Facts and Logic are Now Partisan, Gideon Says

is Bloomberg Surveillance with Jonathan Faraoh and Tom McKeene. The SMP five hundred heading for a fourth straight week of gains, but a little bit of weakness emerging in the past few days, sparks some would say, by jitters around tax cuts and whether the GOP has the votes to get this done next week. As far as futures are concerned, this Friday morning, a little bit firmer at five points on the SMP five hundred, positive sixty two points on

the doubt in the bondom market. It's as you were, incredibly tight trading ranges through the year and over the last month as well. Somewhere in the two thirties were up another basis point at two thirty six on a US ten year. At the front end of the curve on a US two year, we are trading at one point eight two percent. Confidence that growth will improve and inflation will stay low, shared by most investors and central

bankers are like going into ten. And in the FX market, it's just a story of dollar witness through the year and on the session as well, with one exception some dollar strength against the pound. Even as European leaders vote to go to Phase two of Brexit negotiations, the cable rate on the back fot south of one thirty four. At one thirty three ninety two, we're down a third of one percent for the year so far. Tho, it

has been the pain trade of seventeen. All the ingredients for a year of dollar strength, rate hikes, better growth, pushing through fiscal stimulus seemingly, and yet we grind towards one of the worst years for the green back in a decade. To discuss Bob sinch Amherst Pierpont global strategist, Bob a man that has followed the FX market four decades, we have not seen a year like this for quite a while for the US dollar. Yet we had the recipe and the ingredients for a year that should have

been good. What happened? You know? I think the markets discounted a lot of this. Remember the dollar had a huge run up from the election to the end of the year, and in fact peaked right around the year end. So you know, when we do these annual comparisons, we will be comparing the dollar move this year to just about its peak at the end of December of of last year. Uh And I think the market just got two builed up um on US growth earlier in the year.

They got two builed up on on higher US interest rates, and two bowled up on the dollar. And so the the year was really one of trying to digest those long positions um and And I think also, you know, one of the big disappointments I think if you look at the year as a whole, is that the US trade balance and therefore current account balance hasn't really improved all that much, even though we're almost at balance in

the oil trade balance for the US. So you know, the US trade balance and oil had gotten out to his wide is about forty billion dollars during the peak, and oil prices it's down down to less than five billion. Yet the total trade balances is why as it's ever been, which means we have records record deficit in the non oil trade balance. So I think that there were some expectations that trade would improve because of the U S

improvement in the oil balance. There were expectations that, um, you know, that the markets would would embrace um, these reforms. In the US, it embraced growth, and I think a lot of it just got discounted in that big run up in the dollar in November and December. We've been

digesting ever since. So if we think about excessive bullishness in the dollar at the end of two thousand and uh and sixteen and the response that we saw in two thousand seventeen of disappointment, you sort of look around and say, well, where's the greatest optimism right now in terms of market action in price action, it's bitcoin. So you're wonder where the bitcoin is going to be the

disappointment of two thousand and eight. Maybe we're gonna spend a little bit more time talking about the fundamentals in this tax plan and where the GOP is at. I want to talk tactically just ahead of and you mentioned some of the positioning going into this year. Everyone seemingly on the one side of the boat for dollar strength, and you were wondering where the marginal bar was going to come through come from when net lungs was so big.

What does the positioning look like coming into next year now, Bob, you know the market's a bit a bit underweighted on dollars, I think, a little bit overweighted on the euro, overweight on the Euro. But I don't think the positions are as extreme as we've seen because we just haven't seen the results this year in currency trading. We haven't seen the results in trading in a lot of the commodity markets. So I don't think going into the end of the

year we have big, big positioning. But if we do, um, I think the one that's been embraced is euro strength because of the strength of the economy and that filtering through. You didn't mention that you had such great helpa. You're into the year. Happened about October. Packed it and I'm sure Bob sent you with this with AMers Uh Pure of Bloomberg Surveillance. This morning. Good morning, brought you by Investco. Investco dedicated to delivering an investment experience that can help

you get more out of life. Learn more at investco dot com slash more out of life. What's the number one mistake, Bob sinch that people make when they bet on the dollar. We say the dollar, but you got to do the dollar against something else to make any money. What's the rookie mistake in a belief on dollars stronger or for that matter, dollar weaker. You know. I think that that we've been in a in a in an exchange rate market that's been dominated by capital flows for

for a couple of decades now. And one thing that I think did come through in two thousand and seventeen UM is that current account balances still matter, and so big current account surplus in Japan, big current accounts surplus and the Eurozone, those currencies held up pretty well during the year. And as I said, big current account deficit in the US that requires continuing capital inflows into the US.

