Skip to main content

tv   Bloomberg Surveillance  Bloomberg  February 15, 2021 4:00am-5:00am EST

4:00 am
francine: global stocks surged to fresh records, the nikkei hits 30,000 for the first time since 1990 while bitcoin stops shy of $50,000. u.s. markets, closed for president's day. the u.k. hits its 15 million vaccination target and the euro lags behind. we will speak with the eu commissioner for the economy about the impact on the recovery. the spac revolution continues. the former unicredit chief is
4:01 am
linked to a blank check vehicle. we will speak about his abrupt exit from italy's second largest bank. welcome to "bloomberg surveillance." i'm francine lacqua in london. let's get straight to the markets and the unstoppable surge of bitcoin has taken a moment to pause as prices stopped below the next key level of 50,000. performance in 2020 has blown other classes away, it flew 60% this year. the check of it -- chief executive said the cryptocurrency could hit 200,000 in the near future. he sat down with bloomberg front row and talked about bitcoin becoming the de facto haven currency. >> the real question people should be asking is, bitcoin becomes a de facto reserve currency. it basically displaces gold. what replaces the u.s. dollar? francine: let's discuss this
4:02 am
with laura cooper, bloomberg's mliv macro strategist. a bit of a funny day. good morning first of all. happy presidents' day, a funny day because volumes are lower because of president's day but how much are we focusing on record highs? the nikkei and bitcoin close to a record? laura: price action today is a continuation of this by everything rally because the narratives are not changing. we are still getting fiscal stimulus coming through. we do still have a central-bank policy that is going to persist for some time, even if we do start to see inflation pressures and ultimately, we are still seeing these vaccine rollouts and that is really driving the upbeat growth recovery markets are largely pricing in at this point. at this point, there is not a catalyst to the downside. on a day like today where volumes are light. francine: we look at the
4:03 am
reflation trade, when does it take a breather if at all? laura: certainly if we do see yields begin to climb in the u.s., that is something to watch for at this point because yes, the fed wants to say -- stay accommodative. they want to support this process liquid coal expansion -- cyclical expansion but we have a flood of stimulus coming through and that will send yield potentially sharply higher and as we know, that can sap sentiment in terms of the s&p 500 or even if the dollar, we start to see yields become more attractive, favoring the dollar once again, that could stop some of the euphoria we are seeing across a number of assets right now. francine: what do you do with bitcoin right now? you have a lot more household names saying they want to be part of it. is main street -- wall street becomes more accepting or dominant in the space, does it automatically go up or are we expecting more regulation? laura: there are two stories to
4:04 am
that. one is we are seeing institutional investors pile into bitcoin. that has provided the impetus for this rally around the $50,000 mark and the question is, is this a viable inflation hedge? could it potentially place gold at some point, in which case that does suggest bitcoin has much further to rally over a prolonged period of time. like you mentioned, as more investors pile into this potentially speculative asset, this raises red flags from a government perspective and we could see tighter regulations. we could see controls, we could see out right bans in the cryptocurrency space so that is the biggest risk to bitcoin right now but i don't expect in the near term. we are seeing the speculative frenzy continue on the back of expectations bitcoin could be a de facto reserve currency even. francine: i have to say, if you look at bitcoin, this comes a
4:05 am
week after the tesla announcement. we had news over the weekend of morgan stanley considering whether they should take a bet on bitcoin. what about the other cryptocurrencies? do we need to look at a theory him and the other ones -- ether iums and the other ones? laura: as a macro watcher that is used to looking at economic fundamentals and valuations, to be talking about this cryptocurrency and the fact we are seeing something like etherium double in the span of a few weeks and we are seeing a basket of cryptocurrencies continue to accelerate, even outpacing the bitcoin price action alone so i think this is reflective of this greater exuberance across markets. again, it is hard to see the tangibles behind a lot of these valuations. it does seem to be the speculative frenzy potentially inflating a bubble across the
