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tv   Bloomberg Markets Americas  Bloomberg  February 22, 2021 10:00am-11:00am EST

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jonathan: monday, the 22nd of february, 30 minutes into the trading day in the united states. i'm guy johnson. alix steel in new york. welcome to "bloomberg markets." commodities driving the market again. alix: even oil getting a 2% boost. let's get a broader take on the market. there is two things to focus on. will we see tax increases down the road? janet yellen speaking about a financial transaction tax. higher rates -- we may be taking a little bit of a break today, but nonetheless, the curve is the steepest since 2014 and that will definitely affect equity markets at some point. nasdaq down by over 1%. they tech names the first on the chopping block but the smaller are not getting the beneficiary
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of higher yields. a teeny tiny bit coming in mostly over in europe. significantly steeper than where we were. copper up by almost 2%. $10,000 call might not seem crazy. guy: absolutely. we will continue the trend, and we see what happens in other markets. momentum getting behind these things. let's talk about the stimulus package, because that would be a major part of this question. democrat -- democrats, even, beginning to push for the stimulus bill this week. the bill, alix, will pay some markup in the house. the full vote will happen friday. secretary yellen speaks at the new york times deal book conference this morning about how to get the economy contract. sec. yellen: my view would be
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that the checks for example, $1400 checks, we don't want those to go to high income individuals. but that really helps to make sure that pockets of misery that we know exist out there that armand touched by the more targeted things, that help is provided there as well. guy: janet yellen speaking a little bit earlier. let's get some analysis. a global strategist and head of the bearings investment institute joining us now. he was assistant to the president at the national economic council during the obama administration. good morning. treasury secretary yellen is very keen on making sure that this theme is story continues and delivers in size. we are seeing an expectation that the u.s. economy is going to move forward on a very decent clip as the year progresses.
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what does this mean for assets? are you repositioning as a result of what is happening here? >> i think in the near term you have to be more optimistic that this is a year where we are going to see both effects of the stimulus, effects of the vaccines coming through, and you are seeing the market not reacting so much to the stimulus prospects, although that is clearly a price, but reacting to the data. last week retail sales number was really reflecting the fact that stimulus passed in december is having an effect. you had a good earnings season. i think that is going to continue to flow through. i don't see any reason to stand in the way of what is a good story. this year there are longer-term issues about next year. but when you have people talking about 6%, 7% economic growth in 2021, that has to be pretty good for risk assets. alix: three upgrades so far in
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the last few days. christopher, question -- will joe mansion step in front of this? talk of the week and is he will stand against biden's nominee for the director of office of management and budget. does that make him a stick in the mud when it comes to tumulus? --stimulus? christopher: there is a competition in the senate for being stake in the mud because it gives you leverage. i think joe manchin is using got and more centrist republicans, whether it is lisa murkowski or susan collins or mitt romney or others, clearing different and saying my vote might be available on this. there is a lot of movement around the center. i think the biggest issues are not so much joe manchin but making sure that the senate parliamentarian clears the $15 minimum wage increase as being legal within the framework of reconciliation process.
