Zelenskyy Says Trump Pushing Ukraine to Surrender, France Reels From Violence

>> NEWSMAKERS AND MARKET MOVERS. THIS IS THE PULSE. GUY: MONDAY THE 19TH GOOD MORNING. I'M GUY JOHNSON LONDON. THE EURO AND FRENCH ASSETS UNDER PRESSURE FOR THE DUST FOLLOWING THE COUNTRY'S WORST STREET VIOLENCE IN YEARS. EUROPEAN NATURAL GAS RISING TO ITS HIGHEST LEVEL IN NEARLY FOUR YEARS OF MORE SHIPPING ATTACKS IN THE STRAIT OF HORMUZ. PRESIDENT TRUMP PUSHING UKRAINE TO YIELD TO RUSSIA. THOSE OF THE HEADLINES LET'S TALK ABOUT THE MARKET REACTION. WITH A SHOW YOU WHAT IS FAT -- WHAT IS HAPPENING OUT THERE. WHAT WE'VE GOT HERE AT THE MOMENT IS A STORY OF TECH RECOVERING STATESIDE WITH EUROPE DEALING WITH DOWNSIDE. EUROPEAN EQUITIES ON THE BACK FOOT. EURO-DOLLAR MAY BE SOMETHING A LITTLE BIT FROM THAT FRENCH STORY THIS MORNING. FRENCH 10 YEAR WE ARE SEEN YIELDS RISING THIS MORNING, FRANCE DOESN'T FEEL OUT ACCOUNT WITH EUROPE NECESSARILY. EUROPE IS DOWN BUT STILL THE NUMBER IS 107.15. ARE WE ROLLING OFF ENOUGH TO MAKE A MEANINGFUL DIFFERENCE. THAT'S THE STORY IN TERMS OF THE CROSS ASSET PICTURE. THIS IS THE EUROPEAN EQUITY PICTURE. STARK CONTRAST TO WHAT WE ARE SEEING STATESIDE. WE ARE REASONABLY THIS MORNING. IN THE UNITED STATES ON FRIDAY, ALSO EUROPEAN BANKS ARE BIG LOSERS THIS MORNING OF THE BACK OF THE VIOLENCE WE ARE SEEING IN FRANCE THIS WEEKEND. FRANCE IS HAVING TO DO WITH THE CONSEQUENCES. THIS HOUR THE FRENCH PRIME MINISTER WILL CHAIR A MEETING ON THE ECONOMIC EFFECTS OF THIS WEEKEND'S PROTEST. IT COMES AFTER BEGINNING LARGELY AS A PEACEFUL DEMONSTRATION ACROSS FRANCE IT THEN SPIRALED INTO SOME OF FRANCE'S WORST STREET VIOLENCE IN DECADES WITH WIDESPREAD LOOTING AND LANDMARKS SET ABLAZE. HALF A MILLION PEOPLE TOOK TO THE STREETS. THE FRENCH PRESIDENT CALLED FOR ORDER TO BE RESTORED. >> OUR COUNTRY DESERVES A GREAT PRESIDENTIAL ELECTION IN SIX MONTHS. IT IS NOW BEING SHAPED BY SPIRIT OF RESPONSIBILITY. YES TO DIALOGUE, YES TO SHORT-TERM RESPONSES AND SHORT-TERM DECISIONS BUT ALSO NO TO VIOLENCE IN ANY FORM. WE NEED TO AND RESPECT. GUY: BLOOMBERG'S CHIEF EUROPEAN CORRESPONDENT IS IN PARIS. WE ARE RECOVERING FROM THE VIOLENCE BUT WHAT IS THE POLICY RESPONSE GOING TO LOOK LIKE. HOW TO THE FRENCH AUTHORITIES RESPOND. OLIVER: WE HAD THAT SPEECH FROM EMMANUEL MACRON LAST NIGHT WHICH LASTED FOR ONLY ABOUT EIGHT MINUTES, IT DID NOT CONTAIN A GREAT DEAL OF PROPOSALS HE SAID SOME THINGS ABOUT TRYING TO SECURE SOME CARGOES ON FOSSIL FUELS TO BRING DOWN THE COST OF LIVING. HE IS ALSO LEAVING FRANCE TODAY TO GO ON A SEVERAL DAY TOUR OF THE GULF. SAY IT WILL GIVE SOME MORE AUTHORITY TO LOCAL AUTHORITIES IN TERMS OF THE POTENTIAL ABILITY TO BAN PROTESTS IF HE NEEDS TO THERE WILL BE AN EMERGENCY MEETING WHICH BEGAN CHAIRED BY THE PRIME MINISTER OF FRANCE. SOME SORT OF WORKING GROUPS ESTABLISHED BETWEEN THE GOVERNMENT TO HAVE SOME DIALOGUE WITH THE PROTESTERS SPECIFICALLY WITH STUDENTS. THAT MAY NOT GO FAR ENOUGH AS IT IS. WE HAD THE INTERIOR MINISTER OVER THE WEEKEND APPARENTLY HANDING HIS RESIGNATION INTO EMMANUEL MACRON WHO REJECTED THAT OFFER ON HIS PART AND TODAY IT'S ABOUT CLEANING UP THE STREETS OF PARIS YOU CAN SEE THEM MARKED AROUND PARIS THE DAMAGE HAS BEEN DONE. REALLY THE HEART OF THE PROTESTS YOU CAN SEE THE SYMBOL OF THE FRENCH REPUBLIC HAS BEEN DRESSED UP WITH AN ALLUSION TO THE PROTEST WE SAW IN 2018 AND 20 19. THE BIG DIFFERENCE BETWEEN NOW AND 2018 TO 2019 IS MACRON IS MUCH MORE WEEK POLITICALLY THERE WON'T BE A GREAT DEAL HE CAN GET PER THE PARLIAMENT LEGISLATIVELY AND THERE IS THIS BUDGET ISSUE THAT'S BEEN CONSUMING FRANCE FOR THE LAST FEW WEEKS AND MONTHS EVEN BEFORE THESE PROTESTS BEGAN AND THERE IS THIS PHENOMENON FOR THIS GOVERNMENT SO ONE OF THE HEADLINES CAUGHT BETWEEN THE BOND MARKET AND THE BARRICADES. IN GERMANY THIS MORNING 144,, LILY BLOWN OUT. THE REAL SORT OF PRESSURE IS THERE'S NOT AN ABILITY TO DO A LOT WITH THE BUDGET AND NOT A LOT IN TERMS OF POLITICS. SIX MONTHS BEFORE THE PRESIDENTIAL ELECTION HERE IN FRANCE. GUY: IN TERMS OF THAT ELECTION OR THE IMPLICATIONS? OLIVER: THAT IS THE QUESTION. EVERYBODY CAME OUT OVER THE WEEKEND AFTER THESE PROTESTS AND EVERYBODY SORT OF CONDEMNED THE VIOLENCE ACROSS THE POLITICAL SPECTRUM BUT IF YOU BEGIN FROM THE FAR LEFT, REALLY BLAMING THE GOVERNMENT SAYING THE POLICE WERE TAKING FAR TOO HEAVY A HAND WITH THE CROWDS. THAT IS THE POSITION OF THE LEFT. YOU OF EMMANUEL MACRON BLAMING THE LEFT AND THE LF FEE FOR STOKING THE SORT OF VIOLENCE AND WE HEARD THE SAME MESSAGE FROM MARINE LE PEN, WHO GAVE HER SPEECH IN FRONT OF A BIG DESK IN THE BOOKCASE WITH A FRENCH FLAG BEHIND HER REALLY PROJECTING THIS IMAGE OF A LAW AND ORDER FRANCE, RETURNED TO AUTHORITY AND SAFETY THAT'S HOW SHE PUT IT, AND