can he do with his new team . That is coming up next. Ons is balance of power Bloomberg Television and radio. David balance of power this is balance of power. This is on bloombergwer television. For first word news, we go to Mark Crumpton. David, the u. K. Believe they have a deal with the eu. Dominant rock called on the eu to recognize that regaining control of british waters is a question of sovereignty for the u. K. In china will be a u. S. Blacklist. It will be added to list of firms controlled or owned by the military. Has been warned not to fall into the trap of scraping future talks with the biden administration. The statement after the assassination of a top nuclear scientist. Iran blamed israel. Biden made it clear that the u. S. Will rejoin the nuclear cord if iran returns to compliance. Has namedelect biden near its hands in two head the anden as omb. T republicans could lock the nomination because they see her as to progressive. Oo too progressive. David the challenges of all particularly black and lower income citizens across the nation. How do they do that . We welcome back rashad robinson, president of color of change. Always good to have you on with us. This, it really looks like they are committed to Racial Justice during the administration. Alone does notty always mean we get Racial Justice. Yes, we have, people with the right level of experience that are connected to that have a level of experience that will help them see the opportunities, but also we need to make sure that we are paring that with a progressive worldview. We need to make sure that those are filled out. Now the next step will be how will the biden team work over the first 100 days to deal with covid relates . Covidne of the relief . That is one of the first indicators of how it will work. One of the results from the relief for Small Businesses that did not get to black and brown small as this is. Recent poll shows that up to 46 of black businesses have closed or will be closing soon as a result of the economic instability of the virus because the relief that went through the big banks never got to blackowned businesses because the majority of those businesses were not big institutions. Thets not just about diversity of the faces at the table, but how they carry out the policies to make sure that we avoid the challenges of inequality. David thats a really good issue. Im glad you raised it. Congressional action to make sure the stimulus money gets to the right places, or will be administrators in the executive branch really have to make sure it gets to the right places . A lot of it does start with congress and the negotiating power the president has, but the president can shape what the administration will or will not accept. There are things that can be done, but there are also rules and regulations at the executive level that can deal with all of the different ways it has been the wild, wild west for banks. At the congressional level we tod a new glasssteagall make sure that publicprivate banks are not allowed to create with the 2008s crash that wiped away so much black well. Homeownership has been a pathway to work in class and middle class life and that really decimated a lot of black communities and their ability to advance a new future. Outwill this play itself and what will be administration be able to push . Is of that matters, but who how are wetable and giving back to where we were, but really recognizing we only want to go forward and in order to go forward we need to have economic policies. Just to deal with what is keeping some folks down more than others. David lets talk about one issue in closing. In wealth. Ty even before 2008 it was remarkable, the disparity that exists. Give me one thing that the administration can do that could help remedy that. What can we do to solve that problem . We can deal with homeownership, access to loans and that will have to start with investing in more public banks, looking at risk in different ways. We will end up with challenges that are more risky for our future. And immediately, given the covid crisis we will see a recovery package that deals with more than one single check, but getting cash in the hands of cannary americans who unlock the spending power of communities. I get it about homeownership. It makes a lot of sense. A lot of net worth is tied up in homes. Can we increase homeownership without getting into the situation . Rtgage you get into that when you build public and private banks without the institution that can move those resources. Ust like covid care we are not incentivizing. We took public money. They have been bailed out once and they can use that money to determine who they want to provide loans to, who they have relationship with. Toid its always a treat have you on. A really important point of view to hear from you. Coming up, the fate of the fed the ballot with two runoff elections in georgia. This is balance of power on Bloomberg Television and radio. David this is balance of power on Bloomberg Television and radio. Two months, georgia will be a center of political attention as to run offs will determine the power in the upper house. Frank luntz joins us. How is this as you see it . Frank i apologize. My video has gone out. Three things are happening in georgia. There is more money going into this race that has ever been spent on a political race in american history. So much money is being spent that people are hearing all of these messages that are 10 to they realizeand they are the center of the universe, of the democratic universe right now and so georgia voters get a chance to iowa gets toat experience. They are fed up and they have so much longer to go. Abouthear various things younger voters. Voters. Ut asian africanamericans. The turnout. Ermine hes going this week and he turnout. An impact on i want to see if joe biden is going to owe. I am looking at people who participate in the process. Oc right now,ey bl mary, white women with married, white women with kids. They shifted from the republican party. They agreed with donald trump, message. Not like his republicans have the advantage because they talk about the agenda, buttrumps they are not saddled with the negativity that donald trump was settled with. But joe democrats have an opportunity that is unprecedented because they registered more people Stacey Abrams has registered more people than ever registered in the state. Those people are firsttime voters and they do not want to give up until after the runoff on january 5. David one thing we have seen reports of all the talk, lets be frank