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Speaker 1: This is Bloomberg surveillance. You can think of cash as

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Speaker 1: effectively a very very short duration asset. The problem is,

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Speaker 1: right now, it's not very attractive. What change does the

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Speaker 1: US need more than anything else economically? I would argue,

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Speaker 1: catch me for a pretty poor way to judge the

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Speaker 1: strength or lack thereof, of a once vibrant American economy

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Speaker 1: and say we're doing better in Japan or Europe, which

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Speaker 1: are not growing at all. Bloomberg Surveillance your link to

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Speaker 1: the world of economics, finance, and investment on Bloomberg Radio.

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Speaker 1: Good Morning, and Michael McKee along with Tom Keane. It

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Speaker 1: is seven am on Wall Street noon in Brussels, where

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Speaker 1: there are reports police have now captured the suspected mastermind

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Speaker 1: of yesterday's bombings. Bloomberg's Caroline Conten joins us now from

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Speaker 1: the Belgian capital. Carolen, what can you tell us? This

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Speaker 1: is interesting because these suspect that has been quotes, according

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Speaker 1: to the Belgian media, draw the clear link between the

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Speaker 1: Brussels attacks and the Parents attacks back in November. So

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Speaker 1: his name is Najim Lashkawe is twenty four years old.

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Speaker 1: He is believed to have traveled to tier Ya in

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Speaker 1: early twenty thirteen, and he is also believed to be

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Speaker 1: a closed accomplish to seller up this plan. The only

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Speaker 1: surviving terrorists of the Paris attacks who was arrested Jim

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Speaker 1: Brussels last Friday. We do understand from media reports that

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Speaker 1: the Belgian police were aware of these three gentlemen. Yes

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Speaker 1: and last yesterday afternoon, the Belgian police actually posted the

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Speaker 1: picture of Najim lash Kawe. He was seen at the

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Speaker 1: airport pushing a luggage carver and a hat and glasses

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Speaker 1: with a white jacket next to two men who believed

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Speaker 1: to be the al backed carib robbers who supposedly blew

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Speaker 1: themselves up at the airport. Now Najim Lashawi has been

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Speaker 1: uh the This has been looking for him since November thirteen,

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Speaker 1: stein the dressful attacks in Paris because he was believed

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Speaker 1: to be in connection with Salad this Lamb. His DNA

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Speaker 1: was found on some of the explosives that were used

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Speaker 1: at the battackcount Concept venue on November thirteen, and he

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Speaker 1: was also seen at the border with between Austria and

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Speaker 1: Hungary last September before the parents attacks in a car.

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Speaker 1: We've sell this lamp o call and just before we

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Speaker 1: let you go. I know they've just finished a moment

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Speaker 1: of silence in Brussels for the victims of the attacks.

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Speaker 1: What is it like there today? Is life getting back

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Speaker 1: to normalist transportation up and running. So the metro lines

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Speaker 1: are not all running, especially the ones around where I'm

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Speaker 1: standing right at the European Institutions. Uh, this is where

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Speaker 1: the metro station now. Because hit around nine am local

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Speaker 1: time Brussels time yesterday morning. This metro line remains shut.

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Speaker 1: Some other lines have reopened. The U S services have

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Speaker 1: started to run again to London or Amsterdam. The Brussels Airport,

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Speaker 1: of course, remain shut for now. I can see right

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Speaker 1: now some helicopters flying over the European Quarter where you

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Speaker 1: have the EU Commission and the U Control where the

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Speaker 1: U leaders frequently meet like they did last Friday for

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Speaker 1: the refugee crisis. There is a heavy police presence around

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Speaker 1: the Commission. There is no specific security parameter except around

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Speaker 1: the metro station, but there is soldiers and heavy police

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Speaker 1: presents around here. Carolin Conner in Brussels, thank you for

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Speaker 1: joining us this morning. Calm has returned to European and

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Speaker 1: US markets in Europe right now, the stock six D

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Speaker 1: is up a point three tenths of eight percent. In Germany,

