Rates are the second time this year, but Jerome Powell says only moderate policy moves are needed from here. Down, a more turn extensive sequence of rate cuts could be appropriate. We do not see that, it is not what we expect, but we would follow that path if it became appropriate. Anna the fed also plans a cash injection to tame the repo markets. Sticking to its guns, the boj calls for an october review after leaving policy unchanged. Investors look to the bank of england for their Interest Rate decisions later this morning. A halfhour from the european open. Treasuries, let me trim this chart down. We have come back down from the fridayike we shot up to my currently trading at 1. 70 after Jerome Powells press conference. We see futures pointing to a negative open in europe. On the s p more tellingly. French futures flashing a little green. Off almostures are 0. 25 . What do you also see . Anna u. S. Futures do not will bethe late rally sustained into todays session. We see negative reaction in some markets in asia, but overall in limbo in the asian session. The narrative of of where banks go from here, and how much support to expect. It looks like a split on the Federal Reserve committee. In asia, down 1. 2 in hong kong. People are asking if the chinese will follow the fed. Pushing of australia the aussie dollar down. Language,view of prices and growth in the economy, but in doing nothing they might have disappointed some who expected something more dovish. That did not weigh on japanese stocks. Some of the sizable moves, the aussie dollar move having an impact on the two years. A big move in italian debt, the fiveyear, we will keep an eye on that. The downward trajectory for metals, iron ore in singapore down and continuing the drop we have seen. Lets talk about the aftermath of the Federal Reserve. Mark, your thoughts here on how hawkish a cut this was from the fed. The headline soundbite we played gives two sides on the argument of what the fed can do. What was your assessment . Mark the expression going around today is confusion breeds contempt. Investors do not know what to make of it, they are not being constructive on assets today in asia. We are seeing in tokyo where there were gains in japan, some of that is coming back. The rest of asia looks subdued. The s p futures are down as well. Treasury futures setting off hard in the morning but rebounding a bit. The dollar retaining its games against the yen, a mixed day were investors are having trouble getting the story. They want more information. We need more clarity because the futures markets are surprising. Quite a bit of head scratching going on, and reflected in the fact that nobody has a strong conviction of what to do with assets after the fed meeting yesterday. Matt they have known what to do with assets over the last year. If i look at the s p 500 which dropped 1 before the end of the press conference then rally back , even with a year to date gain of 20 , that is pretty incredible performance for the u. S. Stock market. Have we reached a peak . Of people are thinking we would see a new record high yesterday if the fed cut rates. Below they about 1 current record. That did not happen. It was choppy during the day and back to where it started. Itple will start questioning if we do not see a new record high on the s p 500, people will be disappointed. They will wonder where the momentum has gone. What you are seeing in equity trading in the states is a momentum driven market. If you do not get a continuation of good news, it can reverse course quickly. We have seen that several times this year where the market looked hot and reversed in a couple of days. Year to date the game is good, but there has been big trading ranges and it feels like we are getting close to the top of another trading range. Thank you very much. On can join the debate todays question of the day, which asks which assets are most attractive following the fed rate cut . Lets continue the conversation with ewald nowotny, former governor, oesterreichische natl bank. He is here with us in berlin. It is an honor to have you with us. Let me ask you about the ecb meeting last week. It seemed Mario Draghis message much more wet have can do in the central bank and need governments to step in with fiscal support. Ewald i am retired so i was not at this meeting, but i can read the messages. Be the banks should not only game in town. There is a need for additional policy. Week the dutch government has some answer to this, so the clear increase expansion, and i hope others follow. Matt we have seen a number of oftic clearly here in europe more rate cuts. Your successor, for example, the french ecb governor, the members, german ecb from finland and holland, with so many people on the governing council against a rate cut, why do you think mario draghi said he consensus was so clear he did not need a vote . Draghi didink mario a good job as president of the ecb. I think it is shocking that we see now a number of personal insults against him in the german press. Case, i wouldic be critical because i think with regard to lowering the deposit rate, nobody expects this will have a positive effect on inflation rates. It is combined with a tiering program. Matt do you think mario draghi himself does not expect that . I think what he in the majority wanted to do was give a signal, and this makes sense, but the signal should be answered by fiscal policy. This is something that is needed. Kind of restarting the program of buying bonds, that might have an effect, but it might be better to keep your powder dry because you are running out of options. Anna good morning to you. There were interesting comments coming from your successor at the austrian central bank. Such as more transparency about who argues with whom at the governing council meetings. And the possibility of lowering of the inflation target down to 1. 