guy: 3:00 p.m. in london, 10:00 a.m. in new york, 30 minutes into the trading day in the united states. welcome to "bloomberg markets." equity markets pushing ever higher. alix: inching towards record highs. i feel like that is what we are doing today in the equity market. the s&p up by not even 0.1%, but still inching to those highs. i want to highlight what is happening in the bond market. a little bit of bond buying. we are still at 92 basis points. the beige book, some were saying that maybe we are in a double-dip recession scenario, but if you have stimulus coming down the pike, that means higher yields. euro-dollar moving higher, the highest we have seen since 2018. yet again another superlative, up by 0.4%. also watching crude for any opec deal. guy: let's talk about what is happening in the aviation sector. we are seeing boeing stock jump sharply higher, up over 4% within the last few minutes.

we've had confirmation of a monster deal. ryanair, europe's largest carrier, committing to the 737. max's.oing to buy 75 737 this comes on the heels of that grounded,being un- after the huge grounding following those two crashes. we will be talking to the two ceos of these companies at the top of the next hour. alix: this is your super bowl. i just want to point that out. some data dropping right now as well. ism men effect ring data for november -- ism manufacturing data for november. mike mckee has that. michael: it is slightly less than we expected. it comes in lower than the prior month. the services pmi comes in at 55.9 from 56.6. not much of a change.

still growing strongly, which is important because this is a services economy. new orders were down a touch, as is the business facility. 51.5 from 50.1. in the manufacturing survey earlier this week, we saw employment fall into contraction soritory for manufacturing, rising services employment is still good news for the auto -- for the overall economy. compare this to what we saw for the market services pmi. it tells you the two of them are saying the same thing, that the services economy is any and there. -- is hanging in there. if it is growing, it is growing very slowly. least,hanging speeds, at very slowly. alix: what happens when you have the benefits running out as well? michael mckee.

the u.s. reporting its deadliest day ever with covid-19 fatalities now topping 2700 on tuesday. california reported a record number of new pick -- of new cases that prompted la's mayor to order residents to stay home. >> my message couldn't be simpler. it is time to hunker down. it is time to cancel everything. and if it isn't essential, don't do it. don't meet up with others outside your household. don't host a gathering. don't attend a gathering. following our targeted safer at home order if you are able to stay home, stay home. alix: joining us to discuss is a senior scholar at the johns hopkins center for health security at the bloomberg school for public policy -- for public health. we need some perspective. just how bad is it in l.a., and how often are we going to hear what the mayor talked about in other cities going forward? >> what we are seeing is that

there are hospitals realizing that the number of cases and the pace of the missions is unsustainable. they are getting to the point where their capacity becomes a concern on a day-to-day basis. they have to think about what nonemergency services they have to curtail. this is something that we knew would happen during the fall, and it is not surprising to many people that this virus accelerated as we had more fandom -- more pediment fatigue, as we had the virus be favored by the colder conditions. angeles, they don't have the public house for structure system to basically keep track of the cases and meet them as they come. if you see testing lines outside of la's dodger stadium, those are really not acceptable this far into the pandemic. many of what has happened didn't have to be so if we had a public health structure that could that could test, track and isolate. expect theo we

effects of thanksgiving took again? dr. adalja: probably in the next couple of days we will see cases increase if there was significant transmission, and then a week later and uptick in hospitalizations. what we are seeing right now is not the result of thanksgiving. it is the result of people doing things before that holiday. there is a real concern that what the holiday brings will be kind of a surge on top of a surge, to use dr. fauci's words. alix: after l.a., who's next? where the next hotspot? dr. adalja: what we have basically as a country full of hot spots. the media often focuses on major metropolitan areas like los angeles and new york, but it is often the work -- the rural and suburban areas where i am mark concerned because those hospitals don't have the people to be to increase staffing as much, and maybe a dozen icu beds in their hospitals.

