Skip to main content

tv   Bloomberg Markets Americas  Bloomberg  December 6, 2021 10:00am-11:00am EST

10:00 am
guy johnson. ♪ alix: it is 30 minutes into the u.s. trading day on this monday, december 6. here's this top stories we are watching at this hour. shares of lucid are lower after a subpoena suggesting sec is probing its back deal -- it's spac deal. detect route -- the tech rout continues. omicron spreads. dr. fauci says the data has been encouraging, calling the overall mood music in the markets. to stay with the vaccine for a second, the top story is the new york city mayor bill de blasio is talking about a private company men date for vaccines and tightening the rules also for kids on eating in restaurants. guy: new york certainly feels
10:01 am
like it is ahead of the rest of america when it comes to this, but may be behind europe. europe already doing this for quite some time. that has an interesting aspect to it as well. photo ids going to be required. kids as young as five having to show some sort of proof that they have been vaccinated. it is a very different world. i wonder whether it is going to have ripple effect into other aspects of life. how long does this stick around for invoices like new york city -- stick around for? is this the new normal in places like new york city? alix: if we wind up having mutations that are not as disastrous, may be we don't need these kind of mandates anymore. i don't know. i think this will be a really interest debate. guy: it will certainly be something to watch. europe does feel at the p tradition of the moment in terms of not only what is happening with omicron and the spread, but also some of these new social norms may be we all need to get used to. do we need to start thinking about the story when it comes to
10:02 am
voting, photo id? we will see. the story for the markets this morning is what is happening with stocks like tesla getting battered. alix talking about that in the open as well. we are watching carefully some of these spac deals. that links to what we saw over the weekend. bitcoin, a big retreat from record highs. maybe having an impact, dragging stocks exposed to crypto lower. bitcoin down 13.5% over the last few days. the question is, can we draw a clear line between what is happening with crypto and what is happening in equity markets, particularly some of the yolo stocks? bloomberg's justina lee is joining me on set in the u.k. is yolo dead? investors are looking spooked. justina: it is interesting.
10:03 am
we use doing about crypto as a hedge to every thing else, but now it seems like just another risky asset. it makes a lot of sense if you think about it. we had a lot of retail inflows into the ark etf, so if you are hurting and one part of the portfolio, you might want to sell off in crypto, too. that is potentially happening for investors that just started dipping their toe in bitcoin. it is an interesting double edged sword we maybe hadn't thought of much about. alix: so why is it selling? is it people taking profits? is it fear? what is your best call right now? >> it is don't fight the fed or get risk assets go down when the fed tries to pick the bubble. that is what they are doing. the most speculative assets that have been the best performers are crypto, so we are hitting some of those stops. i think the crypto's are going to come out better for it like we had that big swoon in march
10:04 am
2020. i think that is what the market is looking forward to. it is a new asset, still zero on most portfolios, and i think institutions are buying the dip and the speculators are getting stopped out, so that is the speculation. the bloomberg crypto index is still up about wonder 70% on the year. it is just giving back some of that. guy: will this be comparable to the april selloff? if so, where does that take us? >> i think there's a very good floor around $40,000. the key thing i think about is this is all happening together. the crypto's are just a good leading indicator, like when doge peaked. i think the fed is going to be hawkish until the fed tells them not to be. they are worried about inflation. but you look at commodities, deflation is starting to accelerate. alix: hold onto that thought for a second.