4:06 am
cryptocurrency space, but it is too soon to tell at this point whether we will see this momentum extend. i think it is hard to value a lot of these cryptocurrencies at this stage. francine: there is a lot going on this week. minutes from the fed, minutes from the ecb, this arctic freeze pushing up the price of natural gas and oil because of this arctic freeze in the mid-we u.s. -- made u.s.. laura: that was the impetus but white -- behind this wti rally, over $60 a barrel, on part of that tight inventory constraints within the u.s. that could take out a few hundred thousand barrels of oil. that is coming on the back of inventory drawdowns in the u.s. already outpacing what many analysts had expected. overlaid on that is strong demand recovery. markets are looking through the near-term risks around potential virus variants and toward economically openings so if demand is helping lift oil above
4:07 am
$60 a barrel. the question now is how sustainable is this rally? we had the iea revise lower their demand forecast last week. we are still seeing these technical levels signal wti is overbought, and ultimately, the virus is not yet contained. we are still in lockdowns across the globe, so will we see stumbles in terms of vaccine rollouts that could sap some of this demand optimism that is being priced in? francine: quickly, we have a viewer question. i urge everyone to write in and give us their thoughts and ask some of the things they are looking for. this person is writing in saying, look, what about bitcoin? will it undermine the currency? that is one for regulators. laura: we are seeing regulators take a tougher stance in terms of the retail investor later in the week. that does take a risk in the
4:08 am
viability longer-term in these cryptocurrencies because that is meant to be one of the strong points of crypto. you can transact in these with little regulation, but as we start to see these signs of fraud, that is going to tighten the squeeze in terms of regulators so i think it is really up to let -- regulators at this point to see how sustainable this crypto rally can extend for a longer period of time. francine: thank you and the viewer who wrote in, please continue writing in and give us your thoughts and worries on these websites where they say i'll sell you bitcoin and there is nothing underneath it. laura cooper, mliv strategist joining us. let's get to the first word news with leigh-ann gerrans. leigh anne: england has hit its milestone of immunizing the top four priority groups, including over 70's by february 15. with 50 move -- 15 million vaccinations, the u.k. has given one jab to over 25% of the adult
4:09 am
population. it adds to pressure on boris johnson to reopen the economy. in the u.s., the former president donald trump has been quitted on the impeachment -- acquited. senators who voted against trump but fell short of the majority needed to convict. senate republican leader mitch mcconnell described the president as practically and morally responsible for the attack on the capital. new zealand's unrestricted movement and social interaction has come to an abrupt halt due to three new cases of covid-19 after and a curb -- emergency cabinet meeting, the prime minister put auckland into a snap three-day lockdown. she reimposed social distancing for the rest of the country. global news, 24 hours a day on air and on bloomberg quicktake powered by 2700 journalists and analysts in more than 120 countries.
4:10 am
i'm leigh-ann gerrans. this is bloomberg. francine: thank you so much. stay with "bloomberg surveillance." this hour, we have two exclusive interviews you don't want to miss. we will speak to the latest former bank chief executive that wants to set up a spac, the former unicredit chief executive jean pierre mustier. first, we speak to the former italian prime minister and eu commissioner for the economy, coming up shortly and we will talk draghi and the euro area economy. this is bloomberg. ♪
4:11 am
4:12 am
francine: economics, policy, finance. this is "bloomberg surveillance ."