from President Trump its a fraud, the election is rigged, may be discouraging Republican Voters from voting. Do you see that in georgia . That in the see first days after the election. But in the work we have done, 70 of democrats in georgia give this election at 10. That means is extremely important, they are definitely going to vote. Compared to 80 of republicans. Also, which question is more important, the president ial election or the Senate Election and more republicans chose the Senate Election, which means they are keyed in on the thertance of january 5, and Green New Deal is up for grabs. Ts a filibuster whether they will pack the court. All of these issues will be decided. I will let you in on a secret. I had to decide whether or not to sell my house. By december 29 i get the capital gains. , the democrats will repeal the tax cuts and i will pay a lot more. I have a personal stake. David you are a oneman poll. We will call you up and let you know and see how george is going to dutch georgia is going to do now. Trump is not on the ballot, which helps some. People have split anyway. If the democrats pull this out, how would they do that . Frank they will do it by raising turnout. The most important person in georgia would prefer to split the ticket. Is going to determine if republicans win and right now republicans have a fourpoint advantage. However the republicans are in disarray. The are arguing with secretary of state. This is leading to chaos and confusion. What you dont want in a race like this. They are following Stacey Abrams. The republicans are much more disorganized. Republicans a 1 advantage if the election were held today. David its a huge amount of money. Is it evenly split between democrats and republicans. We have heard that republicans are not going in because of your house. Dont think democrats on wall street are concerned about my house. I think they would rather burn it down and do anything with it. To a point where there is a saturation where theres theing money can buy. At gut all the advertising they got all the social they need. Think for donors in both parties, unless you are donating hast now, your money nothing to be spent on. They will spend millions because it will impact many, many billions of dollars. David im delighted to say we will have more with frank luntz in our second hour on bloomberg radio. A report on ahave growing crisis in canada. This is balance of power on Bloomberg Television and radio. David this is balance of power on Bloomberg Television and radio. Im david westin. Its not the first time that the United States is so focused on it own problems we ignore what is going on to the north of us. We tend not to hear much about canada. Ation in so we welcome our global analyst. Michael, its always great to have you on. Give us a sense of the state of covid19 in canada right now. Michael great to be back on with you, david. A few months ago, canada was new doing nothing less than crushing the curve. Now were looking at an average of 5000 cases a week. That is not much compared to 160,000 in the u. S. With lots of down Government Support so we can sit home, but now it the big news last week was canadians were told for the very first time that the majority of us, 50 plus may not be vaccinated until the end of 2021. After people in other countries like the u. S. , germany, the united kingdom. G7a reason for that is other countries have their own a mastic vaccine production. Canada used to have that domestic vaccine production. Canada used to have that. On the who press conference in geneva. And countries not being prepared no iback, they said, said, is there any excuse for countries not being prepared for vaccine production . They said no. David what is the reaction, are they blaming the Prime Minister . Michael the Prime Minister, some people call him the tough love Prime Minister. Survived a lot of scandals. The charity scandal. Those are all in the background. But the economy is really having a tough time. We saw the light at the end of think it will i be very damaging for the prime split screen these of americans getting vaccinated. Canadians are sitting at home under lockdown. Behould say this will consumed very quickly by the most vulnerable. David as you know, we have a new president coming in january 20. As canada looks south, what do you hope or want out of President Biden . Sure, in canada, everyone was hopping up and down. It was well received. Was very arump salted to our Prime Minister. Canadians do not like that. President trump was very assaultive to our Prime Minister. The other thing, there were the duty implications on multiple trade commodities. Commercial have the entangling of our supply chain between canada and the u. S. So we want to restore some civility to the collateral relationship. We look forward to going back to defending a rulesbased national order. We got a lot of that up here, too. Sorry, david, there is one more thing. That is ane pipeline, worrying cloud. The extension of keystone itself. It is not a complete reset back to the obama years. David just a little civility, but the timeline could be a Sticking Point . The outboard a economy was really hurting because of the drop in oil prices and now with covid. They are really, really suffering. To prop spending a lot up the provinces. Michael, always nice to speak to you. We will speak to the bioethicist about how we will prioritize it gets the vaccine once its available in the United States. This is balance of power on Bloomberg Television and radio. Mark i am Mark Crumpton with bloombergs first wood news. A group of opecplus ministers could not reach an agreement on whether to delay januarys oil output increase. Drawnout discussions today among opec ministers about conditions attached to such a move means a final decision will not come before tomorrow. Today, joe biden n, harris received the same intelligence briefing that President Trump gets. Their first briefing follows a four week delay while the president has challenged election results. The Intelligence Community set up a secure room in mr. Bidens hometown, wilmington, delaware, for him to be briefed. Congress is reconvening today under pressure from both President Trump and president elect biden to pass a covid19 stimulus bill after months of deadlock. The meeting is an opportunity to take another shot at passing a stimulus bill. Lawmakers are still at odds over the size and scope of any package. Global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2,700 journalists and analysts in over 120 countries. Im Mark Crumpton