francine: democratic leaders called for president trump, who moved from office when inciting -- removed from office for inciting capital chaos. donald trump finally concedes that joe biden will be president. meanwhile, there are reports the president is incinerating pardoning himself as well as several others. bet on additional stimulus, and it is also jobs

day. good morning, everyone. welcome to "bloomberg surveillance." i am francine lacqua in london. the focus is on stimulus as we continue to follow washington very closely, try finally conceding to joe biden and saying that he will take office. rising ins are also europe. investors are beginning to look past toward a prospect of a biden presidency and a democrat-controlled congress. the dollar gaining, bitcoin crude oil actually edges higher. bloombergget to the first word news. here is leigh-ann gerrans. hi, leigh-ann. leigh-ann: good morning, francine. top democrats are calling on the vice president mike pence to act, saying otherwise they may start the impeachment process. it comes amid a wave of

resignations over the president's incitement of the mob. president-elect joe biden has described the trump supporters that stormed the u.s. capitol as "domestic terrorists," adding they would have been treated much more harshly had they represented black lives matter. creating an atmosphere that toowed the violence happen. bloomberg sources tell us president trump has prepared a list of individuals he is hoping to pardon in his final days of presidency, including family members, cabinet members, prominent rappers, and perhaps the president himself. january 19 is his last full day in office. global news, 24 hours a day, on air and at bloomberg @quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am leigh-ann gerrans. this is bloomberg. francine? francine: leigh-ann, thank you so much.

joining me is the director of global engagement at the white house under president obama, here to talk about the week that was. to focus on need joe biden or try to understand what happened, you know, to president trump in the next 12 days? brett: well, i think there is a remaining focus on president trump and what transpired earlier this week on capitol hill, but the process is going to be a long one, and i think the aspirations of some democrats and even a few republicans to remove president days from office in the 12 that still remain before joe biden is inaugurated are unrealistic. that being said, i don't think that donald trump's legal troubles will be over when he leaves office. francine: brett, what is the number one thing that actually

joe biden should focus on right now? how does he bring the country together after the week that we have seen? tott: i think he has got find a way to compromise, and obviously there are going to be a lot of efforts within the democratic party to try and fake out ideological ground. i think what joe biden needs to do is to stake out grounds centered around american ideals and to bring the country back to values,mmon set of core and to do that, i think it is important for the bloomberg audience to understand -- and we have seen examples in just the last couple of days -- of the role companies can play in helping to promote reconciliation, reminding americans that we have more in common than divides us. francine: but something i am trying to figure out, and we are trying to figure out, at least theondon, do the events and

writing on capitol hill actually unite americans, or does it -- rioting on capitol hill actually unite americans, or does it further divide them? brett: we have seen, and it was witnessed in the early hours of the morning after the capital was invaded, that you have seen a number of republicans that are separating themselves from trump and trumpism. they realize this has gone too far. the election on tuesday in georgia was a pretty stark reminder for republicans that trump is not able to carry them even in reliably republican states like georgia, in a runoff election that they should have won. so republicans are having second thoughts about trump's ambition to stay relevant, to stay in control of the party for the next four years. francine: when do we know what

the fate for donald trump is? what will be republican voter do? do they actually believe that this was a legitimate election, and will they vote for trump again, even if he were to have an independent vote? brett: i think we will have to wait a couple of weeks to see in polls and in some of the positions that republican out.rs to stake just this morning, we saw yet another cabinet secretary, betsy devos, secretary of education, resign. so all of this is likely to have an impact, and by the time we get to january 20 and on into february, the true extent of the damage of what donald trump has brought to the republican i think will be more evident, but this is going to take months to ull effect, and f i have to say, for republicans,

looking ahead just to legislative elections in now less than two years, there's going to have to be some quick repair to try to restore confidence, especially amongst those suburban voters that he lost in november. francine: what will the democratic administration of joe biden look like? is it going to be more moderate, is it going to be a little bit more left wing? what tone will they have to strike in the first 20 days? brett: biden, just in the announcement of cabinet secretaries other senior positions that he has unveiled t a prettyas staked ou centrist round and has resisted a lot of the pressure from progressives on the left to include those that have a more ideological agenda. and i think biden understands to both govern,