If that's going to happen in two thousand and eighteen, and I think it will, I think it's not going to be because US short term rates go up. I think it's gonna it will be driven by long term

US rates going higher. So I think that the dollars fortunes in two thousand and eighteen are similar to the bond market's fortunes, obviously inversely related to the bond market fortune fortunes and and I think one of the key issues will be to see whether US bond yields rise as the FED gets out of the way UM in terms of beginning to to sell bonds. At the same time, the deficit projections get get moved higher. Uh. And the question is, well, that creates some some congestion in the

bond market. So what we've got to think about and then is structural forces reassertting themselves. That means stronger Euro, stronger, Swissy stronger, and weak compound and we could dollarways that how we've got to think about get ten next year. Well,

I think that's what drove this year. I think that the markets were all boiled up on the cyclical story at the end of two thousand sixteen, and when the cyclical story didn't continue to drive those capital flows, we went back to um you know, the underlying current account balances. And I think that's what helped the end and the Euro this year. The question will become do those capital flows become bigger again in two thousand eighteen. And I think the driver of that is not short term rates

and the FED. I think the driver of that is bonn yields, and so it's really dependent upon bon yields. We think bon yields are going higher in eighteen in the two thou eighteen in the US. To me, this is absolutely fascinating. As you say, there's almost a zeitgeist rain which is the theme for next year? Do they ever work out? Does the beliefs that John and I read about and typically, Yeah, I was gonna say, I mean, the dollar is going to be stronger, Trump won US ascendant.

That worked out. But right now, whatever you read across all the literature, are you sitting there is a grizzled Bob since you're going are you guys kidding me? Yeah? I mean I think that that there is some pressure on people who are deeply involved in the business to come up with these ideas for the year. You know, the Trump trade, the higher US interest rates, fiscal stimulus, that all did drive the dollar. It drove it for eight weeks in November and December of two thousand and sixteen.

And the problem is by that time everybody was on the trade in the position, Bob, we don't care. Here's what we care about. Pharaoh's so large, John, Pharaoh is now so large at Bloomberg that his entire compensation package is hedged. The problem is John's going back to London for the holidays to see mom, you know, and the rest of it can what sterling level does he need to live large in the United Kingdom in the next two weeks? You know, I think he's doing okay at

one thirty. I don't. He's an unhappy camper full disclosure here funded in dollars and saying absolutely naked with no hedges. Okay, So as I'm going back into the UK, we're going pure on hedge dollars back into sterling. You know. The other issue is when Jonathan goes home, does he actually pay for anything? You know, I mean everybody's going to be paying for hands price on the Bloomberg as I see,

it's nice spot price at the terminal at JFK. Was walking down thread Needle Street down towards our new office, and they like they bow, they do the head the tap thing from medieval England. When he walks by, what's your call on sterling for next year? Boring? You killed it this year? Full disclosure, Yeah, we had it was okay. I think it's relatively boring. You know. One of the things that I think may surprise us in in in the in two thousand and eighteen is the Brexit negotiations.

I don't think they're going to be as difficult for the UK a on a relative basis as they were in Phase one. Look in Phase one, the the EU leadership had very little to give up, and this was primarily about how much money the UK was going to pay to get out of the deal. And so I think that that the EU leaders didn't have a lot

of disagreement. I come back to the fact that that the EU has is a major exporter to the u K. And that creates a lot more strength for the UK and the trade negotiations than people generally perceive pay upon. The global strategist Gideon Rose with us with a really interesting and emotional issue of foreign affairs. The Undead Passed with two actual plaques from Auschwitz, was very, very very

emotional cover. John Ferro, you look through it and you go to the challenges of the Middle East that are spoken of within the Undead Past getting and I'm thinking about the United States State Department in the era of the reluctant hedge him on what that means for the Middle East. So basically there's a big picture and the details. The big picture is we're getting a preview of what a post American world would look like. Um the essentially

the United States. It's almost like we're in the Iliad and where the Greeks and the United States is Achilles, and essentially we're sulking in our tent. We walked off the battlefield, and the enemy, the Trojans, are winning because we're basically not fighting. And the question now is you have in Saudi Arabia interesting developments where there's both internal reform but also a regional uh a regional Hedgeman trying to be born. You have Iran doing the same thing

in reverse from the north and the Gulf. You have Syria in which we've not only defeated Isis on one hand, but also the Russians have basically helped a sad win.