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maybe we will see a smaller package, but it is going to be on the higher side right now, that is the current betting. guy: christopher, if we continue to see the data coming out of the vaccine rollout and also the lower virus numbers continuing, clearly this is having a major impact on the bond market. how high will the yields get? at what point will this have a meaningful impact on equity markets? seeing a little bit of that today. is there more of that tomorrow? christopher: that is the single most important question the market is grappling with right now. if you have yields going higher, which looks like they will, even past 1.5%, and that is against the backdrop of an economy growing 5, 6, 7%, it seems to me the equity markets are not going to be too troubled by that, particularly if you have a fed that continues to reiterate that
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it is not going to be raising rates in time soon. knowing exactly what the tipping point is, if it gets to 2% people start wondering. i think the fed is going to make sure people don't get too far, too fast in that regards. alix: will congress do the same thing? we are talking about stimulus more than $1.9 trillion. janet yellen talking about the financial transaction tax. already starting a stock about those things. it would be regressive, no? christopher: yes, indeed, but congress is a giant ship, and once momentum gets going, it is very hard for it to slow down or course-correct. the talk of the tax increases are going to be much more backend-loaded going into next year and the following years. the talk of the spending will continue to be very strong this year. we will have to see what the data looks like, what inflation
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excitations look like going into the spring and summer. there is a lot of momentum if president biden can get through this first stimulus package to come back again with a much more ambitious program that includes tax increases, infrastructure, and the like. they are talking about a number around $3 trillion. how that plays in terms of tax increases versus spending, coming on all of that, those are big questions that remain to be worked out. congress is not nearly as nimble as the fed might be in some of these decisions. alix: christopher, thanks a lot. we really appreciate it. as we were talking about in terms of expectations for fiscal stimulus that is driving a selloff in the bond market, yields are actually climbing to the highest level in a year, and that jump in at nominal yields means that the equity risk premium, that is how much more extra juice you get from buying equities.
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this but between the 10-year yield and the dividend yield and global equities, titus 19 months, raising the question if you want to stay iniquity market. joining us at the head of u.s. equity strategy. where do you adjust positioning based on where we are with yields? >> so, look, given the increase we have seen so far, it is a story within u.s. equities as opposed to getting out of u.s. equities. as i talk to investors over the past few weeks, what has become very clear to me is that investors are not positioned in areas like financials and areas like energy that are really the beneficiaries of things like rising yields, rising quantity prices. i think there's a little bit of a scramble. you are having to see investors pull out of some of the seyfert secular growth areas;. that is why the markets have been trading flat recently. guy: small caps have been driving higher for quite some time.
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are they can the little bit over their skis? is that an area we could see pullback? lori: you know, it's interesting -- i don't think small caps have any problem from a valuation perspective. you can make the argument that some of the biggest small caps, those are a little bit overvalued. but when you look at the russell 2000, we were in such a deep evaluation hole relevant to the large-cap it will take quite some time to climb out of that. perhaps they get knocked around a little bit in the short-term, but longer-term still a lot of evaluation support. alix: typically when you see rising yields you get inflation scares. rising prices is a gold star for energy. how invested you want to be in the energy sector? lori: i said among our three overweight sectors that energies on the shortest leash, and that is because of things like esg concerns. when you look at the valuations on energy come they are not as cheap as what you have seen in areas like financials and materials, which look undervalued to us.
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energy started to move and is hovering around neutral. i think it is a shorter leash, but you still have some runway. guy: if you want to play the commodities trade, you don't want to be playing in the united states. if you're looking to play supersize, you need to look elsewhere. lori: i don't cover sectors outside of the u.s., but we have done work on u.s. relative to non-u.s. equities. doesn't matter whether we are looking in valuation or positioning. it seems like the best bargain, the most runway is in regions that are outside the u.s. that would generally apply to that commodity space as well. alix: if we do get rising yields, a steeper curve at some point, is it automatically bad for equities? even if you do get a steeper curve, you can see good returns within 13 months. where do we get nervous, where we don't? lori: it's a tough question.
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if you look back a few years ago what is spooky markets right now is there is a quick move up in rates. that is where you can tell any fees of 275 basis points or more that starts to create short-term wobbles in stocks. we have some other models that point to the 3% area. we could get there, but it seems like a far way off. this level seems like it is palatable longer-term for right now. guy: christine lagarde has been pushing back against higher yields in europe today. we will get powell tomorrow. if we were to push back against
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higher yields, the effects on equity markets from that? lori: i think we will have to see. it would throw some of the shorter-term rotations we have seen in reverse. this is a weird market at this point in time. what is good for the tech sector has generally been good for the s&p 500 as a whole. if we started to see some selling pressure reducing the tech stocks, it could end up reversing things a bit in the short term. alix: what about utilities? what do you do with them? lori: utilities -- you know, we think utilities are an interesting way to standpat. i think you still have a good valuation case in the utility space. it looks more interesting to me than other defensive sectors like staples. i think utilities are -- i would look to them as an area to stay neutral. i think they are interesting in a pullback, not necessarily one
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sparked by rising great fears.-- rate fears. guy: thank you very much indeed. coming up, boeing gets grounded again. the aircraft maker is faced with another engine issue, this time of failure with the triple seven. we will talk about this more. this is bloomberg. ♪ so you're a small business, or a big one. you were thriving, but then... oh. ah. okay. plan, pivot. how do you bounce back? you don't, you bounce forward, with serious and reliable internet. powered by the largest gig speed network in america. but is it secure? sure it's secure. and even if the power goes down, your connection doesn't. so how do i do this? you don't do this. we do this, together. - [announcer] imagine having fuller, thicker, bounce forward, with comcast business.