but more importantly, in order to heal the wounds of our country, he is going to have to reach across the aisle. this is something that joe biden is uniquely capable of doing. he has spent decades in the senate. he has good relations with mitch mcconnell, who will soon be the minority leader in the senate, as well as other republicans. that will be critical. francine: thank you so much, president of the global situation room in d.c. a lot of officials coming under file for a symbolic way of putting them out. mrs. von der leyen of the european commission, where she is president, says europe will have more of the needed vaccine, they will have 300 million pfizer vaccine doses. we need to look at the numbers to see if that is enough. it is also how it is distributed, who has access first. if you actually rank them,

francis falling farther behind. we will talk more about vaccine distribution in europe coming up on "bloomberg surveillance." former speak with the swedish prime minister about events unfolding in washington this week. shington this week. this is bloomberg. ♪ mberg. ♪

francine: economics, finance, politics. this is "bloomberg surveillance." i am francine lacqua here in london. let's get back to our top story, and a day after he urged his angry supporters should take action, president trump condemned the storming of the u.s. capitol. night,deo released last he defended the seat of u.s. democracy and demanded an

orderly transition of power. eric, away from the political talk that has really been gauging out from resignations out the white house, does this have implications for joe biden's policies going forward? eric: i think the biggest story won is that the democrats the democrats have now control of all three levels of power, so that is now overwhelmingly likely to be implemented over the next year or thereabouts. that includes higher taxation of corporate's, for example, but to be lessckage well-off in society. so this has a lot more momentum than it had before. francine: erik, what does that mean -- there is a majority, a thin majority -- what does that

mean for what you think the democrats will be able to push through? is it stimulus, is it infrastructure spending? what happens to taxes? erik: that is right. it is thin. there is a limit to what they can do. previous segment , to joe biden is a man who my discretion, will be someone who likes to have republicans along, including infrastructure projects in there about, but he cannot get away with not implementing some of the things about the corporate sector, for example, higher taxation, and that will come for sure now, and it will be a bit more like what the democrats want, which is a $200,000 blank check across everybody, and it would not make sense anyway but targeted to those who are suffering most for the pandemic. francine: when you look at the

markets, there is a clear reflationary trade. are we going to see, you know, the start of reflationary pressures coming from the u.s.? erik: that is going to be further down the line. i was looking through again, looking at the numbers, there will be an outlook gap in the u.s. for at least another year, two years, or thereabouts. underlyinge any inflation pressure, but the curve will be little higher, as he talked earlier in the previous section. the threat seems to be a little bit on hold here. what does the december surprise mean? that they did not commit more. i do not think they will change that tone. you will see a little steepening of the curve, but the underlying inflation story i do not think we will see for another couple of years at least. erik, when you are expecting all the democratic spending, you know, for the democrats to push three things,

does it start straightaway, or do they need to first try to put the country together -- less division after the week we had in politics? erik: oh my god, i wish i knew. these two things go together. there's no question that joe biden has to do something immediately. explain ore to understand fully to what extent or what it takes to unite the u.s. again. point, horrible, horrible. but hopefully he can do some of that. but he can do it at the same time as fiscal policies, and in many ways, these hang together, right? he needs to look after those who have not been looked after well enough during these years, and particularly last year, those who suffered most from the pandemic. erik, what kind of an economy do you think the u.s. will be in 12 months? we talk about the u.s. and china. i do not know whether what we

saw on capitol hill and the rioting gives china the opportunity to have a leg up over the u.s., but how do you expect that trade relationship to go, and what does that mean for the economy? erik: this is probably a decades-long discussion to have about u.s.-china relations. my understanding is that joe turn wanted to normalize, down the volume a little bit discussions with china. look, as far as i can see commit was not trunk who ultimately change the relationship between the u.s. and china. that had been going on earlier. remember, it was obama who had the transpacific agreement precisely to isolate china and push them closer to a more fair way of trading and investing, so this has been going on for a long time. moving to awe are chasm. had notlso obama who

