be able to lift the debt ceiling in time? and countdown to the german election. with just a month to go until the vote, what is at stake? ae ftp tells us it is wary of coalition with chancellor merkel. have less than a half-hour to go until the open of cash trading. maybe we'll get some movement on the ftse, it closed yesterday unchanged and we see futures up .1 of 1%. not really any moves in futures either but more than we see on the dax and dax futures unchanged. cac futures up what one of 1%. the market is in weight and hold mode. the last couple of days waiting to see what janet yellen does. president trump maybe spooked the market into some safe haven trades yesterday. we see them coming off today. take a look at the bunds, you yields coming back up, still miniscule levels on the german ten-year bonds at least they yields are rising investors get out of that trade. they did the same with treasuries, the yen and gold. in the safe havens and there is not a lot of action and markets as we wait for jackson hole to manus: the markets have decided to focus in on paul ryan's comment. basically saying the gop has no interest in federal shutdown and that is one that's what the market is looking at. the kospi up by .4 of 1%. the dollar is down by .3 of 1%. you can see the bloomberg dollar index is why -- of five and eighth of 1%. win andl for draghi to yellen to potentially lose. in a swansong? those in the questions the markets are asking themselves and what extent should we be worried about the debt ceiling? fitch have made it clear about the markets that they want a timely resolution to the debt is byg issue and it prioritizing who do you pay. let's get to juliette solly. house speaker paul ryan said he does not want to see a u.s. government shutdown after president trump threatened congress with that and -- unless it agrees to fund his mexican border wall plan. >> no one is interested in having a shutdown, it is not in our interest to do so. while we work on doing what we said we would do what we have done is to control our border. do not think you need to choose between the two. juliette: the u.s. is preparing another round of sanctions to punish the government of venezuela. would squeezetoll trading in debt. one of the people said the campaign to pressure nicolas sarkozy maduro and number doesn't -- no decision has made. you may be assured under the leadership of president, the u.s. will continue to bring the full measure of american economic and dramatic power to bear until democracy is restored. in venezuela. germany's free democrats say they are under no pressure to form a coalition with the christian union block after next months election. wasnior member of the fdp speaking exclusively to bloomberg. importance,not of bring our ideas through, get the organization running again completely. there is one thing still in the background. ,f we do not accept defeat [inaudible] will be a killer. juliette: charlottesville has covered two statues of confederate generals. the decision came during a chaotic meeting and follows racially charged protests in the town that left one woman dead. typhoonh toll from the has risen to 12. it is the most powerful storm to hit the chinese region in more than half a century. theeople were killed in gambling hub and another 153 were listed as injured amid extensive flooding and power outages. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. manus and matt. matt: thanks for that. talk downa chance to the euro but if he does will markets take them seriously? some concern was raised about the strong euro in the ecb's recent policy meeting. president draghi is expected to move further toward unwinding the qe program in the coming months. in an interview, ecb governor hansen said he is not currently concerned about the strength of the euro which is not a big change. is a bloomberg mliv strategist. with the euro react to , to jot owning as everybody knows he is about to unwind stimulus so it is not like he is going in the other direction amid what he says. -- havingink it would case, i haverish been hearing people saying we know that even if they try to talked down the euro it means nothing. it's not like they are going to intervene. any headline risk may not sustain. it would have to be aggressive dovishc, aggressively rhetoric or negative on the euro . for the euro dollar to sustain and last for a couple of weeks. >> is a possibility that mario draghi does get spooked by the euro and says, you know what, we're not going to taper qe here, we will go further. is definitely a chance. the expectation is buried in the market. ofre is a definite chance going back into a disinflationary environment. thosere not -- a lot of will be interpreted as maybe they are not going to taper anytime soon. that is the way of verbal rhetoric and does it sustain beyond the initial couple of weeks, it is hard to know. manus: we have written a number the economy parties like it is 1999 channeling alan greenspan who annihilated every fund portfolio at the time. there were a sequence of rate hikes that were unexpected and this is the risk. the economy looks like it did in 1999, an implement falling, core inflation falling. whether you attend corner and whether yellen is more reoccupied about asset values which were somewhat rich when she was here in london at the british academy. that is the risk for markets, isn't it? mark: definitely it is a risk and the market is wary but it is -- no one expects yellen will give any strong signals about policy and no one thinks there is a major reaction but there is the message,gives for the purpose of financial stability is important to looking aunt the immediate inflation readings. that is seen as a hawkish message. i do not think the analogy was 1999 is perfect. there is an