EVERYBODY ELSE ON THE POLITICAL SPECTRUM THE EXTREME RIGHT LOOKING AT IT VERY SQUARELY BLAMED ON IMMIGRANTS. WITH THESE KIND OF PROTESTS BUT BEGIN AS SOMETHING CONCRETE AS COHERENT IN TERMS OF THE NARRATIVE THE STUDENT PROTESTS AND THE COST OF LIVING WHEN THEY DEGENERATE INTO THIS WIDESCALE CHAOS AND DESTRUCTION, EVERYBODY CAN SEE EVERYTHING THEY WANT TO SEE POLITICALLY IN THESE PROTESTS AND THAT'S WHAT EVERYONE IS GOING TO TRY AND CAPITALIZE ON. WE WILL SEE IF THIS FAVORS MARINE LE PEN OR THE LEFT. GUY: THANK YOU VERY MUCH OLIVER. CHIEF YOUR CORRESPONDENT IN PARIS. DEEPENING WORRIES ABOUT THE COUNTRY'S PHYSICAL -- FISCAL HEALTH. JOINING US IS THE HEAD OF MULTI-ASSET SOLUTIONS FOR THE EMEA AT GOLDMAN SACHS ASSET MANAGEMENT GOOD MORNING. WHAT DO I DO, HOW I PRICE THIS IN. WHAT SHALL I BE THINKING ABOUT IF I AM AN INVESTOR IN EUROPE AND THE IMPLICATIONS OF WHAT WE'VE SEEN. >> FIRSTLY AS A RELATES TO BOND YIELDS IT'S WORTH NOTING THE GLOBAL CONTEXT BOND YIELDS HAVE BEEN INCREASING IN SOME OF THAT SMOOTH INFLATIONARY PRESSURES. WE ARE A SIGNIFICANT ENERGY SHOCK. THOSE PRESSURES PASS THROUGH THE CENTRAL BANK TO A MORE HAWKISH POSITION AND BOND YIELDS AROUND THE WORLD HAVE INCREASED AS A RESULT. INFLATION EXPECTATIONS ARE PRETTY WELL ANCHORED. PRETTY STEADY WHICH SUGGESTS THE VAST MOVE HERE IS DRIVEN BY YIELD AND THAT'S CLEARLY REFLECTED IN THE CENTRAL BANK. CERTAINLY WITH THE FED, THE SEA BREEZE INCREASED POLICY RATES AS WELL. I THINK THE CHALLENGE WITH RESPECT TO FRANCE AND AS I THINK WE JUST NOTED IN THE PIECE EARLIER, THE SPREADS BETWEEN THESE IS QUITE ELEVATED. WE SAW THE SORTS OF LEVELS BACK IN 2011 AND THAT'S CLEARLY REFLECTING THIS CHALLENGE AROUND THE FRENCH FISCAL DISCIPLINE, THE PASSING OF THIS BUDGET INVOLVING CUTS. FRANCE NEEDING TO RESOLVE ITS DEBT TO GDP AND IS RUNNING A 5% DEFICIT. SO IT WILL BE INTERESTING TO SEE HOW THIS EVOLVES. GUY: LOOSING A SERIES ABOUT THE COST OF LIVING. RUNNING AT TWO PERCENT, ECONOMISTS KIND OF TALK ABOUT RECENT CHANGE PARTICULARLY THE LOWER END WITH A CUMULATIVE INFLATION STORY. PRICES HAVE GONE UP SIGNIFICANTLY OVER THE LAST FEW YEARS. ARE WE UNDERESTIMATING IN FINANCIAL MARKETS THE POTENTIAL FOR SIGNIFICANT PUSHBACK. I DON'T KNOW HOW YOU PRICE THAT. THE IDEA THAT FRANCE IS GOING TO GO THROUGH SOME AUSTERITY MEASURE TO GET THAT SELF-CONTROL IS TOTALLY UNREALISTIC AT A TIME WHEN WE HAVE THIS HUGE SECURITY STORY IN EUROPE HAS TO DEFEND ITSELF. THAT FEELS LIKE BIGGER DEFICITS NOT SMALLER DEFICITS. EQUITY SAYING WE WILL GET THIS UNDER CONTROL. SHOQAT: I THINK THAT'S A FAIR REFLECTION YOU SEE A K-SHAPED SORT OF ECONOMY IN A LOT OF DEBT MARKETS AT THE MOMENT YOU NEED GROWTH AND IF YOU LOOK AT THE PICTURE IN THE U.S. YOU ARE EXPERIENCING THEIR RESILIENT GROWTH PHENOMENAL GROWTH THERE IS ABOVE 5%. COMBATING INFLATION I THINK IS INCREDIBLY IMPORTANT IN ORDER TO ENSURE THAT THOSE COST-OF-LIVING STANDARDS ARE MAINTAINED AT A REASONABLE LEVEL. THEY'VE INCREASED THEIR POLICY RATES AND ENSURING MEASURES THAT ACHIEVE GROWTH AS WELL. GERMAN FISCAL EXPANSION IS HELPFUL IN THAT REGARD. I THINK EUROPE HAS SEEN AN IMPROVEMENT IN ACTIVITY CERTAINLY IN RECENT MONTHS AFTER EXPERIENCING AN ENERGY SHOCK EARLIER IN THE YEAR. WE'VE SEEN PMI INCREASE THE GROWTH OUTLOOK AND WE NEED TO SEE MORE. GUY: YOU WANT GROWTH YOU HAVE TO GO TO THE UNITED STATES AND IF YOU WANT GROWTH YOU NEED TO BE MORE SPECIFIC BECAUSE IT LOOKS LIKE THE ONLY GROWTH IN THE U.S. IS LARGELY COMING FROM THE AI TRADE SO IS THE ONLY GROWTH COMING FROM TECH AT THE MOMENT AND AS AN INVESTOR HOW DO I TRADE THAT GROWTH AND QUESTIONS AROUND ITS SUSTAINABILITY. SHOQAT: IT'S RIGHT TO NOTATE -- AI CAPEX HAS BEEN VERY SUBSTANTIAL. IT'S LIKELY -- LIKELY TO EXCEED 800 BILLION IT'S A SIGNIFICANT CONTRIBUTION BUT NET CONSUMPTION IS HELD UP WELL. RETAIL SALES OF BEEN STRONG. AND YOU'RE LIKELY TO SEE REAL GDP ABOVE 2%. AND HOW THAT'S TRANSLATED INTO CORPORATE EARNINGS IS INCREDIBLY STRONG AS WELL. IT'S NOT JUST BEING DRIVEN BY TECH AND ENERGY. GIVEN THE MEDIAN COMPANY IS EXPERIENCING THIS GROWTH ABOVE 10% WE ARE LIKELY TO SEE THAT AGAIN IN THE THIRD QUARTER. A NUMBER OF SECTORS BEYOND TECH ARE UP DOUBLE DIGITS BUT INCLUDES MATERIALS INDUSTRIALS HEALTH CARE. I THINK IT'S CLEARLY BEEN CONTRIBUTED FROM AI CAPEX THROUGHOUT THE ECONOMY. BUT THERE IS A BROAD-BASED LEVEL OF EARNINGS THAT MOVES BEYOND. GUY: THE CONCENTRATION PORTFOLIOS IS WRONG. SHOQAT: FIRSTLY THE U.S. IS SIGNIFICANT. THE GLOBAL MARKET CAP ABOVE 70% AND A SIGNIFICANT PART OF THE S&P IS OBVIOUSLY DRIVEN BY TECH. THAT IS NOT TO SAY YOU'RE NOT SEEING EARNINGS GROWTH FROM A WIDER RANGE OF COMPANIES AS WELL. BUT THIS ONLY SOME DEGREE OF CONCENTRATION BUILDUP. GUY: WHAT I LEARNED LAST WEEK RESPONDS POTENTIALLY ACT AS A