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tv   Bloomberg Daybreak Americas  Bloomberg  July 8, 2019 7:00am-9:00am EDT

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it's a massive revamp of the fifth bank, recalling a of its workforce and scrapping dividends. jay powell in the line of fire. president trump keeps up the pressure to cut rates as the market prices out further rate cuts this year. erdogan flexes his muscles. did turkish president fires the head of the central bank -- the turkish president fires the head of the central bank. the lira falls, equity sells off. david: welcome to "bloomberg this monday, july 8. a little something going on in france. it was a great game. aix: their second win in row? david: that's right.
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alix: even president trump took to twitter to congratulate the team, versus a couple days ago, when one of the women said we are not going to the white house, and he said why don't you win first. now apparently very proud. david: it was a great game. the u.s. was really taking it to the netherland for the first half, but they kept it up in the second half. alix: go team usa. in the markets, you have powell coming out in the next couple of days. drive up market reaction for this week. euro-dollar lower by 1/10 of 1%. the dollar getting a little bit of steam in the last 20 minutes of trading. crude also quiet. it is a quiet market with idiosyncratic events turkey, like deutsche bank. david: what a nice word to use. alix: right? david: idiosyncratic.
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time now for the morning brief. today, british conservative party members mail in their votes for the next prime minister, widely expected to be boris johnson. on tuesday, the allen company conference gets underway in sudden valley. we also get chinese cpi and ppi numbers. wednesday, fed chairman jay powell begins two days of congressional testimony on fed policy and releases minutes from his most recent fomc meeting. alix: time now for bloomberg first take. we are joined by gina martin adams and marty schenker. our top story is deutsche bank and the restructuring there. a huge revamp, from cutting about 1/5 of its workforce, restructuring its business. is this enough to save the bank? gina: it's a good question. analysts are naturally going to be quite skeptical. this is years of attempted
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changes at deutsche's. there was a failed merger earlier this year. the long term outlook is slower roe growth than the rest of the sector, even with changes. i think analysts are naturally skeptical. what are we going to get out of this? how far is it going to go? is searching for guilt, so cutting the dividend is also going to cut the outlook for this group that is still pretty depressed, so there's not a lot to be excited about. i think you have to see these changes implemented and see real results before analysts get on board. david: they had no choice. they had to do something pretty dramatic, it was clear. the question is, will they make more money doing this? they will save money, but will they make more money? think about it,
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this is back to boring banking. it is taking deposits and providing customer service. that is where deutsche bank is going. is it highly profitable? no. is it safer then where they've been? for certain it is. but what kind of bank is it really going to be? just a to domestic consumer bank, basically. alix: to this point, all of the analysts are saying short-term, this is a good positive. david: there's a lot of regulators that said that is what you should get back to. alix: and now they have the job cuts to come with it. marty: we just published a story that people getting their severance notices and leaving the london headquarters in tears , so there's a human toll to this, too. alix: so where did they go? what area of the banking world can absorb either the market share, the clients, the people
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who lost their jobs? gina: it is tough. yields are suppressed around the world. where is the growth? it is a huge question for the financial sector at large, but in financial terms it is clear there are stronger growth prospects in asia and the. u.s. than europe. you can't say it is -- and the u.s. than europe. you can't say it is extraordinarily strong, but at least there is growth. there's much stronger topline growth than in europe. that's one of the reasons why u.s. financials have outperformed over time. are you going to get superstrong job growth that absorbs all of this excess labor? it doesn't seem likely this late in the cycle. that's where the human toll is going to be relatively high, provided that deutsche's is successful at cutting as many jobs as they suggest. this is another question mark. how many jobs will they be able to cut, especially in germany? david: there's one job back in
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the united states that appears to be on the line, and that is jay powell's as president of the -- as chairman of the fed. pres. trump: if we had a fed that would lower interest rates, we would be like a rocketship. but we are paying a lot of interest, and it's unnecessary. but we don't have a fed that knows what they are doing, so it is one of those little things. david: rumors continue that the president is really considering moving jay powell aside, something that has never been done. marty: no mind there is some question about the legality of doing that. the fed has made it clear through its spokesperson and jay powell himself that he intends to serve out his four years. i think that if donald trump were to try to do that, there would be a legal challenge to prevent him from doing it. david: it hasn't made him hesitate so far on immigration control, on issue after issue. he's got somebody lawsuits going, you can't even count them.
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marty: and this might be one of them. what he's really done is create an environment where if the economy stays strong and the stock market is high, he can take credit for it. if it doesn't, he can blame jay powell. alix: does he have a point? you saw good jobs growth friday, but wages remain stuck. gina: i think it's a 50-50 right now. frankly, the s&p 500 is a rocketship. if you look at last week's gains, we are at all-time highs again. part of the reason for that is the premise or notion that we are going to have much easier monetary policy going forward, with the consistent stability of economic growth. frankly, i believe the fed is going to have to really balance for the july meeting pretty stable economic conditions in the later stages of an economic cycle. they would like to reserve some
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firepower for a true deterioration in economic growth. then you have the president swooping in, trying to change their mind, which only incentivizes them to make sure they state their independence quite clearly. so it is a really questionable what is going to happen in the july meeting. tothe interim, you're going see earnings come in for s&p 500 companies in a pretty depressed state, which is going to increase the need for some sort of insurance cut in july. but it is a relatively tenuous relationship right now because the economic data is not horrible. frankly, rates are still very low relative to history. alix: let's talk about the third story, which is turkish president erdogan firing the central bank chief. you can see what happened here. lira knocked down. equities knocked down. -- actuallyly hire
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higher. is this like president trump's dream? marty: it may be his dream, but this hold notion of air to gone -- of erdoganian theory that high interest rates because inflation and low interest rates keep inflation down is rather unique. i don't know that donald trump has that kind of economic footing for his comments about powell, but certainly erdogan is not letting anything stand in his way of getting what he wants. david: is this idiosyncratic, or does it read through to emerging markets more broadly? gina: i think it is more idiosyncratic. i think it is very specific to turkey. there doesn't seem to be this conflict between global leaders policymakers -- and monetary policy makers and the rest of the world.