expectation that would feed through to headline readings and that is what we got. a long inflation for time and with the way commodities are trading at does not look like we are set to get any sudden surge higher, we might get a small take up that note 7 surge. i cannot see the fed starting an aggressive rate hiking cycle. matt: is there any better we get a shocker here, what could jolt markets from jackson hole? that's one of the things as we might get no real surprise. we come to think about the jackson hole meeting that this is where new policy is announced. going toid i'm not give you anything interesting and yellen is not expected to give anything interesting. there's a chance that jackson hole is a down square area is back to the risk on we have receipt -- we have seen and investors will pile back in. i am -- i think volatility is higher and credit spreads are wider and there is a negative focus on the debt ceiling. even if jackson hole gets out of the way it would be a relief rally and we will trade lower again into the end of august. matt: thank you. you can follow mark cudmore's insights on mliv . bloombergyou are a customer you can watch the show on tv and you can get everything you need, all the charts and the functions and you get as much as me -- from me as you want over the next three hours and an hour and a half of matt miller. what more do you want? you have the ib function and you can pop questions through. investors change with the seasons. turnscuss how summer could into an auspicious autumn. that is next. this is bloomberg. ♪ matt: you come back to bloomberg markets, the european open. looking at a slightly positive open this morning although markets are in wait and see mode as we've appear for jackson hole. that's get the bloomberg headlines from around the world with the business lash with juliette saly. haidi: dixon scarf on has forecast an unexpected drop in profit as an increasing number upgradein's do not their phones. the average analyst estimate is 508 million pounds. beacon roofing supply has agreed division to- a new expand its footprint in new york . the acquisition of allied building product is expected to add to earnings in the second year of ownership with $110 million in annual cost savings earmarked from the deal. we can will finance the acquisition with $2.2 billion of debt. $13.7 billion whole foods deal won swift antitrust approval. the approval indicates it does not think the tie up will increase competition. president trump has singled out amazon for criticism. d fixede bank has halve income as competition mounts. according to three people with knowledge of its plants the german lender plans to charge asset managers 30,000 euros a year for up to 10 years is. a sports -- a spokesman did find to comment. providence financial has a zero value. according to its own advisor jpmorgan, providence home credit division may lose 120 million pounds for tax this year and 60 million pounds in 2018. the bank also cut its rating on the u.k. subprime lender to neutral from overweight and shredded its price target i almost two thirds to 1200 pence per share. that is your bloomberg is flash. we were talking about how european markets are a little bit overhauling in terms of futures and that is what you're seeing in asia but have a look at this chart, you can see the white line, it is outperforming what we have seen in u.s. equities even as we play the waiting game. asian stocks getting a bit of a boost even though today it has been fairly flat. if you have a look at the movers a lot of these apple and samsung's players rallying following the release of the new samsung phone and in anticipation of the new iphone. we have seen the nikkei closed down by .44% at hong kong coming stoppeder the typhoon treating yesterday and a good in hongming through kong stocks. we are awaiting cnooc and petrochina after the bell. stocks, signther ocean in hong kong rising 11% in late trade. closing higher by all must 11%, underlying profit [inaudible] for more words to the downside. hit by a 150 million aussie dollar charge to its discount unit big w. a flat to mixed finish as we round out the asian session. manus: thank you for the roundup. it has been a lackluster summer for european equities. the stoxx 600 and the ftse 100 following a seasonal trend but if in the last 10 years were anything to go by, it could we that you have an autumn rally on your hands to contend with. our guest is a senior equity strategist from bloomberg intelligence and he has been digging into the numbers. this is the fabled statement to sell in may and go away and buy day.int leger border --onal fashionable for the ladies to buy your partner a hat. what is the empirical research to justify the statement? >> as many -- much as we like to dismiss seasonal trends the king they should be arbitrage to way, over the last 10 years we have seen the typical average the stoxxe, -1% in 600 over the summer and up less 4% over the ensuing september 2 may period, call it the winter-autumn-spring rally. it happened many more times than not and it is true in the u.k. as well. this time around we have certainly seen that in kind with 1%, 2%. stocks down want tog what day you start the calculation from and it makes for an interesting set up as we look into the autumn in part because we have seen the summer doldrums and in part because we started at such a high base, if you think about the rally that we have enjoyed from last autumn through winter. which sets up also to interesting discussions about the supports and the risks. matt: it is not all about risks, bold casere are factors. what are the ones that could spare -- spiro rally? he goes back to the economy and underlying earnings. there has been a nice correlation with how relative stoxx 600 havee played