So you're entering a new phase in Syria. And all this is playing out with essentially the US completely distracted, having no essential state department, no diplomatic apparatus, uh AT a half hearted attempt to do a piece deal, but with things like the move of the embassy to Jerusalem, there's no possible way you're gonna get a piece deal. So essentially the Middle East is working on its own

dynamics going forward in interesting ways with stuff happening. In the United States is sort of watching from the sidelines, and nobody is quite sure just how long the unraveling will continue and if and when the US will ever come back to the diplomatic game. Gidion. We have an emerging alliance as this is happening, one that many years

ago people might not have expected. Emerging alliance between Saudi Arabia and Israel, with the bond, the glue keeping those two together, a will and effort, the objective to to isolate Iran. How is this going to evolve in the

coming year? Well, I mean essentially, Uh, you have guards, you know, guardians of the old order that are essentially happy with the status quo, Israel and Saudi Arabia, which actually are strong in their position and actually care about it, and Iran, which is trying to make inroads and essentially counter them and with its own allies. So you're having kind of regional teams pick sides, uh. And what the Saudis and the uh Israelis are happy about. What this administration.

Is they felt the Obama administration was almost moving to be neutral between them and the Saudis, and now they're happy that the Trump administration is backing them. But the question in the long run is Israel and Saudi Arabia are not enough to make a Middle East policy with

and they're actually uh gonna be. You need to have some way of bringing Iran into the negotiations and stabilizing the situation in some way, and the question of what happens with the future of the Iran nuclear deal is actually crucial and interest So, Gideon, as you think about the Middle East right now, there are several hot spots Yemen, Lebanon emerging so in the last couple of months much

more so, and Syria as well. As you look at this evolving relationship between the saud East Israel, and there are oppositions wereran, Which region, which area of the Middle East You're most concerned about things bubbling over? Well, Syria is always has been in the last several years, the potential for regional conflagration. Um now we're moving into an interesting area there because we're not quite sure what's going to happen with a post Isis. But strengthened Assad regime

and what will the future of Syria look like. Uh, that has potential. Yemen's a terrible tragedy, but I don't see it blowing up. The really interesting thing is the

Saudi Iranian relationship. And also, frankly, it would be interesting to see if there are any repercussions between what happens in the American domestic political situation and the Middle Eastern situation, because, uh, the the the Saudias are close allies of the Trump administration as well as the Israelis, and if the Trump administration finds itself in real troubles in that could be a problematic for Middle Eastern diplomacy. Were the Middle Eastern

plomacy and we all have, I mean literally, folks. The evening of September eleven, I picked up eight hundred pages of Albert Harani and as one volume, the History of the Arab People. That's a true story. I picked it up that evening and ran through it in about three months, two months. Maybe we all have our legacy knowledge of the Middle East. Gideon Rose, those books are old news. What's the new book being written? Now? What's what's the zeit?

Guys that you would recommend we learn about about this new Middle East. It's a fascinating question. Basically, when you're looking at the Middle East, you always have to remember the past because you want to understand the problems and the motivations of the different actors. But you have to get past and transcend the past so that actually you

can focus in the future. I think the question of whether we can actually create some kind of balance between the Saudias and the Iranians in which their regional rivalry can can be stabilized without destroying the region, where they can compete in a structure that for regional influence that is not destructive to everything around it. That will be

the key question. I've had the privilege of meeting three of Faisal's immediate and directs, and it's what I believe it was maybe a brother, I'll be honest, I can't remember. And it's completely authentic tribal Aristocaracratic royal Middle East heritage. And we all were weaned on Lawrence of Arabian all of our false mythologies. This new guy is trying to get them away from that. How do you do that

within a tribal legacy? I I find it fascinating. So what's happening with the Mohammed bin Salman in Saudi Arabia? Fantastic reform UH moves, but where it's actually going? Is this just an increased play for personal power and control? And what does he want to do with the power when he has it? Does he want to liberalize Saudi Arabia? Are we talking? Look at me? What's gonna happen with energy markets? With happened with religious extremism and control there?