. they don't have the ability to take more patients. that's where i think you will see the first collapse of the hospitals that really run into problems and have to curtail services. it is all ready happening in the pittsburgh suburbs. it is not going to always be the big major cities because they tend to have big academic medical centers. it is the smaller hospitals, the rural hospitals, where i think we will see a major problem. the we are expected to see pfizer vaccine being cleared by the fda within the next few days. sitting here in london, it has just been cleared here. as we see the case counts, the hospitalization counts, the death counts rising rapidly, how does that complicate the rollout of the vaccine? dr. adalja: the vaccine is not going to change our death count overnight. it is going to take some time. it is going to trickle out to high-risk individuals and health-care workers, so we will see theme to

impact on deaths and hospitalizations. we probably won't feel that impact into spring. the rollout is going to be difficult in the best circumstances, even more difficult in the middle of heightened activity of heightened pandemic activity, especially when you're trying to vaccinate the general public. you don't want people to get infected with a are in the line to get vaccinated. adalja, we are going to leave it there. thank you very much, indeed. let's get back to that monster deal i announced at the top of the hour. boeing ceiling a landmark order for its 737 max jets from ryanair, a crucial boost for the u.s. plane maker's efforts to revise its best selling model after a 20 month grounding. joining us now, brooke

sutherland, blumer giving and columnist. they've got a look -- bloomberg opinion columnist. do you think these are going out the door to ryanair at cost? brooke: i would be very surprised if they are going out the door at cost. typically we see airplane orders of this size are already seeing pretty sick of the can discounts given be 20 month ash pretty significant discounts -- pretty significant discount. iven the 20 month grounding, would be very surprised. tos will go a decent way helping boeing clear out the 450 max jets that it has not yet been able to deliver. just to take a step back, this is still a win for boeing. i think the key phrase here is that this is a firm order. , there member last year

was a letter of intent to buy jets, so having a firm order is certainly a boost that boeing badly needed. alix: are there other airlines that are. . going to want the same deal -- that are going to want the same deal? brooke: i don't think boeing is in a position to drive a hard bargain here. i think they will have to build these planes on the lines that the airlines are willing to pay. i will say this is a pretty sizable order, suffer some of the smaller airlines looking to take deliveries, their price point is not exact what it once was. guy: do using southwest is next? brooke: it will be interesting to see what happens with southwest. it's reported that southwest is in talks with boeing.

it is not necessarily going to be an additional order. it will be part of southwest's existing order, just repurchasing some of those jets. i don't know at this point if we should expect to see southwest topping up its order like ryanair did. boeing is struggling with a lot of carriers right now. they've been clear they don't need a lot of additional new planes in their fleet right now. i don't know that we will see necessarily a wave of airlines announcing orders along the lines of what we heard today from ryanair. i think a lot of these carriers are going to want to see some kind of recovery start to take place before they are willing to really expand their fleet. alix: such a good point. thank you very much, brooke sutherland of bloomberg opinion. in the next hour, we will speak to the ceos of boeing, as well as ryanair. you don't want to miss that. this is bloomberg. ♪

ritika: let's check in on the bloomberg first word news. i'm ritika gupta. fewer americans than expect it filed for an implement last week. totial jobless claims fell 712,000. that is better than all but one of the 40 estimate in the bloomberg survey. continuing claims were also down to a little more than 5.5 million. november jobs reports come out tomorrow. house speaker nancy pelosi and senate democratic leader chuck schumer are now backing a bipartisan stimulus plan. they see the proposal from house and senate lawmakers as the foundation for a new round of negotiations. the plan calls for $900 billion .f spending

the u.s. has restricted travel visas for millions of memory of china's communist party new rules will allow party numbers and their families to obtain visas good for one month. previously they could get 10 year visas. the u.s. embassy in beijing says china's communist party actively tries to influence americans through propaganda and economic coercion. opec and its allies are making progress in talks on oil output cuts. that increases the chances that today's meeting can salvage a deal after failed negotiations earlier in the week. told bloomberg discussions are now focusing on proposals for gradual easing of output cuts over several months. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg.