through in terms of relative performance versus the european markets. there is a nice correlation that we have seen or relationship between forward earnings expectations for the stoxx 600 and the wrap up in the pmi that we have seen across europe since 2014. if you look at earnings 9%ectations, we have seen come through in terms of actual results for the first half. it is about the same, slightly less for the second half of 2017 and another 9% for next year. foundationunderlying is pretty positive. , by there we have the way, chart on the bloomberg that illustrates that. our bloomberg users can access this. this shows that correlation that you are talking about. with the price of the stoxx 600 divided by the msci world in blue and the earnings in white. that rise, that bounceback is and if it here continues that is only good news for people who are long and markets. manus: yep, you are right. if you are long let's see what your risks are. strategistequity create we are minutes away from the start of the trading day. we will look at some of the movers. dixon's car phone unexpected profit, drop warning for them. we will talk about that. deals.o doing who said cement could not be sexy? it is 7:52 a.m. we will be with you very shortly. ♪ manus: 7:54 a.m. in london. dixon's car phone has issued an unexpected drop in profit. the estimate was 508 million pounds. currency folks rations will make it more expensive they say in terms of buying your handset on the day that samsung launches the 8. and roaming charges or taken away so that will hit between 10 and 40 million pounds a year. what have you got, cement. irish globalan materials construction supply company selling its american distribution unit. crh is selling its distribution eaconin the americas to b roofing. that islion for crh, the story. we will watch it at the open. the open is next. ♪ ♪ 7:59. i have an good authority that there is a strange to being played in berlin, but i leave met the link to explain. stocks are called higher, the world is focused on paul ryan who has to get gop reelected in 2018. the market is focused on paul ryan's comments back the gop are not that interested in -- they want a timely resolution on the debt ceiling. despite higher opening warning to this: to be tough times in the u.k.. idiosyncratic day. only listening to violin because i was reminded of the 1980's, this debt ceiling scott -- tsonga -- saga. of the debteting up ceiling in the 1980's at this point in the last 10 or 20 years, it seems there is no reason at all to have it, it continues to climb and you see this chart on 9426. all remember the 1980's, but you remember 1999 in the bonds market? some are tortured going into the early 2000. bought a lot of bonds, what a tortured soul i was. waiting for jackson hole, is this the same period of time that janet yellen is facing as greenspan did in the 1999. they like their earnings, they like what they see. set for a slightly better open. nejra cehic can bring us up to speed. morning, i am starting with the gilt market open. we saw the 10-year treasury yield lows is close -- lowest close in june yesterday. it looks like the 10-year gilts yield is following somewhat here. are on theere we gilt killed at the open. it looks like we're edging higher on that. if we move on to the stoxx 600 at how the industry groups are shaping up. the benchmark higher by some .2%. european and asian shop -- stocks shrugging off losses in the u.s. yesterday. material stock outperforming, we're seeing -- on the front foot following closely behind most industry groups in the on the stoxx 600 at the open. sterling, a third day of decline for cable and this chart is showing pound net short. we're basically seeing the sincet stretch of shorts 2010. -- extending short positions on the pound to 21 months. we talked about sterling weakness and the impact to the ftse, this is comparing the ftse versus its european peers year to date. this is in euros, but the u.k. index very much underperforming and guess what. in terms of the 20 steepest single day of losses in 2017 on the stoxx 600, u.k. made up 11 of those. >> thanks very much. i am looking at the individual movers in the market. the mov screen on the stoxx 600. crh, as far as gainers, i have a percentage change. crh at the top of the list. the biggest gainer of the 600 companies on the ss -- sf xp index. we talked about the fact that this company is selling its america's distribution company for two point $6 billion. another interesting maria highlighted, fiat chrysler. fiata report our -- chrysler is considering spinning off both its maserati, which i find very interesting, that could unlock some more cash has the ferrari spinoff did, and also the parts unit. the very famous parts unit, the poor is raised parts unit from fiat chrysler. that would be interesting as far as losers in protect -- percentage terms, easyjet is one loser. 1.8% drop, as well as h&m, almost down 1%. don't have any really massive movers here, with the exception of some core -- simcorp. manus: matt, thank you. let's talk about donald trump in the thread about a shutdown of the government. over the border wall. concerts across capitol hill. he hinted he would veto a bill that doesn't fund the wall. congress needs to pass a spending measure to keep the government open, but it is also facing the deadline to fake -- raise the nation's debt ceiling. paul ryan spoke during his visit to oregon. >> i don't think anyone is interested in having a shutdown, i don't think it is in our interest to do so. while we work on doing what we said we would do, what we have been in the house and need to do, which is control our border. you don't choose between the two. , the: joining us nowmanus: global strategist at allianz. you have seen this party, you have seen