5 where it seems to want to sit. What is your response to these ideas . Nowd i think what we see is the ecb is developing a policy of inflation target with the rate of 1. 9. On the other hand, we see we have structural changes in the economy, and if you look at the fiveyear market perspective, it is 1. 2 . It makes sense to think about, 1 and a range between 3 , and some Central Banks have adapted this. I would hope this will be a discussion that many Central Banks have started, some policy, and i would hope such a discussion will be started within the ecb. Set out a little more detail if you could about what difference that would make, giving a range the ecb to generate more inflation. Ewald the difference would be, if you have an inflation rate of 1. 5 or 1. 6, you would not see the necessity to be expansionary. If we have 1. 9, it would mean Central Bank Policy has to be expansionary for a very long time. A lot of problems, technical problems and maybe legal problems. It is worth discussing this. Matt you have heard americans talking about negative rates. The fed is far away from that. Powell yesterday said he does not think they need to go there. Resized rzman has criticized and said they were poisoning the financial system. What do you think about this kind of criticism . Ewald it is clearly an abnormal situation to have negative rates , and such a huge amount. It is not so easy to get away from this, but i would have preferred a policy that does not increase the problem. To someying to get normalization. I cannot imagine this is a permanent feature of Monetary Policy. Matt do you expect governments to step in . You talk about the german press being negative about mario draghi. Expect about the German Government spending more money . Ewald i am talking as an outsider. Matt we still value your opinion. I think there is a lot of pressure now. There are different ways to be expansionary, it can be by reducing taxes. There is room to reduce taxes. There is room to maneuver. Anna on the subject of negative rates, do you think they pose an existential threat to Capital Markets as we know it . , the for the time being horizon of one year or so, i would see this might be a feature, but i will take seriously is the danger of an inverse structure of interest curve. There is a lot of discussion about it, but we have some empirical evidence that means negative elements for the banks and the economy. This should be a priority to avoid such a structure. Matt i recognize you are an outsider, but you did laud the performance of mario draghi, and i would love to hear your opinion as a former business leader, what do you think of Christine Lagarde coming into the ecb . She is clearly more of a politician than economist. Do you expect her to shake things up at the ecb . Ewald i have the honor to know christine for quite some time, she is very talented on economic policy. Choice,she is a good but of course Central Banks time objective of stability. These are not institutions for abrupt changes. I would like to see a certain element of continuity, but reacting to different needs as they come up. Matt will she be able to convince governments to spend . It is something mario draghi has been pushing for years but not able to achieve. Ewald this is something where external needs will be the convincing argument. In some cases, rational arguments take a long time to be effective. Sometimes you have to wait until it is obvious you have to do something. We might get into this situation. Matt thank you for your time. Ewald nowotny, former governor, oesterreichische natl bank. Up, we will get a Rate Decision from nordisk bank. It is an interview you do not want to mess. The fed has cut rates for the second time. Chairman powell says the u. S. Outlook is solid saying moderate moves should be enough to sustain the expansion. Joining a now is James Mccormack , director global head of sovereign supranational ratings, fitch ratings. What do you think of the cut yesterday . We think the fed is done thenow and agree with assessment that the u. S. Economy is fundamentally strong. The only thing that has really changed is the global outlook, and that is driven by trade and the trade conflict. Hawkish cut, i guess you could say that because there is not an obvious path for another rate reduction which is the way we are looking at it. We think the fed stays on hold until the end of next year as well. Is that because you think the data is better than the market is factoring in . Even when the fed looks divided. James we are talking about two things, the