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Speaker 1: the docks is up a hundred and three points right

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Speaker 1: now over one. The Euro on the day one six

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Speaker 1: is down by about two tenths. The footie is up

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Speaker 1: by three points right now about to we'll call it

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Speaker 1: less than a tenth of a percent. The pound continues

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Speaker 1: to fall, although it has paired its losses, and if

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Speaker 1: you take a look at implied volatility, as some analysts

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Speaker 1: have done this morning, they're suggesting the drop may be

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Speaker 1: overstated as a sign of Brexit risk. US futures unchanged

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Speaker 1: on the day, no change for SMP, DOW or NASDAG.

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Speaker 1: Many futures bond yields little change ten year one one

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Speaker 1: forty one for the five year, and the two year

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Speaker 1: eighty eight basis points, although the whole curve has moved

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Speaker 1: up just a touch from yesterday after signals from several

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Speaker 1: FED officials they may be more aggressive than markets have

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Speaker 1: priced in Today. A Bloomberg exclusive, Tom, you and I

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Speaker 1: will interview St. Louis FED President James Bullard nine am

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Speaker 1: on Bloomberg Radio and TV. We are and I'm sure

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Speaker 1: there are many things you want to hope from him.

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Speaker 1: What what's the most important thing. I think the most

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Speaker 1: important thing from from him it is comment on little

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Speaker 1: bit of rising inflation and just the dynamic here of

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Speaker 1: CPI and Cleveland, Robert Harmance with us with Kissinger associates.

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Speaker 1: What would you like to know from the Federal Reserve

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Speaker 1: Bank of St. Louis President. He's an interesting guy. He's

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Speaker 1: very interesting and a very thoughtful person. There. There are

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Speaker 1: a couple of things. One would be how what's going

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Speaker 1: on in the global economy and the general weakness of

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Speaker 1: the global economy is affecting their decision making if at all? UH.

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Speaker 1: In the past volatility and markets, particularly concerns about China

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Speaker 1: have caused him to be a bit more cautious. I'd

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Speaker 1: be interested if that UH sentiment continued. And the second

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Speaker 1: the question of these terrorist activities. Do these over a

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Speaker 1: period of time undermine investor confidence? Do they cause market

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Speaker 1: and stability? It turns out markets today seem to have

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Speaker 1: become much more normal after a horrendous attack on Belgium.

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Speaker 1: The question is if they are more of these attacks,

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Speaker 1: because there are a lot of former foreign fighters coming

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Speaker 1: back into Europe and other parts of the world. If

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Speaker 1: they continue, does that cause problems. He won't speculate on that,

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Speaker 1: but obviously has to be concerned about that undermining consumer

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Speaker 1: confidence and investment confidence as it did in the United

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Speaker 1: States after not eleven. Interesting point you raise about the

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Speaker 1: markets yesterday the lowest volume of the year UH losses

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Speaker 1: in Europe, very contained, US markets mixed UH, and right

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Speaker 1: now we're seeing a rebound in markets. Have investors, as

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Speaker 1: horrible as it sounds, become somewhat inured to terrorism. I

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Speaker 1: think they have seen lots of acts of terrorism and

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Speaker 1: they've seen the markets recovery after each one. So they're

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Speaker 1: beginning to build this notion in that markets won't be

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Speaker 1: permanently adversely affected. The question is if they're more of them,

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Speaker 1: and they're more widespread, does that sentiment change? But you're

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Speaker 1: quite right for the moment, markets have shrugged off these horrible, volatile,

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Speaker 1: terrible tragedies and and done it fairly quickly. So the

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Speaker 1: question is will just continue. But a lot to talk

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Speaker 1: about within our international relations. Robert Hormettz with us for

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Speaker 1: this half hour Bloomberg Surveillance this morning, Rotch Buy investco

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Speaker 1: to the day's headlines. Have you searching for more investment

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Speaker 1: views Investco's experts can help find the latest thought leadership

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Speaker 1: at the Investco blog. Visit investco dot com slash us