10:05 am
part of that is going to depend on retail investors and when they are going to get in and by the dip. what is the options market, what is all that telling you about what retail is doing? justina: one interesting thing is in crypto options, it is mostly bullish speculation rather than hedging, which is the opposite from what we normally see in stocks, but over the weekend, we did start to see a little bit more hedging in crypto options, and that is definitely one interesting trend. one thing about crypto is all the liquidations are really melodramatic. in one go, we have seen a lot of liquidation across derivatives, and that certainly means at least you don't have that much room for another drop. but we are still seeing today that the nasdaq is down, so it seems like the yolo complex, if i can call it that, is a little afraid right now. guy: somebody smarter than me i was talking to the other day at an event, i would be
10:06 am
interested to get mike's take on this, when the government and the fed think about selling come of that is when you want to think about selling. is that what you are alluding to hear? is that what is going to happen? mike: oh yes. every manager on the planet knows it is unsustainable. in crypto's, bitcoin and a cerium are becoming reserve assets. just look at the 30 year long bond. it is five basis points away from being down on the year, and it is completely against consensus. so a look at the bigger picture. when we discuss this next year, you will probably see some mean reversion in assets like the stock market, but things like bitcoin are probably back to their longer-term upper trajectories. most asset portfolios are still very low allocated to things like bitcoin and ethereum. i think they are does getting up there. alix: one follow on that. if we see allocation to that,
10:07 am
what is the goal what is gold -- what is gold? mike: gold has been replaced by the new digital version, nothing we are seeing a little bit of stock-taking in the stockmarket. we know how these things work out. i think most asset managers, particularly when we had the miami event last friday night, the asset managers pointed out that we think bitcoin is going to come out better for it once we get through this period of risk off. the fed is basically adding too long positions in equities. guy: the point here is that we seem to be does abusing ourselves of the idea that crypto is a hedge for my portfolio. it doesn't seem to be acting that way. the correlation to stocks seems quite high, particularly for bitcoin.
10:08 am
justina: i was reading a report from man group, and one thing they point out is generally speaking, bitcoin has an almost zero correlation with other asset classes, but the problem is when other risky assets selloff, it tends to selloff as well. so in other words, it is not really a hedge when you need it to be. most of the time, it is diversifying, but it does seem like at the end of the day, it is still moving along with the entire risk compex. alix: mike, i think you might disagree longer-term with that? mike: i do disagree longer-term, but justina is spot on, there's no more powerful force than when the s&p goes down. everything else goes down with it. that is why i look at that long bond continuing to trickle lower. it is the use case that is so significant. crypto and dollars are all priced and tokens, and if these are priced in token -- nft's are priced in tokens.
10:09 am
this is where money will go to the rightful owners. guy: in terms of who is buying, do you see this changing? as justine a outcome of the correlation between yolo in the stock market and the crypto space seems pretty tight right now. in terms of breaking that connection, do you think that in order for that to happen, we need to see significant institutional money coming in, and do you worry that the current story at the moment with these correlations, with this kind of risk on-risk off story, will dissuade people from doing that? it is not doing what it says in terms of most people's perceptions. mike: that is the perfect analogy. china just cut their rrr rate. bond yields are declining. i think most money managers get into short-term, things go down together. the big picture, you have to be
10:10 am
thinking at least a year out, and what has the potential to continue doing what it has been doing. the bloomberg crypto index is up seven times the s&p 500. once you get down, people know, where is my potential performance. just imagine we get a 10% correction in the stock market. we haven't had that in a long time, but we had a six to percent correction in crypto's already this year. at some point we do need to see some normalization in the stock, and everyone on the planet expects it is less different this time. alix: 10%, i don't remember what that looks like. thanks a lot, justina lee and mike mcglone. tesla dropping over 4%. market value now falling to nine had $72.5 billion -- 900-7215 billion dollars. that after reuters says -- 972 $.5 billion -- $972.5 billion.
10:11 am
that after reuters says tesla is under investigation by the sec. guy: clearly, what is going on in terms of the regulatory story may be acting as a catalyst, but may be that narrative just putting on an open door. we are going to talk to our next guest about all of this. we are entering a new regime and markets are starting to reflect it. alicia levine, bny mellon investment management chief strategist, joining us next. this is bloomberg. ♪
10:12 am
10:13 am
alix: the mood music across the market is relatively calmer.