And foreign policy? It's actually really interesting because he's trying to It seems like he's trying to do interesting things domestically, but he's also been a strapper US on foreign policy and the m in side of things has not worked well at all. So the end, what will happen with Mohammed bin Salmans Saudi Arabia going forward is a really

interesting question. Some people would argue Gideon that this is a power graph under the veil of reform, and there are still significant doubts whether he can really contain Wahabism

in Saudi Arabia? Can he really do that? When he talks about a moderate Islam, I don't think of what hobbyism is that Uh look, any of these religions has variants that can be more militant or more pacific, and there's plenty of room for political authorities in a place like Saudi Arabia to shade the coverage and interpretation into various kinds of quiescence or not. Religious wise, So if he wanted to do some reform, he could, but we

just don't know. And one of the things we'll all be watching is to see not just how the power play works out internally, but what the fruits of it are in terms of what does he do with the

power position that he has consolidated. So, given what does success look like for MBS, success would look like maintaining domestic power, having sent a clear message that he won't tolerate opposition to his policies, and then some kind of attempt to gradually reform to be able to take the kingdom strengths, stabilize it, and move it forward into the twenty one century with a different kind of model that's

more adapted to the future of the Middle East, energy wise, socially, religiously, etcetera. That's a big challenge, and uh, we don't know whether he can pull it off, find a question. This has been wonderful getting rose. What's your challenge with foreign affairs? Folks. I'm gonna make this simple, John, help me here, because I don't know if I have the pricing right. It's a price of two Manhattan's. Maybe it's a price of to Gibson's. Our our challenge is pretty simple. Actually, we

are essentially shock troops of the Enlightenment. Our goal is simply to apply reason to public policy for the public benefit, to provide a forum for serious discussion of real issues. And this whole question of fake news, the whole question of trying to undermine standards of truth. That's the biggest single challenge, because it doesn't matter about which political side you're on. There should be as as Dan pat Monehan used to say, you can have the right to your

own opinions, but not your own facts. And that's the biggest challenge we're in is that now facts and the logic themselves are creating a part of the environment on behalf of all the foreign affairs and counts on forign relations. What's the print subscription dynamic right now? To do this year? We're actually doing pretty well. We're up over a couple hundred thousand and you could basically subscribe anyway you want. Go to Foreign Affairs dot com and we're seeing a

resurgence of journalism. Let me give you the real sales job here, folks. The Prince subscription has adult larger font you can actually read the damn thing. Two, you get a subscription for Foreign Affairs for the mouthy brat you have at home who's an undergraduate somewhere. You get on the subscription and you say, you don't get the Daily Pharaoh.

You get a daily or weekly. Do understand that that kind of magazine is going to make the mouthy brand in the family even mouth yet it is, that's true. But you get on the subscription and you say you must read one article or you don't get the allowance to go to Florida for winter break. Hopefully it's not spinach, and hopefully they're already reading an online and using it

for their debate teams and other kinds of preparation. But together, you're doing the digital and you're doing the producing Foreign Affairs magazine. You're end of my sales pitch. Joe Biden's

in it some really interesting cross political analysis. The Undead Past John Farrell what's the one thing you see on the data screen here, I just say a week, a dollar that's just struggling to get a bit, not just today but throughout the whole of Tom and I know we've talked about this a lot in the last couple of days, but really, as we round out the year and look at and with a prestigious guest next to

us as well, that's what I'm thinking about. What went wrong with the call for a stronger dollar this year? To bring him in, bring him involved. I don't know what's wrong with Tom Key this morning. I'm worried about Steelers, Patriots data CEO and founder. Yes, it's always great to catch up with you. Tax cutter set to go through, Fiscal stimulus is set to happen, g d P is exalerating, great hikes are going to continue through this year through

next year. What's the dollar doing down here? Well, so I think when when you look at the dollar, it tends to move in cycles, and we had a really big dollar strengthening cycle from the summer of two thousand fourteen too January this year, depending on how you counted, and once you had one of these really big movement becomes hard to just to sustain the gains, and you

need to have like continuously good news. And this year we've we've had a lot of good news, but a lot of us priced in and early in the year Trump arguably started to talk the currency down, So I think that was a part of the turning point. Another really important part of the turning point was that we started to have much better global growth. Right, So it's always very attempting to sort of be okay, we want

to trade the dollars. Lets look, look, let's look at you as fundamentals, but effects is always a relative game, and we've had a lot better growth. Like just let me emphasize one point from the ECB press conference last year yesterday. The ESPN our projects essentially two and a half percent growth for two thousand and eighteen. That's the same as United States, and and they have no population growth.