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Speaker 1: to subscribe. About part of our diplomacy is the privacy

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Speaker 1: of citizens. It's gonna be invaded. I mean, we're four

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Speaker 1: months on from Paris a detect. There could be another attack,

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Speaker 1: three months, seven months, two years out. Tell me how

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Speaker 1: the State Department works day to day trying to honor

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Speaker 1: our privacy as citizens. This is going to be an

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Speaker 1: enormous already is an enormous dilemma. On one hand, the

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Speaker 1: intelligence services need more information, and they need it well

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Speaker 1: in advance. You just can't do it afterwards. You have

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Speaker 1: to really be find ways of tapping into potential threats.

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Speaker 1: On the other hand, you don't want to do things

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Speaker 1: that violate the privacy of Americans. Uh, it's in our

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Speaker 1: constitution that you don't do that. So they're gonna have

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Speaker 1: to find the right balance. My guess is that for

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Speaker 1: the moment, Americans are going to allow more uh invasive

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Speaker 1: activities by the intelligence services, with courts obviously having to

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Speaker 1: provide the go ahead to do it. So you need

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Speaker 1: some judicial oversight and you need some congressional oversight, But

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Speaker 1: you need intelligence. That is the thing that all of

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Speaker 1: these incidents underscore. You need very good intelligence. It's very

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Speaker 1: hard to get to the extent you can find ways

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Speaker 1: of doing it, then I think Americans will sacrifice a

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Speaker 1: little bit of privacy for a lot more security very quickly.

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Speaker 1: You've worked for Republicans, you worked for Democrats. Did you

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Speaker 1: know anyone on Donald Trump's foreign policy team trot it

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Speaker 1: out yesterday? I don't actually don't, and I haven't actually

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Speaker 1: seen the list, so I've really have not had a

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Speaker 1: chance to get you. I expect the answer will me.

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Speaker 1: I don't know. I just thought, you know, we're talking

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Speaker 1: about hormances are important. But I do think candidates need

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Speaker 1: uh good foreign policy advice because what people can't say

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Speaker 1: as candidates does have an effect on the national dialogue

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Speaker 1: on foreign policy. So you need people with seasoned experience

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Speaker 1: to to provide you information. Michael, what will you ask

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Speaker 1: Jim's bullet in the nine o'clock Are you've interviewed him

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Speaker 1: more than I have? No? We want to know first

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Speaker 1: and foremost where he is on the dot plot. Patrick

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Speaker 1: Harker of Philadelphia last night came out and said, I

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Speaker 1: am not a two dot person, I think we need

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Speaker 1: more rate increases and we should start, perhaps in April,

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Speaker 1: which was a fairly aggressive stance. We've also heard from

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Speaker 1: John Williams of San Francisco and Dennis Lockhart of Atlanta

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Speaker 1: suggesting they too would move more quickly than people anticipate.

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Speaker 1: So maybe the markets are under pricing risk here. Should

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Speaker 1: we talked about the Red Sox beating the Cardinals? Um no, uh,

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Speaker 1: it's spring training. It's spring training. It doesn't matter, and

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Speaker 1: hope springs eternal. You, as a Red Sox fan, should

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Speaker 1: know that more than anybody else. You are. You are

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Speaker 1: undefeated in Major League Baseball in two thousand and sixteen.

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Speaker 1: I'm just trying to get not depressed by a Sam Kennedy,

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Speaker 1: Boston Red Sox preadate. And Sam kenny came on this

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Speaker 1: program the other day and said that you're crazy to

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Speaker 1: be so pessimistic. I mean to hear that from a

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Speaker 1: Red Sox executive. We'll continue with Bob Horman's Michael Barrow

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Speaker 1: have a New York here important updates from Brussels. A

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Speaker 1: real chure in the market future is actually flat A

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Speaker 1: ten year yield. In a little bit watching Sterling on

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Speaker 1: eighty nine sterling weaker. This hour of surveillance is brought

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Speaker 1: to you Bozda by Mazda White Plains. Visit Mazda White