4:13 am
i'm francine lacqua in london. the x unicredit chief executive jean pierre mustier plans to raise funds for a spac, the latest former top banker to take advantage of the trends for blank check vehicles. joining us to discuss is dani burger. we had an interesting interview with someone from bridge point that said he knew more people that were starting spac stem had covid. jokes aside -- spac's then had covid. jokes aside? dani: we've seen $40 billion worth of spac's come in 2021, half of what we had so far. part of that is it is the right place, the right time. valuations are high so you can do well when you list one of these spac's. at the same time, you are getting into these companies early stage, getting more liquidity as well. we spoke to chamath palihapitiya
4:14 am
who said this is democratizing spac's. chamath: i think spac's are here to stay. using the language of inequality, it evens the playing field. it democratizing by allowing retail and small-scale institutional investors, folks who may not necessarily have been tier one hedge funds, now they can also play. dani: of course, there has been criticism too. when you and i were talking to bridge point, he said perhaps this indicates we are at the top of the market. you can take either side. maybe this is great, it gets people involved in m&a or it is dangerous if you get people who are not used to this launching spac's. francine: dani burger with the latest on spac's. we will have a conversation with jean pierre mustier coming up and talk about his time at unicredit and spac's. we will speak to paolo gentiloni
4:15 am
. ib directly if you have questions for our great guests. this is bloomberg. ♪
4:16 am
4:17 am
4:18 am
francine: economics, policy, finance. this is "bloomberg surveillance ." i'm francine lacqua in london. the topic of the recovery will
4:19 am
be on the agenda when europe's finance ministers meet to discuss the economic cost of vaccine delays. let's talk with the eu commissioner paolo gentiloni. if you have questions to our guests, message on ib+tv . thank you for giving us a little of your very busy schedule. when you look at the recovery from capitals, how are they looking? paolo: it is very good we received 20 out of 27 member states draft plans. i would say they are very coherent with the main goals we decided to have in these plans. first, the green transition and second, the digital competitiveness. we also asked for these plans to address reforms, very important
4:20 am
to have to have stronger growth in several european countries and we are working with member states, especially to strengthen this aspect of the reforms in the plans. i'm quite confident in the time we have in our schedule, which is the end of april, we will have a very good and effective plan for this unprecedented with a common purpose. francine: what you have seen of the plans, are they specific about the reforms they want to put in place? are they were a work in progress -- are they a work in progress? comm. gentiloni: it is a work in progress. we are quite satisfied on the reaching of targets in investments. you know we have binding targets of 30% of investments further
4:21 am
green investments and 20% of investments on the digital competitiveness, but also in this case, we have a few plans to work with governments to make these targets clearer. the means to reach these targets clearer. then, we are working on reforms we recommended to member states, key reforms, and this is the opportunity to address them. i don't think we will have any other opportunity to rebuild better our economies after such a crisis. francine: commissioner, what do you think mario draghi's proposal should be to use the recovery funds? what priority should he focus on the next six months? comm. gentiloni: well first of all, i think it is very good news for not only italy but also
4:22 am
for europe that mario draghi, with all his experience and leadership, is dealing with it. we've already had a basis from the previous government, a good one, but now, i'm sure with the new government, we will work hand in hand, especially for reforms dealing with threats facing the public administration, social justice, competition rules. so in a few words, the bottlenecks that in the last many years made the italian growth to slow. -- too slow. this is, i think, a unique opportunity to address these bottlenecks and i'm sure draghi is completely aware of this. francine: mario draghi talked
4:23 am
with the parties before accepting the premiership that he wanted a common euro area budget. how quickly can that come? do you think it is a real prospect? comm. gentiloni: well, draghi was stressing, especially in the last years of his leading the ecb, one clear point. we can't have in a single currency area only a monetary policy without a more coordinated fiscal policy and indeed, what we decided after the pandemic was a farmer -- common fiscal tool without precedent for the european union. we have an opportunity to go further in this message that, by the way, also christine lagarde is frequently sending.