alix: thank you so much. here is some breaking news for you. the cable rate is the highest level since december 2019. it means the pound is up against the dollar, the most we have seen in over a year. so a lot of bets on a weaker dollar, the same way we are seeing more bets on higher yield. joining us now on how you restructure your portfolio is based on those two things, michael antonelli, baird market strategist. what you do as an equity guy? michael: we have been watching these. certainly a lower dollar to some of our multinationals. you are probably talking about boeing today with that deal. there's printing to like -- there's plenty to like about a weaker dollar at this current juncture of history. we need to get these global companies back on track, and that will certainly help. we are certainly watching yields. if using about 92 basis points on the 10 year, we are inching closer to 1%. stocks and yields are kinda moving in the same direction right now.

the only concern is maybe sentiment is probably a little bit over its skis, and that lowers the threshold he would have for a shakeup. guy: would you be pushing this market higher? would you be putting fresh money to work? does this market make sense to you? michael: that's where we are at as strategists. we end this incredible year we've had, and we look forward to talking to clients about 2021. i think december probably starts off choppy. we are set up for possibly a little pullback, but i think we end strong. i really do believe that most estimates of next year's gdp are probably low. i will tell you one reason. people consistently underestimate how much americans are willing to spend. and i think on the others out of this, americans are going to be spending. alix: but does that imply that we are going to get some kind of stimulus out of d.c.? do you have to have that based into your forecast to get more bullish on stocks? michael: no, i think the stimulus would be a nice push, and i do think that is going to

happen if you look at the washington wrangling going on. dan clifton is one of the political strategists at strategas. he thinks the administration is looking for a deal that will probably happen before year-end. i'm excited about that. i don't think the market needs that, per se. we are rally and without that. but if we get the stimulus on the table plus that boost next year, you are looking at a good set up. the table is set for a really good 2021 if the vaccine can get us there. guy: in the near term, the case count is going higher. do you think that translates into economic data? the claims number today i think we can probably put to one side. it comes with a health warning. other data are pointing to a slowdown. do you think we will see that manifesting itself in a big way? for payrolls friday, what would it take to spook the market in terms of payroll numbers? dr. adalja: i think payrolls -- michael: i think payrolls is going to miss for a couple of

reasons. yes, the case is seem to be rising. the discount and hospitalizations in the u.s. is at record highs right now -- the case counts and hospitalizations in the u.s. is at record highs right now. there will be more people out of work. the market, i believe, is looking past that. i think the vaccine certainly helps. my biggest concern short-term, to be quite honest, is that as a vaccine rolls out in the u.k. and then comes to the u.s., what happens if just a random coincidence of somebody who takes a vaccine and gets sick right after that, what happens to the market then? i think that is a real big question mark. there's a couple billion people that are going to have this vaccine within the first 3, 6, 12 months. i am worried about how the market is going to react to one possible negative case. but i do believe economic data is going to be weak in the near term. i think unemployment tomorrow probably misses. alix: are you buying the dip?

guyael: this research sales used to say big moves start big moves. if you look at things like housing, some of the reopening trades, the bounce of the lows are in, but as you continue to reopen, i think you can still dabble in the airline space and the crude oil space. if you think that the roaring 20's is a thesis for next year, there's lots of ways to play it. i would stick to the consumer spending because i think that is going to be really robust here. guy: michael, always a pleasure. thanks for taking the time. michael antonelli of baird, we really appreciate it. what have we got coming up on the show? we will be talking to jim chanos on his view of what elon musk should do next. hear that conversation next. this is bloomberg. ♪

guy: live from london, and guy johnson. this is "bloomberg markets." associatesof kynikos has been long tesla for five years. he's not done just yet. he spoke exclusively with scarlet fu. i think that it is really a business model and a valuation issue with tesla. there are some things we don't want their accounting as well. a company trading at a $500 billion market cap. it will have revenues this year of $30 billion. despite what everyone says, they are still an automobile company. they make cars. so they are competing with other companies that make cars. and increasingly, those companies have ev's as well.