this before with all this was -- all due respect. you have seen the punch outs when it comes to debt ceiling. paul ryan, from my reading, this is why markets became less perturbed. ryan is not interested in shutting down the government. what do you see as the biggest risk? are seeing post-removal of mr. bannon from the white house is an uncertainty as to how the trump agenda is going to dovetail with the republican party. we look slightly more strategically at the concerns of the republican party to maintain dominance of cash in november 2018 have to offer something on.ident trump campaigned cash repatriation, personal tax records, something has got to be delivered to the electorate, otherwise one feels republicans will lose majorities in congress. i think that is where history shows the debt ceiling issues have always backfired on the people in power. clearly almost negligent according to the eyes of the electric. at this moment in time, i am isfused about how bad leaving has almost isolated president trump in terms of what he was elected on. matt: i want to quickly mention, dixons carphone warehouse, anybody outside u.k. is unlikely to know this company. itillion pound company, but is worth 20% less now than it was 10 minutes ago. dixon's falling by 1/5 right now and profit down on the mobile phone market. neil, notteresting, to talk about a specific company, but to talk about the fact that specific companies make mistakes and move apart from what the entire market is doing. do you prefer to invest in a company based on what it is doing or do you prefer to invest across a sector based on more macro movers? neil: no, we are very company specific and just to give you a more -- a little more company -- color on dixons, he had the result in the last couple of months and didn't for shadow any of this current disappointment they are reflecting. this is a significant disappointment. consensus is now for less than 400 million pounds of profit, or as the market was looking for over 500. down 20% is maintaining the same valuation on a company that has significantly disappointed this morning. manus: for me, this tells me something more significant. i think this shows there has been a dynamic shift in the consumer. the british consumer has now broken up. a myriad of bad news pieces. i'm not saying it is brexit, but that has a ramification. neil: i would agree in terms of buttenor of sector levels, what i would say specifically -- and i'm the wrong generation to understand this, but if your iphone is working, people don't need to have the next box of tricks. although the new samsung is out today and we are getting at the one 10, aof the iph lot of people are thinking, if it is working, don't upgrade. i do agree you can read into that two things. one, the u.k. consumer is feeling more and a pressure, but the second thing is many of us are sitting there thinking why spend even more money on a piece of kit that does the same thing of what i am used to using. maybe dovetailing at that time. matt: i think it is an interesting comment on dixons, on the consumer. hand, crh in the news for selling its america distribution unit for $2.6 billion. by the way, that is about the entire value of fictions -- dixon. saying that heis really still sees a vibrant u.k. economy and he wants to still invest in the u.k. economy. i wonder what you think about the differentiation between the high street economy, i think you call it in london, kids on the street buying car forms -- carphone warehouse us, and the institutional economy, something like crh would make any on, is there a difference between the two? there is ank significant district -- difference because we are still seeing support for the house and it and -- industry. another runway at heathrow, maybe more railway lines and other things going on, i think the building side of it probably looks into the next three to five years with a relatively positive outlook. which i think is different from the people earning money and haven't had a real pay rise in nearly a decade. wpp has had a small recovery this morning and i emphasize the word small recovery because if we look at what has gone on in the stoxx 20%.wpp down more than leader of the company said a lot had to do with the kraft bid that went awry earlier in the year. he warned about an industry that is racing to the bottom in terms of fees and digitization. is interesting how he warned about consumer goods and this is another theme in terms of the ad spending. what does the bpp statements a to you? one of the biggest advertising companies in the world, what did that take to you about the state of play in the world? we felt that quite a few of us have been cautious under bpp inside the company because nearly 60% is coming to google and facebook and not the hands of wpp. what the kraft bid, the pressure and others is showing his many companies are finding it easier to cut their costs. manus: or are activists pushing them off? neil: to some extent, they are but zero budgeting, all of these issues dampened spending in europe or the u.s., it is suggesting to many corporate that they don't have to spend. i always go back when i think about advertising, how i react to it personally. one of the famous advertisers said, i never know which half of the advertising is of any good. if you think half of it is a waste of time, maybe we are going through one of those phases where some martin sorrell is seeing some of that margin is slipping to his fingers. , stays withdwane us. what we? brexit. will talk about we won't forget to discuss brexit today. we look into whether the u.k. has done enough to begin trade talks in october. you will never tire of the brexit stories. this is bloomberg. ♪ ♪ breaking on dixons carphone warehouse. we have been talking about the , 24.8% dropping 25% now i believe is the drop we saw. it has been halted in trading after the huge plunge. had a profit warning on the mobile phone market in the u.k., and as a result, shares have dropped. the value of the company has dropped by one quarter now. the trading has been halted in london. continuing to look into this dixon story, although it is a small company, it is much smaller than yesterday. worth about 2 billion pounds. i want to stay in the u.k.. we are going to continue talking about the situation in the u.k.. manus, want to talk a little brexit? manus: ever far from the brexit convocation -- conversation. we talk about progress in the brexit discussions, there are a number of questions that remain unresolved. theresa may's government is still unclear about its divorce bill. citizens rights, the border. on data protection, scheduled for release later today. global strategist neil dwane is still with us. is the latest series of papers, the one that caught my eye is the latest story. u.k. once the eu not to play hardball. why does that matter? the u.k. contribute 16%, spent 7 billion pounds into this country last year. this is the part of brexit that gets very -- very little bearing -- airing. some of the good points about a close relationship with your neighbor. neil: absolutely, this is part of the bill. how much are we going to leave in the 10 and how much will that return to us? this type of issue, there are so many things that many of us are unaware of the complexity of undoing all of these knots we had on the -- done over the next 45 years. we still default to the fact it is uncertain. has your headline started with today, we still see the main difference between the u.k. and italy or spain, or greece in its difficult times is sterling can take the strain, therefore we are more relaxed about the economic and financial impact because the currency can reflect whether it is going better or worse. neil, are u.k. negotiators a little too optimistic here? position to bea warning the eu about how negotiations should show -- go? neil: you and i would probably accept even by house, and you can have strong words for the person on the other side of the conversation. i do think it is good we feel we have some teeth and muscles to show from time to time. senior investors at allianz, we feel the one outcome that is most unlikely is the one which hit the deadline of march 2019. we are thinking about the likely outcomes of no deal or a transitional deal, because it is just too complicated to see how we can meet something like an agreement in the next 12 months so we have five months to get it approved by what seven countries and our parliament. manus: in many ways, that is a european affair. go to the wire, take sure there are only a few left in the room, somebody sign something. the pound.about the moniker is this. short positions on the pound have been rising for 21 months. it is the longest, most pessimistic period of time since 2010. there is them to sell the pound should they become more concerned. my interpretation of what you said is you concur, and the risk cablemore sterling than -- euro-sterling than cable. neil: we think the most undervalued currency in the world is the euro. it is not a surprise to us in fundamental terms. , sos: let's pause that groggy is not bothered and where can i go in a relative sense? neil: let's say on a strategic, maybe three year view, it is another 15% of the from here. so the pound we also think is undervalued by about 10% to 12%. but we think it can go down if brexit -- we would then be looking at selling -- telling clients globally to buy certain -- sterling assets. short areand interesting because i would argue most of the corporate and crew investors are worried about brexit have already taken protection on their sterling assets. in which case this is speculation -- >> dirty, fast money. and generally, when they are at record lows, they lose money because the currency goes the other way because someone moves from one side to the other. i would call that a neutral position even if it has been there for 21 months. i would be worried if the shorts were lower, but i would be looking to see a bounce in sterling once they got there. matt: he was going to stay with us, neil dwane, global strategist at allianz global investors. he will stay with us. next, the big movers in today's trading. we will include exits carphone warehouse, though not currently moving. the stock has been halted after it dropped 24.8%. this is bloomberg. ♪ ♪ welcome back to bloomberg markets: the european open. we are looking at stocks in europe that have moved from the open. first up, then down. and we see little change on major indexes, but the rest of europe is a sea of light red. nejra cehic has your mid-cap movers. nejra: let me start with dixon's carphone warehouse, trading has resumed after halting. we are down more than 30% on then's carphone warehouse, uk's biggest electronics retailer and forecasted drop in profit this year. market, noted the as an increasing number of britons opting not to upgrade their mobile phones. what wasng also stops an unblemished record of profit growth since dixon's carphone warehouse was merged. to investorto add concerns that dixon's carphone warehouse sharply exposed any slowdown in consumer spending and the stock before today had seen its share price dropped by one third already. we will see how far that goes today on dixon's carphone warehouse, on the upside, sunrise communications, a telecoms company. this session has hit its highest since june 2015, or the 5% at the moment. some second-quarter numbers, sunrise saying full-year guidance increased. it has also been raised to a buy. that feeding into gains. , games haverose moderated somewhat but this company