4:24 am
a common monetary policy needs to go hand in hand with a more coordinated fiscal policy and we, at the beginning of march, will give guidance to member states. we the commission for the fiscal policy of this year, how to address the situation of this crisis and how to make steps forward. we have to work for this stronger coordination of fiscal policy now. francine: commissioner, i wanted to ask about vaccine rollout in the eu, but let's listen to prime minister boris johnson taking to twitter yesterday to celebrate the come -- country vaccinating 15 million people. >> an extraordinary feat, administering 15 million jobs into the arms of some of the most vulnerable people in england. we've gottenjabs top the four
4:25 am
most vulnerable priority groups, hitting the first target we've set ourselves. francine: commissioner, does your forecast completely depend on vaccination rollout in the eu and are you comfortable with prospects that enough people will be vaccinated in the eu not to have to lower your forecast? comm. gentiloni: well, of course, this will be crucial because in our forecast, we see growth coming in our economies in the second half of this year and this is strongly connected to the rollout of vaccines. as you know in our forecast, we see a 3.8% growth this year and next year, but the basis is that containment measures are still
4:26 am
around in all european countries including in the u.k. will be eased in the next months thanks to the vaccination. we have a very challenging goal, which is 70% of vaccination at the end of the summer. we faced some problems of production capacity in some of the vaccines. we are dealing with these problems. until now, we've distributed 33 million doses of vaccines, but we have to do much more and we will do much more in the coming weeks. francine: commissioner? thank you so much. commissioner, thank you. ♪
4:27 am
4:28 am
4:29 am
francine: economics, finance, politics. this is "bloomberg surveillance." i'm francine lacqua, here in
4:30 am
london. a new week, and global stocks surged to fresh records. the nikkei hits 30,000 for the first time since 1990. bitcoin stops just shy of $50,000. u.s. markets are closed for presidents' day. this back regular -- revolution continues as jean-pierre mustier is the latest to be linked to a blank check vehicle. we will speak with him about his abrupt exit from italy's alleged -- second largest bank and his next steps. and england hits its target for vaccinations but europe lagged behind. good morning, everyone. happy presidents' day for those watching from the u.s.. jean-pierre mustier plans to raise funds for especial acquisition company. his spac will be -- the company will invest in financial services, including wealth management and tech.
4:31 am
he announced his departure from unicredit after more than four years at the helm of italy set buy. it follows multiple classes with board members over strategy, and he was forced to scale back bank ambitions because of coronavirus. we are delighted to be joined by jean-pierre mustier, joining us now for this exclusive conversation. as always, thank you for giving us a little bit of your time. congratulations on the spac. why a spac and not being chief executive for another big bank? jean-pierre: good morning and thank you very much for inviting me. the need for growth capital, cooperation between the u.s. and europe, market cap gdp is three times higher than europe. we lack capital in europe, and there are concerns -- my
4:32 am
appointing partner share the vision to bring capital come and we chose naturally the -- francine: the world has capital in abundance. many people are starting spac's. why -- what would set you apart? jean-pierre: there are two strategy point concerns. with two partners, while they focus on financial sectors, when we will do, what we can bring to a company is experience of the financial sector and digital
4:33 am
transformation, regulatory, and long-term vision and the ability to work with -- francine: which areas of financial services do you now consider undervalued? jean-pierre: within the financial services, the -- that has been taking place than it been actively directed by the crisis, you can see in subsectors insurance, pin tech, and financials, that the need for all of them to reach critical size on one side, and traditional asset management need to reach the critical side of asset management in europe.
4:34 am
[indiscernible] concentrating on most of the activity, with asset management, you have to grow and expand your range of activities. insurance companies are impacted today by negative rates and by the activities, but they are willing to go more than by the capital difference, or with banks, and especially finance companies need to go as well. so all of these segments, we consider the need to grow and there are a group for investors to accomplish to date.
4:35 am
francine: insurance is struggling, of course, with regulation negative, or very low interest rates and costs. is it about rationalizing the industry, or is it about merging it? jean-pierre: it is about finding within the sector, and within the banking sector as well, finding a combination with higher valuation. it is an organic thing, but not organic by -- there is a tradition that allows it to grow more quickly, and you can see on the insurance side subsectors which are based on that. francine: when you look at some
4:36 am
of the asset management rationale that you just laid out, would it be small companies , even if they are overvalued, that have a good name? does name make a difference, or is it literally getting clients and then consolidating? jean-pierre: i cannot comment about a target because we are not allowed to speak to it with regard to financial regulatory issues. we can see first of all, traditional asset managers, which -- we need to go to lower the cost for asset management. on the other side, there is the ability to go and expand -- there are two different stories.
