Consequence with leading investors and executives. What is going on right now is a lack of alternatives. I dont think we have seen it peaked in shares yet. Mark big banks head up a parade of earnings reports. The best way to get shareholders on board is to show our plans. Our transformation is a journey. Mark its all straight ahead on bloomberg best. Mark hello and welcome. I am mark barton. This is bloomberg best, your weekly review of analysis and interviews from Bloomberg Television around the world. The week began with another development in spains ongoing Political Drama over catalonias quest for independence. Matt the president of catalonia has failed to clarify his position on independence. Defying a Spanish Government demand. This morning, he simply repeated his claim that he has a mandate from voters to act, but his decision to suspend the move has left the country in a state of confusion. He is basically doing what madrid told him not to do. We need a simple yes or no answer from you. Did you declare a republic or did you not . Essentially, it is a fourpage letter where he says i have a mandate and he is willing to act upon it, but he will engage in talks with the next two months. Again, the question mark now is what is madrid going to do . This is precisely what the government did not want. They were very specific about this. You have to answer in terms of yes or no. If you say yes, article 155 will be triggered. If you answer in any manner that is not a simple yes or no, article 155 will also be triggered. At this point it is safe to say madrid has all the grants to grounds to trigger this article. Two more wall street giants posting thirdquarter reports. Today, Goldman Sachs continued weakness in fixed income trading unit, where we saw a 26 decline. Morgan stanley was shielded from the same trading slump that afflicted its rivals. I thought the results were ok at both firms, better at morgan than goldman, although they were starting at different points. Morgan starting at a higher point. Things have been going well for them throughout the year. The bar was hired for them. Higher for them. They were able to achieve that. I thought the most encouraging indications were out of Wealth Management business. On the goldman side, they had lagging on fixed. They looked in line of that pack, but at least not trailing the pact significantly. I thought that was encouraging. Next step is moving forward with many of the Growth Initiatives they have weighed out over the next few years. Vonnie ministers from canada and mexico rejected what they see as hardline proposals by the u. S. In the fourth round of nafta negotiations. The parties plan on having a longer intersessional period for the next negotiating next round to assess proposals. Lets take the next month to continue our intersessional work and meet again in mexico with fresh creative perspective. None of us want to end this process emptyhanded. There is no reason for that. We dont know exactly where they are going with this. The idea they have extended the talks is good news and that they want to make progress. Donald trump keeps saying its a bad deal and we need to do Something Else. It was highlighted today all the problems the administration sees with the deal. But the nonstarting proposals all seem to come from the United States. On the one hand, while they are saying bad things about each other, they feel enough hope that they are scheduling negotiating sessions father down the road. We are coming down to the start of chinas party congress, president xi jinping will give the opening address. He is expected to list achievements since coming in in 2012 and will lay out his reform agenda. Our government is in a great situation. Our prospect is bright, but our challenge is also tough. This has been about recapping some of the achievements as the party would see them and then laying out policy framework for the next five years and highlighting some of the focus, the areas of focus. A couple of areas that stood out. President xi talked about the need for Foreign Exchange in yuan reform and Interest Rate reform. Interesting coming on the back of the comments of the pboc governor of his desires to see a greater market role for the renminbi. Also his comments about the greater role for Stateowned Enterprises and mixed ownership structure. What it has done is reinforced and brought the hammer down on the political economy you expect in china. Which is that even though he is speaking about reforms and speaking about liberalizing Exchange Rates and allowing foreign investment, it will continue to be on chinas terms. That will be at the center of everything. There has been a reinforcement of the central message coming out of president xi in recent years that it will be on his terms in terms of how chinas economy develops going forward. Jonathan the Spanish Government has announced an unprecedented decision to move forward with process of suspending the powers of the Catalan Government after the regional president refused to drop his claims for independence. The catalan president is as defiant as ever. As you mentioned, he refuses to drop this quest for independence. He is insistent he has the mandate and the reaction from madrid is article 155. The government said they will meet on saturday. This is an urgent Cabinet Meeting that will come forward and come up with a way to present to the senate. The measures will be an indication of who will replace the president and for how long. Also, a date for regional elections. The senate yesterday passed their version of the budget resolution, putting the ball on the house side with possible action as soon as next