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but you do tend to see when one emerging-market struggles, you tend to see the feedback through emerging-market assets. i wouldn't be surprised to see emerging markets take a step back. broadly this is not a testament -- step back broadly. there's intensive correlations between the groups within emerging markets to dismiss it altogether. alix: and you get fired now if you disagree with that monetary policy. gina martin adams and marty schenker, thanks a lot. great to see you. you can find all the charts we just used and more if you go to gtv on your terminal. browse the features, check it out. coming up, more on deutsche bank's radical overhaul. this is bloomberg. ♪
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viviana: this is "bloomberg daybreak." the saudi arabian budget airline begin the first carrier to officially drop in order for boeing's troubled 737 max 8. it reversed in order to buy as many as 50 of the jet. it will now fly only airbus planes. in march, the plane wasn't grounded -- was grounded after two fatal crashes. broadcom secured funding for its acquisition of financi -- of finance tech. to china now, where the venture capital bloom shows signs of
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turning into a bust. the value of deals there plunged 75% in the second quarter. the venture boom began in 2014, when alibaba went public in the largest ever ipo. that year, chinese venture deals tripled. that is your bloomberg business flash. alix: thank you so much. the banking bombshell. deutsche bank will undergo one of the most radical overhauls since the financial crisis in its latest turnaround plan. , andll cut 18,000 jobs quit its equity sales and trading business. >> we are taking the decision to retrench and step back from elements of our global markets franchise, and particular equity sales and trading. that is a significant step in rearranging the bank. alix: that is the cfo of deutsche bank speaking with bloomberg. joining us is david sowerby, anc ora managing director and manager, and
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is it going to be enough to grow revenue? guest: i think currently the, the question is not whether it is going to be enough. the current situation is that the measures are taking place from a position of a certain weakness in a backdrop of weakening economic activity and lower rate environment, so overall the circumstances probably will make it somewhat challenging. , the measures announced were needed to refocus businessesd focus on where deutsche bank does have strength. david: it is clear from the
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announced changes that they are going to cut costs and save money that way. is it clear in your analysis that they will be able to hold the top line? you can't make more money unless you keep revenue in, despite the fact you keep cutting costs. it depends a little bit. obviously there are certain sections that will be exited, and presumably because they were less making, so it is not all about the revenues. it is also about profitability of the business. bank perceivese that they do have certain core strength in which they want to invest, but i think at this point it is too early to see how revenue growth materializes. we do have an economic environment which is not really conducive to strong revenue growth, so it would be more about market share gains in some
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areas, and it remains to be seen how customer confidence is still there. alix: part of it is a sinner capital buffer -- is a thinner capital buffer. you think that is enough to make them not have to go back and raise capital in the market? ,onja: from our understanding there are multiple factors happening simultaneously. on one side, the business divestitures are supposed to make the bank less risky. it should rely less on variable thenue streams, and overall balance sheet will shrink taylor: -- will shrink. at the same time, it is our therstanding that restructuring unit in which the
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essence -- the assets are stored will be winding down. at the moment, it does not appear that there is a significant deterioration in capital levels, but nonetheless, it is something which very much depends on the way it is going to be executed, which we will be watching. david: how much of this is deutsche bank, and how much is a broader issue with european banks? i have a chart here that shows the ratio. the blue line is average for european banks. the white line is deutsche bank, down under $.25 on the dollar. david s: it is a story of lower lows on a secular basis. what you bank the last five years has compounded -22% to investors. not to take it to the home turf, but this index is barometer the last five years. i am starting to nudge up bank
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holdings, but it is domestic. it is jp morgan, citizens financial, and to get very territorial, allied financial used to be mostly autos, but they are moving into non-auto banking. they are growing their deposits. great loan portfolio, right type of growth on the digital business. i think you want to be upping your banks on the domestic side. alix: how do you do that when the 210 spread is still at 16 basis points? david s: i could forever not want to own the banks because of the basis on the yield curve, but if i look at the margin, the economy will get a little bit better on the lower interest rates. i think banks hopefully have still more sensibility when it comes to the regulatory environment. is the valuations on a spread basis are so compelling that it makes you want to nudge up your financial waiting. for the beleaguered value investor in the last five years, it is starting to become a much
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more compelling story. david w: interesting. sonja forster, thank you for joining us. david sowerby will be staying with us. coming up come turkish lira weakens after president erdogan surprises with the ouster of the central bank chief. more next. this is bloomberg. ♪
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david w: turkish president erdogan stunned markets over the weekend by firing the head of the central bank because he had not cut interest rates in accordance with government policy. we welcome now bloomberg's riad hamade. we've been hearing about his displeasure with interest rates. why now? why did he move now? reporter: i suspect he wanted to wait until after the election, which ultimately he lost, so there is a new mayor of istanbul
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from the opposition. expeditionere is that the central bank would cut rates. the inflation rate has been coming down, so since the central bank stood its ground ,nd decided not to cut rates that seems to have really annoyed president erdogan, and he decided to make a move to put somebody in place that he believes will, as you mentioned earlier, told the line of government policy. david w: putting aside for a thent the independence of central bank, is it possible that president erdogan is right? i will put up chart that shows a spike in real rates. point in thea sense that real rates are at the highest in the world, and inflation has come down.
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has beenous governor criticized for moving too late, so he had to increase interest rates more than possibly would have been necessary had he moved earlier. theink the governor took decision to wait a bit longer and get more evidence of inflation slowing, and to give the lira more opportunity to recover some of the losses it's had. the lira had been doing quite well so far this year. now you have president here making this move, which makes it really hard for the new governor when he will lower interest rates, as everyone had expected anyway, to argue he is doing that because of policy reasons rather than because he's giving into pressure from president erdogan. david w: thank you so much. that's our colleague riad hamade from dubai. thestors have been hit by turkish moves, but also by the
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chance of a rate cut. with us still is david sowerby of ancora. how do you look at this? there is a place for emerging-market stocks, a ratio to u.s. i think emerging markets have the potential to outperform u.s. markets by 1% to 2%. you just have to stomach the volatility that comes along with it. on a valuation and growth basis, emerging markets deserve a place in our portfolios. i'm not so sure about developed markets outside the u.s.. alix: where in e.m.? david s: that i think is the tougher question. in the case of turkey, 14% -1.5% toment rate, gdp -2%.
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it is simple to say asia, china, far east. that's the places where the growth rates are favorable. countries made start seeing a turnaround in fiscal policies that could be pockets of south america. alix: coming up, the market sees a smaller fed cut in july after friday's blowout jobs number. we are going to discuss expectations with prime bridge investment -- with pine bridge investment's chief economist. gain was 22 basis points, a lot of nothing. markets softer, but not a whole lot of movement. we are really waiting for fed chair jay powell to testify before the house and senate this week. this is bloomberg. we're the slowskys.