gone after the wto sufficiently and appointed people, so trump made it worse. but this is not only trump, right? this is a massive, massive story for decades to come. to sit back and see how that works. i am still worried about china also from a point of view of what we have seen lately in terms of their interaction with , refusing to cooperate, as i understand it, on the virus investigation, and the crackdown on people in hong kong and how they handled some of the corporates. i think there is a lot of thinking in america and elsewhere how it is going to go, and i do not have the answer for sure. francine: erik, thank you so much. we will have more from erik ni elsen from unicredit. the virus and a new faster

spreading variant. we will have more on the recovery and vaccine distribution in europe. that is coming up next, and this is bloomberg. ♪ this

francine: this is "bloomberg surveillance." i am francine lacqua here in london. additional 300 million doses of the pfizer-beyond tech -- biontech vaccine have been

secured in europe. this is after a highly transmissible virus variant discovered in the u.k. and south africa. to talk about what we can expect in 2021 and beyond is erik nielsen from unicredit. first of all, we write all your yearly notes looking into the markets. i know it is very comprehensive, and it is a great sense of work. you talk about china and things like that. where do you think we will see the biggest shocks economically, if you look at regions? erik: wow, that is a good question. shocks are difficult to forecast. [laughs] -- how question mark is fast does the vaccine come out? and how to react to the vaccine? how safe do they feel again? remember, both in europe and america, we have enormous issues in the household sector. if that gets employed, that will be a very nice upswing the second half of the year.

and of course that relates to the whole issue of the policy response and the markets, how the markets react, stocks slowdown or in europe, people talk about doing the fiscal stimulus to early. so for me, those are the big whereon marks and shocks, mini shocks could come from. francine: what do you do with europe right now? i do not know if you look at just the roll of the vaccine to try and understand whether this economic region will get back on its feet may be quicker than others right now. immediately, the the feeling one has right now is disappointment, right? we get lots of statements about how much they can buy and all the rest of this, but europe has not done well so far in terms of getting people vaccinated. the u.k. is doing much better

than israel, and the u.s. seems to be doing a better job right now. with the health care system, take a place like france, which has socialized health care, and they only vaccinated 2000 people. i don't understand. and i am not an expert on this, but i am stunned by this, how slow it has come. hopefully it accelerates, the whole european coordination in that area will end up looking a bit poor, to put it politely. francine: talking about knots political stability but just the recovery fund. if you look at some of the countries that have been hit most by covid-19, how much time do you give them to try and figure out what they do with that money and whether it is, you know, put to good use or squandered? this isah, so, i mean, a big question, right? i think you want to think about

into terms -- the immediate impact money that sort of course cushion society, those who have been hit by the pandemic, and the fiscal stimulus. that money really is natural money, and i think that is why one must not withdraw the fiscal to early. then there is the european money, which is much more specific money in terms of climate change, investment, business, and bigger, common issues, and we can think about what is written in this next generation eu. ,ou can call it fiscal policy financing, common objectives, particularly in those two areas. those will have longer impacts, so our estimate is for europe as a whole, they would have about .2 or thereabouts, effective of gdp this year, but that about .5% in each of the three or four years, if the money really gets moved out, but that is just

reality. i think the commission is too optimistic in terms of the impact already this year, but that does not mean it is not good progress. erik, thank you so much for we will have more with erik nielsen from unicredit. concerns afterhe brexit happened to of course january 8 now. coming up, the unexpected flipping of george in the senate race helps joe biden to reshape the u.s. economy. we will talk about taxes and also technology giants. we discuss those details next. this is bloomberg. ♪ next. this is bloomberg. ♪

francine: economics, finance, politics. this is "bloomberg surveillance." i'm francine lacqua, here in london. let's get to the blue bird first

word news with leigh-ann gerrans. that the bloomberg first word news with leigh-ann gerrans. leigh-ann: there are mounting calls for president trump to resign or be removed from office amid the violence on capitol hill. top democrats are calling on mike pence to act, otherwise they may start the impeachment process. germany's health minister is considering money for chancellor. that is according to local media -- runninggermany for chancellor. that is according to local media reports in germany. he is thought of as the nation's most popular politician. imposing mandatory covid test on all passengers arriving in the country. anyone failing to do so will face an immediate fine of 500 pounds. travelers arriving from countries not approved on the list have to isolate at home for