tesla, every bull market has a stock that people pin their hopes and dreams on. back in the dotcom era, it was cisco and yahoo! and a few others. certainly one of those stocks this go around his tesla. for some holders, it is an ev company. for others it is a clean energy company. for others it is an autonomous vehicle company. it is whatever people want to believe that elon musk is touting, and that the traditional rules of valuation do not apply to it. i would just point out, as i always do, that for the trailing 12 months, tesla has not made any money selling cars. of the trailing 12 months, whatever profit they have shown has been very low, has been from selling tax credits. so for all of this, for all of their market leadership, selling $50,000 on average cars, they

are still not making any money doing it. francine: have you ever met --scarlet: have you ever met elon musk or talks to him? jim: i've never met him. i've never had a conversation with him. scarlet: what would you say to him if you do get to meet him? jim: i would say job well done so far. scarlet: going back to that idea that people project whatever they want on the company, you anounced your tesla short in five-year saga. all of your shorts are capped at 5%. are you still max short on tesla? jim: we are not max short, but we are still short. there are now so many other things to do, including in the ev space, that we found lots of other things that are maybe even crazier than tesla, but we deals -- but we still do have a position. it has been painful clearly, but i will say for the first four of those five years, it is not a

bad short. it went sideways while the market went up. so those are the kind of shorts in a bull market that you hope for. , and ourt is going up shorts are not going up. but the last 12 months has been a different animal. foldtock is up five or six , and we had to risk manage it by getting money out. chanos of was jim kynikos associates speaking with scarlet fu. he's not the only one to say i'm not max short. goleman sachs, their analyst is upgrading tesla to about a from neutral,buy i should say. they say the shift towards battery vehicle adoption is accelerating. i feel like it is a little late to the tesla party. battery prices have been falling for a long time.

but who am i to judge? guy: and it is quite a big upgrade as well. the other thing i will point out is that you can argue the germans are getting into gear. you can't talk about years when you talk about electric cars. germany is about to overtake california in terms of its adoption of electric vehicles. europe is beginning to gain traction here. it is going to be interesting to see whether or not that changes the balance between the carmakers and the electric carmakers. it is going to be fascinating to see how the likes of bmw and daimler get going on this one. alix: people are going to need to buy a lot of ev's. still ahead, we will take a look at what bidens presidency means for u.s. clean energy. this is bloomberg. ♪ in a land not so far away, people are saving hundreds

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chinese companies getting kicked off of american next ages if regulators can't review their financial products. president trump is expected to sign the bill. we want to bring in "balance of power" host david westin. how big a deal is this? where does this leave biden? david: first of all, it is a done deal. it has been pending for some time. having said that, if you actually look at the number of chinese companies listed, it is not that much money, and the markets didn't react that much, although it certainly is another instance of the outgoing president trump trying to box in the incoming president-elect joe biden. it is going to be hard for him politically to reverse that. guy: why did it take the house so long to catch up with the senate? david: there's been a back-and-forth, and frankly the fcc has been doing this for some time. i think they just didn't get around to it. they had a lot of other issues on their platter, and they

didn't get to it. but as you know, this is the most important point, there is bipartisan agreement on one thing in washington. people don't like china. alix: but biden said he won't be lifting the tariffs, not necessarily that he is going to him for him into more. but he wants to work with his peers at the european union. that is little bit different. david: absolutely. this is one of the things the president-elect has to steer a course through. he doesn't want to just go back on everything that president trump did because president-elect biden has said he should be tough on china. he once to take a multilateral approach, so he's got to figure out when to pull up those tariffs, how, and what he gets in exchange. handicap for me a stimulus deal before christmas. david: it's a lot better odds than it was yesterday.

you've got this bipartisan proposal out of the senate. now you have president-elect joe biden saying we thing that is a good down payment, as he put it, on something going forward. basically, they are boxing in mitch mcconnell, and perhaps more importantly, giving speaker of the house pelosi and elegant way to maybe climb down from her position. let's be frank, that bipartisan proposal is way south of where she was, but more than what mitch mcconnell wants to get. i think it is 50-50, maybe a little but better than that right now. alix: do we know what role president-elect biden played in making this stimulus get done? david: i don't know. i wasn't in the room. having said that, my information has been for some time this is sort of where you would like to go, to take half a loaf instead of go for the full. he wants some energy behind the economy. as we know, it is faltering right now, particularly with the covert shutdowns. he needs a little bit of wind under his sales. if the senate stays re-publican,