So in in in GDP per capital terms, it's it's growing faster than United States, even though United States has to do fiscal stimulus our at tax cuts to get there. It's kind of interesting. Yet we have a deposit rate in Europe negative forty basis. Noticed, I'm noticed, and at the front end in the United States, we continue to grind higher. I'm trying to reconcile those two things. Yes,

can you help me? This is really good news for me because I have to make a living predicting currencies, and if it was easy, then I wouldn't have a job. So this this year has been really interesting, right, because we've had these huge divergence between the signal from interest rates and what currencies have actually done. So I think there's been some really important flow effects that has pushed

the US higher, and I think that can continue. But since identified this an hour ago, let's go into this. There's two drivers of effects flows money slashing around, and am I right? Real interest rates inflation adjusted interest rates and their expectations that right versus president indust rates. Now you're really going into uh always religious debate. I'm on the edge of Michael. Help you here about the edge of Michael Rosenberg. One I want ends you'd be thinking

about great differentials at the front end. Yeah, that would be effects one I want. And that's right. Um, if you're looking at emerging market country, I always look at real interest rates for detail countries. I think normal is more Chapter eight of your wonderful Important and I might point out at the time courageous book pounding the European society to get their act together. Chapter eight, where's the growth?

The cost of deflation? Can you say now your book is old and the Europe is on a new regime and you need to write a new book about a European GDP that may be bigger than the U S g d P. Yes, that that book came out in two thousand thirty and I think a lot of things have changed as a fair few chapters I would like to add as the refugee crisis that was not in the book, and now we actually seem to have come through in a way where after ten years pretty much

but no growth. Okay, let me help you with the title here, and I need a royalty on this. Are you going to write the Rise of the euro? Well, the first thing I have to do this, I have to get an approval from my wife to write another book, because it takes a thought. You needed to get an approval from Mrs Nordvig for me to get a royalty. He needs an approval for both. Is that what we faced out a Ryan seeing euro a rising Europe? Is

the excitement justified? Yents I do so I was. I was just speaking with the Lisa Brahmas and Alex Steel this morning where we touched on this topic and the one chart actually just tweeted out now is about the public support for the euro So the whole thesis in the book that wrote back in two thousand and thirteen was that the project was very, very shaky if public support was going down, and now we're actually having a

turning point in the public support. So this is really important because it means that the sort of forces in Europe that were ready to embrace a breakup potentially having a less less momentum, and that that could keep the thing together. So when we think about political forces reasserting themselves in I think most people think instantly they think Italy and what's going to happen with the Italian election and how that may kind of throw this whole, this

whole happy talk around Europe of course with it. So this this is why I watched these opinion polls very very carefully, right, because if you look at the different part aunties in Italy, there are right wing parties that are anti Europe and there are left wing parties that are anti Europe, but they also look at opinion polls. If they can see it's actually not that popular to be anti Euro, they're gonna tone down the rhetoric. And

we learn in France it's not in France in Italy. So, and Italy has always been the big public problem country in that support for the Euro is kind of fifty fifty, right, So it makes a big difference where the ten percent is going to swing six against it or in favor

of it. Just because the time I want to go over to Asia, my recollection I could be wronging it is correctly, please is at the beginning of the year there was almost a partition of euro U S trans Atlantic dynamics and then a whole another beast called Asia d X Y or Asia Japan, whatever that dynamic is. Is dollar dynamics separate with Europe and then over here Asia or are they more of a converging set of dynamics. Well, so, I think you're making a really good point because as

some flow dynamics that are very Asia specific. Yes, there's the capital flight that has been happening out of China up until earlier this year but stopped for various reasons. We go into then there's also a country like Korea, another very important country in Asia. They have essentially stopped intervening in the currency market this year. That allows the currency to go to a different level than we've seen in the the ones that great. Yeah, well, I want to rip the script up right now and if you

don't want to answer this, that's okay, without question. On this Friday in December, the bitcoin focus is on the frenzy in Korea. With your work at Golden Section, work at the beautiful book you put out the Fall of the Euro, what do you see is the trading frenzy of China, Japan and Korea over this thing called bitcoin. You've lived that psychology, You've traveled there a million times.