10 days regardless of the test results. -- the u.s. is 1.3ending tariffs on billion dollars of french goods, and move a retaliation of attacks on global tech companies, any of them american firms. the decision to not go ahead with the trade dispute just two weeks before president trump does leave office. global news 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more i am120 countries, leigh-ann gerrans. this is bloomberg. francine: with democrats set to gain control of the u.s. senate house, president-elect biden will have a clean slate to reshape the economy, starting with a covid relief fund. yesterday we spoke with the cleveland -- she said she did

not believe that would pave the way for a federal back on monetary policy this year. don't really see it impacting the need for monetary support the recovery because i don't think we are -- i to be necessarily think this is a real journey, not a sprint. francine: joining us now is scott thiel of blackrock investment institute. scott, thank you for joining us. when you look at the week that was, on capitol hill with the writing, does it have an impact on fixed income -- on the rioting, does it have an impact on fixed income? scott: the most important thing in terms of the political events and the impact it has had not only on the political system but on people's lives, it is important to reflect that four people have lost their lives in the process of this event on

capitol hill, in addition to everything else. whatrms of fixed income, we just heard from the fed, and what they have been echoing, is that in this environment, monetary policy and fiscal policy are going to continue to be very supportive of the economy and of the markets going forward. when asked why isn't the market and fixed income reacting in a risk off way with the events of the last few days, the big answer is the support of both fiscal and monetary. i would note that the blue wave or the blue tide or whatever you want to call the change in the senate over the course of the last few days has obviously impacted the fixed income relatively significantly, particularly when we look at yields and breakevens, or implied inflation rates in the u.s. in particular. we have had breakevens move from 1.75, and election at now more than 2%, 2.1 this

morning. a really big move, but at the same time, nominal yields have also moved higher. i think this is the important part about where the fed comes in in terms of our yields now moving too aggressively higher, or are they too high overall, through 1% in the 10-year treasury? i think it will be really interesting to see, in some respects because of the blue wave, because of the continued theort, because of vaccination news which is positive coupled with, here in europe, as you discussed, there has been some negative developments. it will be interesting to see how monetary policy response to this increase in yields, which is again, i think part of the move wider in breakevens. francine: what exactly happens to the 10-year treasury yield? how much of a reflationary trade

will continue with a democratic senate and joe biden the white house? scott: i think there is an important elements to the today, between today and the runoff. fiscal spending -- the path first fiscal spending is clearer. there is this idea that we have a very narrow margin, the narrowest you can in the senate and in the congress as well. to see what kind of fiscal push can get made. but i do think that yields in the yield curve are reacting to that. as i said before, i think the fed is key on keeping the financial conditions easy, so we do not expect a very big move higher in yields here as monetary policy is going to stay on hold. one of our key themes, a positive view of risk assets is this idea of new nominal, which

is where rates stay relatively stable. although inflation increases, it does not solicit a policy response from the fed, and that is positive for risk assets and obviously the treasury range maps. what would actually warrant a policy response? scott: i think obviously to the extent that we got a very positive rebound in economic vaccination,if the the virus and impact would be significantly less than expected . but i mean, i think we are far from there. in particularly, the employment situation with a new fed framework, we are not at the point where we should be talking about withdrawing both fiscal or monetary policy. someine: when you look at of the data points that we are getting -- we are getting jobs today -- does that come second to everything else we were talking about?