10:14 am
investors taking comforts and report that cases of the omicron variant are relatively mild. pulsing singer of elliott management wrote, "investors have elevated their risk level that may suffer significant and perhaps long-lasting damage when the government orchestrated music finally stops. joining us now is alicia levine, bmi mellon chief strategist. we had a whole -- bny mellon chief strategist. we had a whole conversation about the fed pricking the bubble. do you agree with that assessment? alicia: great to see you guys again. there was definitely a crossing of the rubicon last week with chair powell's testimony about retiring transitory and officially saying we are moving into the removal of liquidity phase of this project in response to the covid pandemic some 20 months ago. it is clear we are heading towards a curtailing of
10:15 am
liquidity even though, and this is really important, even though the absolute level is still enormous, which should provide support to markets, but you are bumping up against that second derivative problem. so the incremental change is going to be negative, and now it is out there. you can't take it back. you can't take back i hate you. what it has done is it has insulated the markets somewhat from some really tough data reads that we may get in the next couple of days on ppi and other things because essentially, as you know, the short end, the two-year is pricing in two to three hikes this year, so therefore, we are there. we rip the band-aid off and we are here. but this does have implications. it is not just about who the fed's pr team is. this is about what is supporting markets. very clear the liquidity elevated markets in all asset in
10:16 am
the last 20 months. what we are seeing here are those asset classes which are most dependent on buoyant liquidity underperforming, and that should continue for a little bit as things get digested. guy: how aggressive do using that repositioning is going to be? how different does the portfolio look this week compared to two weeks ago? alicia: it shouldn't look that different even though the very long duration is getting hit because it is throwing some of the baby out with the bathwater. if the market feels like it did in march and april are all tech underperformed and we saw inflation, high-growth, and the cyclical recovery, there's a little bit of that echo here as well. what you should have been in is midcycle growers, either value or growth, that has earnings revisions that are positive and that are not dependent on very
10:17 am
high multiples for price-performance, meaning they are reasonably priced. because the other thing you are going to get is a bit of a compression of multiples. it may not be that bad, but it does affect the non-earners more. alix: right when we started the segment, i mentioned tech was down. we are now off by 0.4%. it feels like a continuation from what we side the end of the close on friday. what do you make of the miss price action? from what you are saying, it feels like you want to go buy financials and sell tech -- and sell tech, which was the trade at 9:30. alicia: i would never say that, but these markets are ready for a reopening all over again. we had a reopening after the original variant and a reopening after the delta variant, so we are going to reopen now after the omicron variant if the news is marginally better. so financials should do well.
10:18 am
we like energy and we like homebuilding. however, and some ways that is really technical. but as you go further into 2022, growth will slow, so the fundamentals start to change on the margin, and so you want to be in your secular growers. you need to be in stocks that can earn and companies that can outperform on the earnings side. the multiples will not help you next year, and in fact will be a hindrance. guy: what you say that -- say to the people that say the economy has had a fantastic run, corporate profitability may hold up for a bit, but the risk to the upside is significant he smaller than the risk to the downside, therefore i'm out? what do you say to those people? alicia: in the short term, that may be correct, but it is hard to be right twice on the same trade. so you will see some liquidations here and some forced de-growthing.
10:19 am
he may have more opportunities now than you did 10 days ago to book losses against your book. so we will see some of that. but ultimately, i think that is tactical. we think growth is pretty good the first half of the year, and we think companies learn well. those that don't, and those low yield names you were talking about come are going to have a difficult time multiples get compressed. that was really the story for march and april, and we will continue with that theme into 2021. alix: the curve, does it ever really truly steepen? alicia: the truth is we never bet on the curve steepening. what the market has been telling you is that given the level of negative yield globally, the u.s. 10 year was going to have a very hard time rising out of this 1.7%, 1.8% top put in
10:20 am
because we have forced buyers of treasury debt. the treasury market is essentially telling you it is making a mistake. i don't think the fed is making a mistake. the treasury market is saying that because it is saying the fed is going to raise rates quickly and then crush growth. that is why the long end is so low. that is what the market is saying. doesn't mean it is right. there may be some steepening, but you're not going to get 10 years over 2% because your terminal rate is probably not going to be able to get over 1.5% on the fed funds rate. guy: on that note, we will leave it. you go early, maybe you don't get to go that high. alicia levine of ny mellon, greatly appreciate it. it is a tough day if you are an electric carmaker today. use it saying it has received a subpoena from the sec about its
10:21 am
spac deal. more on that next. this is bloomberg.