4:37 am
francine: given what you are explaining, why is no big european banks going after targets cross -- cross-border consolidation? jean-pierre: the situation for the banking sector -- first of all, we need to transform the bank, and the transformation is looking at activities to simplify the product and simplify the process, and then digitalize them. so cross formation, the financial sector of the clients while changing -- it is not always efficient because of some regulatory constraints that is working hard to waive, and also
4:38 am
because of the nature in terms of -- what will be the allocation of capital. in terms of economic activity. francine: when you look at the world, banking globally, do you see more value in europe because of some of the dynamics that we just mentioned, or are there also opportunities elsewhere, in asia or in parts of the u.s.? jean-pierre: for the financial sector in europe, we value on the banking side on traditional banking activity, they are under pressure because of negative rates as well as -- banks are an instrument which are very much
4:39 am
focused on the economy, and waiting on the bank for -- banks are more a question then in the u.s., based on the economy. and we consider to do more and more quickly, especially in the u.s., so banking in europe are today, more slowly than in parts of the world. so that -- francine: under your tenure at unicredit, there was a big restructuring and cleanup. why didn't it work out in the
4:40 am
end? jean-pierre: we went the first time to deliver our plan strategies, which was a massive transformation of the banks in terms of activity, in terms of strengthening of the balance sheet. 2020 was a focus in terms of cash value, it is something that we have to do as well as -- so -- francine: my question was more not that it didn't work out for the bank, it just did work out for you. why didn't you -- why did you leave? jean-pierre: i think in this case it is good to look at the next step, and in terms of the
4:41 am
future element. francine: what were these clashes about? do you think there is political interference from outside and what the bank should be doing? francine: i think that in terms of -- tom: i think that in terms -- jean-pierre: i think that in terms of evolution of the bank, it is -- francine: were you asked to considered a tie up between -- between what is considered and around? jean-pierre: you understand that i cannot comment on matters that are privately discussed. francine: do you have a big job left in you as head of the bank? or will you concentrate on spac's? is it a vastly -- it is vastly different to being charge of a
4:42 am
bing institution compared to what you are about to do. jean-pierre: it is a wonderful opportunity to be in the financial sector, looking at the possibilities, and to be caught in the financial sector. so i am putting all of my focus on that. it is a wonderful opportunity. [indiscernible] francine: where will you be based, in italy or in france? jean-pierre: i will be based everywhere where i need to be meeting with combination companies. but in france mostly. francine: when we talk about european banks, the recurrent theme, and it has been about
4:43 am
five to six years, we cannot really compete in certain places with a big wall street american banks? what needs to happen for europe to really be able to take on some of these big giants from the united states of america? jean-pierre: i believe that the big difference between europe and the u.s. is that europe is not one single market yet as far as banking industry is concerned, but different domestic markets. in europe, france, germany, italy, the markets are independent and more fragmented. so what we need to ask is more europe as far as the banking sector is concerned, with the investor, when they look today at european banks, they do not look to european banks per se.
4:44 am
the market, which is much more open, and banks are really very much -- it is a step-by-step evolution. the banking union seems to make some progress. and with our spec, we will make sure that -- francine: how do you view bitcoin? every day we look at bitcoin and every day it seems like it is a little bit more mainstream. is this something that can be systemic risk? is this something that you can be looking at? how should banks deal with it? jean-pierre: i think that digital currency or digital money is something which is an important initiative. so digital currency, based on
4:45 am
the real currency, it is the right way to go. but at the same time, one has to be extremely careful, especially in terms of access to the client and in terms of management of liquidity. liquidity is part of -- it is important, and with europe and central bank. we need to move forward on that. francine: jean-pierre mustier, thank you so much for your time today. former chief executive of unicredit with the new spac and ups this morning. chump allies lash out. next we speak to bloomberg's senior writer, stephanie baker, about the former president's acquittal. this is bloomberg. ♪
4:46 am
4:47 am
4:48 am
sen. mcconnell: president trump is practically and morally responsible for provoking the events of the day. >> all i can say is that the most potent force and the republican party is president trump. >> i voted to convict president trump because he is guilty. >> people who believe they brought change to washington policy wise. it is long overdue. >> trump movement is alive and well. francine: let's get more on that story. former president donald trump acquitted by the senate on the charges of inciting a riot at the capitol. seven republicans joined democrats an independents in finding trump guilty on the
4:49 am
single impeachment count. let's go to stephanie baker, who has been following it from the beginning. when you look at the division across the republican party, how apparent are they? stephanie: i think the republican party is split down the middle. this was 8% of republican senators who voted to acquit, which i think is a good reflection of the state of the republican party right now. i think the most devastating blow was handed down by mitch mcconnell in his speech, you know, where he attacked trump's actions and said that the senate should not be the forum for holding him responsible, but criminal litigation. nevertheless, i think it shows that he got a huge amount of support.