market and the real economy in the u. S. If you read the statement the fed put out, it sees economic strength as we do, labor market strong, household sector strong, consumption growth, good. A little weakness in investment and exports, but it does not look like we are on the verge of a downturn or recession. We do not buy into those stories. The economy is fundamentally strong. Anna do you think the trade war will catch up with the u. S. Economy the way it has caught up to the German Economy and others . Because the u. S. Economy is not as open, not as concentrated in manufacturing. Is at thee u. S. Center of the uncertainty, the Economic Impacts china china and u. S. Are bigger in the eurozone. U. S. Is at the center of the dispute. Matt what do you think about the possibility the tail wags the dog . A lot of people would say the fed was pushed to a rate cut by the market because you are in a situation where 2 growth, 2 inflation, 3. 7 unemployment. The president may have pushed them there as well. I want you to listen to this where a journalist asked the governor about trumps attacks. Mr. Trump has been a vocal critic of you, and your colleagues you boneheads and a terrible communicator to read how do you respond to these criticisms . I do not. I am not going to change my practice here of not responding to comments or adjusting comments by elected officials. I will just say i continue to believe in the independence of the Federal Reserve from direct political control has served the public well over time. My colleagues and i will conduct Monetary Policy without regard to political considerations. Matt do you think political or market considerations play into what the fed does . On thei would say yes market side, not so much on the political side. As long as mr. Trump is in the white house we will have these outbursts from him with respect to policies he is not happy with. Our stance is that does not move the needle for the Federal Reserve. It makes the job more difficult and opens questions about independence, but more broadly there is a question of Central Bank Independence not just in the u. S. But globally. At fitch we do not think it makes much difference. For the markets, the pressure on the fed is something that is something they take into consideration. We are a little worried about that capture of Central Banks paying less attention to the economy and more to the markets. Anna thank you for your thoughts, James Mccormack, director global head of sovereign supranational ratings, fitch ratings. Minutes away from the open, we will look at your stocks to watch. German engineering giant named a new ceo. This is bloomberg. Anna welcome back, you are watching the boj governor giving a News Conference in tokyo following the decision. No change in policy. They are reviewing their progress today. No sign of recovering in the Global Economy today. A steeper yield curve is desirable, the boj has referred easing. Matt really . Can you believe that . They want steeper curves and have been pursuit of that for some time. Lets talk about the stock market. They have been announcing reshuffles for a couple of days. Yesterday was the chief technology officer, who is designated deputy chief executive officer. , but het a done deal has been in charge of the restructuring and is emphasizing ownerships with german manufacturers. Story withis the next . Innumbers came practically and they maintained their guidance. For september the numbers are looking softer. Lower, and the shares have been up 55 this year. They need a push to get a boost at the open. Anna another red headline from. He boj, more easing now we have seen the yen gaining. We will see how that moves. More on the markets opening up here, and. This is bloomberg. Here, it all starts with a simple. Hello hi how can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone [ camera clicking ] wifi up there . Ahhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your xfinity store today. Anna a minute to go to cash equities trading. Lets look at how the markets are positioned. The european session a minute away, asiapacific looking flat. All the talk of the Federal Reserve conference, the threeway split on the fmoc leaves the market confused about that, and narrative to adopt. The rally at the end of the session yesterday not necessarily going to carry through into today. We see strength in the yen, maybe disappointment about what the boj delivered from a dovish perspective. Englandd, the bank of meets later today. The brexit story very much at the fore. There does not seem expectation the bank of england will do anything today. Futures in europe suggesting a mixed to flat start to the trading day with a bit to the downside as we see u. S. Futures looking in the red. Investors are trying to figure out what the fed is communicating, and what it means for policy going forward. 0. 2 . Se 100 down by the spanish ibex up by 0. 1 . Euro stocks as a whole pretty flat. We see a Little Movement in the agayen. In the nordisk we have a lot of rad on the board. D on the board. Materials and Energy Companies look in the red. I am not getting a lot of direction from this break down what do you see in the individual movers . Matt i see some interesting movers. 