The twostens spread is up 31 basis today. Been a while since weve been that wide on the spread. A far cry from the negative numbers we saw earlier in the year. A little bit of weakness today for the british pound. We are waiting for Boris Johnson to speak to lawmakers in parliament. Has gotten several upgrades. There are still some analysts cautious about the fundamentals, but generally, that type of a gooddata is seen as outlook. In europe, we are seeing a mixed bag with carmakers again, kind of in trouble today. They are dragging down the dax. We also have a couple of french carmakers lower after the deal with fiat yesterday. We will get into Boris Johnsons plans in a few minutes. The stoxx europe is all told, flat. At 22 basisield points right now. That is the most positive we have seen it in negative territory for quite some months. Later this hour, we will be watching Prime MinisterBoris Johnson speaking in parliament after laying out his legislative priorities earlier, with a focus of course on brexit and Funding Health care. Lots of other priorities in that statement, though. We will bring it to you when it happens. Meantime, the u. S. House of representatives impeached donald trump on charges of abuse of power and obstructing congress, deepening the partisan devise in congress. President trump addressed the crowd at a rally in battle creek, michigan. Pres. Trump we did nothing wrong. We did nothing wrong. We have tremendous support in the republican party, like weve never had before. Alix the senate plans to hold a vonnie the senate plans to hold a trial in the new year to decide whether he should be convicted and removed from office. Or more, lets bring in Emily Wilkins from washington, d. C. The surprise isnt going to be in january, when the senate happens to hold its trial. There might be surprises that will emanate from that trial, however. What are analysts and your sources telling you . Emily right now, theres a lot of debate in washington about what we are going to see during this trial, whether or not we are going to see witnesses being brought for the senators. Right now, theres been some discussion of that, but Senate Majority leader Mitch Mcconnell wants to try and keep this as short as he possibly can. Theres been discussion about having no witnesses at this point. The white house has got a little bit back and forth, but it sounds like they might agree with that, so we might see a fairly short trial in the senate. Vonnie we are watching live pictures of Mitch Mcconnell speaking on the floor. What is the significance in terms of risk for the 2020 campaign . Emily absolutely, the senators right now who are running for president , it is about a month out for some of the first primaries. It is very important to be in iowa talking with voters, and the longer the trial goes on, the more time they cant spend with voters. For this senate trial, every senator must be present. ,hey are simply sitting listening, asking questions, and they need to be there for the full day. That is a requirement under the law. Vonnie the president s campaign is insisting this is actually a boon for him, and obviously he spoke for hours last night in michigan. What exactly do they mean by that . What are we seeing in the polls . Emily President Trump emphasized a lot last night that there werent any republicans in the house who supported the articles of impeachment. All republicans were united in opposing the articles of impeachment. Some of them did say they had concerns about President Trumps conduct in regards to ukraine, but everyone agreed it did not rise to the level of an impeachable offense. Vonnie what about swing districts . What is the concern for the president s campaign . Emily in regards to impeachment, trump is actually and i think other republican groups are as well seeing that impeachment has split the country pretty evenly, so they are using this to sort of rally his supporters. In the house, you have the democratic majority that was made in part by democrats who won trump districts, so you are seeing the Republican House campaign arm really come out and make sure that they are doing everything they can to tie these vulnerable members to their impeachment vote. Meanwhile, the members are trying to create some space, trying to focus on other things such as the trade agreement between mexico and canada that will be voted on later today. Vonnie Emily Wilkins, thank you for joining us. That is bloomberg governments Emily Wilkins and washington, d. C. Lets check on the bloomberg first word news. Heres ritika. Ritika Goldman Sachs is in talks with the u. S. Government 1mdby a fine in the scandal. Goldman has been accused of ignoring warning signs while billions of dollars were looted from its clients. Clients, the Malaysian Investment Fund 1mdb. That aals court found key piece of the Affordable Care act is unconstitutional. The case has been sent back to the judge who struck it down a year ago. Decision probably wont come before next years election. It pits President Trump and a texasled coalition against, Craddock States against democratic states. Claims fell by 18,000 to 234,000. The late thanksgiving holiday may be responsible for some late adjustment issues. Launch a space capsule into orbit tomorrow. The plan is for it to rendezvous with the International Space station and return to earth. If all goes well, nasa could resume manned flights next year, the first since the Space ShuttleProgram Ended in 2011. 