How do you distill the bitcoin z that we see within the Pacific rim was that they definitely have a gambling culture that is different from what we know here and you can see that on the exchanges for for bitcoin in Asia. But I would add one more thing. So there's more and more people who are serious investors that have managed institutional money over the last couple of decades that are telling me we're closing down our hedge fund, maybe multiple and dollar hedge fund. Our focus going forward

is gonna be cryptocurrencies. It's stunning. It's not just a retail phenomenon. That's going to be an institutional chapter to this. This is so too important. Are they going to Kogermon the Long Short Cryptocurrency Fund? Are they going there because they want to? Are they going there because they think that's the only alpha creating game in town to make two and twenty. It's probably a mix. But I really think there are there is people who are fundamental believers

in this. You can maybe call them religious about it, but there are smart people who have conviction this space. And sometimes when I sit down with these people who I'm known for years and hear what they say about it, I'm I'm surprised how broad baseds and and how it's mergings an institutional space. Now I'm not surprised the funds are closed and I'm surprised to go into cryptos. Global macro just got killed by central banks. Todd one data point.

Even people who have been successful, been successful in macro are doing it. It's amazing. That's interesting. Now, that's interesting. The Interview of the Week Howard Ward, gam Coo and Gabelly up this year and he's not making two and twenty. I speak to Mario Gabelly on television today around twelve noonishing, yes, we will speak about the media Fox in Disney with Mr Gabelly as well. Yes, Nordvig, thank you so much, greatly,

greatly appreciate your wisdom. It is good to catch up with Sony com or he's with Sony copor he's with Redefined. But far more than that, he takes a very broad, a holistic view of a europe Uh. That's really sort of in ascendency Sony, good morning. Did you did you ever think you would see forecast of European real g d P larger than American Um. Yes, even at the depth of the European crisis, I never lost my faith in the US ability uh to get together and be resilient.

Part of it, of course, is simply a question of bouncing back. The sad reality is that even with the relatively optimistic forecast that we see today, many European countries, especially in the UA Zone, will still have g dps that are lower than they would than they were back in two thousand seven and eight. Uh So, yes, it looks good on a relative basis in a world that is otherwise confronted with slowing growth and rich economies. But

we have had a lost decade in Europe. Certainly, we've had a lost decade in Europe, arguably because there was a man called three around the e c B and then we got a man called Drug that boiled everything out. Is this president dr recovery or is this Europe's recovery driven by politicians that got their act together? Well, I think part of it is simply again the question of bouncing back. At some point, real economic activity had to

pick up. But yes, you are right that tre Set built a bad blow at the start by raising interest rate prematurely, by taking a divergent vie on monetary policy compared to what the Fed and the Bank of England were doing, and that probably cost Europe three or four years of much lower growth in a deeper recession than

we would have needed to have had. And yes, Drug has contributed to restoring confidence, particularly to taking away the possibility of a breakup of the Eurozone that haunted investment

and economic activity in Europe for several years. But some of this is simply the result of the asset prise inflation we have seen and may actually be temporary rather than real seal hell, one of the things we can do with you, and this goes of course your advice to the Norwegian government, your work with O. E. C. D and I m F. We got like eight ways to go here. But in the time that we've got left, Sony, both John and I are to be kind surprised that

Germany can't get its act together. I guess the election is old news, but have you been surprised by the struggle to get to a two thousand eighteen coalition? Well not really, because there has been a president of the junior party in grand coalitions across Europe having to pay a significant electoral cost, and this time, after several such years and coalition of being the junior partner, the SPT decided that enough was enough and the mathematics simply didn't.

But but we have to remember, and this is very important, that Germany is a federal economy, with most key critical economic decision making actually not lying with the federal government.

So in that sense Germany can, as opposed to France and the UK, which are far more centralized, we afford afford to be without a federal government without any serious economic costs for far longer than these other centralized economies, and the example of Belgium, which set the record for not having a government while the economy did quite well, is perhaps the best comparison. Like Germany, Belgium itself has multiple levels of government. The federal government in Belgium is

only responsible for some small decisions rather than being all important. Sonny, thank you so much. Nice to catch up, refels CDVO. Sony Kapor is managing director for Redefined with a Good Perspective and Europe jen if I just it is one of the great surprises of the year. I just thought a coalition would be doable in Germany. I think everyone just saw. Everyone just thought smooth sailing for Chancellor Angela Merkel.

That probably was the political surprise this year. That was sunny, called Cappolla points out Tom Ready, the lesson is that you don't really need a government sometimes in Europe for things to be uncounty. Thanks for listening to the Bloomberg Surveillance podcast. Subscribe and listen to interviews on Apple Podcasts, SoundCloud, or whichever podcast platform you prefer. I'm on Twitter at Tom Keane Before the podcast. You can always catch us worldwide. I'm Bloomberg Radio