290t off, and even split, winners, 290 losers. I was checking to see if any banks were on the upside. Yesterday we saw financials lead stocks back to games after the cut. Socalled hawkish we see pmb paribas adding points to the stoxx 600 as well as lloyds and ing. These are not huge gains or outsized moves in terms of the gainers. Switzerlands watch exports, 1. 5 year over year. Taking the most points off the stoxx 600 as the oil price continues to feel pressure, both down 1 . Shell is off as well. Iageo is off. The Worlds Largest distiller. You would think more people depressed they would reach for the model, but that is another story. European markets opening mixed in the wake of the fed cut. Holding off on signaling what comes next. The fed is a said paired be aggressive if growth falters. We will be making decisions meeting by meeting, and we will try to be as transparent as we can. If the economy turns down, a more extensive sequence of rate cut could be appropriate. We would certainly follow that path if it became appropriate. I do not think we would look at negative rates. If we experience another episode , we have the tools to address that and will not hesitate to use them. We are watching carefully, and there will come a time when we have done enough. Theyre made come a time when the economy worsens and we may have to cut aggressively. We will watch things carefully. Matt benjamin jones, senior multiasset strategist, state street bank. It seems like all good news from powell. He is ready to cut aggressively if needed. He does not see it as needed. The economy is strong. He does not see negative rates, termed as financial poison by big names in the u. S. And Market Operations are back, shouldnt the market like this . Benjamin i think powell delivered with the market was expecting. Powell was keeping his options open. Like investors, powell can see the policies i can see the economy and market. Adjust we stand ready to policy if needed, but perhaps we do not need to. There was not an awful lot of news. It was at the margin a little more hawkish than expected based on the fact that the dots are showing we will not get further rate cuts this year or through 2020. You start to see a flattening last night which was positive for the rotation we see more recently. Lets just wait and see again, and look for the data and see what happens. Anna there seemed a little for everybody in this press conference. Let me ask you about this chart, the surprise index for the u. S. This caught me by surprise. It is a good way to explain why they are reliant on this data, seeing things rosier in the u. S. Some of the data is surprising to the upside. Do you go along with powells rosy assessment . Benjamin we have been more positive through this year and do not see a lot of need for the banks to be easing as aggressively as they are. I have also said the easing we are seeing is not effective at helping and stimulating the real economy. But it is not needed because the data is coming through better particularly on the consumer side. On the mac you on the manufacturing side i do not see the need for aggressive policy. It can offset that. Dayse seeing in recent trade tensions have eased a little bit. Is a deal being done, the pressure is on the manufacturing side. Fedex issues a warning, and we have concerns from manufacturers like john deere and caterpillar, even diageo which sells booze which people need to live says the trade war is a problem. Of course, i am not being serious about that do not reach for the model this early in the morning. Do you expect the problems in the Manufacturing Sector can spill over to the u. S. Economy . Benjamin i think it is certainly a possibility. The big fear for us a couple months ago at the beginning of august when trump announced additional tariffs that would hit consumer goods, and some of those have been deferred, that was the risk. If you see the legs taken out of the consumer, which is propping up the u. S. Economy, that would be where we would reassess our slightly more positive views. At the moment manufacturing is a small part of the u. S. Economy. It is a more volatile part. Manufacturing pmi numbers, people look to them a lot. But contributions to the us economy, it is less enforced than the services and consumer sides. Anna how confusing is it, the message from the press conference, how significant is it to have a threeway split in the fed . You can see a path for hikes, holds, or cuts. Benjamin there is a lot of dissension widespread, but it reflects the way the Market Participants are looking at it as well. When i speak to clients, i have conversations where i can see this positive argument and this negative argument, and the clients can see that as well. That is forcing them to not take big bets, they are putting a benchmark and see the positive and negative outcome. You have this bifurcation of views among investors and in the fed speak as well. Anna benjamin jones, senior multiasset strategist, state street bank talking about the u. S. Recession being low. Thank you. On the European Market open. Lets get to some of the stock stories we will focus on next. Kia is slumping as its chairman announces his departure. This