especially until we exactly figure out what the democrats can do in congress? very: i think this is a important point. the incoming data has been so contorted by what is happening in terms of the virus, in terms of the economic lockdown. i think investors are looking through the near term economic data to try and assess how significant the overall economic going of the lockdowns is to be with the vaccination news and now with the democratic control of all three houses of u.s. government. newsear term economic takes a backseat because investors are trying to assess what is the total damage to the economy, from this entire situation, and how are the markets reacting to that total damage? we talk about the economic scarring, how much economic scarring will there be as a result of all of this, and i think that is what the markets

are focused on. that is why equities keep rallying, because they are looking through what is obviously going to be poor economic news, particularly in europe with this new wave of economic lockdowns. the trend is being pushed farther away. markets look through that because they look at the total economic impact and the potential for scarring, and they still don't -- they still see a positive light at the end of the tunnel. francine: what is the biggest challenge for the ecb this year? tott: i think the ecb has balance both the virus dynamics plus the inflation dynamics that are part of their ongoing struggle. obviously i think the ecb will continue like the fed, to push forward and try and both provide the support that the economy needs during this crisis, but obviously the fed went through a

major review of their policies and the ecb is doing the same. it will be interesting to see what comes out of that. for ecb watchers, that will be a significant development and we will wait for the news from that as it rolls out. for them it is about the ee recovery fund is in place, policies are in place, and we will see particularly with in germany and the u.k., for germany how that will impact economic development. thiel, fixedtt income strategist at black rock investment institute. including theup, former swedish prime minister and cochair of the council on foreign relations. that is coming up shortly, and this is bloomberg. ♪

>> it was really something that is embarrassing a lot of people to see what happens at the capitol. the reason where ,he actions of president trump not accepting the outcome of the elections. and it is something of a very democratic principle to accept elections, and if you are not successful you have to agree to the results. asking people to not accept the election is one of the reasons for all the things we saw yesterday night. said hed refuse and will always refuse to concede the election defeat.

do you think the u.s. president needs to come out and admit his loss? the: i'm sure that president should have admitted his loss for a long time, and now it is the time to do so. >> he is been accused of inciting an insurrection. are there laws in this country that would stop a leader from inciting such a mob insurrection? >> in the end, it is something that should not happen anywhere. it is one of the key principles of democracy, that you accept a defeat and that you do not ask to develop violent actions against parliament and in this case the congress. >> does it disappoint you that a democratic partner

allow such a thing to happen? olaf: we are quite confident that things will become better and you should know that the european union and the united states are involved in democracy and our cooperation and trends of lending partnership is important for democracy in the world, so it is absolutely key that the democratic principles are obeyed in our countries, and i hope this will be better in the united states. how has the transatlantic partnership been injured in during the trump presidency? all left: we understand there are at there --understand there is also a lot of things for use important together, and the united states -- we have the same principles, and that should have an impact on the way we are cooperating, and in the end we should be responsible for

multilateral corporation -- cooperation in the world. this is the only way to peace in the future. francine: our exclusive interview with german finance minister all left schulz -- olaf scholz. let's get more reaction, european reaction, and joining us from stockholm is carl bildt, the former swedish prime minister and council on foreign relations. thank you for giving bloomberg a bit of your time. in the week of u.s. politics, and we also remember the people that gave their lives to what happened on wednesday on capitol hill. how should europe react? is in supportope of the long-standing ties with the united states, as part of everything, as part of democracy in the united states and elsewhere. make clear his shock and

horror over what we saw on the very dark day of wednesday, and ,erhaps the greatest challenge with a president that has gone from leader of the world of democracy as a threat to that very democracy. the darkness and the horrors of the appalling act that we saw wednesday and the ultimate faith in the institutions of american democracy. francine: is this the end of american exceptionalism? and if it is, what does a new world order look like in foreign policy? carl: the world has changed irrespective of this. worldlationship and the -- what has happened on wednesday has made it someone more difficult to put my faith

in the election, democracy, and other things. there could be other parts -- -- were thea, asia world of america, the united states, when it comes to freedom, will not have the credibility and the strength that we have been relying on for a long time. francine: carl bildt, when you look at the way that china should look at this, the way they have looked at this, is there even more of a power vacuum for them to take space? there is ank element of glee from the chinese side than from the americans. you see the bloody chaos where they cannot even keep control of their congress, and it is a bloody mess. that has been the reaction of the chinese not officially, but most probably that has been the reaction that some informally