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karina: let's check "first word" news. i'm karina mitchell. a big loss for donald trump at the supreme court. they rejected his bid to keep
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tax return information private. investigation by manhattan district attorney cyrus fans rooms is one of trump's biggest legal threats. democrats begin the final push for president biden's $1.9 trillion stimulus bill this week. the talk of bipartisanship has gone out the window. democrats want to get the measure passed quickly before an earlier round of benefits runs out. house has a vote on friday. the real action will be in the private talks in the senate. some democrats are poster plans for a $15-an-hour minimum wage. our united airlines flight made an emergency landing in denver after one of its engines suffered a fan blade failure. engine parts were scattered along the flight path. united is inspecting two dozen of its planes. airlines in japan and south korea are doing the same.
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global news 24 hours a day, on air and at bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am karina mitchell. this is bloomberg. alix: thanks so much. some of that video, when you have part of the engine in someone's front yard, it's terrifying. guy: the good news was, though, it was a largely contained failure, i.e. the blades spinning out with huge centrica force did not puncture the fuselage. you got a look on the bright side, glass half-full. alix: pointy hat. that sounds good. let's get market reaction. boeing is off 1%, but off the lows of the session. brooke, is it a boeing issue? >> i think it is extremely unlikely that it is a boeing issue. these planes have been flying since the 1990's. they have been in service for
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quite a while. there is significant structural flaws, we would have known by now. it is jarring to see those images, but the early reports from the national surface transportation board is that there was broken fan blades on the engine, and that can cause the kind of violent failure that we see in those images. it is unlikely that it is anything to do with the rest of the plane. it is likely contained to the engine itself, but we will get more information as the investigation progresses. early reports indicate this would seem to be more of an engine issue than a boeing issue. guy: not great images if you are looking out the window, and the right-hand side engine you see. how long do you think such a grounding could last? we have had problems with blades. we certainly see it with rolls-royce aircraft. what does history tell us for the grounding of the plane? brooke: it will be interesting
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to see what happens. there was a similar incident with the pratt & whitney engine in 2018 on a united flight. pratt inspected all of the blades after that and said it made corrective actions. i think it is reasonable to assume that regulators are going to be taking a close look at those corrective actions and making sure that all of the problems are addressed here. it's just too early to speculate how long this grounding might last. i think it is notable that boeing came out almost immediately and said it supported regulators' actions and recommended that the planes be taken out of service while regulators try to get at the bottom of this. boeing was not interested in having planes grounded by the faa initially. there were reports that dennis muilenburg called president trump the time to insist on space. we are seeing a change in boeing 's response here. alix: again, that video is
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bananas. i can't imagine being on board that flight. you mentioned the plane has been around since the '90s. but who makes the engine? brooke: not pratt & whitney, actually. pratt & whitney, these engines have been phased out, and boeing went into an exclusive contract ge in 1999. although the newer wide-body model--all of the newer wide-body models have ge engines. in terms of the long-term implications, you cannot get away from the fact that these images are terrible and they are very jarring. but i don't know if it will have a far-reaching consequences for the aviation industry. even for pratt, if these engines for some reason don't fly again, that cuts a lucrative source of after-market revenue, but they're almost as many of these 770 models grounded right now in
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storage then there were flying because the pandemic. it is just not really in style planes have right now. huge poking aircraft that are typically used on longer-range international flights. we are not taking many of those right now. guy: certainly that is true. bloomberg opinion's brooke sutherland. u-boat aircraft onto the engine, not the other way around. we will talk about what is going on with bitcoin. bitcoin earlier on under a little bit of pressure. more volatility. this is bloomberg. ♪ (announcer) do you want to reduce stress? shed pounds? do you want to flatten your stomach? do all that and more in just 10 minutes a day with aerotrainer, the total body fitness solution that uses its revolutionary ergonomic design to help you to maintain comfortable, correct form.