week. How difficult will it be to get the house to agree with the senate on this resolution . Not that difficult. I have been talking to a lot of sources on capitol hill on the house side after the vote last night and pretty much what they are saying is this would be less controversial than the media has made it out to be and they are actually anticipating this to advance the first half of next week. Thats good in terms of tax reform timeline efforts by the end of the year. President trump is expected to announce his decision on who should lead the fed before he leaves for asia and about 10 days. We were told to get a decision maybe next week. What is it going to be . I think he is testing the waters by maybe letting some of these stories drift out where he is leaning or who is favoring or whatnot. I still think republicans in general want continuity, so that points to either the existing fed chair or a continuation of that regime, which if you want a republican continuing the regime, it is jay powell. Kevin warsh is qualified for the job, but i dont know they will pass the trump litmus test, not impeding the trump fiscal agenda. Interest rates are the throttle for the economy, so low rates will help the economy ultimately accelerate. Mark still ahead, as we review the week on bloomberg best, Oil Executives tell us where the crude could creep up to 60. Plus, an indepth look at how automation is disrupting wall street. We will also comb through some more earnings reports and up next, we will continue with the weeks top business headlines. Banks are anxious but the negative reprieve from the fcc. The fcc is close to saying, look it is fine if you violate , u. S. Rules to comply with mifid, we will not punish you for that. Mark this is bloomberg. Mark this is bloomberg best. Im mark barton. Lets continue our top business stories in austria when voters went for youth in the national election. The 31yearold Peoples Party foreign minister has claimed a victory as austrias next chancellor, yet protections from yesterdays election put the countrys nationalist Freedom Party within reach of second place. Manus what does the result from austria mean for the rest of the European Partners . Matt for starters, it shouldnt be terribly antie. U. This rightwing party, the Freedom Party in austria, has been antie. U. In the past, but they changed tact before the election to gain ground. And because sebastian kurtz, the leader who has been elected pretty overwhelmingly in austria, has said he will not form a coalition with anybody who is against the idea of europe and deeper unity in europe. So he is the Freedom Party has got to either conform to his ideas of europe to get together with him, or he could form still a coalition with his Current Coalition partner, the social democrats. Airbus agreed to acquire a majority stake in bombardiers cseries program. The jetliner will be assembled in the u. S. And opens a new front in the battle with going with boeing over global aircraft sales. Airbus walked away from a similar deal two years ago. What has exactly changed . We put this question to him last night. They broke this announcement in the middle of the night to us and there was a Conference Call with the ceo. He said times have changed. Two years ago, the cseries had not been certified, wasnt flying. We didnt know if it would be popular with customers. Now we have more data points on this. Also, dont forget, that bombardier is in a bit of a funk. They tried to sell their train business and didnt succeed. The cseries is a troubled program even though it is popular here at they felt the longer we wait, the more time bombardier will have to find a partner. Tensions are rising between iraq and the kurds. Iraqi troops to control of the crude deposits in the kurt cook uk area. Kurk as much as 6000 gallons a day can flow through that pipeline. Floats of invidious considerably. Reduced have been considerably. Our latest intelligence shows far from pumping 600,000 barrels a day, that line is pumping 220,000 barrels a day. The hope is this will be temporary. This is clearly a direct fallout of tensions between baghdad and both sides have an economic interest in keeping the flows going. This pipeline is the only way of exporting oil from Northern Iraq and so it is the only way of generating foreign currency income from that production. Guy the swiss activist investor rudolph wally has found they found a new target in the secondlargest lender. Credit suisse. According to person with knowledge of the state purchase, he has taken a. 2 stake. That means that stake is worth 100 million francs. The main rationale behind the move is the share price credit around credit suisse. He thinks it is undervalued. That is something other investors would say. The reason for that is the big restructuring that bank is going through and the capital raising. Shares have been up so far this year of 10 but since the ceo , has been taken over, it is down quite significantly. Yeah, wally says this needs to be changed and this is why he took a stake in credit suisse. The u. S. Securities and Exchange Commission is preparing to give wall street a reprieve. The ssc will tell Financial Firms they will not have to overhaul operations to comply with europes mifid 2 regulations. Among the complicated issues with mifid, the most complicated for u. S. Firms is complying with mifid technically they are violating u. S. Sec rules. They have been lobbying the sec for months over this and the sec seems close to saying, look, it is fine if you violate u. S. Rules to comply with mifid, we are not going to punish you for that. It is hard to see a world where wall street is