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[Bloomberg]( Trade hopes spring eternal, Hong Kong forecasts first annual recession since financial crisis, and Labour looks to nationalizations. Final stages White House economic adviser Larry Kudlow said that [negotiations over a phase one trade deal with China]( are down to the final stages, with both sides in communication every day. Talks are focusing on details such as the [timeline of Chinese purchases of agricultural goods]( and Beijing’s demand for the removal of existing tariffs as part of a deal. This morning global shipping giant A.P. Moller-Maersk A/S added its voice to those [warning about the fallout from the trade war](, saying it is less optimistic about growth as the standoff dents the economic outlook. Revising lower Hong Kong is now forecasting an [economic contraction of 1.3% for 2019]( with the government citing an “abrupt deterioration in the third quarter” which it blamed on “local social incidents.” There is little sign the driver of the slowdown is easing, with protesters gathering in the city’s financial district again today. Chinese President Xi Jinping, in a rare remark on the demonstrations, said bringing the violence to an end is Hong Kong’s “[most urgent task](.” There’s also urgency for the city’s bankers who have started to [shorten their day amid the protests](, with deals closing much earlier than usual this week. Electioneering The campaign for the Dec. 12 U.K. election is stepping up a gear with the Labour Party pledging to [nationalize BT Group Plc’s Openreach broadband unit]( to give free internet to everyone in Britain. The party said it would pay for the nationalization with government debt. Shares in BT [dropped as much as 3.7%]( in London trading. Bankers in London [don’t see much prospect of a Labour-led government](, but have started some contingency planning in case it does come to pass. With the Conservative Party [holding a clear lead in polls](, it currently seems like the nationalization policy has little chance of coming to pass. Markets rise Larry Kudlow’s positive comments about trade progress have been enough to give global equity markets a small Friday lift. Overnight, the MSCI Asia Pacific Index added 0.5% while Japan’s Topix index closed 0.7% higher, which wasn’t enough to avoid its first weekly drop since early October. In Europe, the Stoxx 600 Index had gained 0.1% by 5:50 a.m. Eastern Time. S&P 500 futures [pointed to positive open](, the 10-year Treasury yield was at 1.834% and gold had slipped. Coming up… U.S. October retail sales data at 8:30 a.m. is expected to show a rebound from the previous month’s negative number. At 9:15 a.m. Industrial Production and Manufacturing numbers for October are forecast to show a further slowdown. Today’s impeachment hearing is likely to focus on Rudy Giuliani's back-channel efforts to pressure Ukraine's president. J.C. Penney Co. Inc. reports earnings. What we've been reading This is what's caught our eye over the last 24 hours. - Ray Dalio warns of [capital war]( between the U.S. and China. - Goldman [stumbles on path to main street]( with Apple card turmoil. - NYC, London and Vancouver [losing luster]( with luxury homebuyers. - Russia is [making more money]( from OPEC+ deal than Saudi Arabia. - European Investment Bank to cut off [fossil-fuel financing](. - Banks are [struggling to value good behavior](. - [Objective reality doesn’t exist](. And finally, here’s what Luke's interested in this morning During his two days of testimony before the Joint Economic Committee of Congress, Federal Reserve Chairman Jerome Powell emphasized that the U.S. fiscal trajectory is unsustainable. He judges fiscal sustainability to be determined by whether debt is growing faster than GDP. If it is, then it's definitionally unsustainable. (Japan, over in the corner, is saying, “Hold my sake.”) It’s debatable, given Powell’s definition, if the U.S. really is on an unsustainable footing. According to the U.S. Office of Management and Budget, the ratio of debt-to-GDP has been flat for the last four years. Powell’s comments were also accompanied with a concern about business investment in the present (because of slow global growth, demographics, and the trade war) as well as the long run, because of elevated government debt. This speaks to the potential for a “crowding out” dynamic: the idea that government borrowing both utilizes real resources and potentially pushes up interest rates in a manner that reduces private capital expenditures. However, he didn’t seem to allow for or endorse the possibility of “crowding in” – government spending supporting higher aggregate demand and business investment – to improve the current situation. During Thursday’s testimony, Powell somewhat softened some of the fears surrounding debt that he had fanned. Any day of reckoning on the U.S. debt load “could be quite far off” – more than a decade, at least, even on the current trajectory – he said, due to the U.S. dollar’s role as the world’s reserve currency and the depth and breadth of the U.S. economy and financial markets. That means the U.S. retains fiscal space to support growth in a downturn, he added. Like Bloomberg's Five Things? [Subscribe for unlimited access]( to trusted, data-based journalism in 120 countries around the world and gain expert analysis from exclusive daily newsletters, The Bloomberg Open and The Bloomberg Close. Before it's here, it's on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can't find anywhere else. [Learn more](. 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