have at the kremlin as well. does that affect power to some extent? it does because the united ittes is dependent on -- is hard power, military power, the strength of the dollar or whatever? the united states is ultimately dependent more on soft power, the credibility, the attractiveness of the american model of government and society. --t has taken francine: does it mean that china will fill that vacuum, or is there more space for europe carl: idemocracy echo would not call it a vacuum. i think they are very careful, for europe, absolutely. i think there will be -- the

question is, there is a lot of 20 then onnuary 2024. are we seeing now a period of american history where trump is the emphasis, that where trump is the parenthesis or will joe biden be the parenthesis? francine: what will make the dt?ference, mr. bil is there something joe biden should do now to make sure that he is not the parenthesis? carl: he must succeed on the side of the atlantic. .e has taken over power accelerating in the united states and in europe. we have a global challenge. and then of course he has an economic challenge, the polarization of the american political spectrum.

most depends on the midterm elections. there is the presidential election in 2024. i think we can say that we alter the -- if that is not the case, then we will see. bildt, europe is also going through a challenging time in trying to keep covid-19 under control but also the distributions of the vaccines. do you worry if there is not more stimulus, or if we go into austerity, or if we don't distribute the vaccine properly, will things be more divisive than in the past? carl: not that much. i think the vaccine is going to come out somewhat slower than people hoped for. people would hope that it would

be completed by next weekend that is not going to be the case. but in the summer. then we are going to go with a transition in germany with angela merkel handing over to someone in october. germany is essentially a country with -- i think the big challenge is going to be what i goal the recovery from the recovery -- what i call the recovery from the recovery in europe, where we have to exit what we are doing now -- massive , noidies, massive debt we haveions on -- abandoned the competition for the time being. it at some point hearing something like that, we need to go back to basics in economic policy and that will be somewhat challenging. francine: carl bildt, thank you for joining us today. coming up, simon & schuster scrapped plans to publish a book

by senator josh hawley over his connection to the rights on capitol hill. we will bring you more details next, and this is bloomberg. ♪

francine: economics, finance, politics. this is "bloomberg surveillance." i'm francine lacqua, here in london. the bloomberg business flash. here is leigh-ann gerrans. leigh-ann: simon & schuster have publish a bookto by josh hawley. he calls the move a direct assault of the first amendment, and he plans to go to court. elon musk is now the richest person in the world. he has overtaken amazon founder jeff bezos, who has held the top spot since 2017. elon musk is now worth $195 billion. he has added 165 billion dollars of that in the last year, due to a message -- due to a massive surge of shares in his carmaker tesla. and blackstone is working with bill gates on a potential buyout

of signature aviation. the microsoft billionaire is the biggest shareholder, earning about 90%. the deal can value the world's biggest operator of private jet basis on 4.3 billion dollars. signature also said the carlyle group is considering an offer suggesting a potential bidding war. that is your bloomberg business flash. francine? francine: thank you so much. this is a picture from the markets, a lot of the focus on the reflation trade and what you see from congress, and trying to figure out exactly what comes once inauguration day is upon us. stocks are rising as futures are also rising jobs day. bitcoin dropping after topping $40,000. crude oil up a touch. ," moreerg surveillance of that next. ♪

francine: democratic leaders

call for president trump to be removed from office for inciting the capitol chaos. the clock ticks. there are 12 days left in his administration. donald trump finally concedes that joe biden will be the next president. meanwhile, there are reports that the president is considering pardoning himself, as well as sweeping lists of other individuals. and global stocks continue to climb after u.s. equities close at an all-time high. traders bet on additional stimulus, and it's also jobs day. good morning, everyone, and welcome to "bloomberg surveillance." i'm francine lacqua in london. tom keene in new york. a bit quieter on the political front after the last 72 hours. there is still the reflation trade going on, they are looking at stimulus, and they expect a lot more quiet after january 20. what is interesting is not only are we looking on oil but also touchingbriefly $40,000. tom: rather