going to make more money selling research than it has through trading. Wall street has benefited for a long time from bundling these services. I think there will be a lot more issues down the line as clients perhaps go as far as revolting and saying we want what the europeans have. We dont want a conflicted arrangement where we are paying you one fee for everything. We want to pay the firm who does something the best to get that service separately from them. President donald trump wrapping up a joint News Conference with the greek Prime MinisterAlexis Tsipras in the rose garden. He mentioned this is a critical point once again that obamacare does not work. Insurers have made a fortune and yet, it appears we have a shortterm deal. Can congress, Lamar Alexander says he and patty murray have made a deal which tracks healthcare shares, getting a list on that news. Health insurers, those involved in the Obamacare Exchange markets, getting a boost as well. President trump has said obamacare was dead and seconds later, Bloomberg News reported that there was a deal between Lamar Alexander, the republican and patty murray the democrat to restore the csr payments, the payments that help offset costs to middleclass people buying insurance. The very payments that trumps executive order had removed a few days ago. Weve basically done a 360degree aboutface and we are back to where we started. Mixed messages from washington. Only a day after senators Lamar Alexander and patty murray presented a bipartisan fix to shore up Obamacare Exchanges, but now you have House Speaker paul ryan and donald trump coming out against the plan. President trump i wont do anything to enrich the insurance companies. Rep. Paul ryan he is against some of the things contained in this fix, but he has made it very clear he wants to see some sort of bipartisan deal get done that prevents people from feeling pain. Frankly, i dont know if thats possible. Chinas robust factory output and Consumer Spending kept the economy humming in the Third Quarter. Gdp rose 6. 8 , giving president xi jinping a firm footing to deliver on his pledges to rein in excess capacity, curb pollution and shift to a more sustainable growth. Despite this, markets have not reacted positively. Likely still reeling from the pbocs comments on high corporate leverage. Comments from the pboc governor we heard from him , again. At a session he was meeting with regulators and he flagged this issue of high corporate leverage and household that is Something Else he talked about. He was also pushed on the question of yuan reform. That was something that came up in the president s speech yesterday. The pboc governor said this is a longterm process and he sees no immediate need to change the trading band for the yuan. That was another issue that came up. Yes it doesnt seem like much , for the markets to hang their hats on get here it there are a couple of caveats. Yes, Consumer Spending is up. But you have a lot of Infrastructure Spending as a result of this credit push. Lyft, the ridesharing company, is raising another round of funding. It is being led by alphabets investment arm, capital g. They were in talks a month ago and the cash infusion, 1 billion, a total game changer against its competitor, uber. This is clearly a Huge Investment and a valid indication of maybe a shift. Google alphabet was one of the early investors in uber and now they are putting 1 billion either through google corporate i guess they are deciding to go through their private equity arm. I do know they are excited about this space. They were an early investor in sidecar and uber, and now in lyft. They are thinking about using ride hailing with selfdriving car. It is a space they feel they need to be in. Jonathan the brexit mood music improves in brussels. Throwsmerkel theresa may a rope. There is zero indication the divorce talks wont succeed and she wants to see an agreement rather than an unpredictable resolution. The e. U. Said it has given the green light to start making preparations to move the talks to trade in that is just december. Preparation, no guarantees. We heard from Emmanuel Macron in the past hour. He said the ball is in theresa mays court. We are not halfway there on the financial settlement. Whats more, people familiar with the matter have told bloomberg there may not actually be a final number published on this divorce bill because they will break it up to make it more palatable politically. I thought that was interesting that Bloomberg News managed to get that. Even though you have the eu president , donald tusk, saying there has been progress, that is not accurate and im hoping to move on to trade talks by december. Hope doesnt always translate to reality. Mark welcome back to bloomberg best, im a mark barton. Automation has changed the nature of Many Industries around the world and now it is changing wall street. In a series of reports, bloomberg examined the revolution overtaking Financial Institutions and what it means for the people who were not there. Some of the highestpaid jobs, some of the jobs where the people are literally making millions of dollars in some cases to do these jobs, are increasingly under threat of automation. That is stuff like trading on both the sell side and the buy side, meaning hedge funds and asset managers. Everybody from the Portfolio Manager making decisions on what to invest in to the order taker , on the trading floor, to the Legal Department that is determining whether that swaps document is valid or not, there are technologies able to do a lot of those tasks and while it is not clear they will be able to do all of it, it is still a very early stage this