10:22 am
10:23 am
guy: let's get some clarity on lucid. shares down after the news that it got a subpoena from the sec. ed ludlow. what is this about? ed: the filing seems to indicate it is the merger between the spac, which is churchill capital , and the company, which traded under a different name at the time. we don't know much more of that. the scope of the investigation is not known. the sec has really ramped up enforcement against spac's in general. isaac we are in the high single digits this year. if you think about nicola or
10:24 am
lordstown, they have been subject to sec investigations. we don't know what the specifics are in this case. alix: unfair question, but how damaging could this be for the company to actually get its job done? ed: for nikola, they haven't really covered from just haven't really recovered from the sec investigation, so it is a distraction. specs have been painted with a broad brush of poor reputation because of the enforcement actions that have taken place. it is interesting, michael klein has been an advisor to the saudis for a long time. if this is about a merger, it is worth noting that lucid's chairman was also a partner of the spac they merged with, so there is a lot to look into here. guy: let's turn to tesla. company could be about to go into a bear market if it closes at current levels. another investigation. it is not the car company that
10:25 am
is the focus this time. it is the solarcity part of the business. ed: right. this was based on a whistleblower in 2019, who was then fired in 2020. he basically alleged he was fired because he brought to light some issues around the safety of the solar technology. the source of the story that reuters is reporting is a letter from the sec confirming, through a freedom of information act request, that an investigation is still ongoing. that letter was dated september 24, so we don't know what the most up-to-date stage of that process is, but that is what happened. it was an employee who first made a whistleblower complaint who was later fired by tesla and sued them, basically claiming wrongful dismissal, and it is an issue of safety around the solar cells. that is pretty much what we know today, and the shares are down. investors taking this seriously. alix: no doubt. a lot of froth it feels like
10:26 am
being shaken out. bloomberg's ed ludlow joining us. one of the trigger for the shakeout and certain assets is omicron fears. they are easing overall, which is why you are seeing the dow rally over 1%. potentially, the virus isn't going to be as bad as we thought. we are going to talk to a modeler at the brekke teller foundation. he's going to be joining us next, as we look at an equity market where you have the dow up by 0.6%. the nasdaq flipping into positive territory as the session gets underway, up by 0.4%. financials and materials doing really well as the curve tries to steepen. this is bloomberg. ♪
10:27 am
hey, angie! you forgot your phone! hey lou! angie forget her phone again? yep. lou! mom said she could save up to $400 on her wireless bill by switching to xfinity internet and mobile. with nationwide 5g at no extra cost. and lou! on the most reliable network, lou! smart kid, bill. oh oh so true. and now, the moon christmas special. gotta go! take the savings challenge at or visit an xfinity store to learn how our switch squad makes switching fast and easy this holiday season.
10:28 am
when you have xfinity xfi, you have peace of mind built in at no extra cost. advanced security helps keep your family protected online. pause wifi whenever for ultimate control with the xfinity app. and family-safe browsing gives parents one less thing to worry about. security, control and peace of mind. with xfinity xfi, it's all built in at no extra cost.
10:29 am
♪ alix: this is "bloomberg markets ." you are about one hour into the
10:30 am
trading session. pretty good that is here. we have a reap -- kriti gupta is here. we had a rebound monday. kriti: you can start to see a little bit of the underperformance from tech even though you do have a broad rally. a lot of that has to do with the ev makers because it isn't just tesla, lucid. it is also the semiconductor trade that goes along with it. that is really what is dragging the nasdaq down. when with ink about tech, when we think about high beta, the immediate thought that comes to mind is cathie wood. that is a trade that has kinda been working sideways, but hasn't really gained a ton of momentum, starting to drag a little bit. but sometimes tech and lead the way higher. that brings me to my chart of the day over in the terminal. you can see this on gtv . when you see the rallies come after, they are shorter, faster, and led by tech, something we watch for as we recover from the latest dip.
10:31 am
guy: thank you so much for the update. that market bounce we are seeing today partly driven by some fears easing around omicron get initial data doesn't show a resulting surge of hospitalizations. these are the numbers coming out of south africa. dr. fauci speaking on cnn, indicating that maybe the early data suggests that omicron may be less dangerous potentially than delta. dr. fauci: thus far it does not look like there is a great degree of severity to it, but we have really got to be careful for we make any determinations. we feel certain that there will be some degree, and maybe a considerable degree, of protection against the omicron variant. guy: joining us is skinny will scarp -- is samuel scarpino.
10:32 am
thank you very much for your time today. is there a positive scenario here in which omicron is more transmissible, and therefore takes over from delta, but produces milder symptoms? we are all talking about the downsides at the moment. is there an upside scenario? samuel: thanks for having me. i agree with dr. fauci that it is very early days in terms of what we are learning about this variant. it is true that in south africa, we are not seeing the corresponding surge in hospitalizations relative to the number of cases, and very early data suggests the hospitalized cases are less severe and less leslie to be vaccinated, but i think we need to be cautious as we learn more about this variant . alix: mayor bill de blasio in new york was talking about the fact that we could see private mandates, also pushing to get kids in their vaccination cards to go into restaurants. are these kind of measures necessary right now?