PORTFOLIO BALLAST THEY ARE GOING TO PLAY A ROLE, BONDS WILL DO BETTER. WAS THAT THE LESSON FROM LAST WEEK? SHOQAT: IT'S GOOD TO KNOW BOND YIELDS ARE MUCH HIGHER. THEY PROVIDE A MUCH GREATER BALLAST IN THE EVENT THERE IS A RECESSION BECAUSE THERE'S GREATER ROOM FOR YIELDS TO FALL AND PROTECT ON RISK ASSETS IN THIS PARTICULAR PERIODS THIS YEAR WE STILL SEEN RISING BOND YIELDS BUT HAVEN'T REALLY PROVIDED THAT FORM OF RISK MITIGATION BUT CERTAINLY THE LEVELS OF YIELDS WE ARE SEEING NOW YOU WOULD EXPECT THAT DEGREE TO PLAY THROUGH EVEN IF IT DOESN'T WE ADVOCATE THE ASSET INVESTORS TO NOT JUST CONCENTRATE ON BONDS AS YOUR PRIMARY DIVERSIFICATION SOURCE IS A RANGE OF TOOLS YOU CAN HAVE YOUR DISPOSAL. HEDGE FUNDS HAVE PROVIDED THAT DEGREE OF DIVERSIFICATION AS WELL AS WELL AS RETURNED CONTRIBUTION BRING OF HIS OTHER FORMS YOU CAN DEPLOY AS WELL. THERE'S MECHANISM ON FX MARKETS YOU CAN USE SAFE HAVEN CURRENCIES INCLUDING THE DOLLAR AND THE SWISS FRANC, THE YEN. THIS ALSO THE ABILITY TO MANAGE INTEREST RATE OPTIONS ON THE FRONT END TO THE EXTENT THERE IS A SHOCK LIKELY TO SEE CENTRAL BANKS PITTED TO A MORE DOVISH STANCE BUT GET PRICED INTO THE FRONT-END AS WELL. WHEN RISK ASSETS FACE STRESS. GUY: ARE YOU EXPECTING MORE WOBBLES? ARE YOU EXPECTING MORE WEEKS LIKE LAST WEEK BASICALLY IN TERMS OF WHAT WE WILL SEE. ARE THOSE ALTERNATIVES GOING TO BECOME MORE VALUABLE. SHOQAT: ON RISK ASSETS WITH RESPECT TO EQUITIES IT'S WORTH BEARING IN MIND WE'VE SEEN ANOTHER DRIVE UP AND RISK ASSETS OFF THE BACK OF RESILIENT GROWTH AND STRONGER EARNINGS. ABSOLUTE LEVELS OF VALUATION VERSUS LONG-TERM LOOK HIGH SEE HER NATURALLY AND A FACE THAT SORT OF HEADWIND TO THE EXTENT THERE IS SURPRISES TO THE DOWNSIDE ON EARNINGS BUT IF YOU LOOK AT THIS YEAR, PRICE-EARNINGS MULTIPLES ARE AROUND 22 TIMES FOR THE S&P. GIVEN THE STRENGTH OF EARNINGS WE ARE NOW AROUND 19 TIMES THAT'S BROADLY VYING WITH THE LAST 10 YEAR AVERAGE SO NOT SEEN VALUATION AS DEMANDING AS IT WAS IN THE BEGINNING IT'S NOT TO SAY YOU'RE KNOCKING A SEAT BOUTS OF VOLATILITY WITH RISING BOND YIELDS AND INFLATIONARY PRESSURES. THAT'S NATURALLY GOING TO LEAD TO HIGHER BOUTS OF VOLATILITY BUT THE OVERALL FUNDAMENTALS STILL REMAINS RESILIENT. GUY: HEAD OF MULTI-ASSET SOLUTIONS AT GOLDMAN SACHS ASSET MANAGEMENT. LUCADO HAS WALKED INTO THE EMERGENCY MEETING WE WILL GO BACK TO THOSE LIVE PICTURES VERY SHORTLY AND KEEP YOU UPDATED. COMING UP SPARRING BETWEEN THE U.S. AND UKRAINE. PRESIDENT ZELENSKYY ACCUSING DONALD TRUMP OF TRYING TO PRESSURE KYIV INTO SURRENDERING TO RUSSIA. ALL THAT STORY NEXT, THIS IS BLOOMBERG GREEN -- THIS IS BLOOMBERG. ♪ GUY: 18 MINUTES PAST THE HOUR. THE UKRAINIAN PRESIDENT OF A LOT OF HAS TOLD BLOOMBERG DONALD TRUMP IS TRYING TO PRESSURE KYIV INTO SURRENDERING TO RUSSIA. TESSA'S -- TENSIONS ESCALATED. THE U.S. HOUSE SPEAKER MIKE JOHNSON SAYS THE DECISION NEEDS MORE DISCUSSION. >> I TOLD THE WHITE HOUSE TEAM THAT -- WE NEED TO TALK ABOUT IT AND I THINK CAREFULLY CONSIDER THE UNINTENDED CONSEQUENCES THAT MAY ENSUE FROM ABOUT. ANOTHER PRESIDENTS EVALUATING THIS AS HE DOES EVERYTHING ELSE. LOOK HE HAS TWO MAJOR OBJECTIVES AS YOU KNOW EVERY DAY IS TO KEEP AMERICA SAFE AND HE WANTS TO BRING DOWN THE COST OF LIVING FOR EVERY AMERICAN. GUY: HANNA NOTTE AT THE CENTER FOR NON-PROLIFIC -- PROLIFERATION STUDIES THE GLOBAL CAMPAIGN TO DEFEAT THE WEST JOINING ME NOW SAYS GOOD MORNING. DOES ZELENSKYY HAVE A POINT WHEN HE SAID THE TRUMP ADMINISTRATION IS TRYING TO PUSH THEM BASICALLY TO GIVE UP GROUND TO RUSSIA? HANNA: THERE'S A LOT OF PRESSURE ON THE UKRAINIANS WHICH COMES AT A DANGEROUS TIME FOR UKRAINE AS WE SEE THIS INTENSIFICATION IN RUSSIAN BOMBARDMENT OF UKRAINIAN CITIES ESSENTIALLY AN ATTEMPT TO MAKE UKRAINIAN CITIES UNLIVABLE INTO THE FALL AND WINTER AND NOW YOU HAVE THIS ADDED PRESSURE REALLY THE DAMAGE IS LESS THAT THERE IS AN ECONOMIC BENEFIT TO RUSSIA FROM ALL OF THIS BECAUSE PROBABLY EVEN IF THE RUSSIANS EXPORT ADDITIONAL DIESEL TO THE U.S. AT THE VOLUMES INDICATED AND EVEN IF THE GRAHAM ACT HAS BEEN WAVERED I DON'T THINK THE END AGAIN FOR THE RUSSIAN STATE BUDGET WILL BE CHANGED. GUY: WHAT ABOUT ON THE GROUND? WE ARE SEEING INTELLIGENCE SHARING NOT BEING SHARED. AND SO SO IS THAT THE EFFECT THAT IS REALLY IMPORTANT. HANNA: IT'S A MEASURES THE UNITED STATES APPEARS TO BE TAKING TO PUNISH UKRAINE FOR CONTINUING TO STRIKE RUSSIAN REFINERIES. YOU HAD A REDUCTION IN INTELLIGENCE SHARING APPARENTLY. I THINK UKRAINIANS SAID THE INTELLIGENCE SHARING RESUMED BUT THIS MORNING ZELENSKYY CAME OUT AND SAID THERE WAS ANOTHER BALLISTIC MISSILES ATTACK OVERNIGHT AND THERE WAS NO EARLY WARNING FROM THE U.S.. THERE IS ALSO THE THROTTLING OF THE STARTING PROVISION TO UKRAINE AND THEN THREATS BY THE U.S. ADMINISTRATION