is bloomberg. Anna welcome back to Bloomberg Markets european open. 12 minute into the yea trading day. A bital weakness in the u. K. The pound fairly flat against the dollar. S. Futures do look mixed the bank of japan has left policy unchanged. Speaking in the last halfhour, they said they are more inclined for easing than the last meeting. The bank of england will stay out of the current easing and hold rates steady. Benjamin jones, senior multiasset strategist, state. Treet bank is still with us the bank of japan, the lack of movement in their policy pushed the yen up a little. Any takeaways that they will do a review for the meeting in october. Have we drawn a line in the sand to see more from the boj . Benjamin i think they are doing these reviews all the time. Today the statement is what we expected. Still weak inflation pressures are there. Realizing the limits of traditional monetary easing, and the limits of qe. They will have to do Something Different if they are going to get inflation expectations. Are in the waitandsee mode with the boj, but todays announcement is nothing we did not expect to see. Matt it is a great points, and one mario draghi was making last week that they have reached the end of the line. There are a lot of tools to put to use, but they have reached the end of the line with the efficacy of rates. The bank of japan has a more difficult job and is more impotent. What could move you in terms of investing in the japanese market in terms of making real moves in Japanese Equities . Anything besides the yen is a safe haven. Benjamin Japanese Equities are very attractive from a valuation perspective, that has been the story i could have told over the last five to 10 years. A know the value has not been style in fashion for the last decade. We need to get more involved in those markets, you need to see a more cyclical upturn in global activity around the world. You need to see Manufacturing Activity starting to accelerate. Alongside that, monetary tightening. You need fiscal spending, manufacturing, Monetary Policy to shift away to something more hawkish and tighter. I do not see that happening in the immediate future by any stretch. Equities aree attractive, they are not that quality, they do not offer good income compared to other equity markets. Anna there is a lot going on in the bank of japan rests conference. Let me ask you about u. K. Asset. Things looking cheap on valuation. Withthe bank of england the headline risk in brexit . Benjamin i do not think the bank of england matches today, or there will be any meaningful change or statement out of the bank of england today. There has been a waitandsee mode to watch the data. We have no idea what will happen on brexit or how the politics will shape out. The worrying thing for the u. K. Is at the beginning of this year we were saying they were doing a little better, but that is starting to be called into question. The retail numbers are weaker. There are some arguments for rates to be cut. I think mark carney will wait to thishat happens on brexit close to the october 31 deadline. Matt you will stick with us, benjamin jones, senior multiasset strategist, state street bank, our guest cohost for the hour. Good morning. Down 2 this morning, one of the biggest losers among the stoxx 600 as iron ore prices are falling on the shanghai contract. In singapore now below 90 per ton. Watch export, good news, yesterday both those companies were losing momentum with affluent chinese customers. Plunging this morning, down 7. 5 . Their shares really pushed lower, and the chairman says he will step down once the board finds a successor. Anna lets take a look at the sectors on the move. Banks to the upside. Telecoms,e, media, up next, saudi arabia is reassuring customers they will keep pumping out oil, but how much money are they pumping into Climate Change . That story next. This is bloomberg. Matt welcome back to Bloomberg Markets european open. Bloomberg news is part of covering climate now, a global collaboration of to what a 20 news organizations to highlight Climate Change. Today we are looking at the role of big oil and gas. Here with the details is annmarie hordern. As the climate heats up, so do shareholder meetings. Oil and Gas Companies are facing off with activist shareholders who want to force management to think more green. Investors voted overwhelmingly for a company to put its investments in line with the paris climate accord. We saw investors dump big oil shares. Sharesvested 300 million in june. Investors may have cause for concern according to a new looking to shed light on Climate Change when it comes to meeting the paris agreement. Only two companies have come into alignment before 2050. Report says a majority of companies are not aligned, mostly because they are focused on cutting their omissions while not worrying about emissions from the products they sell. Bp is taking the lead, 83 of potential allocated to projects that will be safe investments to keep warming below two degrees celsius. U. S. Giant exxon is the worst at only 63 . Anna thank you very much. Lets talk about where we are on oil and where we see it heading. Benjamin jones, senior multiasset strategist, state street bank