10:33 am
samuel: these kind of measures are necessary for the delta wave we are currently experiencing. we know the vaccines are highly effective. we know there's a lot of transmission being driven in that 12 to 11-year-old age group . we need to focus on boosters, and as we start to learn more about omicron, we need to layer in additional public health measures. masking, testing, and focus on ventilation. guy: does it make sense to restrict inbound travel into the country if omicron is already in the country? is there a logic that says for every extra case we have, obviously that expands rapidly, it seems like you are seeing fairly rapid spread in south africa, so do these restrictions make sense? samuel: the restrictions are going to do very little to slow the spread of the omicron variant. there was evidence it was in the never length -- in the netherlands prior to the announcement from south africa,
10:34 am
who we are fortunate they shared so quickly with the world. the travel bans are really ineffective. our partners globally are screening wastewater, screening pcr samples in over 40 countries at this point, many of which have seen global transmission. alix: to that point, what are the better measures long-term? is it possible that this could be more of a seasonal flu scenario, that it is transmissible, you get it, if you are vaccinated, you are relatively ok? samuel: this is a very different virus from influenza, as we know. we have vaccines that are highly effective, much more effective than the typical seasonal influenza vaccine. so time will tell with respect to how this variant will evolve. i know we are all crossing our fingers it will be less severe, but given the increase in transmissibility, we are still
10:35 am
looking at a very concerning potential environment with respect to hospitals being overwhelmed and mortality. guy: how quickly will this thing expand? it is expanding rapidly certainly in south africa. can we expect a similar rate of expansion elsewhere, given the fact that elsewhere, particularly in the developed world, we do have a significantly higher preponderance of vaccination, and there is still some natural immunity if you have contracted covid before? samuel: one of the key pieces of data coming out of south africa is that the rate of reinfection following natural infection may be two to three times higher with omicron. we are still looking for data on how the vaccine may play a role. cases are up from 200 to 300 per day, so well over 10,000 today in south africa, so very concerning signs. we are all watching closely in the u.k., where they have surveillance via pcr and
10:36 am
wastewater. we will learn very quickly how it is spreading their, and also in the united states, we note there's been a number of potential super spreading events . we will learn a lot more about whether the situation in south africa will generalize for the rest of the world. alix: to push on that point, when does omicron become the dominant variant? how quickly can we get there? samuel: if it spreads at the same rate as it is spreading in south africa, it will be weeks or months before it becomes the dominant variant. it is moving very quickly. of course, south africa was not in the middle of a surge when omicron started spreading, so we don't yet know how this variant will behave when it encounters the delta variant in the same population, and we don't yet know how this variant will spread when it shows up in the east coast of the united states, where we are very much in the middle of a major surge. guy: the new german health minister who was announced today
10:37 am
says that this pandemic is going to last a lot longer than everybody thinks. what do you think about that statement? how far through this process do you think we are? samuel: we are at least on the third phase of this pandemic. we had the first phase coming out of wuhan in 2020. we had the second phase characterized by delta, and now we are very much into the third phase, initially characterized by omicron, but there are almost certainly going to be other variants that emerge and start to spread. we do have agency. we understand the importance of masking, ventilation. we have vaccines. we understand how we can deploy testing, wastewater surveillance, ptr. all of these tools can be used to get out in front of the virus. that is what we're doing at the pandemic prevention institute at the rockefeller foundation. we will be able to bring this under control faster and more equitably. alternatively, we can do what we did in 2020 and with delta, to
10:38 am
sit and wait for things to get bad, and that is a scenario that i think is on except it will. alix: we really -- is on acceptable. alix: we really appreciate it. thank you so much. coming up, dig data week this week -- coming up, big data week this week. weather and lng prices will be huge for the winter. we will have an exclusive interview with michael smith, freeport ceo and founder, coming up. ♪
10:39 am
10:40 am
10:41 am
ritika: this is "bloomberg markets." coming up , christopher payne, doordash ceo. this is bloomberg. ♪
10:42 am