TO NOT PROVIDE WEAPONS TO UKRAINE ANYMORE. SO IT IS A THREAT LOOMING OVER THE UKRAINIANS. THIS IS COMING AT A TIME WHERE THE RUSSIANS ARE NOT MAKING SIGNIFICANT ADVANCEMENTS ON THE BATTLEFIELD BUT THEY ARE TRYING TO BOMB THE UKRAINIANS INTO SUBMISSION TO ACHIEVE AN OUTCOME ACCEPTABLE TO THEM AT THE NEGOTIATING TABLE NEXT SPRING. GUY: IS THIS ABOUT THE MIDTERMS, IS HIS NEW TOUGHER LINE RELATED TO THE U.S. MIDTERMS. HANNA: THIS IS ABOUT THE DOMESTIC POLITICAL CONTEXT IN THE UNITED STATES. WE HAVE RISING PRICES FOR AMERICAN GAS CONSUMERS WHICH IS LARGELY BECAUSE OF THE IRAN WAR. TRUMP WANTS TO DEFLECT CRITICISM AND PIN THE BLAME FOR THOSE PRICES ON SOMEONE ELSE AND THAT IS ZELENSKYY OF UKRAINE SO HE IS SAYING THIS IS THE STRIKES ON RUSSIAN REFINERIES CAUSING THIS. SO THERE IS THIS DOMESTIC CONTEXT. BUT I ALSO SEE SOMETHING ELSE GOING ON HERE, THE U.S. ADMINISTRATION RETURNING TO THIS IDEA THAT YOU CAN WORK WITH THE RUSSIANS TO END THIS WAR BY OFFERING THEM ECONOMIC INCENTIVES. WE DON'T JUST HAVE THE DIESEL DEAL OR WAIVING THE SANCTIONS, WE ALSO HAVE THE U.S. ADMINISTRATION APPARENTLY GETTING INVOLVED IN THE SALE OF LUKOIL'S FOREIGN ASSETS. WE HAVE JARED KUSHNER AND STEVE WITKOFF APPARENTLY FLOATING THE IDEA MAY BE THE EUROPEANS COULD RESUME GAS PURCHASES FROM RUSSIA ONCE WE HAVE A DEAL YOU HAVE TALK ABOUT UNFREEZING RUSSIAN SOVEREIGN ASSETS SO RETURNED TO THIS IDEA THAT MAYBE YOU CAN GET THE RUSSIANS TO MAKE CONCESSIONS IF YOU OFFER THEM A LAYERED STRUCTURE OF ECONOMIC INCENTIVES. THE PROBLEM WITH THAT IS THE U.S. TRIED THAT LAST YEAR AND IT WAS VERY CLEAR RUSSIA IS NOT INTERESTED IN MAKING THOSE CONCESSIONS. IT WILL POCKET THEM AND THIS IDEA YOU CAN MAKE BILATERAL DEALS WITH THE TRUMP ADMINISTRATION IS A WELCOME ONE TO THE RUSSIAN SIDE BUT I DON'T SEE ANY INDICATION WHATSOEVER THAT RUSSIA IS EVER MODERATING ITS DEMANDS WHEN IT COMES TO UKRAINE. GUY: THAT'S IN SOME WAYS OR THE BIGGER THINGS OF THIS WAR IS RETURNING SOME OF THAT HISTORICAL STRENGTH RUSSIA AND THE SOVIET UNION HAD ENJOYED HISTORICALLY. HANNA: I THINK AT THE MOMENT THE MINIMUM RUSSIAN DEMAND APPEARS TO BE TO AT LEAST TAKE ALL THE DONBAS, THAT IS WHAT HE MUST GO HOME WITH BUT HE LIKELY BELIEVES HE CAN HAVE EVEN MORE. HE IS NOT MOVING VERY FAST ON THE FRONT AT THE MOMENT AND ALSO THE RUSSIANS ARE INCURRING HIGH LOSSES BUT THE CALCULATION MIGHT BE THAT IF YOU CAUSE THE HARSHEST WINTER FOR THE UKRAINIANS YET LET'S SEE WHERE THEY ARE NEXT SPRING AND WE ARE RELEASING THE GLOVES COME OFF ON THE RUSSIAN SIDE. WE SEEN BOMBARDMENTS DURING THE DAY WE SEE ATTACKS ON BRIDGES ON THE ENERGY AND WATER INFRASTRUCTURE IN THE UKRAINIAN CITIES EVEN THE ACADEMY OF SCIENCES WAS RECENTLY BOMBED SO THIS IS A NEW QUALITY OF ATTACK AND THE BELIEF IS MAYBE THE UKRAINIANS WILL YIELD THIS TERRITORY AT THE NEGOTIATING TABLE. TRUMP IS THIS ADDED BOON. IF YOU HAVE HIM WHO SAYS MAYBE ZELENSKYY NEEDS TO BE REPLACED THIS PLAYS INTO RUSSIAN TALKING POINTS BECAUSE THE RUSSIAN POSITION IS THIS REGIME AS THEY CALL IT IS AN ILLEGITIMATE ONE AND THERE SHOULD BE ELECTIONS ON THE UKRAINIAN SIDE. GUY: WHAT DO YOU MAKE OF TALK OF A MEETING THE CHINESE THE RUSSIANS GETTING TOGETHER MAY BE SOLVING THIS PROBLEM. HOW DOES THAT WORK WITH THE UKRAINIANS. HANNA: THE RUSSIANS LOVE THIS IDEA BECAUSE THIS IS CATERING TO THEIR IDEA OF HOW THEY WANT TO ENGAGE IN INTERNATIONAL POLITICS. THIS IDEA OF THE GREAT POWERS SITTING AROUND A TABLE AND ESSENTIALLY CARVING THE WORLD INTO SPHERES OF INFLUENCE IN MAKING A DEAL WITH THE U.S. AND INVOLVING CHINA YOUR CLOSE PARTNER. LET'S NOT FORGET HOW THE CHINESE HAVE SUPPORTED RUSSIA THROUGH MASSIVE EXPORTS SO YOU MAKE A DEAL AND YOU DON'T EVEN INCLUDE ZELENSKYY OR THE EUROPEANS. I DON'T THINK THIS WILL WORK BECAUSE AS MUCH AS STEPS BY THE TRUMP ADMINISTRATION HAVE BEEN BENEFICIAL TO RUSSIA THERE WAS ALSO A FLIPSIDE TO THE STORY WHICH IS THE EUROPEANS ARE INCREASINGLY EMANCIPATING THEMSELVES FROM WHAT THEY SEE IS A VERY RECKLESS TRUMP ADMINISTRATION. THE UKRAINIANS OF INCREASED INVESTMENT IN THEIR OWN WEAPONS PRODUCTION THEIR OWN DEFENSE SO THE IDEA YOU COULD MAKE A DEAL ON UKRAINE AND END THIS CONFLICT WITHOUT INVOLVING THE EUROPEANS AND UKRAINIANS IS NOT GOING TO HAPPEN. GUY: CAN I TIE THIS BACK TO THE STORY BEFORE. CAN EUROPE DO WHAT YOU SAY AT THE SAME TIME AS MAINTAINING ITS SOCIAL SECURITY NETS BUT IT CURRENTLY HAS, CAN EUROPE DO BOTH CANADA FOR TO DO BOTH? MONEY IS VERY TIGHT. I'M WONDERING HOW THESE PRIORITIES MIGHT PLAY OFF. HANNA: YOU ARE ASKING THE MILLION DOLLAR QUESTION. BEFORE THE EUROPEANS YOU SEE I COME FROM BERLIN YOU SEE THE STRENGTHENING OF THE AFD IN GERMANY. THE ARGUMENT WAS THE SAME WE NEED THAT MONEY FOR OUR OWN ECONOMIC PROBLEMS. SO YOU SEE THE RISE OF THESE