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we like drip coffee, layovers- -and waiting on hold. what we don't like is relying on fancy technology for help. snail mail! we were invited to a y2k party... uh, didn't that happen, like, 20 years ago? oh, look, karolyn, we've got a mathematician on our hands! check it out! now you can schedule a callback or reschedule an appointment, even on nights and weekends. today's xfinity service. simple. easy. awesome. i'd rather not. alix: this is "bloomberg daybreak." if you like most markets are taking a pause today, except for idiosyncratic factors filtering through. european stocks trying to eke
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out a game, but not looking successful. european banks down by 3/10 of 1%. still more questions about capital raising for deutsche bank. in other asset classes, it was a weaker dollar story, now a mixed dollar story. the big movers in emerging markets with the lira, the dollar up by over 1.5%. some saying it could have been worse as president erdogan removes a central bank head and says that higher rates cause inflation. i want to point out what is happening over in europe. the 10 year yield in greece 0.211. david w: who would have thought that greece is a safe harbor now? alix: i guess. david w: now it's time to find out what is going on outside the business world. viviana hurtado is here with first word news. viviana: european leaders are
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urging iran to reverse its latest decision to breach levels of uranium enrichment, but for now, no one is threatening to impose sanctions. iran says it will resume purifying uranium above levels allowed by the 2015 agreement, taking it one step closer to being able to build an atomic bomb. president trump joining a national celebration of the u.s. soccer team winning the world cup. the americans won their second title in a row and fourth overall. the president tweeting, "america is proud of you all." a week ago he got into a social media clash with star megan rapinoe. in greece, voters dumped the populace government in favor of the center-right new democracy party. a new primee minister with a mandate to fix the greek economy after a decade
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of problems. tsipras premier alexis conceding defeat, his party falling to 32% of the vote. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm viviana hurtado. this is bloomberg. david w: so greece has moved back to right of center. alix: what i love about this story is you still have all the same problems. you still wind up having to grow the economy with all of these budget constraints from the overall eu. tot because you are supposed be business friendly, what does that mean? you still have to grow with all of the debt. david w: everyone drags this thing out, but they swear the guy in yesterday. you've got to give them credit. let's turn back to the fed.
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fed chair jay powell has a big week in front of him, with two days of testimony on monetary policy before congress. one of those watching is surely going to be president trump, who's had a fair amount to say about him lately. michael mckee is here to take us through it. michael: wednesday the chairman sits down before the house and financial services committee -- before the house financial services committee. for the last year, the president has been attacking the fed chair on twitter very often for raising interest rates, even though the rest of the fed is raising rates along with jay powell. a lot of people think this is because president wants a straw man to attack if the economy doesn't look good on election day. on december 24, 2018, donald trump tweeted, "the only problem our economy has is the fed.
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they don't have a feel for the market. they don't understand necessary trade wars were strong dollars or even democrat shutdowns for more borders." here's a chart that shows what's been happening with the economy if you talk to ceos. they stopped investing because of trade wars and uncertainty. you can see how ceo confidence and they since investment in blue have tracked each other very well. as companies got more worried about what would happen, they stopped spending. broughtthe one where he in the europeans on june 19. are you draghi just announced more stimulus could cut, which immediately dropped the euro against the dollar, "making it unfairly easier for them to compete against the usa. they've been getting away with this for years, along with china and others." both the you want and the euro have -- both the yuan and the euro have gone up and gone down
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since trump took office. right now, both are a little stronger than the dollar, but the dollar has moved down a little bit now that we are talking about the possibility of a fed rate cut, perhaps as early as late this month. we will look at with the president has repeated over and over again. we had a fed that would lower interest rates, we would be like a rocket ship. we don't have a fed that knows what they are doing." he frequently argues that it's rates weren't high, the economy would be much stronger. economists disagree. but you can also see that even as the fed raises rates, gdp was rising. we had a couple of bad quarters, but in the first quarter we went back up to over 3%. so the president's tweets don't always track what is happening in the real economy, and for jay powell, what we will probably here again is the same line as conference.
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"i have four years, and i intend to serve them." alix: the open question now, where does the president have a point? if you look at wages spike the strong print, wage gain two tense ofmissed 1%. with us -- 2/10 of 1%. sowerby,till is david and joining us is markus schomer , pinebridge investment chief economist. markus: all of this talk about the president trying to influence the fed misses the point. government has always tried to do that. i came into the market in the 1990's in germany, would it was almost foreign to smirk at government officials who tried to do something for policy. look at what happens in turkey,
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for example. we only difference now is have twitter, so we are paying more attention to every word. but what trump is doing is no different than what any other country around the world is trying to do. david s: let's start there. the issue is whether or not we need an insurance cut or not. the market cure -- the market clearly feel so. mid-1990's, where we need significant amounts of rate hikes or rate cuts. we are close to a very stable equilibrium in terms of economic growth. one cut, maybe another next year, is what we think to avoid a serious slowdown. david w: let's talk about how much latitude jay powell in the fed have at this point. they say they are data dependent. at the same time, the market is really pricing and a cat. it has come up a bit since friday because the jobs are so they really have
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much of an alternative? central banks around the world are going the other way. are they going to have to cut in july? --david s: as an investor, i one flow inflation. i think that is the fed's number one mission. they are a little less than 2%. that makes it a very good backdrop to be a stock investor, and that is the story. please let the fed do its job of independence. take care of the tariff uncertainty. that has the potential to erode parts of the tax cut. alix: when you take a look at with the market is pricing in or not, are we going to look at a way of easier financial
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conditions. and how we are rated for that, or not? david s: --markus: i think we are looking at easier financial conditions. only sweden and norway and some , buts raise rates to early everything else has changed now. i think the strength abroad, with the bank of canada ready to .ut rates david s: if we cut rates again, we will effectively be back to 0% real fed funds. i don't know if that is necessary in this economy, where the real cost of capital is still very low for businesses to be borrowers, to spend. confidence in need uncertainty removed. alix: and if it is priced in,
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what is going to be the catalyst? andrew sheets of morgan stanley is now saying that global letter -- that global allocation is the highest in five years. >> we looked at the g20 and did not think that changed global gloves -- changed global growth outlooks. if i look at how much morgan stanley is actually expecting equity markets to make over the next 12 months, it is one of the lowest levels of the last five years, so it seems more logical, more reasonable for us to lower our equity weight to the lowest of the last five years, and that's what we did over the weekend. alix: part of that is if you have the central bank cutting already priced in, what is the catalyst? david s: how much more can the fed cut? alix: so is there a catalyst? what stocks do you own in that moment. david s: i think small caps look
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very valuable. that is usually a good backdrop 12 we talked about upping the financial weight on the margin. i think that is the place to be. if you can find stocks growing their dividend who have 14 times earnings, you will be well placed within the market for the next year and a half. banks have been so active in the economy. they actually are depending on them. problem with is a the conventional my lessee that .- with the conventional policy you are absolutely right.