raising its output estimate for 2017 after posting rest -- record production in the first half of the year. thank you very nejra cehic with the latest. you european complex. the idiosyncrasies of markets are that if you have a bad story, you will get battered. financial, the carphone warehouse story. if you have a bad story, you will take a punishment, but over all of these european equity markets are focused on the french data, german data and proclivity of the central bank to tolerate a move higher in the euro. that is the point. markets are a little firmer as we count down the start of jackson hole. that is the state of play. we'll talk a little more of what some people say is a draw fest. it is bloomberg. ♪ ♪ matt: central bankers had west. yellen andwait draghi's jackson hole speeches for clues about the path ahead. how much will be revealed at this year's summit? up against the wall. comes government shutdown threat triggers worries in the markets. how likely is it the u.s. will be able to lift the debt ceiling in time? and another countdown, this one to the german election. with just one month to go until the vote, what is the state of the race and what will the coalition look like? in an exclusive interview, we are told it is wary of teaming up with chancellor merkel. welcome to the european open, i am at miller in berlin alongside manus cranny at london. manus: 30 minutes into the trading day, let's see how things are shaping up. european stocks are a little better bid, london up .2%. really, the market focusing on the jackson hole be a exercise? there is no greater indication from mario draghi that he is worried. is he worried about the euro, mr. hansen certainly isn't. overnight, london up .2%. for me, more interested in paul ryan's comments that the gop administration is not interested in a shutdown. that is what i think markets are focused on. let's talk about that gathering of central bankers at jackson hole. will have a chance to talk down the euro if that is his choice after months of gains against the dollar. even if he does, what markets taken seriously? while some concern was raised about the strong euro in the ecb's recent policy meeting, mr. grassley is expected to move further ports unwinding in the coming months. neil dwane is a global strategist at allianz. here we are, no matter what, mario draghi says should he choose to use the warning like about whether currency is important, has a magnificat impact on our economy. qe isrket has in its head coming to an end. it is merely, we only go to war or haggle about the dots. it is coming, so why would i want to short the euro? neil: has you can tell, i wouldn't be shorting the euro. but i wouldn't be expecting for him to say anything in jackson hole because i think the calibration in september and october with the german election in between is something he will still -- which we have argued all year -- people want to be on the political sidelines until he knows what has happened in germany and i think that means they will set the scene in september, probably start executing a clearer roadmap in october. as ane won't want to do italian is anything that maybe prejudices the run into the italian election in april or may next year. wouldn't he be tempted to repeat a trichet brutal moves kind of phrase, i'm sure he sees the value of the euro similarly to how you do, but it is the speed at how it gets there that worries him? neil: i would agree, but would give you one other angle. he has sounded all your quite frustrated that he is doing a lot, but politicians around the world are doing little to increase competitiveness in their economies. a stronger euro outside germany is a warning sign that politicians need to stop. one level, provided it doesn't move too quickly or much further from here, maybe he is happy for that to tighten the pressure a little on mr. macron to get on with some real reform in france and set the bar for the italian elections next year. manus: i don't think ambiguity works anymore. i think around the world, you need to say it how it is. i've got something for you, i will put a proposition to you. what is the risk and reward for janet yellen? risk, transitioning to a balance sheet reduction, we've got that. the transitory nation of inflation. asset values, she has her concerns. she said it at the british academy in the u.k. i decided to check those three, put it together with triple c rated paper. i haven't been to belarus, but mongolia, belarus and ukraine, this is the quantitative easing around the world and to reach for yield. there are summary in signs. if these governments are able to borrow at sub 6%, i think we should be worried. i agree, but i also think 100 year bonds are an interesting phenomena because we know in the u.k. our perpetual's have only done one thing and lose capital overtime. qamar two things i would disagree with. not bek inflation may transitional. it has all been about oil but inlook outputs are tight but the u.s. and japan, the labor markets are changing to a point or they should be wage inflation beginning to return. only in europe do we have low employment in the countries you can see the economy can grow further before inflation pressures emerge. andk inflation isn't dead strategically, we are telling our clients inflation is the answer, because we will not pay back the debt we have borrowed around the world. we can only default on it through inflation. clients have to think about their portfolios in terms of protecting the purchasing power of their wealth. for your pension, you have to think in 10, the old one-pound coin bought a pound in 1983 and buys 37 today. the new is worth one third of what the old is worth. he won't be impressed with me as a pension advisor if i do the next -- same in the next 30 years