POPULIST PARTIES AND VARIOUS EUROPEAN COUNTRIES AND IT IS A BIG CHALLENGE AND ONE THAT THE RUSSIANS ARE ALSO SEEKING TO EXPLOIT. THE RUSSIAN POPULATION -- CALCULATION IS YOU NEED TO INCREASE PRESSURES ON EUROPEAN SOCIETIES SO THAT THE CONSENSUS IN SUPPORT OF POLICY SUPPORTING UKRAINE WILL FALTER AND THIS IS ALSO WHERE THE RECENT INTENSIFICATION IN RUSSIAN HYBRID MEASURES IS COMING IN BECAUSE WE SEEN AN UPTICK HERE IS WELL COMPARED TO PREVIOUS YEARS IN THE WAR. GUY: UPDATE US, AT THE JAMES MARTIN CENTER AND AUTHOR OF WE SHALL OUTLAST THEM, WHOSE CAMPAIGN TO DESTABILIZE THE WEST. FRANCINE WILL BE SPEAKING TO THE GERMAN CHANCELLOR, THAT EXCLUSIVE CONVERSATION TONIGHT. UP NEXT WE ARE BACK TO THE TECH TRADE COMING UP, THIS IS BLOOMBERG. ♪ GUY: MONDAY THE 19TH WELCOME BACK TO THE PULSE. ONE OF YOUR TOP STORIES, THE EURO AND FRENCH ASSETS UNDER PRESSURE FOLLOWING THE WORST STREET VIOLENCE IN YEARS. VOLODYMYR ZELENSKYY TELLS PRESIDENT TRUMP -- SAYS PRESIDENT TRUMP IS PUSHING THEM TO YIELD TO RUSSIA. LET'S PICK UP ON SOME OF THOSE STORIES AND IN SOME WAYS YOU CAN TIE TOGETHER WHAT WE'RE SEEING IN FRANCE OVER THE WEEKEND AND WHAT WE SEEN EUROPEAN GAS FUTURES WHICH EXTENDED LAST WEEK'S RALLY. FRESH ATTACKS NEAR THE STRAIT OF HORMUZ ADDING TO STORAGE LEVELS AS WE GO INTO THE WINTER. LET'S GO INTO MUCH LET'S GET INTO THIS WITH WILL KENNEDY. WHY AM I SEEING THIS DIFFERENCE? WILL: GAS IS RESPONDING TO A PARTICULAR EVENT WHICH THERE WAS AN ATTACK ON AN LNG CARRIER IN THE MIDDLE EAST. THERE'S BEEN SECURITY TEST QUESTIONS AS TO WHETHER ANY LNG IS GETTING OUT OF THE STRAIT OF HORMUZ. AND SOME QATARI CARGOES SEEM TO HAVE BEEN GETTING OUT WHICH BROUGHT SOME RELIEF TO THE MARKETS. IF THEY ARE TECH PEOPLE GET VERY NERVOUS BECAUSE THEY ARE THE BIGGEST MOST EXPENSIVE SHIPS IN THE FLEET AND YOU DON'T WANT THEM BEING OUT. GUY: WHERE ARE WE IN TERMS OF GOING INTO WINTER. IT'S GETTING COLD. WE PASSED THE POINT NOW WHERE WE ARE FILLING WHEN DO WE START EMPTYING? WILL: STORAGE LEVELS ARE WELL BELOW THEIR AVERAGE. 84% NOW IN THE MID TO LOW 70'S. SO THAT IS A CAUSE FOR CONCERN AND WE SEE PRICES RATCHET HIGHER AS EVER WITH GAS AS YOU ALLUDE TO THE KEY QUESTION WILL BE THE WEATHER. SO FAR IT'S BEEN PRETTY MILD. I HAVE MANAGED TO TURN ON MY HEATING YET. BUT IF IT DOES GET COLD THAT WILL CHANGE THINGS GREATLY. I THINK SOME PEOPLE ARE HOPEFUL THE EL NIÑO MEANS IT'S LIKELY TO BE A FAIRLY MILD WINTER AND EUROPE'S CONSUMERS REALLY NEED THAT TO HAPPEN. GUY: YOU HAVE PROTESTERS IN FRANCE COST-OF-LIVING CRISIS ENERGY IS A BIG PART OF THAT NARRATIVE, GOVERNMENTS DON'T HAVE THE CAPACITY IN THE WAY THAT THEY HAVE DONE OVER THE LAST FEW YEARS TO DEAL WITH THAT. IF WE GET A TOUGH WINTER IS GOING TO BE CONSUMERS BUT ALSO ONLY HAS TO PAY THE BILLS? WILL: OUR COLLEAGUES CALCULATED IN THE U.K. GAS BILLS COULD RISE 25% IN JANUARY WHICH IS POLITICALLY EXTREMELY TOXIC. DURING THE FIRST GAS CRISIS THAT PUT BILLIONS INTO MITIGATING THAT FOR CONSUMERS. I'M SURE THE CHANCELLOR WILL FIND SOME MONEY BUT THAT WIDESPREAD RELIEF WILL BE VERY DIFFICULT AND THE U.K. TENDS TO BE AN EXTREME EXAMPLE BUT THAT WILL BE A DECISION AND DILEMMA FACING FINANCE MINISTERS ACROSS EUROPE. GUY: THANK YOU VERY MUCH INDEED FOR THE UPDATE. LET'S TURN TO WHAT WE ARE SEEING ELSEWHERE. CHINA'S GROWTH ACCELERATED MORE THAN EXPECTED IN THE THIRD QUARTER. REACHING BEIJING'S ANNUAL TARGET. STEPHEN ENGLE HAS THE DETAILS FROM SHANGHAI. STEPHEN: CHINA'S THIRD QUARTER GDP GROWTH CAME IN SLIGHTLY ABOVE CONSENSUS ESTIMATES AT 4.5% GROWTH. THAT IS IN LINE THOUGH WITH THE FOR YOUR GROWTH TARGET SET OUT IN MARCH BY POLICYMAKERS AT THE NATIONAL PEOPLE'S CONGRESS TARGETING FOUR POINT FIVE TO 5% FULL-YEAR GROWTH. WE ARE ON PACE FOR FOREIGN A HALF PERCENT GDP GROWTH. THIS IS STILL AN ECONOMY THAT IS LEANING HEAVILY ON EXPORTS GIVEN THE WEAKENED DOMESTIC DEMAND. HOWEVER ONE BRIGHT SPOT IN THE MONTHLY DATA FROM SEPTEMBER WAS RETAIL SALES SURPASSED EXPECTATIONS COMING IN AT A STILL TEPID 1.1% GROWTH. HOWEVER THAT WAS MUCH BETTER THAN THE CONSENSUS ESTIMATE OF JUST HALF A PERCENT GROWTH. ALSO YOU STRIP OUT AUTOMOBILES, A RETAIL SALES IN SEPTEMBER IN CHINA GREW 3.9% SO IT'S A GLIMMER OF HOPE BUT STILL THIS IS AN ECONOMY THAT IS STILL SLUGGISH AND STILL RELYING TOO MUCH ON EXPORTS. 