still with us on set. Looking at the oil price this higher on big push the saudi news. Assessment of where we go, do we know the oil spike, will it be temporary or an oil shock that permeates the economy . Isjamin i think now it temporary in terms of the size of the spike we saw. , we weree weekend minister. The oil demand was the big factor last week and in previous weeks demand growth was slowing. All of a sudden supply is back into focus. That someowing you big Oil Infrastructure facilities are more vulnerable the hand previous thought. Saudi aramco was thought to be very well defended. Further going to be attacks, that is a possibility. If there are, that increases the geopolitical risk premium in the oil price, particularly in the brent oil price. Even so we saw that spike come down, the spread did not widen out more. If you look at 2011 when we saw the toppling of qaddafi, that widened out to more than 25. There is more premium to put their. Against that, what you have around the world are bigger oil inventories. Build inventory yesterday. Saudi aramcos stockpiles around the world, pretty opaque numbers. They have not been forced at the moment, and art meeting the demand and are meeting the demand. Matt i wonder what you think about esg investing. Peabody energy which is a coal miner may be forced to pay 8 on a bond offering. It is a double be rating, and average is 4. 1 . Anthis starting to have effect on how you and others invest . Upjamin it is being brought in conversations with clients. I am not an esg expert, but i am hearing from clients about how they market their funds. There is demand there. We were talking in the break about how you do that, do you divest away from these companies , or stay invested . Thank you very much, benjamin jones, senior multiasset strategist, state street bank. This is bloomberg. Devices are like doorways that could allow hackers into your home. And like all doors, theyre safer when locked. Thats why you need xfinity xfi. With the xfi gateway, devices connected to your homes wifi are protected. Which helps keep people outside from accessing your passwords, credit cards and cameras. And people inside from accidentally visiting sites that arent secure. And if someone trys well let you know. Xfi advanced security. If its connected, its protected. Call, click, or visit a store today. Matt lets get your top headlines off the terminal. The fed cuts rates for the second time this year but Jerome Powell is only moderate policy moves are needed from here. If the economy does turn down, then an extensive series of cuts could be appropriate. We wouldly expect, but follow that path if it became appropriate. Plans anotheralso cash injection to tame the jittery repo market. And the boj says monetary easing is officially an option. Investors look ahead to the boe and noticed Bank Norges Bank opening. I am matt miller alongside anna edwards. This is what the European Equity markets look like right now. European markets are biased to the upside, up by. 2 . 400 or so stocks going higher within that. Briefly, lets look at some detail. You have a cap the outlook unchanged, the revenue lines are seeming more positive. Lets have a look at the downside. Von davila is an exdividend stock but also the subject of negative territory. This retailer is reporting numbers that look broadly in line. Arcelormittal, that was covered earlier on. Negative headline on deutsches licht. Matt the Swiss National bank is leaving its policy rate sohanged at 75 basis points the benchmark rate is not move. By the way, you can see the Swiss National bank page on bloomberg. Untilxt decision is not december 12. Lets get first word news in singapore. The Federal Reserve cut Interest Rates by 25 basis points yesterday. Jerome powell says moderate moves should be sufficient to sustain expansion, reiterating his view of a solid economy. He admitted that weakness in Global Growth and trade policy are waiting on the economy weighing on the economy. We do see those risks are morenow. Heightened now. We are watching carefully. The final day of hearings in the Uks Supreme Court for Boris Johnsons suspension of parliament. There promised a statement on what they will do if they lose the case. They have not yet given a date for the ruling and have the potential to derail Boris Johnsons Brexit Strategy or even cut short his premiership. Set tok of england looks keep rates on hold staying out globalrate that way of easing but no News Conference this time around. And while, lawmakers are looking on looking for clarity. They say carneys term could be extended. One of Warren Buffetts deputies is striking out on her own and will start her own firm after 10 years at berkshire hathaway. She has been an advisor, helping the company take care of struggling businesses. The new venture will be a platform to acquire and build companies. Global news, 24 hours a day on air, on tictoc, and on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Anna, matt . Thanks very much. On what is check going on with the swiss franc. We have the Swiss National bank Rate Decision out. They did leave the benchmark rate unchanged at 75 basis points and i did say the next icision would be in 2009, but meant december 12 of 2019. I sometimes forget what decade we are in your fortunately, all of that information is written down for me. It looks like the frank has really lost im sorry, gained strength. Against the euro, the swiss franc has gained some strength and now goes for 1. 