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>> it is time for the "bloomberg business flash." i'm karina mitchell. another takeover in the next phase. amity bank is the region by united at a deal valued at $6.6
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billion. the company will have more than 1100 ranches in 12 states from into virginia. there have been a number of deals for regional banks. shares of petrobras plunged as much as 60% in são paulo today. still'-- brazilian president jair bolsonaro replace the head of the state-controlled oil company. he is impatient to appease his political base. jeff immelt's legacy is a dubious one. you will be remembered as the ceo who wrecked an iconic american company, general electric. immelt is out with the book and tells his side of the story in an exclusive interview with erik schatzker. >> there isn't a day that i don't think about the company. there is a sense i have that if
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i let people down, that wears on me. did all the decisions work? no, they didn't. what could anybody try harder love the company more or been have been more purposeful about the company than me? i don't think so. karina: that is your "business flash." alix: thanks so much, karina. one of the things we want to watch in the market is bitcoin. elon musk tweeting "do seem high. lol." guy: his influence on the market is amazing. he is the swing factor. amazing, the influence he has. compare it to janet yellen, treasury secretary, out with comments -- bitcoin is highly
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speculative and people should beware. bitcoin is used for illicit finance, it is inefficient. that is a damming indictment of bitcoin from janet yellen. alix: in the same thinking we are not going to include this in the ecb policy, what are you talking about. that drives retail investors and the bubble and the euphoria we have seen. we are lucky to have richard baylor, a nobel laureate, joining us next. this is what he does. he discovers how people understand the psychology. we will talk bubbles and reopening with him after the break. this is bloomberg. ♪
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guy: you looking at a life out of the house of commons here in
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the united kingdom. prime minister boris johnson scheduled to arrive a few moments from now can work you will be outlining his plans for the lifting of the lockdown in the prioritizing of reopening of schools. alix: march 8 is the target date, right, guy? guy: oh yeah, huge day, kids going back to school. i think it will have a meaningful impact on the economy. just anecdotally compute talk about appearance of having to home school and trying to work at the same time i think there will be significant economic benefit. alix: let's get into it, what the psychological shift will be. joining us is richard thaler, nobel laureate, expert professor in behavioral economics. you are the perfect person to talk to right now on we are lucky to have you. it's a start with you care reopening. the timeline for reopening. what does that do psychologically to people who are going to go back to work and one no go out and buy stuff? richard: well, that remains to
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be seen. it is great for parents, it is great for kids to reopen the schools. i think the interesting thing from the perspective of the stock market is what's going to happen when society reopens enough that people get bored with trading? if there is one thing that characterizes the stock market almost through the last year or so is lots of people stuck at home with nothing to do, people who are keeping their jobs and have more money than they used to, and many of them have taken to the stock market, and we see evidence of it. guy: this is really important -- do you think that when people can go to bars and do all the
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other things they want to do and then they can go out, the stock market will suffer? is that what you are suggesting here? richard: i wouldn't say that the overall level of the stock market will suffer. i think that some particular stocks will suffer. you know, when people started getting interested in investing in the stock market, may, june, say, the companies they knew best were also companies going up the best -- and that made sense, companies like google and apple and facebook, netflix, were all making more money because of the lockdown. you know, just before we came on you had a news segment about two
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midsized banks. i would say the typical homestyle they trader would yawn during that. i can't remember what the name of those two banks are, and i doubt many of the traders do. but it is easy to get excited about tesla of gamestop. alix: we tend to refer to them as dumb money but they have been the smart money. they have been at front of these trades, particularly recovery trades. that is why we are wondering how much of the money will be drawn out when they have been real winners. richard: again, i think it is hard to say. individual investors buying individual securities have been disappearing from the market. they were big in the last bubble in the late 1990's.