36 PERCENT RISE IN EXPORTS YEAR-OVER-YEAR IN SEPTEMBER. ALSO WHAT WE ARE SEEING IS WEAK BUSINESS PRIVATE BUSINESS SENTIMENT AND ALSO CONTINUED SLUMP IN THE PROPERTY MARKET. THAT'S BEEN REFLECTED IN FIST -- FIXED ASSET INVESTMENT IN SEPTEMBER WHICH CAME IN NEGATIVE -7.2% FOR A SECOND CONSECUTIVE MONTH. STEPHEN ENGLE, BLOOMBERG NEWS IN SHANGHAI. GUY: LET'S TURN TO TECH. END SCALE FACING COMPETITION TO VALUATION TARGET OF AROUND $30 BILLION FOR ITS IPO. THIS IS A DATA CENTER COMPANY WHICH FACES ONGOING CHALLENGES INCLUDING A DATA CENTER DEAL WITH MICROSOFT. LET'S GET A SENSE OF WHERE THIS GOES NEXT AND WITH THE MESSAGE FROM THIS IS. THIS FEELS LIKE THERE'S A FEW OF THESE NOW HAPPENING THAT WE ARE GETTING SOME SIGNIFICANT PUSHBACK TO THESE DATA CENTER STORIES. IS THERE SOMETHING SIGNIFICANT IN END SCALE OR IS IT JUST THE CLOUDS UNDER PRESSURE. >> IS A BROADER PROBLEM ON THE SPEED TO VALUATION AND CONFIDENCE PROBLEM. GIVEN THE SELLOFF WE'VE SEEN AROUND CONCERNS ON FINANCING AND WHETHER THESE WILL GENERATE AN ADEQUATE RETURN FOR INVESTORS. YOU ARE SEEING A BIT OF A MARKDOWN IN TERMS OF EXPECTATIONS RESOURCE SIMILAR. GUY: IT FEELS LIKE A BIG WEEK. BUT FOR MAYBE THE WRONG REASONS FOR THE TECH TRADE. THIS WEEK STARTING OFF WITH SOME BIG NUMBERS THROUGH COMPANIES LIKE META HOW IMPORTANT WILL THOSE BE TO SOLIDIFY THE STORY. RUHELL: WE HAD BANKS KICK OFF LAST WEEK PRETTY GOOD NUMBERS ALL IN. I THINK THAT REALLY REFLECTS THE SKITTISHNESS AROUND MARKETS A LOT OF THE INDEXES ARE TRADING NEAR HEINZ. MEDIC KICKS OFF THIS WEEK IT'S HELD BETTER THAN EXPECTED. BETTER THAN SOME OF THE TECH STOCKS GIVEN THE POSITIVE CATALYSTS AROUND SOME OF THE OTHER MODEL LAUNCHES. FOR WHERE WE ARE IN TERMS OF SENTIMENT AROUND AI. GUY: NASDAQ FUTURES ARE UP THIS MORNING IS THAT WHAT PEOPLE ARE LOOKING FORWARD TO. RUHELL: IT IS A BIT OF A REBALANCE. THE 50 AND 100 AND MOVING AVERAGE SO TRADING AROUND A KEY TECHNICAL AVERAGE SO YOU WILL GET SOME NET BUYERS. ULTIMATELY THERE WAS A LOT OF OPTIMISM AROUND THE SECTOR AND I THINK THAT'S WHAT THAT WAS. GUY: TALKING LAST WEEK YOU GET NAMES THIS WEEK. IF YOU WERE TO SEE A SLOWDOWN IF THERE'S A DATA CENTER PROBLEM I'M ASSUMING EVEN WITH THE STUFF THAT'S BEING BUILT CURRENTLY THERE'S A LONG LEAD TIME FOR SOME OF THOSE FURTHER DOWN THE FOOD CHAIN. RUHELL: THERE IS. AND WE'VE SEEN YOU MENTIONED A BB SOME OF THOSE COMPANIES IN THE SPACE THEY ARE INVESTING IN THERE WAS A LOT OF OPTIMISM AROUND THE SECTOR BUT ULTIMATELY WITH THE DELAYS WITH END SCALE AND THE NEGATIVE NEWS WE'VE SEEN THE PROOF IS IN THE PUDDING AND THAT'S WHAT'S CAUGHT THE MARKET'S ATTENTION IN THE LAST FEW WEEKS. GUY: JOINING US ON THE TECH TRADE. LET'S TURN TO THE OTHER NEWS WE ARE WATCHING. ANTHROPIC PLANS TO PUT 5% OF ITS SHARES INTO A NEW PUBLIC BENEFIT FUND WHICH COULD BE USED TO DRESS AI'S IMPACT ON THE JOB MARKET. THE MOVE COMES AS THE AI STARTUP SEEKS TO ADDRESS CONCERNS ABOUT AI SAFETY AND POTENTIAL CONSEQUENCES. VOLKSWAGEN PLANNING TO FREEZE SALARIES FOR MOST OF WORKFORCE TILL 2030. THE CARMAKER IS CONSIDERING REDUCTIONS IN VARIABLE PAY SPECIAL PAYMENTS AND VARIABLE PAYMENTS AS WELL AS JOB CUTS. IT SAYS IT COULD MEAN A 10% LOSS OF INCOME DUE TO REFLECTION FROM VW'S STAFF AND IN THE SAME SECTOR MERCEDES-BENZ HAS UNVEILED AN SUV DEVELOPED ENTIRELY IN-HOUSE. TARGETING BUYERS IN THE LUXURY MARKET. JUST OVER 13,000 EUROS AND IS A DIRECT CHALLENGE TO PORTIA WHICH DEBUTED IN NOVEMBER. TODAY'S BIG TAKE LOOKS AT THE FATE OVER THE WORLD'S GREATEST FORTUNES. THE CHILDREN OF WARREN BUFFETT PRAYING TO TAKE OVER. THEY HAVE TO AGREE UNANIMOUSLY TO HOW TO GIVE IT AWAY WHICH IS A SIGNIFICANT CHALLENGE. THAT ONLY HAPPENS WHEN HE DIES. SUSIE, HOWARD AND PETER BUFFETT SAY THEY DON'T KNOW HOW THEY EXACTLY WILL DO IT. DETAILS, CHARLIE WELLS IS HERE. A FEW MONTHS AGO WARREN BUFFETT'S CHILDREN BECAME STEWARDS OF HIS FORTUNE WITHOUT MUCH NOTICE. HOW ARE THEY PREPARING NOW AS HE HAS SUGGESTED TO GIVING THIS MONEY AWAY. >> VERY CAREFULLY BECAUSE THIS IS SOMETHING THEY WERE NOT EXPECTING AND I THINK THIS MAKES THIS CHALLENGE SO DIFFICULT BECAUSE THE BUFFETS REALLY WERE LIVING IN SOME SENSE OF MORE ORDINARY LIVES DESPITE THE EXTRAORDINARY WEALTH IN THEIR FAMILY. ONE OF THEM HAD BEEN LIVING AS A HOMEMAKER FOR A WHILE. ONE LITERALLY STILL IS A SOYBEAN FARMER AND ANOTHER HAD BEEN A MUSIC PRODUCER AND PRODUCED A SONG IN DANCES WITH WOLVES SO THIS IS NOT NECESSARILY WHAT YOU WOULD THINK ABOUT WHEN YOU THINK ABOUT PEOPLE WHO WILL GO ON TO BE MAKING PHILANTHROPIC CHOICES BUT THIS IS SOMETHING THEY WILL NEED TO DO BECAUSE BUFFETT HAS PARTED WAYS WITH THE FOUNDATION. PREVIOUSLY GIVEN THE RELATIONSHIP BETWEEN BILL GATES AND JEFFREY EPSTEIN SO AGAIN BUFFETT PIVOTING AWAY FROM THE GATES FOUNDATION WHICH WAS SUPPOSED TO MAKE A LOT OF THE CHARITABLE DONATIONS THERE BUT NOW THIS LANDS WITH THESE BUFFETT CHILDREN WHO ARE NOT EXPERIENCED IN THIS BUT EVEN SAY THEY WILL HAVE TO FIGURE IT OUT. GUY: THAT PRESUMABLY EXPLAINS THE LACK OF PREPARATION BECAUSE WARREN BUFFETT IS A DETAILED GUY AND NORMALLY HE WOULD THINK ABOUT THIS AND SPEND TIME DEALING WITH SESSION -- SUCCESSION ISSUES. SO IT'S THAT BREAK WITH THE BILL GATES FOUNDATION THAT'S CAUSE THIS TO HAPPEN. CHARLIE: THAT'S WHAT'S PROMPTED THIS AS WELL AS THE SIZE OF HIS FORTUNE. BACK IN 2006, WARREN BUFFETT STARTED TALKING ABOUT HOW HE WANTED TO GIVE THAT ALL AWAY AND FORDING THIS IDEA OF THE GIVING PLEDGE WHICH A LOT OF BILLIONAIRES SIGNED UP TO WHICH IS BASICALLY A PUSH TO GIVE AWAY AS MUCH MONEY AS THEY COULD WITHIN CERTAIN LIMITATIONS AND I THINK ONE OF THE THINGS WE ARE STARTING TO SEE FROM THE BUFFETS CHILDREN IS MAYBE NOT NECESSARILY THE CERTAIN TYPES OR SPECIFIC CAUSES THEY WOULD GIVE ALTHOUGH WE DO KNOW THEY ARE INTERESTED IN EDUCATION AND CONFLICT MITIGATION AND FOOD SECURITY AND SOCIAL JUSTICE, BUT THE STYLE IS COMING INTO FOCUS. I THINK THAT IS SOMETHING DIFFERENT FROM THE OTHER BIG CHANGES TO PHILANTHROPY THAT WE'VE SEEN OVER THE YEARS WITH SAY MCKENZIE SCOTT KNOWN TO GIVE ONE BIG CHECK AND SORT OF LET THE PHILANTHROPY DO WHAT THEY WANT TO DO WITH IT. SOME OF THE BUFFETT CHILDREN WANT TO BE MORE HANDS-ON AND NOT DICTATE TO SOME DEGREE WHAT HAPPENS WITH THAT MONEY BUT AGAIN THE CHALLENGE IS THERE IS SO MUCH OF IT. THEY WOULD NEED TO START ACTING VERY SOON AND VERY QUICKLY BECAUSE WE ARE TALKING ABOUT THE CHILDREN BUT DON'T FORGET THESE "CHILDREN" ARE IN THEIR 60'S AND 70'S AND THE GOAL IS TO GIVE THIS MONEY AWAY THROUGHOUT THEIR LIFETIME. THIS SAY THE CALLS ARE ALREADY COMING IN ASKING FOR THE MONEY BUT THAT IS THE RESEARCH TO MAKE THESE DONATIONS. IT'S A WAY THEY HAVE TO STRUCTURE THAT AND THE WAY THESE DONORS WOULD POTENTIALLY BE INVOLVED IN THESE CHARITIES THOSE OF THE QUESTIONS THEY HAVE TO KEEP ASKING. >> HAS WARNED HIMSELF GIVEN THEM GUIDANCE? CHARLIE: WE KNOW HE WANTS THIS MONEY TO BE GIVEN AWAY. WHAT WE KNOW ABOUT HIM AS HE LIKES INVESTING ACROSS DIFFERENT ASSET CLASSES BASED ON PREVIOUS DONATIONS THAT HE'S MADE HE DOES HAVE SORT OF WIDE RANGING INTERESTS THERE BUT AGAIN IT IS THAT KEY ISSUE OF ALLOCATING THIS AND IT REALLY BRINGS UP THIS IDEA MAY BE IT WAS DIFFICULT TO CREATE THIS WEALTH BUT IT'S EVEN MORE CHALLENGING TO GIVE IT AWAY. AND THERE'S A LOT OF STAKES HERE. WE ARE AT A POINT IN THE UNITED STATES WHERE TAX POLICIES FRONT AND CENTER, IT'S FOCUSING ON THE UPPER ECHELONS OF WEALTH STRATEGY. WE HAVE TALKED ACROSS THE COUNTRY IN MANY DIFFERENT STATES ABOUT POTENTIAL WEALTH TAXES. IF THIS DOES NOT GO RIGHT OR IF THE BUFFETS DO NOT GET THIS RIGHT THEY COULD DO TWO THINGS. IT COULD SORT OF AMP UP THE RHETORIC AGAINST BILLIONAIRES IN THE UNITED STATES BUT YOU ALSO GET SOMETHING OF AN ASTERISK ON THE BUFFETT LEGACY BECAUSE HE IS REALLY KNOWN AS PERHAPS HISTORY'S BEST INVESTOR CERTAINLY THE MOST FAMOUS VALUE INVESTOR. THAT SECOND CHAPTER BUT ENDING CHAPTER WHERE HE GIVES IT AWAY, GET THAT RIGHT, THAT'S WHAT'S SO IMPORTANT HERE. >> THANK YOU CHARLIE, A GREAT STORY. REALLY APPRECIATE IT. CHARLIE WELLS ON TODAY'S BIG TAKE. YOU ARE WATCHING THE PULSE WE ARE 44 MINUTES PAST THE HOUR. TAKING YOU BACK TO PARIS TO GIVE YOU AN UPDATE THEIR AND SEE HOW THE MARKETS ARE LOOKING AS WE HEAD TOWARDS THE U.S. SESSION. THAT'S ALL COMING UP. THIS IS BLOOMBERG. ♪ GUY: WELCOME BACK YOU ARE WATCHING THE PULSE. QUICK CHECK ON WHERE WE ARE WITH MARKETS. YOU ARE SEEING A BOUNCE IN NASDAQ FUTURES. A LOOK AT THE SIX-DAY CHART BY NO MEANS MAKES UP FOR LOSSES WE SAW LAST WEEK. EUROPEAN CENTRAL LOWS. ROLLS-ROYCE SIEMENS, SANTANDER OF THE BANKS ARE PRETTY HARD THIS MORNING AS ARE SOME OF THE INDUSTRIALS IN EUROPE. YOU ARE SEEING SOME OF THE ENERGY NAMES WITH CRUDE LOWER, BRENT IS STILL TRENDING -- TRADING AT 107 BUT IS DOWN BY OVER TWO PERCENT. FUTURES ROLLING UP SLIGHTLY BUT THEY HAVE BOUNCED TAKE A LOOK AT THE CONTEXT OF WHAT WE SAW LAST WEEK. IS YOUR UP A SPECIAL CASE THIS MORNING IS IT ON ITS OWN? -- IS EUROPE A SPECIAL CASE ON THIS MORNING OR IS IT ON ITS OWN. THE FRENCH PRIME MINISTER SHARING A MEETING ON THE EFFECT OF THIS WEEK -- WEEKENDS PROTEST. DISCUSSING BUSINESS AFTER WHAT'S BEGAN LARGELY AS A PEACEFUL DEMONSTRATION AND VERY MUCH SPIRALED INTO SOME OF THE WORST STREET VIOLENCE WE HAVE SEEN IN FRANCE FOR GENERATIONS. LOOTING AND LANDMARKS MORE THAN HALF A MILLION PEOPLE TOOK TO THE STREETS. THE FRENCH PRESIDENT EMMANUEL MACRON HAS CALLED FOR ORDER TO BE RESTORED. >> OUR COUNTRY DESERVES A GREAT PRESIDENTIAL ELECTION IN SIX MONTHS. IT IS ALSO NOW BEING SHAPED BY RESPONSIBILITY. YES TO DIALOGUE YES TO CONCRETE SHORT-TERM RESPONSES. BUT ALWAYS NO TO VIOLENCE IN ANY FORM. WE NEED UNITY CALM AND RESPECT. GUY: LET'S REJOIN OUR CHIEF EUROPE CORRESPONDENT OLIVER CROOK WHO IS THERE FOR US. WHEN ARE WE EXPECTING A RESULT FROM THIS MEETING THIS MORNING, WHAT KIND OF A POLICY COULD COME OUT OF THERE. OLIVER: I DON'T KNOW IF WE ARE EXPECTING ANY SORT OF MASSIVE POLICIES OF WHAT WE'VE SEEN FOR THIS WEEKEND WE HEARD FROM EMMANUEL MACRON COMING OUT FINALLY