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there is a dangerous conflation of interest between central banks and governance happening everywhere around the world, and we should be a little worried about that. david s: the whole notion of modern monetary theory, if i thing about risks that keep me up for the equity markets at night, that is probably number one. the returns should be linked to taxes. alix: thank you both very much. some breaking news on thyssenkrupp. planningny will now be to start formal talks to sell its stake in its elevator unit in the fall. it is a $16.8 billion unit. they were approached by a number of potential bidders. the question is how much can a
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raise for it. of an ipo, the elevator unit. david w: they've been working on this for some time. that stock up by over 2% on the news it will probably sell stake in the elevator unit in the fall. coming up on this program, departures at deutsche bank. the troubled lender sees some top. executives leaving where they go -- some top executives leaving. where do they get? directly, goith us to gtv on your terminal, or on twitter. this is bloomberg. ♪
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viviana: this is "bloomberg daybreak." coming up in the next hour, career builder's cep -- career builder's ceo. ♪ viviana: this is "bloomberg daybreak." morgan stanley has turned bearish. the bank cutting its global equities allocation to the lowest in five years. it's is the outlook for stocks over the next three months looks particularly poor. in a new note, morgan stanley says profit forecasts remain optimistic, and orders for manufacturing keep getting worse. car sales showing sign of recovering from a historic slump come arising in june for the first time in 13 months. sales were up on was 5%. chinese car dealers offer discounts to clear out inventory.
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some employers are putting an end to weekend and late night emails. according to "the wall street journal," they are concerned about employee burnout. firms care consulting have software that puts messages sent after 10:00 p.m. on hold until 6:00 the next morning. i'm viviana hurtado. that is your bloomberg business flash. alix: i love that story because it is so unrealistic. david: exactly right. i bet you the ceo has figured out a way around that automatic putting it off. alix: like a phone call? it is called the sunday scariest, but that's what you do. david: i never get a late night email. alix: as i'm sending this article out to the team yesterday morning, i'm like hey, guess what. if you works tomorrow it -- -- if you work
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too much it's bad for your health. the next ipo darling wework is in planning. david: with us now is sonali basak. bank, there are going to be some really high-profile people gone. --sonali: they said they would resize the fixed income business, but what that means is unclear. alix: who else is going to be leaving? patrick, head tom of the americas come on his way
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out. we have three new members of the management board. seeing atill commitment to the u.s., and also asia to some degree. the other i thought was interesting was somebody there bringing in who is focused on data and innovation. they are going to be spending 13 billion euros on data and innovations. are the robots coming? is that the new thing? david: for a while ago i thought they were behind in other automation. my question, there is a lot of ?etail calls, even on the media people did ask about where these cuts would be coming from 18,000 cuts is a lot deeper than the couple thousand we are seeing inequities. that is a big question mark.
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he wouldn't answer or get a regional breakdown. alix: let's go to our next story, jeff epstein getting arrested and taken into custody saturday. this was a surprise arrest even though there have been years of accusations. walk us through what we know and how this affects the street. i don't know that it affects the street so much as everybody is watching it. epstein has a lot of relationships with people like donald trump. , i don't knowwas if anyone has read the "miami herald" story in september, and outlines his relationship to alexander acosta, who gave him a secret plea deal at the time. david: he was already on charge in florida and played out, and now this is new york. alix: he went to jail for like 13 months, but could leave? he had a driver or something. sonali: that's the biggest thing
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about this. he could have been in jail for his whole life. david: these allegations are horrific. we are talking about 12, 13-year-old girls. sonali: the story also outlines that those girls are now 20 and 30-year-old women, and they want justice. that's what a lot of this is about. alix: let's go to this next story, we work. your eyes just got really day when i said that. -- really big when i said that. [laughter] is making wall street salivate. we were going to be potentially ipo owing as early as this year, and everyone is really excited about it, but think about how much is embedded for the banks. this draws a huge question mark on all of these pre-ipo moneys and how they are going to
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raise markets. david: so why did they load out the balance sheet? alix: i had that question two. sonali: this is the question mark for everybody, to be honest. better equity come a better source of financing for all of these equity companies. this is what ever jalandhar is -- what average lending is all about. david: coming up, the race to replaced theresa may heats up. we will discuss that next. alix: if you are heading out in your car, listen to bloomberg radio. this is bloomberg.
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david: this is what i'm watching , it is brexit, and the election going on in england. all of the campaigning and debates is over. today the members of the conservative party was send in their paper ballots by mail, and find out who the next leader of the party is, and therefore the new prime minister. alix: i love the paper ballots by mail, by the way. david: you can always go back and check if it is right or not. alix: let's say he gets it. boris johnson is thought to be a shoo-in this week. but remember, those hard brexit docs are back a gun -- are back again. it wasn't that long ago we were talking about great hikes for the boe, and now rate cuts. the markets are saying this may get pretty rough if we crash out of brexit.