for your savings. if you see inflation coming, and i'm sure you see mario draghi will start the taper before he sees the whites of its eyes, how do you deal with that in your portfolio? what do you do to protect against the taper? neil: there is a dynamic here that -- there was the market and liquidity dynamics of the tapering, particularly out of the u.s. much of the spread products around the world, when the fed becomes a seller of assets or drainer of these assets of liquidity through the market, this is the first stop and flow effect we have seen for a decade. everyone is trying to figure that out, but from an investor perspective, if you think over the longer term, we will have two or 3% inflation for the next 20 years, you have to protect the purchasing power of your wealth. or ecb, theyboe are trying to hit a 2% inflation rate. in a decade, they have lost 35% of the value of your money. the future will have a shock, but briefly, what is the best way to protect myself? i'm going to ring the financial advisor after this, what message do i give him to protect me against risk inflation in the next 15 years? neil: we think it is to own wealth argued, high-yielding, high-quality stocks. evaluation ishink more attractive in the u.s., but you own yield, it is less volatile than the markets themselves and will compound the returns to deliver you an inflation-proofed solution. manus: i need a lot of solutions with a lot of proof. thank you so much for being with us. that is neil dwane, global strategist at allianz global investors. he will join us on digital radio in a little bit. tv , if you haven't had enough of matt miller and anna edwards, you can always go back and look at it again. tv, you geton your the charts, you get to joining if you are feeling frisky, pompous a question. you have the ib at the bottom of your screen. you know you want to, you just have to be brave. becomeext, could be ftp coalition partners for the second time in pucci chancellor ships. he talked with senior member of that party. this is bloomberg. ♪ ♪ this is the european market open. let's get into some of our top stock stories. nejra cehic is standing by. with thearting gainers, the global building materials company crh based in dublin, selling its america about $2.6n unit for billion. crh said it is a chance to catching on a business it spent more than 20 years building by acquisitions, providing funds to enter fastest-growing set -- segments. america distribution has been a part of crh for years. crh announcing the acquisition of a german supplier of aggregates. we also got numbers from the company broadly in line with how analysts have been commenting on second halferms of crh expects that to be ahead of 2016. a number of things lifting the stock today. hitting its highest since 1998. according to people familiar, elliott management is buying additional shares in stock -- stada in attempts. we know bain capital and elliott could surpass 10% according to people familiar. , and on the% downside, dixon's car phone still trading, it was halted decline.ue to unexpected drop in profit this year. this as an increasing number of returns opting not to upgrade their phones. also halting an unblemished record of growth since dixon's carphone warehouse was formed in a merger. likely to add to investor concerns. the company is exposed to a slowdown in consumer spending in u.k. dixon's carphone warehouse, down 32.2%. manus: sebastian salek has your first word news. tom: house speaker paul ryan says he doesn't want to see a u.s. government shutdown, that after president trump threatened exactly that unless congress agrees to fund his border wall. >> i don't think anyone is interested in a shutdown. doing what weon actually said we would do, what we have done already, which is control our border. you don't have to choose between the two. sebastian: charlottesville has avered two statues after chaotic meeting packed with irate residents and follows racially charged process in the virginia town that left one woman dead. typhoon hasll from risen to 12, eight people were killed in the gambling house, another 153 were listed as injured amid flooding and power outages. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. all right, thanks for that. germany's pre-democratic party could return to parliament after a four-year absence, raising the possibility that angela merkel asks it to be her coalition partner. should she win a mandate for another term in power, which right now almost goes as a given. interviewing the party to question if it would be a pushover, and asked the senior member of the party's national leadership, here is what he had to say. otto: the main thing is about, can we change a very well running country and make it fit for the future and to be fined coalition partners willing or , at we fear and see chancellor says it is the same as it has been, slightly different. trust me. matt: we are by the director of the richard holbrook for at the american academy in berlin to discuss what to expect. it stock about the results of this election. everyone is assuming it is a done deal, angela merkel will win a fourth chancellorship. is that fair? go and four weeks to when you look at the numbers, and they haven't moved over the att two weeks, when you look it four weeks before people go to the polls, the likelihood of fundamental changes fairly small. you for unexpected stuff can never foresee, but the trend looks pretty solid and when you look at the discussions behind the scenes, you can see, especially on the social democratic side, the ones who try to unseat her, how they are debating alternatives after the election. matt: one of the interesting things this year is there are so many undecided. i think 40% express and was the underecent all i