this may be the only stimulus we get. we may not get any year. guy: mitch mcconnell is speaking right now on the senate floor, saying we should move forward where there is agreement. where is there agreement? david: where there is agreement is small businesses. everyone agrees it's got to be small businesses, and i think everyone agrees we have to get some cash into the pockets of ordinary americans. where there is not agreement specifically is on assistance to states because in that bipartisan agreement, there was still 220 -- still $280 billion for state and the governments. republicans have said we don't want that. alix: round this conversation out for me because we are still looking at different parts of the cabinet for president-elect biden. where are we in terms of cabinet picks? what are the relevant ones we are still looking at? david: the big one people are expecting next is the health team, specifically health and human services secretary.

i think that is the next in line. obviously there's a large issue with the panic on. -- with the pentagon. he's done very well with women, also with asian americans, not as many african americans yet. of course, we don't have an attorney general yet. guy: david, thanks for your time. really appreciate the update. you can catch david westin on balance of power at 12:00 p.m. in new york, 5:00 p.m. here in london. let's talk about what is going to be a big part of the biden adminstration, and that is the switch to green energy. scott jacobs, generate capital ceo and cofounder, joining us now to talk about this. i am really curious as to how this is going to work in reality. to makes industry need this transition happen in the united states? is it as simple as the biden adminstration coming in and providing stability, providing

clarity on how the rules will work? scott: that will undoubtedly help. you are hitting on the most important point that industry always asks of government, which is clear, transparent, long-term policy so that we know what the rules of the game are, and then we can compete our way to try and find the solutions. it is clear that in the past, we have taken different approaches where we prefer certain technologies over others, and in fact, as you probably well know, we subsidize the fossil fuel industry by more than six times more than we have subsidized renewable power or anything in the climate solutions side of the equation for the last several decades. we are just looking for a level playing field. it is wonderful that the administration is looking to establish clear, long-term, transparent rules. but there are other things we would like to see, and the best

four years for clean energy trump's for years. that highlights just how little sometimes the federal government matters with respect to climate resilient infrastructure, and what we need to build in order to stave off catastrophic effect of climate change. alix: let's pretend that d.c. has a bazillion dollar stimulus for clean tech, all kind of stuff. how much of that as many factored in the u.s., and how much of it is manufactured elsewhere? how difficult would it be to ship that? scott: that is an important point, and i know the obama administration was very focused on bringing manufacturing on shore with a number of the parts of the american reinvestment and recovery act. as you know, that was only $80 billion or so worth of investment from the government, and the biden plan contemplates a much more significant investment, but i will also point out that what we are really focused on right now is the deployment of solutions.

back in 2008, we could worry about inventing new solutions to the climate problem. now we don't have time to wait for new investments to come out of m.i.t.'s lab. it is about infrastructure, not invention. the good news is we have proven solutions. we already many factor a lot of those solutions -- already manufacture a lot of those solutions here on shore. the u.s. has a prison of and wrote a play. -- has a pretty significant role to play. we many factor solar panels here , batteries here, wind turbines here. the manufacturing base that is here in the u.s., there is a big emphasis on enabling the united states vehicle many factors -- vehicle manufacturers to produce clean vehicles as well. i thing a lot of the manufacturing is on shore, and it is not that hard to continue

to incentivize more of that. this is one of the key questions governments around the world are asking themselves. if i spend money on this, how am i going to maintain that money within my economy and not let it leak out? in europemilar story as in the united states. should governments mandate that when it spends money, manufacturing happens in that country? is it as simple as that? scott: my view is that the government should play a crucial role in terms of the supply-side , and a more specific role in the demand side. in other words, set the outcome you want to achieve, and let the market sorted out. that is how you reduce the amount that any of this costs to a taxpayer or a government. in fact, what we know is that most of these investments pay off. these are iconic solutions for

customers we are talking about. the reason why clean energy has seen the massive growth over the last decade that it has seen is because it offers a better, value proposition to the customer than the alternative. so i don't know we need to worry so much about incentivizing specific solutions on the supply-side, and instead focus on the outcomes that we want instead of incentivize the market to achieve. alix: what kind of sectors/companies are best positioned to put in the private capital that will be needed? scott: again, this is an interesting point. we talk about $2 trillion in the biden climate plan. $15 trillion is coming in from the private markets into sustainability over the next decade, according to mckinsey. you've got another set of trillions of dollars coming into the sector from private actors transitioning out of old fossil fuel energy investments into what is called the energy transition area.