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alix: however, if you have a hard brexit and sterling falls off a cliff, they are going to have to hike to stem inflation. david: and it may not be mark carney is deciding because now they are talking mark carney for the imf instead of christine lagarde. alix: apparently they don't want to canadian at the imf. they want a european. ironside, we talked to --tners'managing partner partners' managing partner. this is bloomberg. ♪
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♪ alix: radical surgery for
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deutsche bank. it is a massive revamp of the german bank, closing its equity business, recalling 1/5 of its workforce, and scrubbing dividends. andy fight for central-bank independence. turkey's central bank head is fired. president trump keeps the fed chair in balance. and the where another tantrum. jp morgan warns of a bond selloff that could drown stocks as big banks turn wary on the next catalyst. david: welcome to "bloomberg daybreak" on this monday, july 8. we talked about deutsche bank and the numbers, but we shouldn't overlook the fact that there are real people involved here. alix: real 18,000 people, if they wind up cutting all that they've said. here's some pictures we can show 's leaving ther
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london office with just the stuff in their box. this looks very much like lehman brothers 10 years ago, when you had everyone leaving the office is on that monday. the irony is this is going into a bull market, whereas lehman was really kicking off a spark. david: people know they have lost their jobs. it is tragic. a lot of people will just not know what their future is. we don't know all of the 18,000. area.what regions, what the ceo and cfo will speak a little later on. in the markets, it is a very calm, wait and see day. euro-dollar pretty flat, a mixed dollar story. is a summerit story, the other half waiting
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for what chair powell will say in the senate. david: must-see tv. it is time now to focus on the week ahead. --ay conservative british today, british conservative party members cast their vote for the next prime minister, expected to be boris johnson. we get china cpi and ppa numbers. wednesday, fed chair jay powell begins two days of congressional testimony on monetary policy. wednesday, the fed releases its minutes from the most recent fomc meeting. in the meantime, let's find out what is going on outside the business world. if yana hurtado is here with first word news. alix: increase, the leader of the conservative new democracy party was sworn in as prime minister. kosrie arcos -- kyria
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mitsotakis getting a victory. there is speculation that donald trump may be grooming a successor to fed chairman jerome powell. he said, "if they knew what they were doing, it would cut interest rates." the president might get rid of powell and replace him with one of his two new nominees to the fed board of governors. president trump joining a national celebration of the u.s. wedding soccer team winning the world cup -- the u.s. women's soccer team winning the world cup 2-0. the president tweeting, "america is proud of you all." a week ago he got into a social media clash with star player -- megan rapinoe. there will be a tickertape parade in new york to honor the champions coming home.
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global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. alix: thanks so much. president trump resuming his attacks on jerome powell and the federal reserve last week, -- last week. pres. trump: we have a fed that doesn't know what they are doing, so it is one of those little things. alix: the market is pricing in a less than aggressive fed cut following friday's job number. cutslooks like about 2.4 priced in. is career builder's based on the jobs number, do you think we still need insurance cuts? if so, how many? >> i don't believe that we need any insurance cuts.
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we had severe tightening of financial conditions and 95, in 98 -- in 1995 and 1998. i don't think that argument holds much water at all, nor do i think the low inflation actually caused by endogenous factors to the u.s. economy. in other words, easing when not generate inflation either. to me i think there's a much higher probability that we don't actually get one in july that the market's giving them credit for right now, even with the 10 basis points moving to curb. but payrolls by itself is not sufficient to take it off the table. coreect very strong consumption in the gdp report at the end of the month. we need a decent cpi print, improvement in the regional fed supplies, so by the time we get we may have moved a lot
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of the pricing away. there are some indicators that would say things are softening -- david: there are some indicators that would say some things are softening. what is the pricing power given where the market is and what central banks are like around the world? >> a couple of points you made. the first one is with respect to weakness in the u.s. manufacturing sector, i don't believe that has anything to do with global manufacturing this. that is all about a weakening of trade which is secular in nature, but also impaired by the trump trade war. but weakness in the u.s. came about because consumption was expected to be quite strong through the holiday season. retail sales plunged to their most negative levels since that court hearing started in 1993. now it is rebounding sharply, so
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you had unwanted inventories and a d stocking process that is almost complete. even in the jobs report this weekend, manufacturing jobs went up. trade and transportation jobs went up. the and central-bank pieces are tricky ones. and boj are really actively using currency to try to spur exports. that is probably the most complex argument. it is also the toughest thing for chair powell to explain. politically unpalatable. alix: for him. maybe not for president trump. the other thing we learned from the jobs report is wages were at a stagnant 3.1% year-over-year. why are we seeing stagnant races? of hiring about 50%
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managers with open roles, about 150 5 million job openings then there are qualified candidates to fill it. that skills gap is driving uncertainty within the wages, so we are seeing the 3%, but over the last 40 years, that's really only been keeping up with the consumer index and not really giving employees anything incremental. one of the things we are telling candidates and employers is to think a little more creatively and go outside of the normal resume and normal market of where you look for talent, and go into other industries that have oversupply. david: normally if you have more jobs than people who fill them, that drives wages up. why are we in -- why are we not seeing the wage inflation we would expect? there are some that they would have to go a lot, and others not so much. it ising we are seeing is not holistic over every county.
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that's where we have a lot of employees in oversupply and not a lot of demand. there's been a slowness to move into the industries that better align in order to see the wage inflection happen. these retail workers, what they should really be doing is looking at their underlying skills and be able to find jobs manufacturing, electronics. anything really related to stem sciences, engineering and technology is growing. there's really a mismatch today between gaps in supply and demand. you just hit on a really important point. ing because of turnovers is not sustainable.
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we had the best five quarters for productivity this entire cycle. turnover picked up a lot in 2017 and 2018. 29% of the labor market turns over every quarter. the spread between inflation and the atlanta fed wage tracker is at its best level this entire business cycle. real wage growth is reasonably healthy, but it is coming in sectors like leisure and hospitality, where you are also getting capital investment, substitutional capital for labor, and workers are becoming displacingtive, and that. --irina:in the largest in the largest three to five categories, the workforce is
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slowly starting to look for their retirement plan, so that is really going to help a lot of the turnover as well. given the millennial population is going to be about two thirds of the workforce, they approach work very differently. that is why i cited the growth tracker come over you have this you code -- this huge cohort that is retiring and this huge cohort that is coming into the workforce, which is why it is so different. they do correct for that makes. thank you. irina will be staying with us. more about deutsche bank's radical overhaul, next. this is bloomberg. ♪
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viviana: -- broadcom estimating synergy that would allow the combined company to save about $1.5 billion. a saudi arabian budget airline has become the first carrier to officially drop in order for boeing's troubled 737 max. they reversed in order to buy as many as 50 of the jets. it will now fly only airbus planes. the 737 max was grounded in march after two fatal crashes. chinese car sales showing signs of recovering from a historic slump. they rose in june for the first time in 13 months. sales were up almost 5%.
