Worldwide, and television as well. A bit of a fog and rain in new york. A fog towards the election seven days on. After the carnage we saw yesterday, we really have to recalibrate where we are because we advanced so nicely for it yesterday. It really isnt all that much of a pull back to, is it pullback technically, is it . Jonathan lets be clear, the s p 500 might be bouncing back by about 0. 5 , europe is not as all. Not just the caseload, but also the restrictions around the continent. Europe has a problem. I keep talking about this. Theres a real issue in the european economy. The recovery had already lost moment him just lost momentum. Then you throw this on top already lost momentum. They need for this on top . It doesnt look good. Ecb that gets to in meeting. S of freedom that Christine Lagarde has gets ever more narrow, doesnt it . Jonathan keep financial conditions loose. What i found fascinating, and guy and i went back and forth on this yesterday, if you ask people whether we had fiscal stimulus at the european level, i think they would say we do. We had a deal. But that deal hasnt been ratified, and that money hasnt been disbursed. That is the problem in europe right now. We are still staring at the ecb. They havent got it done at the european level yet. They had an agreement, but that agreement hasnt been ratified in national parliament, and that money hasnt left the door, and might not for several months. Tom Chris Verrone at strategic strategas points out we have not seen that much in bonds as well. What did you observe until right now . Lisa people declaring the death portfolio have been wrong. There has been more buying of treasuries, although not that significant of a yield move, but it raises this issue, the uncertainty you are talking about is not only around the election. It is around where the bigger risk lies, the treasury yields will go up very quickly or rapidly. The fog of uncertainty is probable about everything from the election to just the middle economy and the permanent ay see. Ses we m in 0. 39 vix comes points. That is important. 33to 32 on the brink of right now. Youll doesnt do anything yield doesnt do anything. Euroentions the resilience. I do want to point out turkish lira with a second grim day, know whether way to put it, 8. 15 right now. That is a 16 depreciation since the middle of the summer. Lee ferridge is different. With an acclaimed career at commerce bank, and then almost a decade at rabobank, he holds court in boston at state street bank as their head of microstrategy. He brings it ahead of microstrategy head of macro strategy. What is the position as you try to hedge your bet out . Are you able to hedge right now . Lee in terms of the outlook . You can. Market is very neutrally positioned ahead of the election. A lot of people think a blue wave is priced in. It is not. If you look across a range of different indicators, blue wave isnt priced in. The market is nervous about a repeat of 2016. They are skeptical about the polls. People are really sitting on their hands. Jonathan where do you think it is not priced in . Lee i dont think it is priced in anywhere, quite honestly. , i thinkof the dollar theres a view amongst many which i agree with, that the dollar is going to go down whoever wins the election. You can argue theres some overweight positioning, but again, i think the view is we are going to get more policy stimulus. The barometer for me i am looking at most of all this probably em. A lot of people, most investors are very neutrally positioned. Em is really the swing variable on the election. If we get the blue wave come a very positive for emerging markets. If we get biden with a split congress, that is a much more tricky environment for em. I would look at em positioning as a guide to market positioning. For me, that is neutral. Jonathan lets go back a couple of steps. Stock goes down whoever wins. Why . Lee in terms of the dollar, it is about the fed primarily. A is about Foreign Investors bility to hedge their treasury purchases. ToForeign Investors can head those bond purchases, the dollar goes down. Because thehey can fed is not offering any shortterm rate premium. The curve is relatively steep. It sounds ridiculous with 80 basis points 10 year yield, but therefore the dollar goes down. Whoever wins the election, that is not going to change. The fed is not going to be hiking rates for the next three or four years, whoever wins the election. You can argue on a blue wave, it probably goes down faster because we get the fiscal stimulus. Theres probably an increase to the current account deficit. Either way, the dollar goes down whatever the election outcome. Jonathan what is the threshold lisa what is the threshold for the fed easing further . Lee thats a very good question. The trigger, if anything, would be yields. If we see yields start to backup, i think the fed will be fearful of that. That would mean they would ease further to control yields. I know they dont have yield curve control while is a policy, but they dont want to see higher yields. Again, if you get the blue wave, talk of fiscal stimulus, if we see yields backup, the fed could restart or reexpand qe to hold yields down. I think that is a big trigger. But even without that, we have this shiny new framework. We have average inflation targeting. We have maximum employment rather than full employment. On their own forecasts back in september, they dont achieve either of those targets in the next three years on their own forecasts. So i think the fed is going to ease further anyway. Otherwise, what of the point of switching the framework . You dont achieve them on your own forecast, and you do nothing about it . I think the fed are going to ease policy further anyway. Tom i love that. I thought it was the third album of reo speed wagon, this shiny new framework. Lets go with it. We dont know what it is going to