so the private capital is going to dwarf the government capital that goes into this, and the industries that are going to benefit our renewable energy, power production, energy efficiency, devices. pretty basic stuff like sensors and controls that go into buildings. hvac systems that are more efficient, also manufactured all around the world, certainly. not as much in the united states, in that case. you got electric vehicles. guy: all of that makes sense, and that is relatively straightforward and feels incremental. some of the decisions are not incremental. they are great leaps forward. hydrogen feels like one of those. stand on those kinds of decisions? you can invest billions in hydrogen and find out that it is simply a white elephant. scott: many of us may remember george w. bush, and i think a

fuelingpaign ad, a gm vehicle with hydrogen. it has always been right around the corner. the industry has been very excited because it represented a transition of their fossil fuel fleet more than perhaps wholesale change into the electric city sector, which many of them are also trying to embrace. hydrogen is something that is actually quite real. we are one of the largest owners of hydrogen powered vehicles. it is not a vehicle that you are i would drive, but it is forklifts. these forklifts have been sitting in walmart and amazon and u.s. postal service distribution centers for many years, driving an economic benefit to the customer that is the reason why it has been adopted. so it is not that far off in terms of an industry that is available to be deployed today as a solution. it is actually here, and it is

important not to paint with such a broad brush. we actually know certain segments where the economics are just too compelling to do anything else, and it is a or customeregment by customer situation, and hydrogen is a solution for mini customers already today. guy: some big decisions need to be made. scott jacobs, generate capital ceo and cofounder, thank you very much indeed. this is bloomberg. ♪

ritika: this is "bloomberg markets." coming up later today, an exclusive conversation with southern bancorp ceo deron williams. this is bloomberg. ♪ let's check in on the bloomberg first word news now. i'm ritika gupta. president trump is expected to sign a bill that could lead to chinese companies getting kicked

off american stock exchanges. the measure approved by congress call for u.s. regulators to financial companies' results. it may be president trump's last chance to shape the fed. the senate is expected to confirm the nomination of crist for waller to serve on the federal reserve board. --ler has been the research christopher waller to serve on the federal reserve board. waller has been the research head of the saint was fed. the d-up aren't of health and human services says more than 40% of hospital beds in the u.s. -- the department of human's -- the department of health and human services says more than 40% of hospital beds in the u.s. are occupied by covid patients. rhode island has the greater percentage of beds taken by virus patients and almost when he 4%. -- almost 24%. france is putting pressure on european regulators not to make

any more trade concessions to the u.k., warning they could veto a brexit deal between the eu and the u.k. if they don't like the terms. negotiators are trying to reach an agreement in the next few days. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. alix: still ahead, opec+ is meeting, but guess who's chairing it? it is russia, not saudi arabia, causing lot of questions in the oil market as to how russia is going to be leading the opec+ coalition. we will break that down with dan onker for what his trade is this. this is bloomberg. ♪ ♪

ritika: it's time for the bloomberg business. i'm ritika gupta. 3m plans to start a global

restructuring that could affect about 2900 jobs. the company that makes everything from post-its to aerospace parts expects to take a pretax charge of as much as $300 million. 3m says restructuring will affect more business groups and functions. blackstone is extending its bet on warehouses. it's agreed to buy 13 facilities for $358 million. they are mostly located in california and new jersey and pennsylvania. waitedone had already billions of dollars on industrial real estate. company touro is returning to new york. it left the state after a dispute with regulators over insurance rules. individual vehicle owners won't be allowed to list their cars for daily rentals. will useturo