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but then people got their lives back and realized they weren't geniuses, and it was probably better to leave investing to professionals. what's happened is we have a perfect storm for investors. they came into the market at the bottom, the stocks they like to best are the ones going up the fastest, not just because of them. the meme stocks are different case. amazon didn't need to be tell investors -- didn't need retail investors to drive its price up. guy: just talk me through what you just said. you talk about the late 1990's. you think that is where we are? what mistakes are investors making right now? richard: well, i think the
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biggest mistake is individual investors think they are good at this game. you know, anybody can have a lucky streak. the lucky streak here is that the biggest name stocks were going up the fastest for mostly sound fundamental reasons. there are exceptions to that, of course. and the market is going up. during that period, anybody can think they are a genius. i don't want to say they are the dumb money. let's call it the uninformed money. the people who are driving gamestop up were not running any spreadsheets figuring out what's a sensible economic scenario there was that could justify the
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price. alix: they were more renminbis structural part of the market. --running in the structural part of the market. if the structure changes, does that change the game? we heard yellen talking about financial transaction tax. questions about if we will get free trading platforms because there may be given changes to collateral, for example. richard: well, you know, the fact that they lowered the commissions from $10 or $8 and a sensible world that would've had virtually no effect. $10 is not very much to spend to trade a stock, unless you are attempting to do height-frequent -- high-frequency trading from home. i recommend videogames is healthier for your finances than
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doing that. it clearly did create interest, and the gameificaiton of investing when there's nothing else to do -- in the early days there weren't even sporting events. i think -- we don't want to call them the done money -- dumb money can but i don't know if we want to call them the smart money. i know has figured this out, because i don't know anybody who figured out when gamestop was going to turn around, or that it would settle in at $40 or $50, or won't go back up. if anybody has that figured out, let me know. i think everybody is -- guy: richard f richard: making gases. when you make so much money over a period of time --
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guy: richard, we're going to have to wrap it up. thank you very much indeed for your time. richard thaler. boris johnson, british pie minister--british prime minister. non-essential shops and hospitality will reopen. headlines have been leaked coming out from the prime minister's statements over the last couple minutes. prime min. johnson: six or nine months, because there will always be some vulnerable people who are not protected by the vaccines. there is therefore no credible route to zero-covid britain or indeed, a zero-covid world. we cannot persist in measures that affect our economy over the life chances of our children. that is why it is so crucial
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that this roadmap should be cautious but also irreversible. we are setting out on what i hope and believe is a one-way road to freedom. this journey is made possible by the pace of the vaccination program. in england, everyone of the top four priority groups were successfully offered a vaccine by the middle of february. we now aim to offer first dose all those in groups five to nine by the 15th of april, and setting a stretching target of a first dose every adult by the end of july. as more of us are inoculated, so protection afforded by the vaccines will gradually replace instructions. today's roadmap sets out the principles of that transition. the level of infection is broadly similar across england, so we will ease restrictions in all areas at the same time.
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sequence will be driven by the evidence. outdoor activity will be prioritized is the best way to restore freedoms while minimizing the risk. at every stage, our decisions will be led by data, not dates, and subjected to four tests. first, that the vaccine deployment program continues successfully. second, that evidence shows vaccines are sufficiently effective in reducing hospitalizations and debts. third, that infection rates do not risk a surge in hospitalizations which would put unsustainable pressure on the nhs. and forth, that our assessment of the risks is not fundamentally changed by new variants of covid that cause concern. before taking each step, we were will review the data against these tests.