saw, cided. does that mean those people don't care? they see no difference between the two parties and they won't even go vote? or does that mean they are still researching to find out who they want to vote for? jan: my feeling is this is something else. for the most part, people have made up their mind. most will claim up to shortly before the elections they are undecided when they're not. most of them have the stomach feeling, an age-old preference, a traditional way of thinking about stuff and this is mostly where they go. undecided,they are this is just what they say. for the most part, people have decided by now. manus: good morning to you. broaden the conversation to the global perspective, merkel went to the u.s., there is a great brouhaha made over the lack of handshake, the body language. ofm curious for your take how global politics days in germinal -- germany? does it? is it core german-turkish politics that play into this election? part, this isost like every election you can see in western societies, which means it is focused on domestic issues. i think the mystic issues dominate the political debate in this campaign. that you are right, there are issues on occasion that make their way into the debate. the relationship is one of them. donald trump has the future of transatlantic relationship is one. in europe after the election of macron is one, what is the reaction of germany? we also have a bit of security and nato debate. there is the occasional influence of those issues, but it is like everywhere else. it is the -- domestic stuff that matters. matt: are we seeing backlash from the u.s., the sort of ultra-right-wing terror, the murders, the racism we see in the u.s., is that the road in party?ularity of the years ago, they were polling in the teens and with this almost racing -- racist rhetoric. now they are polling at half that. is it because of donald trump and charlottesville, they are losing momentum? jan: i think charlottesville is too isolated event to have a measurable impact over here, but the trump phenomenon is said to have an impact on the fortunes of populists over here in germany and europe. people now have had the time to check donald trump against -- his delivery against his promises. they see populists do not deliver very well and as a consequence, in france they have elected a different kind of person and in germany, the numbers are down. but do not underestimate the right-wing party here to be able to he wrote itself. they turmoil and the fact don't have much residents place into the numbers. matt: some extent, the voters see we happen -- see what happened with trump, brexit, we don't want that. movement ispulist an international movement. for the first time in history, these populists have a shared master -- message. as a consequence, when the fortunes of those people go down, it has an impact elsewhere. sense, trump has probably pushed the numbers down a little bit. to what extent, we will never know. there were populists with a shared message in the 1930's, the one i am not making that comparison directly. director of the richard holbrook forum in berlin. , deutsche bank is said to have slashed the price of its fixed income research current find out by european regulations could weigh on the sales side. we talked missives next. this is bloomberg. ♪ ♪ deutsche bank is planning to have the price of its mixed income and macro research according to treat people with knowledge of the plans. the german blender is proposing a 30,000 euros a year charge for up to 10 users. that is down from 60,000 euros. the competition is mounting as we run up to the regulations. deutsche bank spokesperson declined to comment. to discuss pricing is hammer markets team -- our markets team member. who is going to charge more? the bond teams or the equity teams? how is the landscape looking? >> at the moment, deutsche had 30,000utsche from a 60000 and this is among the cheapest for fixed-income and macro gain. the price changes depending on the offering. income --en fixed 120,000 euros, those are more or less cyclical because for equities, we have seen jpmorgan asking less -- up to $10,000. it really depends on the offer and what they are offering. accesstance, if there is to the analyst, it would be more expensive, while the access to research is going to be cheaper. matt: who is the most expensive -- what is the most expensive request out there? is there a birkin bag of research? well, it depends on the offering. for equity, we have seen the cold package at barclays be $400,000.over are reallythe prices changeable because it depends on what they are offering. what is more expensive in axis, having the freedom to contact your analyst and what is going on, what is the best investment? that is going to be more expensive. access to only written research is -- the price is already going down. manus: thank you so much. stefania on the cost of your research. a quick line from opec, they say they are planning to invite libya to the monitoring committee. for an extension are on the table. this is bloomberg. ♪ so we need tablets installed... with the menu app ready to roll. in 12 weeks. yeah. ♪ ♪ the world of fast food is being changed by faster networks. ♪ ♪ data, applications, customer experience. ♪ ♪ which is why comcast business delivers consistent network performance and speed across all your locations. fast connections everywhere. that's how you outmaneuver. watching wyoming. investors prepare for yellen and draghi's jackson hole speeches. will markets get any clues? againstsee parity single currency? we get the latest snapshot of the u.k. economy. can samsung's new smartphone restore its reputation and extinguish the memory of the note 7 debacle? this is "bloomberg surveillance ." let's check in on the markets. asset