1 francs. Are in goodre you company. Lets move on from the swiss Rate Decision and talk about in the going on here eurozone and specifically increase. You have to look to europes most indebted nation. Great equities have soared more than 40 and got another boost a 9erday and reported billion euro plan to help the banks tackle bad debt. Joining us to discuss the aspen Stock Exchange ceo. Good to speak to you this morning. Your thoughts on the big surge we have seen in greek stocks . Is this justified or unexplained . Of course it is justified. We have more room to go. Greecesee the ratio in behind the european numbers so the future is in front of us. It does not mean we are not happy. Is this related to the new government or is it a broader story . Stabilityelated to and policymaking. Related to the real efforts the banks are making to monitor mpsis and it is related to the good performance in our macro environment. Crisisfter nine years of , do you see a return to normalcy soon . Already moving towards normality. Can see that all debt in greece governments and corporate are lowering quickly. Were organizing in london are 14th annual roadshow in receipt clear interest from investors who are now counting the numbers that was best year in terms of raising for the stock market. The word that is most close in our discussion is the normality have you have mentioned. The trade war has been having spillover effects in economies that are not directly connected. Are you concerned that could cause problems as well . Implications in the european economy, and to the greek economy, i think you would have a competitive advantage because all of the pro business in greece have made a huge effort during those nine years in their financials and preparations and we are at the level where we can face difficult to eat easier than in muchast difficulties easier than in the past. Anna i wondered if you could talk about the consolidation story. Some say it is inevitable and that it makes sense, others say the feature is not consolidation. What do you think the future is for the Exchange Business . That dataor sure having a higher value now theres. But on the other hand, i personally believe that if the Stock Exchange is to have a future, they have to create Networks Covering different continents around the globe. Anna will your business play a role in that consolidation . Not saying consolidation, im saying working. What we have to have had this that areur area is dissipating successfully in the participation of the Stock Exchange for the creation of the new electronic markets. Matt thanks so much for joining us. Socrates, the athens Stock Exchange ceo. Up next, we speak to someone from pimco after his outlook about his outlook after the feds second cut. What does it mean for fixed income . We get the outlook. This is bloomberg. I am disappointed by what the fed has come out with year because the market here because the market is price for action. Action. D for is hard to say this is a dovish situation. I prefer the way it has been characterized as a risk management, as an insurance cut. I think this was the second payment on an insurance policy. We were expecting a more. Expecting more. The fed is not as accommodative as i would like to be simply because my forecast run over 2 . So i think there is more room for accommodation. I think the fed is too preoccupied with inflation expectations. They have changed the way they are operating at a fundamental level and have moved towards this expectationbased way of looking at the economy. I think it is a very confusing. Some ofose were just the guests on Bloomberg Television reacting to Federal Reserve policymakers cutting the benchmark Interest Rate. Lets continue that conversation about the fed with our next guest, joining us with pimcos andrew is a morris bosombworth. I want to ask you about what is going on over there. Cut . You have a hawkish what do you take from those statements . Andrew the statements after were more in line with what we in terms of taking out insurance. The discussion afterwards was a little bit more on the dovish side than what the fed has begun with. Matt what do you think about the open Market Operations that have been brought back and the dislocation over the last few days . You have confidence the fed consult the issue . Thatw it is an indication the more the central bank and delves into unconditional policy , the more competition things become. One application is maintaining the rate in the desired corridor. The ecb is going through a similar thing with tearing tiering. From a macro perspective, i think it is just noise, but from , it is anerspective opportunity. Its a small thing. Its a small thing, got but good morning. You mentioned this is part of a trend with the growing use of unconventional policy. They did not talk much about this, but do you expect them to change the way they operate at the short end of the market . In terms of the tools they would