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chinese car dealers offered discounts to clear out inventory before new emissions rules kick in. that is your blumberg business flash. david: a banking bombshell. deutsche bank announced a fundamental change in its business model, planning to cut 18,000 people and take restructuring charges of 17,000 euros, shutting down its equity sales and trading business. guy johnson spoke with the bank's cfo earlier. >> we are taking the decision to retrench and step back from elements of our global markets franchise, in particular equity sales and trading. david: we welcome now guy johnson, who sat down with him. great job on the interview. do we know really the details of this plan, particularly 18,000 people? i think there are only like 1000 in equity sales and trading. guy: we don't know actually the
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details as to where these job cuts are going to fall, but let be tell you, they've already started in london. where the big office is of deutsche bank which houses large parts of the investment bank, people are already leaving that building with envelopes that basically detail their severance plan. the losses are already starting. deutsche bank is starting this process. wing is starting this process off. i expect many of the cuts will come in the united states as well, in asia. very few of them will occur in deutsche bank's headquarters, right behind me. the focus is bringing this business to focus back on the german side of what is happening here to become a corporate bank, less of an investment bank. looking at some photos from just a moment ago of what it's going on in london.
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each one of those people represents cost, but for the most part, also revenue. how confident is the cfo that they can take this much cost out without substantially affecting the top line? to be a cost going associated with all of this. there are going to be no dividends for a couple of years. they are going to take a huge cost associated with this. there are going to be costs associated with it, and this is where it will become quite difficult. execution is going to be pivotal. they are operating with a very the margin when it comes to 12.5% ratio. the german economy is having a very tough time of things at the moment. the ecb is likely to cut rates. there are a whole lot of factors that will make this plan very difficult. david: thank you so much. joining us from frankfurt, guy
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johnson. alix: still with us, barry knapp and irina novoselsky. barry, what do you make of this? barry: this is a long time coming. after the financial crisis, we did a lot of work in my barclays days about what happened to the u.s. banking system after world war ii, when the regulatory environment was similarly tight as it is today. it turns out through the whole 1950's, return on equity never got above 50%, and the bank was the worst performers through that entire decade. i was underweight financials all the way until the treasury reform proposal of the summer of 2016, when it became clear that the regulatory environment was going to change and the fed was going to start unwinding their balance sheet and really getting
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the whole process off. u.s. banks had a quantum leap in productivity in the fourth quarter last year, continued through the first quarter, likely into the second. they are now return on equities above 10. in europe, return on assets is half that. i don't do fundamental analysis, but a hero to ago when deutsche was in trouble, i looked -- but when deutscheago was in trouble, i look at the numbers. they have a liquidity problem. all of europe does and all of japan does. unless they can change the dilatory environment, the profitability problem is not going away. david: 18,000 people are going to have a career problem. , what look at the people advice can you give them? what do they do next with their lives? irina: one of the things we do
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at careerbuilder's give tools to people looking for a job. it starts with building a resume. a lot of times it is outdated. we launched with the advent of what ai can provide for us, leveraging skills you didn't even know you had, we launched a resume builder that by topping in your name and job, it tells you the skills whether you would have had -- the skills you would have had without even knowing. it really helps bridge that gap. we also put a lot of supply and demand stats out there. it tells you what the top companies are that are hiring in your location and salary range that also match with the background and skill set you have to to help narrow down that search. alix: for a lot of these guys who are going to be out of a job , and women, talk about ai. it feels like it is a small world of banking to begin with because you are having a lot of robots and ai coming in.
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how do you retrain people? irina: retraining is definitely key. that is why we spend a lot of time with our employer side. a lot of markets don't have that core skill set that is going to be coming out. there's a lot of technology, accounting backgrounds, sales, leadership, all the things he would look for in any industry. we work with a lot of our clients and look into financial services today to go and pull into health care, pull into tech , and pull into one's where there is really a tight supply that you can leverage a lot of the same underlying skill sets. david: thank you so much, irina, for being with us. barry will be sticking with us. coming up, the boeing 737 max 8 loses its first carrier. more on that next in today's bottom line. this is bloomberg. ♪
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david: time now for the bottom line, where we look at three companies worth watching this morning. more news about broadcom possibly buying symantec. identified $1.5 billion in synergies, and looking to pay about 21 billion dollars for the cybersecurity firm. alix: i am looking at apple getting a downgrade at rosenblatt securities to selloff from neutral. "it will face material deterioration over the next six to 12 months." iphone sales will be disappointing, ipod growth -- will slow, and there will not be any real revenue growth. david: andy china problem. alix: that wasn't even -- and the china problem. alix: that wasn't even mentioned. david: the third committee we are watching is boeing. for more we are joined by taylor
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riggs. taylor: this is the first time we are starting to be able to measure the impact of the 737 max groundings. the saudi arabian budget carrier had bought 50 737 max, with the option for 20 more, but now they have changed their operate anand they entirely airbus fleet. alix: the question, though, do others wind up dropping it, or was this an isolated case because they operate 100% airbus? taylor: we have stories of other airlines leasing planes or, instead of retiring planes early, refurbishing them and continuing to use them until you ofany sort of news
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when you can lift that 737 max. [no audio] alix: taylor riggs, thank you for joining us on that. coming up, but where the taper tantrum. jp morgan sees the bond market vulnerable to a selloff. volatility picking up in the bond market. yields grind ever lower. this is bloomberg. ♪ wanna take your xfi to the next level?
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with confidence you can get coverage where you need it most. that's xfi advantage. make your xfi even better. upgrade today. call, click or visit a store. alix: this is "bloomberg daybreak." i am alix steel. in the markets, it feels like a calm monday. dow jones futures off 76.
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a little bit of weakness but it seems like a lot of direction will come after the director jay powell gives testimony in the house and senate over the next few days. bankean banks, deutsche around the lows of the session. will the big revamp do anything for the bottom line? in other asset classes it was a mixed dollars story. the one mover is the lira. the dollar up almost 2% versus the lira. it could be worse. greece 10 year yield, 2.11. minister,cratic prime potential business reforms, i will hold my breath. david: bond bulls seem to like greece right now. likesbob diamond says he greek banks in some ways. david: you need the yield. list an update of what is making headlines outside the business world with viviana hurtado. viviana: conservative party
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lawmakers in the u.k. opposed to a no deal brexit are plotting another attack. the next primeop minister from forcing a chaotic break from the eu. isls showing boris johnson the overwhelming favorite to defeat jeremy hunt. the new prime minister is expected to be announced the week of july 22. jeffrey epstein appears in court in new york on sex trafficking charges. he was arrested after years of accusations of child molestation. he pled guilty to state sex charges while avoiding federal offenses. the prosecutor who agreed to that plea deal is now the u.s. secretary of labor. falling afterra the president fired the country's central bank governor. now there is concern the bank will lower interest rates by more than expected. doganberg has learned er
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told lawmakers the need to get behind his belief that higher rates cause inflation. global news 24 hours a day, on air and @tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. alix: if you are watching were the floor was for rates, there you go. david: the interesting thing is do not get what he wanted in the short term. a weakening lira will not get him there. alix: our reporting intimates how widespread it is. the idea that higher rates lead to inflation. his economic theory. he is like, if you do not subscribe, you are out. david: he called his timid in and said higher inflation comes from high rates and you have to implement that throughout the government. alix: if you don't, you are out. let's turn to what is happening in the bond market. barry knapp is still with us. jpmorgan had an interesting call on the bond market.
