We are going mostly down. Trump has used his executive powers to ban investments in companies that are associated to the Chinese Military. Lets look at some other asset classes. Dollar index unchanged. The euro, which has been under the caution with the dollar. Crude, just dropping below 40 bucks a barrel. We have the surprise stockpile gain in the u. S. Gold price moving up as well. Goldman sachs saying they are bullish on not just gold but also copper. Lets move to what is happening first word news was. We get over to new york and joined karina mitchell. Karina the chances of a new stimulus package in the u. S. Are receiving with the white house saying sources tell us gop leaders will not lead any of the talks. Mitch mcconnell has been more distant from a democrat proposals, reducing the chances of a new deal. The Federal Reserve is again warning fiscal stimulus is required to support the u. S. Economy as potential vaccines may not end the economic fallout from the coronavirus. Chairman jay powell spoke at a Virtual Panel hosted at the ecb and said the coming months could be challenging. The Worlds Largest retrade agreement is expected to be signed this weekend as asiapacific nations conclude negotiations at the aussie on summit at the asean summit. India has so far declined to be involved. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im karina mitchell. This is bloomberg. Coming up, president an orders signed banning investment in chinese firms which are determined to be owned or controlled by the Chinese Military to ramp up pressure on beijing. Ours get more on this with Senior International editor, jodi schneider. Why is the president doing this . What are the implications . Think it is an other in a string of actions President Trump and the Trump Administration have taken against china, trying to put pressure on china through things like these kinds of bands on investment. They are targeting in this case any company that is owned or controlled by members of the Chinese Military. 20t could include at least companies we know of that are on a list. What this would allow is investors could divest any these companies, giving them time because this would not take effect until january 11 and after that, they could divest as well depending on the 60 day rulemaking period. This is yet another in the administrations attempts to pressure china. In terms ofgrowing the criticisms from the u. S. , from President Trump himself about china in terms of the origins of the coronavirus, the crackdown in hong kong and the treatment of the weaker uighur minorities. Disqualified by the Chinese Government and then an mass resignation of the rest of the opposition lawmakers. Responset have been in to that directly but these are the kinds of things the u. S. Is reacting to. Why does it appear at the moment the Trump Administration is pulling back from its threat to ban tiktok in the u. S. . We have had some legal news today. What are the next steps in this litigious fight . Jodi the fight goes on although the ban will not take effect. It is not going into effect. The Commerce Department said it will not occur. They put out a statement saying that will not happen. The next couple dates on the calendar to look for in december. The 14th and the 28th. Sale or tiktoke will be trying to go through the sale in terms of Getting Court action to allow the sale to go through. This is to oracle and microsoft. They want to see this happen so that this can be as President Trump had ordered in american hands. He said that had to happen if tiktok was going to operate. Obviously the Commerce Department is letting it go ahead at this point, but the legal action will continue. The people who one for sale who have filed the Court Papers Say they have not heard from the administration on the sale and they will fight to have that happen so that tiktok can operate on interrupted in the u. S. Jodi schneider, ari Senior International editor. Still ahead, we are having a look at Market Strategy as hopes of a vaccine drive sentiment. Sayy davis from quadratic the markets are straight from winnie the pooh. Andty markets as tigger bond markets playing eyore. Banks asking deutsche affect strategist on whether the pboc has a tight leash on the yuan. This is bloomberg. Haslinda the Federal Reserve is again warning that fiscal stimulus is required to support the u. S. Economy as the vaccine may not be enough to stop the economic fallout from the coronavirus. Our next guest says more stimulus will come. The trouble will be getting the money to where it will have the greatest effect. Joining us is the quadratic capital founder and cio, nancy davis. Good to have you with us. We talk about the stimulus coming but that is in question. I do think the stimulus will be coming. Everyone is waiting for it. I think the question is, when will it have been will it be enough to counterbalance the take up we have seen the tick up globally of covid cases . Haslinda how does the market make sense of all of this . We talk about rising covid cases. Take a look at yields. Still below 1 . 1 . Eating from the cusp of i think entire 10 year u. S. Treasury yields would signal more of a risk on market for equities and credit. I think the bond market still has not recovered to its prepend david prepandemic levels. If you look back to 2013, Interest Rates were still near the zero bound in terms of policy, but it was a more healthy environment with the u. S. Yield curve was about 250 basis points, which it is more normal which is more normal. Right now, the bond market is signaling one thing and the equity and credit markets are looking ahead to that fiscal stimulus. Predicting a steepening, looking at 1. 