rental company to provide their insurance. that is your latest business flash. alix: thanks so much. time now for futures in focus. wti pretty much flat. brent up by 0.3%. reportedly, opec+ is discussing an increase in supply by 500,000 barrels of oil a day. they are also talking about when they want to start that increase. russia is now chairing the meeting instead of saudi arabia. that has many analysts scratching their heads. let's get the break down with dan dicker, founder of the energy word. he's traded oil for decades, and has a new book out. it is such a pleasure to see you. what do you think is going to happen? what is the price impact? think that is the worry, and that is why novak is chairing the meeting. want nois clearly cutback from the 7.7 million they are down in terms of production quotas, and the

russians of course wanted quite a bit more. that has been the dynamic between the two of them ever since opec+ started. the russians always looking to pump more, the saudis always looking to hold the line and make prices go up. i think a deal has already been done. more of ans are given leadership role here. they've become more a part of what is a collective effort from the opec+ cartel going forward, not just all sitting on the sidelines. ,n terms of what is going on 500,000 barrels a day probably still in early january. that is why you are not seeing much reaction right now. alix: i wonder also for other companies how they are looking at the price impact. clearly saudis are going to be very sensitive to how the prices moving higher. they wanted high, but not too high for u.s. shale companies. i wonder what that magic number

is. dan: so do the rest of us. we are all stuck in this cycle between having prices go up because of holding the line on production from opec+ numbers, and then watching shale companies rush in to take up the oficit, whatever deficit production there is, and take it vantage of higher prices. in the end, we are always looking at u.s. shale companies and how they will react to what opec does and how fast the vaccines are going to have an effect on demand, all of these things. but the wildcard always is u.s. shale companies are going to react. they are down 2 million barrels from before the pandemic. they are up another 300,000 barrels since this price recovery sort of started. the question becomes how are we going to get to a place for the sake of everybody, even

environmentally, and get a stable and rising price without incentivizing u.s. shale companies to continue to flood the market whenever the price gets good? that is really the ultimate question on all of this. guy: if saudi and the uae can't get on, how fragile is opec going forward? are we going to see further fractures down the road as we make this energy transition? how difficult is it going to be to manage this cartel? dan: you've got 23 members now, at the beginning there were seven, so it is getting tougher as it gets split up. the uae has clearly had a much of walking in terms in lockstep with the saudis. that may be done now. that may be partially the reason why the russians are chairing this reason. the saudi want to try and find a little more collective effort, and maybe engage others in terms

of leadership roles inside opec so they can hold the cartel together in the long-term. alix: how do you make money off of all of this? the big question is will companies need the revenue from their oil assets for the energy transition. whether you are saudi arabia, exxon, or a u.s. shale player, a lot of these companies have massive dividends, and you kind of like that when you have a 10 year yield at 92 basis. how do you make money? dan: the way i have sort of told my subscribers is to tread very carefully playing the majors here in the united states. in terms of the stock market itself, they have been left far behind what is the stock market make think highs, or very close to it. now you have some of the energy companies, they are very specific, and they are those that have really good assets and a decent balance sheet, and can withstand what is going to be a low price for oil at least

through the first three quarters of 2021, and probably into the back half and may be into 22. in terms of oil per -- into 2022. in terms of oil price and oil stocks, it is a little bit weak, you've got to depend on those dividends for the long haul. alix: dan, always good to see you. ofe in later for the return commodities edge, coming up at one a clock p.m. -- coming up at want to clock p.m. -- coming up at one a clock p.m. -- coming up at 1:00 p.m. guy: this is bloomberg. ♪

♪ guy: from london, i'm guy

johnson. in new york. we are counting you down to the european close on "bloomberg markets." ryanair places a monster order for the 77 max. the ceos will be joining us shortly. sweden is shutting its doors as a virus surge continues in europe, as well as in the united states. brexit down to the wire. france could veto the deal if they don't like it. lastound hitting highs seen in december 2019. let's talk about the markets. we are creeping higher. there's a bunch of factors here. stimulus and the united states certainly a positive. the claims data better than anticipated. a bunch of factors pushing stocks a little bit higher. increment oh, but it is all moving to the upside.