be or what it is. How do you invest given this shiny new framework . Lee listen, its very hard. Policy is very loose. But valuations are hard. Valuations are really tricky. We seen this dollar debasement consistently over the last four or five months. First up was gold. We got to 2000. Then it was tech stocks, and we got huge valuations there. Then it was the euro to an extent. Everyone started worrying about the ecb. Its tough. If we get the blue wave, as i mentioned before, i think emerging markets could have a fantastic when he 21. You will have a weakening dollar. You will have a big Infrastructure Spending plan. You will have huge fiscal stimulus in the u. S. You have a fantastic 2021 for emerging markets. Fx, equities, fixed income. If you get the sort of split , it iss and president much harder. I think the environment becomes much harder for investors. Policy is going to stay loose. That is going to support asset prices probably, but the volatility in the sideways market we have seen since august, the s p is at the same level now as it was in midaugust. As you mentioned earlier, europe are the lowest since june. Those sort of more sideways markets will be the result if we have a split white house and congress. Investing is much harder. If you get the blue wave, em is where i would be. Jonathan lee, come back soon. We would love to catch up. Equities bouncing back. One stock to watch ahead of the open, mc out with some news in open,st 10 minute the amc up with some news in the last in minutes. Several locations in Northern California will resume operations beginning friday, october 30. That news just breaking. The stock up by about 5. 5 in early trading. Tom it has been challenging. I thought you were going to amd off of xilinx. Youre confusing me, jon. Jonathan we will get that later. Tom it is like work here. Jonathan the place he would watch a movie at, tom. Tom when was the last time he went to the movies . They are back almost two pandemic lows of march and april right now. I guess theyve come back a little bit. Thats all there is to it. Jonathan lisa, you have been following the debt story as well. This has been one of the candidates people have been a little bit worried about in the last month. Lisa frankly, the fact that the shares are up this much in premarket trading on the news that they are just reopening theaters indicates how low the bar is. Thats all i can say. Jonathan exceptionally low for this industry. It is tough. Of avonp, tina fordham hearst Advisory Services weighing in on the selection. We might have a result on november 4. It might be an issue for this market because maybe we wont. Tom it could go on as long as brexit. Jonathan what, four and a half years . Tom yeah. [laughter] jonathan i hope not. You hope not, too. This is bloomberg. Has been sworn in as a justice of the supreme court. Required of two oaths was administered not long after she was confirmed. Chief Justice John Roberts will administer the second oath today at the court. Her confirmation solidifies a conservative 63 majority. The record coronavirus surge that started with Young Americans has now reached the oldest populations. According to the cdc, counties with the largest 65 and older populations now have an average 19 daily cases per 100,000 residents. That is 67 higher than a month ago. China ramped up its purchases of American Goods last month. Still, it is far from the fullyear target set out under phase one of the trade deal with the u. S. The chinese bought more american oil, soybeans, and cars. With three months to go in the year, beijing is a little more than 1 3 of the way to the goal of 170 billion in u. S. Imports. In the u. K. , Prime MinisterBoris Johnson faces a revolt from more than 50 numbers of his own party in parliament. Told johnson his strategy of targeting local areas with three sections was disproportionate with restrictions was disproportionately damaging the economies of northern regions. Global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. Im ritika gupta. This is bloomberg. Pres. Trump we have the best testing the world. That is why we shows in many cases, but because we do the most testing in the world. But we are doing great, and excuse me, here i am. Mr. Biden the bottom line is donald trump is the worst possible president , the worst possible person to try to lead us through this pandemic. He either doesnt have any idea what to do or just doesnt care. Jonathan President Trump and Vice President biden continuing to rally yesterday, with one week of campaigning still to go. From london and new york, good morning. One hour and 12 minutes away from the opening bell. Alongside tom keene and lisa abramowicz, im Jonathan Ferro. Futures up, positive on the s p 500. We advanced 0. 4 . We talk a lot about the weakness in europe. ,uro resilience still the story 1. 1830. In the bond market, muted price action after yesterdays rally. Tom muted is the right word. We will watch it amid all of this uncertainty. Part of that is domestic uncertainty. Part of that is the science we have been talking about, particularly with dave ricks of lilly. Tina fordham studies at avonhur with reallyservices thoughtful senses of tying this altogether. What does the state Department Look like with a Biden Victory . Some well, it might have people back in it, tom. The state department was famously hollowed out during the Trump Administration, and the conduct of the u. S. Foreign policy really was coming more from the white house. We have a lot of demoralized u. S. Diplomats around, so i think the broad expectation of a biden presidency, as unexciting as it sounds, would be a return to the kind of conduct of u. S. Foreign policy that we have become used to globally, regardless of whether it is a republican or a democrat in the white house. Tom second terms are always different, and with no disrespect to mr. Trump, it seems all second