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it will take at least four weeks for the data to reflect the impact of relaxations in restrictions, and we want to give the country a week's notice before each change, there will be at least five weeks between each step. the chief medical officer is clear that moving any faster would mean acting before we know the impact of each step, which would increase the risk of us having to reverse course and reimpose restrictions. i won't take that risk. step one will happen by march, at which time those in the top four priority groups will be benefiting from the increased protection they receive from their first dose of the vaccine. mr. speaker, all the evidence shows that classrooms are the best places for the young people to be.
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that is why i have always said that schools will be the last to close and the first to reopen. based on our assessment of the current data against the four tests come i can till the house that two weeks from today, pupils and students in all schools and further education settings can safely return to face-to-face teaching supported bike twice-weekly testing of secondary schools and college pupils. families and childcare bubbles will be encouraged to get tested regularly. guy: boris johnson, the british prime minister, laying out the government's plans to ease the restrictions that have been in place since january as a result of the significant upswings in covid at the beginning of the year, now and again swing--now on a downswing. schools will be opening in two weeks' time. however, people in england will be asked to work from home until june 21.
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alix: that is surprising, pushing it back. it makes sense in terms of five weeks or so. the june 21 deadline. the texas decrease in the energy markets -- we will look at the ripple effect on the global market and who made money and who is losing money with the cohead of oil trading. this is bloomberg. ♪
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karina: this is "bloomberg markets." i'm karina mitchell. we will hear from a new york city mayoral candidate at 12:30 p.m. in new york, 5:30 p.m. in london. this is bloomberg. ♪ alix: it was a week of storms, hunger, cold, lack of water, and severe losers from the texas crisis, front and center consumers, whose electricity bills are skyrocketing. they asked you to get rid of the
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contract last week. the ideas you pay a membership fee and you pay more or less depending on the supply you need and how much it cost in the spot market. some people are getting bills over $2500. unbelievable number. if i opened that bill, i would be freaking out. griddy is a helpful supplier in texas and is backed by the biggest physical gas supply can the u.s. and they got a potential windfall of $210 million with the shares hitting a one-year high. others like just energy also a distributor didn't do so well, potentially lost about $250 million on that. this is not going to end anytime soon, and the discrepancies are going to become bigger and bigger, and who is going to survive and who is not is the key question. guy: fascinating to see what government does, whether or not ultimately the responsibility is going to lie with the companies. as you say, some didn't do well. the cohead of oil trading gives
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us her take -- sorry, his take. alix: it's monday, man. guy: don't know quite what happened there. i apologize. [laughter] guy: let's talk about what last week was like moving on. [indiscernible] ben: look, it was very difficult week. trafigura has a big presence in texas, 200 people in texas and midland. it was not a good week for our people, not a good week for the people of texas, not a good week for the people in the south of the u.s. it is better this week, the weather has improved, which helps a lot. i have not seen too many weeks -- we've been through many hurricanes, haven't seen too many weeks with the amount of pictures and phone calls for employees and friends and family showing how difficult it was. it is most impactful for the people of texas. alix: how is it impactful for trafigura on the bottom line? the end of march is the end of
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the first half of 2021. ben: we have got some volatility which helps a company like us deal with this. the main focus is keeping our customers' supply and keeping our operations going. the focus is not so much on p&l. that will take care of itself over time. have had a huge disruption to operations in the u.s. we are the biggest exporter of u.s. crude oil. the attaching within 10% of every barrel. our people had sleepless nights this weekend, and more than one, many of them throughout the night servicing our customers, unhappy that the weather is getting warm. it is better for our people, but the impact the market is huge in the market is underestimating how much this market is being hit. guy: what is the legacy? how long does the effect last? ben: i think something like 40 million barrels of crude oil out of the u.s.