4:50 am
only seven republicans voted to convict him. that was more than many people were expecting, but he still retains a firm grip on the party, and i think what you will see over the next few years is the soul of the party, and i think we will have a better sense by 2022 other or not trump is winning enters the retained -- and has retained his grip on the party. francine: he is acquitted, which is good, but he has had republicans stand up to him. stephanie: exactly. the most bipartisan vote on impeachment ever. that is not a good sign for trump. mitch mcconnell's attack on him -- that was not a good sign for trump. but trump declared victory in the end. he was acquitted. we will have to see whether or not some of these criminal and civil cases against him really put a dent in his ability to back republican candidates in
4:51 am
2022 or launch his own campaign for the presidency in 2024. i think that remains to be seen. without his twitter platform, he has been robbed of the need for communicating directly with supporters, and i think it remains to be seen whether or not he slowly, gradually fades in political discourse, or whether he finds a new way to communicate, with fundraising power, financial power, if that makes him a kingmaker in some of the republican primaries in 2022. francine: stephanie baker joining us on the latest in the senate impeachment trial. stocks rising, vaccine rollouts, and a slowing virus outbreak spurs global recovery. bitcoin retreats after its we can rally. we bring you market moves. this is bloomberg. ♪
4:52 am
4:53 am
4:54 am
francine: economics, finance, politics. this is "bloomberg surveillance." i'm francine lacqua, here in london. let's get straight to the stocks on the move today. it is only monday, and we have
4:55 am
tuesday, wednesday, and thursday with stocks on the move. dani burger. dani: air is still a lot of action happening, and the two biggest movers are because vivendi is looking at spinning off their universal music group, lifting it by the end of the year -- listing it by the end of the year. the sped up timeline, shares our highest since 2001. lanxess also in the headlines, and up nearly 4%. they are saying the price is right. the bigger market moves, global equities on track for another record. european stocks also up. market caps for the world are at 110 trillion dollars, so the fomo rally is driving part of this. oil rigs shut, driving crude higher. bitcoin taking a breather over the weekend, nearing $50,000.
4:56 am
is that more institutional money coming in? is it a new etf in america, or are people betting this is the next inflation hedge? regardless, that off by .8% this morning. francine: i know you have a big week ahead. the testimony in front of lawmakers, with robinhood. that is coming up on thursday. bloomberg surveillance continues in the next hour. we will speak with hsbc's max kettner about the markets. paul hunter will also join us to talk about the u.k.'s successful vaccine rollout, and that successful rollout is having an impact on sterling. this is bloomberg. ♪
4:57 am
4:58 am
4:59 am
5:00 am
francine: a new wee global stocks surge tosh records. the nikkei hits 30,000 for the first time since 1990, while bitcoin stops just shy of $50,000. u.s. markets closed for presidents' day. the u.k. hits its 15 million vaccination target. europe continues to lag behind. paolo gentiloni says we can rebuild the economy better. and the spac revolution continues. former unicredit chief executive jean-pierre mustier is the latest to be linked to a blank check vehicle. he abruptly exits italy's second-largest lender. good morning, everyone, and welcome to "bloomberg surveillance." i'm francine lacqua in london, tom keene is off today. it is quite a big market day. the insufferable surge of bitcoin taking a pause this morning, prices just shy of $50,000. we


info Stream Only

Uploaded by TV Archive on