HAVING TO ADDRESS THE FRENCH POPULATION AND WITHIN HIS SPEECH HE SAYS WHAT WE NEED TO DO IS ASSESS THE SITUATION AND WHEN NEED TO A THOROUGH INVESTIGATION IT SOUND LIKE BUYING A LITTLE BIT OF TIME TO TRYING TO FIGURE OUT WHY THERE WAS SUCH FAILURES IN TERMS OF BEING ABLE TO CALCULATE THE VOLUME OF PEOPLE AND DAMAGE THAT WE SAW. WE HAD THE PRIME MINISTER HOLDING HIS EMERGENCY MEETING NOW WE EXPECT HIM TO HAVE A COUPLE OF POTENTIAL POLICIES TO SUPPORT BUSINESS OWNERS. WE UNDERSTAND THE INTERIOR MINISTER TRIED TO RESIGN AND EMMANUEL MACRON REJECTED HIS RESIGNATION. SOME DIALOGUE GROUPS PUT IN BETWEEN THE GOVERNMENT AND PROTESTERS. BUT OF COURSE GUIDE TO THE TUNE OF WHAT WE'VE SEEN OVER THE LAST 48 HOURS IN FRANCE. RIGHT HERE IN PARIS WAS SORT OF ONE OF THE EPICENTERS OF THESE PROTESTS AND YOU CAN SEE BEHIND ME SOME OF THE GRAFFITI, ON THE TOP OF THE PILLAR THERE HAS BEEN PUT ON WITHOUT HARKENING BACK TO THOSE PROTEST WE HAD SEVERAL YEARS AGO IN 2018 AND 2019. THE BIG DIFFERENCE IS THAT MACRON IS MUCH WEAKER POLITICALLY AND HAS MUCH SMALLER REPRESENTATION WITHIN PARLIAMENT. YOU LOOK AT THE SPREAD BETWEEN GERMANY AND FRANCE OUT TO 145, THERE ISN'T THE MONEY TO ASSUAGE THESE ISSUES. VERY HARD TO SEE WHAT THE PATH FORWARD IS FOR THIS GOVERNMENT JUST SIX MONTHS AWAY FROM AN ELECTION THAT'S, BETWEEN THE BOND MARKET AND THE BARRICADES. GUY: THEREFORE HOW SHOULD WE BE THINKING ABOUT WHAT HAPPENS NEXT. ARE WE AND POTENTIALLY FOR A PERIOD WHERE WE SEE MORE OF THESE DEMONSTRATIONS, THERE ISN'T A NEAR-TERM SOLUTION AS A RESULT WE HAVE 27 ELECTION COMING UP. IS THIS GOING TO BE A PERSISTENT PROBLEM ON WEEKENDS. OLIVER: YOUR MEMBER THE PROTESTS THAT STARTED IN 2018 WAS ALL ABOUT THIS FUEL TAX INCREASE THAT THE GOVERNMENT PUT FORTH. THEY QUICKLY CAPITULATED ON THAT AND THAT DID NOTHING TO REDUCE THE VOLUME AND SEVERITY OF THESE PROTESTS. ONCE YOU START THE SORT OF PROTESTS THIS WAS ABOUT THE COST OF LIVING AND STUDENT PROTESTS. WHEN THEY SPIRAL OUT OF CONTROL IT IS HARD TO SEE WHAT THE CIRCUIT BREAKER COULD BE WHEN YOU DON'T HAVE ANY MONEY. FOR THIS GOVERNMENT THEY ARE CERTAINLY PREPARING FOR THE POSSIBILITY THAT YOU GET THESE PROTESTS ON SATURDAYS WHICH IS EXACTLY WHAT YOU SAW. OF COURSE FOR NOW THE DIFFERENCES WE ARE SIX MONTHS AWAY FROM A PRESIDENTIAL ELECTION AND EVERYBODY ACROSS THE POLITICAL SPECTRUM SEES WHAT THEY WOULD LIKE TO SEE IN THESE PROTESTS. THE LEFT-WING SAYS THIS IS A FAILURE OF THE GOVERNMENT AND THE POLICE BEING TOO VIOLENT IN THEIR CRACKDOWN ON PROTESTERS. YOU OF THE CENTER CALLING FOR SORT OF CALM AND PEACE AND HE WILL ESTABLISH THE FACTS OF WHAT ACTUALLY HAPPENED, AND YOU HAVE MARINE LE PEN WHO MIGHT USE THIS FOR PEACE AND STABILITY IN LAW AND ORDER AND SOVEREIGNTY AND POWER BACK DOWN TO FRANCE. GUY: WE APOLOGIZE FOR THE BRIEF LOSS OF SOUND. THANK YOU VERY MUCH INDEED ARE EUROPE CORRESPONDENT OLIVER CROOK FOR US IN PARIS. IT'S TALK ABOUT THE IMPLICATIONS OF THIS. VEN RAM JOINING US NOW. FRANCIS TRADING 140 TWO OVER GERMANY THIS MORNING. DO YOU SEE THAT GOING WIDER? VEN: THE BOND MARKET REACTION IS GOING TO BE INCREMENTAL FROM HERE BECAUSE A BUNCH OF THE BAD NEWS IN THE BOND MARKET WAS SET OFF BY THE STATEMENT A COUPLE MONTHS AGO SAYING FRENCH CENTRAL BANKS SHOULD JUST CANCEL FRENCH DEBT THAT THEY HOLD. IF YOU LOOK AT THE SPREADS AND THE -- THEY ARE TRADING MUCH LOWER THAN THE SOVEREIGN STATE AND SOVEREIGN CREDIT RATINGS THAT'S GETTING PULLED DOWN A COUPLE OF NOTCHES. IF YOU LOOK AT ITALY WHICH IS A MUCH LOWER CREDIT THEY ARE TRADING AT A PREMIUM TO GERMAN BONDS. IT SUGGESTS THAT IT'S GOING TO BE INCREMENTAL FROM HERE BUT WHERE I SEE THE BIGGER REACTION FROM HIS ON THE STOCK SIDE OF THINGS. THE EARNINGS IN A WORLD WHERE FIVE PERCENT YIELDS HAVE BECOME COMMONPLACE TO 7% EARNINGS AND SO IF YOU LOOK AT THE CREDIT DEFAULT SWAP SPREADS THIS PLENTY OF SCOPE FOR THE SPREADS TO WIDEN. IT'S DWARFED BY THE LEVELS WE SAW DURING THE INITIAL DAYS OF THE EURO ZONE FINANCIAL CRISIS. THOSE TWO AREAS AWARE EXPECT TO SEE THE BULK OF THE REACTION. GUY: HOW VALUE DO YOU THINK THE STOCK MARKET IS? HOW OVERVALUED IS THE CAC USING YOUR MEASURE. VEN: IT'S NOT A QUESTION OF OVERVALUATION BUT HOW MUCH MORE RISK PREMIUM WILL BE ADDED. TO 7000 ON THEIR I THINK IT WOULD BE THAT'S NOT UNREASONABLE TO EXPECT BECAUSE YOU HAVE A FRENCH PRESIDENTIAL ELECTION COMING UP AND ALTHOUGH MARINE LE PEN IS A LEADING IN THE POLLS I THINK THAT IF LEAD NARROWS I THINK THE FRENCH SELLOFF THAT 7000 LEVEL IS NOT UNFORESEEN. GUY: GREAT STUFF THANK YOU FOR CATCHING US UP. ON WHAT'S HAPPENING WITH THE REACTIONS IN FRENCH PROTESTS. I'M HERE TODAY BECAUSE FRANCINE INTERVIEWING THE CHANCELLOR -- GERMAN CHANCELLOR FRIEDRICH MERZ. UP NEXT VONNIE QUINN AND THE BRIEF. THIS IS BLOOMBERG.