let's check in on the bloomberg first word news. i'm ritika gupta. business economists say u.s. inflation is set to exceed the fed's 2% target rate for at least another two years, according to a survey from the national association for business economics. higher prices are being driven by supply chain bottlenecks, strong demand, and rising wages. economists say the shipping and transportation problems may ease soon. the u.k. will push the u.s. to remove trump era tariffs on british steel and aluminum. the u.k. trade ticket terry meets tuesday with worse, secretary unary mondo. but -- boris johnson said trade with the u.s. would be one of the major benefits of leaving the european union. 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 medicaid group this is bloomberg. -- i'm ritika gupta. this is bloomberg. guy: huge economic week coming up. it will end friday with the u.s. inflation data, cpi. we think it is going to come in
10:43 am
at 6.8%. it could be a little but higher. we will wait and see. the man building is up to that number and bringing it to us is bloomberg's international economics and policy correspondent mike mckee. he's got the key things we need to know about the week ahead. michael: in honor of the season, i'm going to start this way. it is the week before the fed meets, and all through the house, no fed speak to speak of, not even a mouse. the traders did cry, except on friday, we do get cpi. ok, i am done with that. cpi's going to be the big number of the week, even though it is not going to tell us a whole lot. the reason for that is it is a november number. there's no omicron in this, and nothing really about oil because oil has rolled over in the last couple of weeks, and we don't know where either of those things are going from here. but it will set up the fed meeting, and as you mentioned, we could get a 6.8% read on the headline cpi, which would be the highest since 1982. that is why, with oil being what
10:44 am
it is, people are really going to be watching the core rate because i want to see what happens to the rent inflation we are seeing, and also whether we are seeing a broadening out of pressures. that would be the highest since 1992. some real historical comparisons that could scare the markets a little bit, even if they are not giving us a future look because we don't know what is going to happen with oil, except today, the fall has been arrested by saudi arabia which has raised the price of crude oil it sells to asia and the united states. alix is going to be able to tell us why. it doesn't make a lot of sense to those of us who just follow the numbers, but there you go. we could see oil prices heading back up. alix: like crude is actually a lot tighter, so they get to charge more. but let's talk about that poem because that was awesome. mike, thanks a lot. u.s. natural gas collapsing as
10:45 am
forecasts for warmer weather across the country are tempering demand for heating fuel as we head into the winter. all of this support if for the overall cpi number. wea -- weather is crucial for europe. >> how much gas is taken out of storage in january determines how much gas we can take out of trajan in february which is really the critical month. alix: let's take a look at it from the lens of an lng supplier. freeport is a u.s. lng company. currently the second largest are you joining us now for an exclusive interview is michael smith, freeport lng chairman and founder. that is the perspective from a european storage space. what is the perspective in terms of supply and demand from you, michael? michael: supply and demand
10:46 am
currently is quite balanced. we had a situation where we had supply chain issues just like everyone else has had in the economy. before the pandemic, the u.s. was producing 94 to 95 bcf a day, and it got as low as 94 bcf this year, and it was lows to get back to its previous levels until november of next year. there was feed we would not -- there was fear we would not fill our storage, and gas went up to six dollars this summer, but as we got back to 94 this november, gas prices retreated, and with warmer weather, we are now down to $3.70, so it is a fairly constructive market area. they really have a serious issue
10:47 am
if they get a cold winter. guy: absolutely. in the u.k., we are certainly worried about what the weather is going to bring. we are worried we are not going to have enough gas. at the moment the u.s. looks like it is in a very different place. there was a little bit of concern. prices spiked a little bit relative to what we have seen over here, and then came back down again. how much gas do you think over the next few years the u.s. will be able to export? how much of a balancing factored you think u.s. gas will be able to be on global markets? michael: the u.s. has an unlimited supply of natural gas for export. we have the largest production in the world. i just mentioned the 90's i've -- the 95 bcf a day. it is limited by the number of terminals constructed and built right now. we had a number that were able to export a little over 11bcf a day, -- over 11 bcf a day.