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. Im ritika gupta. This is bloomberg. Vonnie thank you. I want to bring in Vince Cignarella now, who joins us from our mliv team. Impeachment hasnt had much of an impact on markets this morning, but we did get some data i wanted to ask you about. A little disappointing. Anything to be concerned about . Vincent not really. Indexes isnomic primarily manufacturing based, and we have seen a slump in manufacturing this year that does continue. That to be lacking when it should be leading best adjust manufacturing will continue to goingeight on the economy forward. Home sales a little bit disappointing, but at the same time, the builders index last week was at a 20 year high, so with balance, markets are looking good. At the same time, the supply of homes on the market has shrunk. I think it was 3. 9 to 3. 7. So the underlying numbers were pretty decent for home sales. Vonnie the twostens spread is up 30 basis points. How significant is this . It doesnt feel massively wide, but it is well wider than we have seen. Vincent i dont think it is something to worry about too much. Vonnie no, im saying the opposite. We should be excited. Vincent oh, totally. Its a great thing. Its adjusts people think the economy is going to grow. At the longer end, rates will be a bit higher. The fed basically said they are on hold for 2020. This suggests there is maybe a demand for for potential higher inflation. Vonnie Vince Cignarella, thank you for that update. Stories at mliv for more now on impeachment, and of course, Boris Johnson speaking in a few moments, lets bring in danny branchflower, professor of economics at dartmouth. He joins us today from naples, florida. Vonnie. I, vonnie im curious as to whether you think theres any risk associated market wise with the impeachment of President Trump. Obviously, we are not seeing an Immediate Impact come about longer term, does this have any secondary implications . Danny i always like to try and teach my students that markets with spohn to surprises, and i think markets respond to surprises, and i think at this point, theres really been no real surprises. I think the worry certainly is that the central bank appears to not have a clue whats going on, and has basically said we are waiting for some data to come in. The worry is if we get some really bad data, that would in a way be a surprise to the markets, and the fed would have to step in, by which point it would be too late. I dont think at the moment theres really anything to be concerned about in the sense that the markets put much know whats coming. Isnt look like the senate is going to remove him. We will see. But going forward, i think the u. S. Economy and Monetary Policy is very much waiting for some bad shoe to drop because essentially, the fed has given up its forecast on inflation, unemployment, gdp growth. They dont really know whats coming. So we are in a lets wait and see, but i think we are more susceptible to bad news then we have been in the past. Vonnie what is your explanation for why there doesnt seem to be any shoe dropping whatsoever . Markets are holding up, the Economic Data is not so terrible, and it really seems like the fundamentals are holding solid. Danny it is pretty interesting the recovery has not turned over yet, the longest recovery ever, that markets are pretty strong, and that the u. S. Labor market does seem pretty resilient. The obvious concern, i think, is that we should look at manufacturing. I think the concern for the politicians, perhaps for trump, is manufacturing and agriculture , but particularly manufacturing, looks weak in states like pennsylvania, ohio, wisconsin. Places that are in the midwest that are going to be important in 2020. But really, we would have expected this to happen with no sign of inflation in the horizon. So i think the answer is it is a bit of a puzzle. Growth isnt fantastic, but its not terrible. On keeping on for a while, but eventually recoveries die of old age, or something happens that stops them. So lets keep on going, but we cant go on forever. Vonnie if we take a step back from the markets just for a second, what is the most interesting thing to you about this house impeachment and consequences . Obviously a senate trial and consequences for the campaign, be it geopolitical significance, social significance. What do you talk about, in other words, at a dinner party when it comes to this impeachment . Danny well, i also talk about it in my class. Is ank the issue right now lot of people are hurting. Theyve been left behind in the labor market. We have lots of despair, lots of hurt, particularly amongst white, less educated adults. Anyway, whats happened is we have this disconnect. We have the president of the United States offering change, support, hope for those people, and the base continues to be strong, and he democrats fighting with one another. The big question you have to ask is what is it the democrats can offer . In 2018, they offered health care. Is one wee big story were talking about today, which is that the Appeals Court has basically gone back on obamacare and suggested we may well see all of the republican attorneys general remove that, which would give the democrats something to fight about. But you have to offer change, and what do the democrats have to offer . Suddenly, that domestic balance changes, and i think we see markets more in upheaval. But at the moment, nothing much is happening. Vonnie just to point out that you are referring to the decision on the individual mandate that may make the whole unconstitutional. Obviously, the democrats will put together some kind of strategy for the campaign for the election, but you mentioned the people that are suffering out there. Up ase they not turning much as they perhaps should be in the data . We have had conversations about the Consumer Holding up. Where is it in the data . Evidence