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you will not be produced that otherwise might have -- i t will not be produced that otherwise would have been produced. in number close to the 40 million barrels will be products not produced across the time they should have. you will see stats in the u.s. of products in crude drop hard in the coming weeks with lower numbers than we would have expected. you have to discount whatever the stats say this week. it will be impossible to count accurately what happened this week. i suspect over the next two or three weeks, and the u.s., in all likelihood it will from the market up and set us up for summer and hopefully we are all getting out of lockdown. we heard boris johnson talking before this about easing u.k. we are bullish about getting out of lockdown in summer. it has been given impetus by the events in texas. alix: have you noticed any sort of change in crude or product flows in texas, products going
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to the east coast, etc. ben: it is more quality. there is a natural arbitrage throughout the world. but this happens quite a lot. what i think is meaningful is we are little bit worried about the way we can get out of this dish i saw some stats from our team in houston this morning saying that at the worst, we were down 5 million barrels from this week. we expect another million barrels a day to come back on this week. a worrying, and saw as a footnote was there's a belief that the last 5% that has come off will never come back, because we are seeing some damage. as the groups are getting picked -- as the crews are getting back out there, they are finding not a perfect situation, and some of these wells will never operate the way they were excited to even 10 days ago. so it is a concern. guy: is there a read across from what is happening in the copper market right now and what is
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happening in the energy complex? it is shooting higher on an almost daily basis. in some ways, you would've thought these things are contradictory. we are talking electric acacia and of the global economy and that would seem to stand against the idea of the oil war. how do you think about that relationship? ben: yeah, interesting question. we have a very big copper book and these guys are super professional. he spoke to bloomberg and told you that copper would've traded 10,000. it looks like it is heading in the right direction. what we like about copper and the oil division is it is a great indicator of real economic development. it is completely tied to the development of energy and electrification of the world cannot occur without copper. but there is a bridge to get there where you need to use hydrocarbons used every day. i don't think they are mutually
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exclusive. the world is quite clearly heading for the energy transition. but we have a decent period of time where we need to continue to develop oil infrastructure and oil assets to get us to that place. it is going to take time. alix: last question -- backwardation is pretty extreme. sustainable? ben: more than sustainable, in my opinion. opec likes backwardation. it doesn't allow for producers to hedge the back end. i suspect that can go on and backwardation is here to stay. we have a strong market going into summer. we're coming out of lockdown and everybody is ready to get out and about and potentially have a summer holiday for the first time in a while. we are very bullish what the market looks like going forward and that means backwardation is here for the for siebel future. alix: really good to catch up with you. thank you for the insight. ben luckock, trafigura head of oil trading.
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this is bloomberg. ♪ rg. ♪
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karina: it's time for the "bloomberg business flash." i'm karina mitchell. jeff immelt's legacy is a dubious one. he will be known as the ceo who wrecked an iconic american company, general electric. he is coming out with the book and is telling his side of the story in an exclusive interview with our erik schatzker. jeff: there isn't a day that doesn't go by that i don't think about the company. there is a sense i have that if i let people down, that wears on me. did all my decisions work? no, they didn't. but could anybody have tried harder or lovely the country more or been more purposeful about -- love to the company more or been more purposeful about the company that meet? i don't think so. karina: in the report says americans are underinsured when
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it comes to flooding. according to the foundation that looks at climate risk, u.s. homeowners face $18.8 billion in flood damage annually. with insurance payments set by the federal government covering less than one fourth of that. that is your "business flash." guy: karina, thank you very much indeed. more on the european close. boris johnson laying out his plans for a full economic reopening. the end of the pandemic apparently insight. the barclays chief u.k. economist is going to join us next to give an assessment of what boris johnson's reopening plans are likely to mean for the economy. that is coming up. this is bloomberg. ♪
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guy: i am guy johnson. alix steel is over in new york, i am in london. downing you down to the european close on "bloomberg markets." what you need to know out of your? the end of the pandemic apparently insight. schools are set to reopen on march 8. the pfeiffer-buys a -- pfizer-biontech vaccine appears to stop a vast majority of transmission. study in scotland shows a substantial drop in serious illness. the pivot to asia gathers pace as the bank sense key executives. let's talk about equity markets. 600 down by .5%. we are getting a bit on the bond market, particularly the approval bond market. christine lagarde speaking a little bit earlier, starting to push back on these rising yields.

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