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raising questions about the risk of a bond transom. how vulnerable is the government to a bond tantrum similar to what we saw in may and november in 2016 in u.s. rates? barry: i would add january 2018 and september of 2018 as well. i've not seen their notes, i do not know the these is but i have a similar thesis. officials argue the reason we have such low real interest rates is a function of an excess of savings over investment. i have a lot of sympathy for that view explaining the conundrum during the 2000s. typically, the 10 year bond treasury yield was love -- was roughly the same or higher than nominal gdp. sincerely 2000s, it has been running well under gdp. the mostt is one of
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credible think tanks on this topic. central-bank policy is playing a much bigger role. let's think about the fed balance sheet specifically. there is been a considerable amount of focus on whether the fed will cut rates. obviously that is can shoot the rally we have had recently. we have had this idea contributing to the same these thesisidea -- the same the idea they will stop the bond purchases in september. the next step is the fed is transitioning their portfolio to all treasuries. putting those mortgages back to means thee sector private sector will hold the single biggest source of bond market volatility, which is mortgage prepayment risk. before the crisis that was held by fannie and freddie. they hedged after the 2002 duration ps going fannie mae. now the fed holds it.
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they suppressed volatility. when they were buying mortgages like it was going out of style, they suppressed volatility and rates at the same time. that spike in the chart you showed was part of the early stages of that volatility getting pushed back into the market and that came as a result of a refinance bounce. that volatility is going back to the private sector. the next stage, as the fed transitions their portfolio and puts the volatility risk back into the market, is they are going to shorten the duration of their treasury holdings. they have said they want to match the treasury issuance, but it is significantly longer than that. the fed action will push duration up. it would not shock me if we got past the july meeting at some point and get another quick 30 basis point moves in real interest rates. those of the trigger events for the stock market selloffs in
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september, october, december of last year. i'm with jpmorgan. we've been telling people to put on long end steepeners and be longer duration volatility. david: give me a time horizon. over the longer term, as long as central banks are saying we will step in if needed to step in. and $13 trillion in negative fielding debt? as long as you have that, you will not have a lot of volatility or high yields, will you? barry: it is hard to see the conundrum completely sorting itself out and rates going back to the same level as nominal gdp. you can get these series of impulsive shocks. a 30 basis point move in the course of three weeks and that will reverberate through the markets. it is almost like when you look at equity market volatility and say volatility is low, but then you have the volatility ball you have these high spikes, the same
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thing is likely to occur in the bond market. when the mortgage prepayment risk is transferred back to the private sector. alix: where does that leave europe and japan? dead. the gtb market is you need to get significant changes in ecb policy. maybe lagarde will be different than everyone thought this week, but right now expectations are the policies will be continued and you expect low volatility on those markets, which brings you back to the short spikes. alix: do like bunds? barry: no. i do not hold any fixed income other than high deal. i am still quite bullish equities. i understand that if you get a spike you will have a pretty good job down in equities. david: barry knapp of ironsides
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partners, great to have you. coming up, deutsche bank is not the only bank cutting headcounts. we will look at hiring and financials in our first installment in our series, banking on change. alix: bloomberg users, you can are not with the charts -- you can interact with the charts you are using throughout the program on gtv . this is bloomberg. ♪
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viviana: i'm viviana hurtado in the hewlett-packard enterprise greenroom. coming up later, an exclusive interview with henry mcvey, kkk headead of global -- kkr of global macro asset allocation.
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here is your bloomberg business flash. bloomberg has learned -- is ready to start formal talks on its 16.8 billion dollar elevator unit. the german company has been approached by a number of potential bidders, including kkr and cvc capital motors. spiderman has given a boost to sony pictures and the slumping u.s. box office, taking in almost $94 million in its opening weekend. sales almost certain to be one of sony's biggest hits this year. morgan stanley has downgraded its view of large-cap banks. the group has rallied. a new note cuts the view from attractive to in-line. bny mellon and state street were double downgraded from overweight to underweight. morgan stanley is forecasting slower growth for the larger banks. that is your bloomberg business flash. alix: exiting the equities
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business. 18,000 job cuts are among the steps deutsche bank is taking its major restructuring. guy johnson ino frankfurt and outlined where he sees growth. >> banking will probably be the biggest growth driver, especially in today's interest rate environment. that may change as interest rates change, but for now we see great growth opportunities that have existed for several years and we have not been able to participate as much as we could or should have. we also see growth in the private bank. the german consumer banking franchise we have, as well as italy and spain. recoveredgement has after a difficult year in 2018 it is back on a growth trajectory. we see underlying growth in our franchises. we are taking the decision to retrench and step back from elements are global market franchise, in particular equity sales and trading, and that is a
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significant step in rearranging the bank. guy: if i client or a global client, the question i might ask is are you still able to serve my needs? james: that is part of the core question, many of our clients, and it is the nature of the german economy that a significant portion of revenues are international revenues. sme's havean activities outside of germany. these clients expect us to be president around the world's and service there needs. they may be risk management, they may be fx, and those rural areas in which we excel. is around those strengths -- guy: how will the retrenchment in equity affect that? of the concerns we have had about retrenchment away
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from equity sales and trading is the potential it would have knock on impact in our other businesses. in making the decision we have made, we have had to grasp that and will need to manage through that. we are retaining targeted equity capital markets, as well as limited distribution in order to continue to serve our clients needs around equity financing. the sales and trading decision has been difficult for us, recognizing that there are likely to be some knock on franchise implications of that decision. guy: do you will lose clients? james: as we look client to client twitter equity sales and trading business to other businesses, we will keep a fair number of clients. we'll will -- we will reduce our client franchise as we attempt to focus on those core clients. the impact of clients that are
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uniquely served by us and equity sales and trading is surprisingly small. guy: you will be operating with a smaller cushion when it comes to capital. it is a very slim margin you will be operating with. james: i will not call it slim. 12.5%, weat even at will remain among most highly capitalized of our global and european peers. david: that was deutsche bank ceo speaking with our own guy johnson. it is time for all the belief, a deep dive into stories making headlines and moving markets. we begin today a week long series on the banking industry called "banking on change." given the changes deutsche bank has just announced, we start with banking jobs, where there being eliminated and created.