certainly see in the data of rising despair. We see it in suicide, opioids, people dying from cirrhosis of the liver. But theres a lot of evidence out there now that this group of white, less said, educated, prime age folk, are in trouble. We have seen a big rise of what i have been writing about, despair. Over the last 30 days, how many Bad Mental Health days have you had . Say 30 ofnk of people the last 30 days, and the proportion of that is now , one in eight or so say that everyone of the last 30 days have been bad ones. That is going on at a time where the economy is growing, we talked about stock markets rising, but the problem is these folks dont share in the spoils. They dont have houses. They dont have stock market. They dont have 401 k s, and trump has given them hope. ,hats sort of whats going on but at some point, those folks have to deliver those folks, you have to deliver. I think thats one of the big issues to deal with. Vonnie we are going to come back and speak more. We want to ask you about Boris Johnson and his plans for another developed economy. Danny branchflower joining us today from florida. We will react to the boe decision as well. Theres jeremy corbyn. Prime minister Boris Johnson will soon speak, coming after the queens speech earlier which laid out johnsons government agenda. This is bloomberg. This queens speech contains nothing of substance to deal with the colossal challenge of climate. , ime live from new york vonnie quinn. This is bloomberg markets. We are back with danny branchflower. So much to talk about regarding britain, obviously. Im curious as to your reaction to the vote to the other day, the fact that Boris Johnson got such a big mandate, and what apparently is going to be his plan for the next 10 years. Golly. I think what was interesting was that the polls seems to get it right. The result was approximately right in the middle of the polling range. Sense, but you had was a clarity. You had Boris Johnson say we are going to get brexit done, and then we had the labour party that basically said we dont know what we are doing come up with a leader that nobody likes, fudged. Lib dems just thats why he one. Now i think the crucial question be the devil will be in the detail. What settlement do they actually come up with, particularly in relation to ireland, where i was the other day . The talk of their was they better not impose a border. The third thing, theres Something Like 60 odd older labour constituencies that went to the tories. Darby, dudley, places in the old labour heartland. The question relates to the point that we were making about the United States. What is boris going to do to deliver to those places and keep them behind him . The trouble really starts now. You can deliver a brexit decision in january, but then your trouble really starts because you havent negotiated anything. You have a long transition period. The worry is the data really doesnt look that good. Very bad retail Sales Numbers this morning. The bank of england decision, where two members are voting for cuts, and we may well see cuts coming in the next few meetings. But this is an election that he won, but boy, does trouble start now. Vonnie theres talk of obviously getting out of the eu. That is a foregone conclusion. But overhauling the immigration system, working on the nhs, but even a controversial plan to scrap the law about general elections. What concerns you about what is being laid out . Is well, the question first, obviously, it appears that he has a mandate for change , and being able to scrap the act which means the Prime Minister now, instead of being stuck having to go for five years, can call things when they want. In a way, it sort of looks like you put bits of the jigsaw puzzle in, and part of it is that as commentators and watchers, we dont really know which boris is going to show up. Is boris going to be pushed to the right, or is he going to be a sort of one nation, support people, build the nhs . Which way is he going to go given that majority . I think people are unclear about that. They are unclear on the fiscal front what hes going to do. Vonnie thanks for joining us today from naples. Nis danny branchflower that is danny branchflower of dartmouth and formally the boe. We will get to Prime MinisterBoris Johnson now speaking in part meant. Pm johnson they want to move politics on and move the country on. Building hospitals, modernizing our infrastructure, making our streets safer, our environment cleaner, our union stronger. And this queens speech of this peoples government sets in motion a vast, interlocking program to unite and level up across the whole United Kingdom and unleash the potential of all of our people. This one nation government will enshrine in law record funding for our in hs, take back control of our borders with a whole new immigration system, longers sentences for the most dangerous, and protect our environment with a bill so ambitious and so vast that there is no environmentally friendly way of printing it off. And mr. Speaker, it is not a program for one year or one parliament. It is a blueprint for the future of britain. Just imagine where this country could be in 10 years. Trade deals across the world, creating jobs across the u. K. 14 new hospitals, Great Schools in every community, and the biggest transformation of our infrastructure since the victorian age, this time using new gene therapies to cure the hitter to incurable the hitherto incurable, and leading us into a dawn of electric vehicles. It or impossible to say i do not think it vainglorious or impossible to say that i knew golden age for United Kingdom awaits, in spite of the negativity that you will hear from