3 by the end of 2021. Do you see that happening . We do. We launched a whole product along that theme called the eyeball etf, which had the curve steepen are coupled with u. S. Treasuries, inflation protected treasuries. Whogree with goldman sachs, is actually my former employer. Rishaad nancy tell me, you have got this analogy that the equity market is tigger bouncing around and the bond market is eyore who is always a bit gloomy. Walk us through the analogy in a more detail. The equities and credit markets are like tigger. They are excited. The vaccine is coming. Fiscal stimulus is recovery is coming. Everything has recovered to the pandemic levels. ,hereas the u. S. Bond market take the 10 year treasury, quite gloomy. It is not normal idle. Prepandemic, we were close to 2 on the 10 year, which given the inflation target around 2 to the cpi was normal. The bond market is behaving like eyore equities and credit are bouncing off the walls. Rishaad lets take this a bit further. Hunny that winnie the pooh like so much and where is Christopher Robin . Who is getting it right i am suggesting to you . That thee that analogy equity and credit markets have their hands in the hunny pot. Be welltion is going to their hands get stuck . In the necke hunny of time or will we see a spike in covid cases and eyore to use the analogy of the bond market is actually the right one . Rishaad the question then is, will the hunny bee significantly more expensive than this time last year . Do you sit in that camp as well that perhaps inflation is one of the known unknowns . I agree with goldman sachs. The u. S. Yield curve is a very market based measure of forwardlooking Inflation Expectations. They are in the toilet because the u. S. Yield curve is about 60 basis points. If you think about what that means for a typical investor, if you loan money or you lock up your money in a bank cd, you get paid daily half a percent to lock up your money for 10 years. Rational a investor do that . It is because they are expecting a deflationary outcome from this environment. Rates normalize, where do you see yields . Will they remain low . Bei do think we are going to in a low yield environment for a very long time. That is why with the eyeball etf, we own about 87 of the fund is u. S. Treasuries. We do believe that Interest Rates will stay low for quite a long time. The question is, will the fiscal stimulus, the fed moving their it not a targets make firm level . In the fed not even thinking about raising rates, we think it is a terminus opportunity to add Inflation Expectations to a portfolio. There are very few things in todays environment that are stating that are trading below their fiveyear, 10 year, 20 year levels . Expectations and Interest Rate volatility are two things that are still discounted. Haslinda some are warning about more pain coming for the 60 40 allocations in the portfolio. What . 60 40, then how should investors be looking at it . 60 40 has been a quite good trade because we have had bonds and equities going up together and that has been really positive. I think the challenge for investors is if we had a stagflationary environment, that would be bad for both sides of the equation. Equities would selloff. Selloff. S would likely investors should be looking for ways to add asset class, diversify their portfolios, add inflation protection, add Interest Rate volatility. Many investors use the equity vol market. It is an important time to be thinking outside mainstream, being a little bit of a contrarian and looking at in financial assets, what is cheap . Interest rate volatility and Inflation Expectations are two things that are attractively priced. Rishaad that is all we have time for. Thank you for joining us. Have a fantastic weekend. Throughs coming considering we had the Chinese Markets shot yesterday. Typhoon known locally as ulysses hitting the country. The bond markets have resumed after the oneday halt because of that storm. News coming through from manila. Coming up, we have the rbnz governor saying aucklands are a signd19 cases of the uncertainties that lie ahead. This is bloomberg. Haslinda the head of new zealand Central Banks is the are a cases of covid19 reminder of the economy. The governor spoke to Kathleen Hays about what the pandemic means for new zealands economy. I think it means the same here as everywhere else and the answer is we cannot only think about a scenariobased we think about assumptions, create particular scenario and then do your best with policy. The challenge for us is that those scenarios can change so dramatically. Policy int monetary new zealand is based on an assumption that the International Borders will be open by 2022. That is a very bold assumption. Even with that assumption, we still having to maintain Monetary Policy. It shows the work that is head of Central Banks to keep inflation positive and to keep employment anywhere near a maximum sustainable level. For countries like new zealand, we have always got problems. Interest rates are so low. S8 rates are high. That means house prices. We are back at the challenge to law. Consumer inflation low. We have got her mandate our mandate. The Monetary Policy this Monetary Policy meeting this week, the outlook was boosted. You introduced the funding for Lending Program. Investors seem now to have stepped away from this absolute certainty. As soon it can almost, rbnz is going to move to negative rates. Does this auckland outbreak somehow remind you as policymakers, remind investors