10:48 am
there are other terminals under construction right now in the united states. one that is coming online next year for 10 bcf -- sorry, 10 million tons, which is a little over a bcf of gas, and you have another one exxon is building that will be operational in 2024. we will get up to 13. then we will need more new fid's to raise to a level greater than that. alix: fid is a final investment decision. you are undergoing that right now. how much of that so far is sold, and would you think you could rectify that? michael: we have not made any announcements. we are very optimistic that we
10:49 am
will get it sold out sometime next year and be able to start construction by early 2023. you have to understand that, i mentioned the two facilities that are under construction, there have been no real long-term contracts signed to build a new facility until recently. the whole world thought that when we finished all the new construction of our plant and cameron's plant, that it was the end of the first wave of u.s. lng facilities, that the market was going to be flooded with lng for years. what we found out is we didn't have enough last winter, and the market just flipped on a dime, and now customers are out looking for 20 year contract, which have gone up to $30, and
10:50 am
the etf lives on spot pressures. guy: what role is you're not gas going to play in the -- your nat gas going to play in the energy transition? it has gone from a perfect incision technology to maybe being perceived as a little more dirty. i am wondering how that changes the equation vis-a-vis investment. do you think that nat gas is going to be the energy transition story for five years, 10 years, 15 years? are we still going to be heavily using lng in 20 years? michael: we will be heavily using lng for the next 30 to 50 years. the energy transition is important. i would love to see as much green energy as possible. but the amount of energy that is consumed in this world is so vast and there are so many developing countries with over a billion people who do not even have electricity yet, that we
10:51 am
need more clean energy. i know some people do not think natural gas is clean enough because it is a fossil fuel, but it is still -- it still cuts the co2 emissions by half over coal and does not have any of the pollutants that coal has when it is burned, so there's no question it make a huge difference, and green energy, until we get different battery technology, is intermittent. natural gas is the only fuel source that can be turned on quick enough when the wind doesn't blow where there are clouds or snow covering the solar panels. alix: before we let you go, i want to drill a little bit into that situation. how are you going to power that? you have been usually tied to the grid, and that has at its own problems, its own weather issues. at what point you think you can power your trains that are,
10:52 am
either more green;y or more efficient -- more greenly or more efficiently? michael: we are not having any power problems with our facility. we had an electrical outage due to hurricane nicholas for a few days that took some trains down for a week. that is living in the gulf. there's nothing we can do about that. our units reduced the carbon emissions of our traditional lng facility that earns natural gas for its power by 90%. in addition, the co2 we do have, we just made an announcement last week to do carbon sequestration on our site to get rid of most of the remaining co2 in our facility. so we believe we have the cleanest lng in the market. we actually call it elng for our
10:53 am
marketing purposes. guy: we wish you well. we could certainly do a some of that nat gas over here now in europe. thank you very much. this is bloomberg. ♪
10:54 am
10:55 am
♪ guy: from london, i'm guy johnson. alix steel is over in new york. this is "bloomberg markets." a quick look at the movers we are watching in europe as we had to the end of day. roche rising. it's got a rheumatoid arthritis drug that looks like it has been cured for covid treatment. we know that is a big part of the immune response. nestle and switzerland leading the charge higher today. a lot of weight to the upside. on the downside, some of the delivery companies really being pummeled over here in europe. we are waiting for wednesday,
10:56 am
some details from the european commission on gig workers becoming staff. that will be the proposal, and stocks like justine really getting pummeled on the back of that. alix: looking for to the close as well. it will be interesting to see that winds up spreading to the u.s. for the gig workers as well. here in the u.s., buy the dip. that is what we are seeing. ab not in tesla, but across the board. we thought it was going to be a down day, but the guy that it -- but the buy the dip theme continues. guy: it is interesting to see that relationship between what is happening in asia into europe, into the united states, particularly off of the big selloff we saw in crypto over the weekend. the european close is coming up next. this is bloomberg. ♪ ♪
10:57 am
when you have xfinity, you have entertainment built in. which is kind of nice. ah, what is happening. binge-watching is in the bag, when you find all your apps, all in one place. find live sports faster just by using your voice... sports on now. touchdown irish! [cheering] that was awesome. and, the hits won't quit, with peacock premium included at no additional cost. all that entertainment built in. xfinity. a way better way to watch.
10:58 am
10:59 am
guy: monday, december 6. european stocks near session highs. we are being led higher by
11:00 am
travel stocks. the countdown to the close starts now. guy: -- >> the countdown is on in europe. this is "bloomberg markets: european close," with guy johnson and alix steel. ♪ guy: 29 minutes to go until the end of trading in europe. for equities, let's give you a snapshot of where we are. the stoxx 600 poised to retake for 70. utilities doing well. travel is bouncing back. the energy sector on both sides of the atlantic trading strongly. the dollar is on the front foot. we've got a $1.12 handle. next week the big week, really. ecb, fed, bank of england. foreign-exchange markets paying attention to that. crude coming back. energy stocks on both sides of
11:01 am


info Stream Only

Uploaded by TV Archive on