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we welcome no a schwartz -- we welcome noah schwartz and our own bloomberg investment banking reporter. whether people are looking for jobs or companies are saying we people, where are their banking jobs being created as opposed to the ones going away? we found u.s. banks have expanded their asset management business, their corporate banking opportunities, and the advisory firms have been continuing to hire bankers with deep relationships. that is where we are finding areas of growth. ali: with 18,000 jobs about to hit wall street, is there enough capacity to pick those jobs up elsewhere? we are finding there are homes that family office firms -- that will house some of these bankers in addition to corporate roles. alix: where are the jobs not?
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,f this happened 10 years ago where would we have found the jobs versus now? noah: great question. some of the bankers will have to reinvent themselves. there will be opportunities in tech. there will be homes for these folks. like afteris not 2008 where every hedge fund was hiring. traders,ens to all the especially the equity divisions being cut. noah: great question. there will be opportunities in equity capital markets. many funds have created capital markets roles in addition to origination roles. if you're a leveraged finance banker you will have an attractive job opportunity in a direct lending role. there will be roles for these folks but it will not be for everyone. are the nonbank banks as labor-intensive as the traditional banks? noah: that is probably right. sonali: it is a competitive job
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and you are seeing a lot of the and these bankers will be under pressure to deploy that capital. how competitive are these jobs? noah: moving to the buy side has been a dream job for a lot of bankers. usually do it when you are third-year analyst and not a senior banker. there are bankers who enabled to break the mold and take -- at senior private equity firms. there will be opportunities in capital markets as well as direct lending. brought uplad you the distinction between a third-year analyst and a senior banking role. that comes with a lot more money. can private equity or leveraged finance pay these bankers what they are used to getting paid? noah: they will have to reinvent themselves in terms of how they think about company -- compensation. a lot of your compensation is structured in long-term kerry as
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opposed to cash. sonali: last year it fell on wall street. are the banks going to be able to pay their talent to stay around? is the new norm for some. people are always managing their careers. we have been called many months in advance about people managing their careers and looking for opportunity. david: there is some hope people will find a job but the overall compensation structure much -- must be affected. if you take 18,000 jobs out of any industry, it will affect the compensation structure. noah: compensation structures are always being reevaluated. fundamentally, you want to be aligned with your clients performances. sonali: another big change, it feels like a lot of people are moving around. you are seeing goldman higher. used to work at goldman sachs. how is that changing? noah: i'm glad you brought that
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up. there has always been a lot of inertia at goldman sachs. people do not go to another bank. now they are moving to other banks. additionally, goldman has been recruiting from other banks. that has been a fundamental change and excited to see what happens. alix: what does that tell you? noah: it tells you this is a fluid jobs market and there will be more movement in the months and year or two to,. david: the best and brightest out of mba programs, is banking as attractive as it was? noah: there will always be a need for investment banking and corporate banking. they are competing with technology companies and will continue to compete with technology companies. if your young person out of college, it is a great avenue for that type of training. sonali: you see some of these investment bankers, the investment bankers are now reporting to the corporate bank
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and that is a similar situation we seeing a lot of banks across wall street. are bankers losing their powers to other areas of other banks? u.s. many of the large banks have merged their corporate and investment banking years ago and have gone through the motions already. that being said, there will be a shift. deutsche bank is focusing on the -- less on the investment bank in the u.s.. that will be a change. david: is your phone ringing off the wall? noah: i would say is last several months. people see there is writing on the wall and you have to see what options you have. it does not mean you are looking to leave immediately, but they are always managing their careers. alix: you talk to people all of the time. what are they talking about in terms of their career path? sonali: if you're a traitor, there is a lot of fear. if you are an investment banker -- think how many people we have at the top.
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the top is looking thin. bottomtom lacks -- the ranks look like it is hard to find a job elsewhere. noah: corporate's are targeting investment bankers. cfo jobs are being felt more often by jobs than they used to be in the past, and there is an opportunity in corporate development and other operational roles. alix: really interesting. thank you very much. great to have you joining us. coming up, tensions in the middle east stir concerns for oil. oil holding steady around $60. more on what i am watching. if you're jumping in your car, tune in to bloomberg radio on sirius xm channel 119 or the bloomberg business app. this is bloomberg. ♪
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alix: here is what i am watching. that is iran.
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iran up to its enrichment of 3.67%. 25% versus it says 90 is leveling you to get a weapon. that is misleading because it is hard to get to 20%, and once you get to 20% it is easier to get to 90. david: the signal is not subtle. alix: it could be worse. there's a nuclear reactor offline, no news if they will bring that online. every 60 days they will look at what they will do. there is some restraint on the part of iran to try to get europe as well as the new u.s. to the negotiating table. david: indicating all of the pain they are feeling because of the sanctions. alix: if you look at what they're able to export, it is nothing. there's a conflict between iran and bp. in gibraltar, there was a rest on a tanker, iran was angry.
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now there's a bp oil tanker stuck in the persian gulf that does not want to drive past iran and is hanging out there. there are reverberations in the area and major oil companies. alix: iran said we had an obligate -- david: iran said we had an obligation to save the tiger, our pride requires us to do that. alix: that does it for bloomberg daybreak: americas. open with the jonathan ferro. as we had to break, we are watching deutsche bank falling as much as 5%. so much for the short-term bump. david: painful. not over yet. alix: the capital rates question front and center. this is bloomberg. ♪
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jonathan: from new york city for our audience worldwide. i'm jonathan ferro. "the countdown to the open" starts right now. ♪
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jonathan: coming up, cutting 18,000 jobs. deutsche bank delivering his biggest turnaround effort yet. says -- turkeyan central banks independence under fire. investors paring back rate cut bets. with 30 minutes until the opening bell, here is your monday morning price action. futures down eight points for the s&p. treasury yields coming in by just a single basis point. the stock to watch through the session today, there is only 1 -- deutsche bank. down almost 6% in frankfurt, germany. -5.7%. let's begin with the big issue. looking ahead to jay powell's semiannual testimony. >> testimony this week will be crucial. >> it either confirms eyil


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