that may be it is still an issue that is alive and well, an issue that is on the table for rbnz . I do not think the reserve banks ever forgot it. We have gone to pains to explain to people we are crowding scenarios and not projections of certainty. Markets to be thinking forward. They know what we have to achieve. They know the instruments we use. I really do hope they are watching the same information. Growe economy continues to and do what it is doing, todays news around the coven just puts the covid just puts it back into perspective. Be prepared. Do not run around on predictions. How much are you depending on the new funding for Lending Program to give the economy the additional stimulus it will need to keep the recovery going and maybe again there will not be a need for negative rates if it does its job. One would hope it is a beautiful world and the sun comes up and covid goes away. We could we normalize Interest Rates. We have a lot of folks a lot of confidence around the funding for Lending Program because it is such an invasive way into the Banking Sector to provide very low cost of funding, which we will be on watch to make sure that is passed on to borrowers and investors. Really making sure confidence and cash flow exists. Is weallenge of course cannot force people to lend. We cannot force people to borrow. We can only create the environment for that to be happening. In terms of steps you might take next, you have mentioned purchasing foreign bonds. Have not taken that step yet. Is that still on the table . What will it do for you. What is the reason to adopt that step if you do . It is still on the table. It is not a preferred option because we do not think it would be as effective as the many other options. It is a way we are building up reserves. We could have more of those in foreign currency terms. That allows us to create the liquidity in the market that we need. It would also impact on the level [indiscernible] selling local. We do not believe it would have a Significant Impact really longterm. It would have an impact on the liquidity, not necessarily the Exchange Rate. We want to keep it there because we want to rule out options. We are comfortable where we are with the funding for lending and the quantitative easing program. Haslinda rbnz governor adrian orr speaking exclusively to Kathleen Hays. Now, the latest business flash headlines. Nissan jumped the most since midjune. Cutting a loss estimates for the current quarter. Million. Mates were 46 market estimates were for 30 times as much. Nissan has been cutting costs, restructuring its operations since the ousting of carlos ghosn. Ferrari has announced a version of it debut hybrid. It will match the power of its starting atrpart the equivalent of 560,000. Orders in october were up 30 . To movers ining japan as we head to the lunch break in tokyo. This is a look at some of them. Nissan on the way up. 7. 6 . The restructuring is perhaps working. Are you frustrated with your weight and health . Its time for aerotrainer, a more effective total body fitness solution. announcer aerotrainers ergodynamic design and four patented air chambers create maximum muscle activation for better results in less time, all while maintaining safe, correct form and allows for over 20 exercises. Do the aerotrainer super crunch. The prestretch works your abs even harder, engaging the entire core. Then its the back extension, super rock, and lower back traction stretch to take the pressure off your spine and stretch muscles. Planks are the ultimate total body exercise. Build your upper body with pushups. Work your lower body with the aerosquat. The aerotrainer is tested to support over 500 pounds. It inflates and deflates in less than 30 seconds using the electric pump. Head to aerotrainer. Com now. Now its your turn to lose weight, look great, and be healthy. Get off the floor and get on the aerotrainer. Go to aerotrainer. Com, thats aerotrainer. Com. Is 10 29 a. M. In hong kong and shanghai. Largest freetrade agreement is expected to be signed this weekend at the asean summit in hyundai in hanoi. Rcep is anchored by china but india declined to be involved. Brexit talks continued in london with both sides admitting serious differences still remain. U. K. Treasury wants to saying it is regrettable the block has not shifted its position. The u. K. Has unilaterally opened access to parts of its Financial Market and wants to see reciprocal action from brussels. Philippine Financial Markets have reopened after being closed by the passage of the typhoon. The storm was the 21st major system to hit the islands this year. At least seven people were killed. Currency and bond markets will be shut for a second day although equities will trade. The typhoon is forecast to exit the philippines today, weakening as it tracks to vietnam. A new report warns australia to expect longer and more destructive bushfires seasons, heavier droughts and more bleaching at the Great Barrier reef as Climate Change intensifies. The bureau of meteorology warning comes after fires caused 10 billion worth of damage and killed 33 people. The report says the trend increases the likelihood of extreme events. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im karina mitchell. This is bloomberg. Haslinda lets take a look at markets asia. Tracking losses in the u. S. All major encz marks in asia are in negative territory. The msci index down. Investors back to worrying about the resurgence of virus cases, tougher restrictions. Vaccine prospects are not enough to cancel out economic challenges created by the pandemic. The dollar pre