terms enter jubilant and become exhausted more gradually. Would you suggest a changed Foreign Policy in a second term trump, or simply more of the same . Say, one of the facts about being a second term u. S. President is you are a lameduck on the first day. You know, youre not going to be reelected from there. I would say not enough time has been spent thinking about what i second term Foreign Policy might look like under President Trump, but one thing i think investors can count on is the continuation of tough rhetoric towards china. And in fact, that stands even if you have joe biden in the white house. So u. S. China trade tensions would remain strong. I think you will see foreign powers actually test a second trump term for policy. Perhaps being a bit more assertive. We are starting to see this in turkey from president erdogan, for example. Who else might want to test the resolve of President Trump or an incoming President Biden . It is a good time in many ways to see if the u. S. Is willing to honor its agreements. Lisa it is hard to look out past the next seven days. There is still so much uncertainty about how this election process will unfold in the weeks and months afterwards. Among democrats, there is persistent fear of a 2016 redux. Hillary clinton leading in polls , people predicting she had an incredibly good chance of beating now President Trump, and clinton taking a backseat and not campaigning as robustly in a certain key swing states. Now joe biden doing something similar. Is this 2016 all over again . Tina democrats will certainly hope not, for many reasons. First of all, hillarys polling lead narrowed in the final two weeks, which is something we are not seeing yet with joe biden. His lead has been pretty consistent. So he has that on his side. Other factors that make this time different is far fewer undecided voters. People have been clear much earlier on in the race then we are used to in u. S. Elections. And we dont have thirdparty candidates that are really helping divide things further. So there are some important differences between now and 2016. But for sure, it remains possible that there could be another divided outcome between the popular vote and the Electoral College, which is why i think the margin is really the key variable to watch for here. President trump of course would be hoping for another electoral and he doesvictory, have a pass for that remaining despite the negatives and the headwinds against him in this race. But another difference would be exampleike in 2000, for , i dont think democrats will roll over quite so easily as they did at that time. Jonathan four years later, is the polling better this time around . Tina this is what my pollster friends assure me. I am not a pollster or an election focused or election forecaster myself. To be fair to them, they were pretty accurate in the National Polling because Hillary Clinton did win on that front. It was the Electoral College whiteg, and specifically noncollegeeducated men who were under the radar screening. This time, if anything, i expect pollsters will have overcompensated for this error. It is hard to think of a kind of hidden pocket of people, a cohort that could appear that havent been factored in. And then of course, we have the phenomenon of what looks like historically huge turnout. Jonathan tina, great to catch up. Appreciate your time this morning. Urst fordham there, avonh Advisory Services head of political strategy. Deleted Hillary Clinton on election day the lead at Hillary Clinton on election day, three points. The final popular vote, the lead was around two points. This time around, the lead is around eight points at the moment in the average goal. I think lisa has made the point that if polls are wrong for time that is ais total failure for this industry in a huge way. Tom theres no question if they do it back to back, yes, it is a problem. There are polls that are successful. Trafalgar its a lot of think for being a lot of ink for being successful in 2016. The polls cant reach a huge body of americans that are just unpollable. It is just not there to reach out and grasp those people. If the president in 40 of the 50 states today . He is making the circuit, looking for those unreachable. Jonathan can you imagine tom doing the phone interview when a pollster calls up . Let me tell you what happened 50 years ago. [laughter] lisa roses. Jonathan hold on, im getting a drink. Lisa lets talk. Jonathan the poll was incomplete. It was meant to go on for two more days. Jonathan it is tuesday morning. Good morning. I am Jonathan Ferro alongside tom keene and lisa abramowicz. We are live on bloomberg tv and radio. Equity futures up 11. Still positive on the day. Meansic data in America Michael mckee is back with us. Good morning. Michael we are seeing the numbers for durable goods orders come in, up 1. 9 on the month. That is an improvement over the. 5 in august. These are september numbers so they will figure in the Third Quarter gdp we will get later in the week. Capital goods orders, nondefense aircraft, that is the one economists watch because it tells you what is going into the gdp numbers from the business side. Business spending up 1 on the month, that is down from the 1. 9 percent we saw in august. It is double what was forecast. Shipments upood. 3 . That is important because it tells us something about how the economy was going during that Third Quarter. It is not as good in september as it had been. In august we saw capital goods shipments up 1. 5 . Let me scroll down to the breakdown of the numbers. What we are looking at in terms of unfilled orders, down at this point by. 2 . The biggest movers appear to be in shipments, down 1. 1 machinery shipments, down 1. 1 . Continues withmy the story we have been telling about the economy since the stimulus and it at the end of july. Tom you take the three month moving average, a