prefer to stop it , the ecb used to do it as well around the end of the reserve maintenance time. Remember the old coupon passers . That was standard work thats what the fed is doing again to steer the policy rate. Conventional, it is just the unconventional circumstances of having such a large Balance Sheet and large that is theves cause, ultimately, of the volatility we are seeing. We talked a lot today with various guests the best negative Interest Rates. What that means for various parts of the financial community. When you have so much debt globally and negative yielding. Andrew that is the bread and butter of what we face on a daily basis. To begin with, when all of the started, the idea was to avoid these things. What we have discovered in the meantime was that cannot so long as the yield curve is steep, and one rolls down the steep yield curve, it is just the negative Interest Rate from that perspective becoming another number which happens to be below the zero line. But the statement still stands. If you hold these securities to securities, you will be losing 6 of your return. There are some Economic Agents in society who have a very longterm perspective. For them, these negative Interest Rates bring systemic risk. Matt and they are terribly unpopular for a number of reasons. Canada German Government do something about it can be German Government do something about it . Mario draghi made an explicit call for it. Andrew that is precisely why we are in berlin. And it could not be more clear than what we heard from mario draghi. At this stage, it is really fiscal policy that has to step into the void when there is a recession. , other thanicy asset purchases is essentially done. The Interest Rate component and europe is effectively over for now. Think it is time for the German Government to do more . If the time and now . Is thehe time now time now . Before theye told could spend on green initiatives. Andrew in terms of the question now, maybe not right now. There is almost full employment in germany. If the economy went through a soft patch. Occurs, andession as we head into that, then yes. That would be the moment we expect fiscal policy to step in. The ability for fiscal policy to do that is somewhat limited given german laws and its debt political objective of the coalition to maintain a balanced budget. Is a little room to maneuver on the automatic stabilizers but there is then the possibility of parallel budgets being established for Climate Change initiatives. We will get more information on that on friday. Here would bene that we are not going to see a Huge Investment project that would really take the economy up a gear in terms of growth, but it is headed in the right direction. Matt great to have some time with you. Orth, head of Portfolio Management at pimco in berlin. ,e are asking the question which assets are most attractive following the fed rate cut . Join the debate yourself. This is bloomberg. Matt welcome back to Bloomberg Markets. Almost one hour into the session. We are seeing green arrows across the board terms of european equities. , but in is only up. 1 paris, up. 5 and the ftse mid is up. 65 . See futures trading down in negative territory over the u. S. , so if you are prepared for the u. S. Open, be prepared for a little bit of selling. The fed has cut rates for the second time but it was not enough to please investors today. Toterday, we saw a big move just over the zero line. Lets bring in Richard Jones to ask him, do you think it was a hawkish cut . The fed has been want to keep their options open. If you look at the dots, yeah, its hawkish. Rate market is not buying that. They think they will get another cut this year and two next year. That is still modest easing in terms of accumulation. So yeah, it did lean on the hawkish side, but the market is still expecting more this year and into next year. Anna we saw a lot of dissent at the fed. Some think there wont be dissent because brexit will keep people united. Your expectations . I think the hands are tied until we get more clarity on brexit so i expect them to repeat what they have been saying. No big changes. Matt thank you for joining us if you want more from Richard Jones and the rest of the team, its easy to get. Type mliv under bloomberg terminal. On your bloomberg terminal. Todays question of the day, which assets are most attractive following the fed rate cut . Out by typing ib tv anna and i are headed over to radio, tune in on london dab. Otherwise, surveillance is next. This is bloomberg. At comcast, we didnt build the nations largest gigspeed network just to make businesses run faster. We built it to help them go beyond. Because beyond risk. Welcome to the neighborhood, guys. There is reward. Beyond work and life. Who else could he be . There is the moment. Beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected, to do the extraordinary. Take your business beyond. Francine the Federal Reserve cuts for a second time this year but dampens expectations for faster easing. The fed offers up to 75 billion of extra liquidity. Will it be enough to calm nerves . Banks respond. The boj calls for an october review. Switzerland, norway, and the bank of england all decide on policy