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Speaker 1: Plains dot com. Here's Michael Boch, Mike Tom, thank you

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Speaker 1: very much. Brussels remains on high alert as police have

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Speaker 1: captured the main suspect for me Yesterday's terror attacks. According

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Speaker 1: to Belgian media, authorities have arrested twenty four year old

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Speaker 1: not Jeames Leshroui. He's caught on closed circuit TV wheelling

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Speaker 1: baggage cards at the airport. State broadcaster RTBF says the

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Speaker 1: other two men seen on video are brothers. Islamic State

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Speaker 1: is taking responsibility for the attack that killed thirty four people.

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Speaker 1: Donald Trump and Hillary Clinton and one last night's biggest

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Speaker 1: prize of Arizona, while Democratic challenger Bernie Sanders one caucuses

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Speaker 1: in Utah and Idaho. Republican Ted Cruz claimed the Republican

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Speaker 1: and caucuses in Utah. Meanwhile, former presidential candidate Jeb Bush

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Speaker 1: is endorsing crews. Global News twenty four hours a day,

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Speaker 1: powered by our journalists and more than a hundred fifty

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Speaker 1: news bureaus from around the world. Michael Barr, Tom mcabar

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Speaker 1: thanks so much again. Nine o'clock this morning, Michael McKee

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Speaker 1: and myself in a timely conversation with James Bullard of

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Speaker 1: the St. Louis fed from New York and worldwide. This

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Speaker 1: at Tjan tm pleach Pledge to Accelerator is structuring through

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Speaker 1: as he forecast a first quarter loss, and Tia made

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Speaker 1: the comments in an interview with Francine Aqua on Bloomberg

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Speaker 1: Television Futures this morning. They're little change. The decks in

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Speaker 1: Germany's up one point one percent. Then your treasury up

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Speaker 1: one thirty second, the yield one point nine three percent.

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Speaker 1: Niemex heret oil down one percent or forty two cents

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Speaker 1: to forty one oh three of arrel comex goold is

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Speaker 1: down one point three percent or sixteen dollars ten cents

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Speaker 1: to twelve thirty two fifty ounce, and the euros at

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Speaker 1: a dollar eleven ninety three. And that's a Bloomberg business flash,

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Speaker 1: Tom and Mike Karen, I thanks so much for so

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Speaker 1: to bring you. Robert Hormats of Kissinger Associates UM this morning.

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Speaker 1: I believe Secretary Kissinger wrote a book, UM, which was

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Speaker 1: my Book of the Year two years ago, called World Order. Yes,

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Speaker 1: it is a jumble, it is just that simple. I's

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Speaker 1: the Westphalian system gone that we hearkened back centuries. What's

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Speaker 1: the new world order for Boba Mormats? Well, the new

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Speaker 1: world order is that the borders that were seen to

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Speaker 1: be sacrosancd um after the Westphalian system and up through

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Speaker 1: the end of World War Two, are now deteriorating, particularly

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Speaker 1: in the Middle East. So you've got challenges to national borders.

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Speaker 1: And then you also when you look at the way

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Speaker 1: governments operate today, there is not so much one global

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Speaker 1: order as a lot of regional orders. If you look around,

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Speaker 1: China's developing a regional order with the trade negotiation process

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Speaker 1: with countries in the region the Silk Road. Russia is

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Speaker 1: trying to restore the old Russian Empire, so that the

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Speaker 1: world is becoming much more regionalized, and there are many

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Speaker 1: more transnational actors. That's what's really different. It's not state

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Speaker 1: actors that are the big threats so much anymore, although

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Speaker 1: Russia and I think other countries are still threats. But

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Speaker 1: you've got transnational actors that don't care about borders, that

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Speaker 1: that perpetrate terrorism and other things regardless of orders about

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Speaker 1: other gods. How do we reaffirm the Atlantic charter of

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Speaker 1: that's the ultimate risk. Totally agree with you. I think

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Speaker 1: one of the things we have to do is reinvigorate

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Speaker 1: the Atlantic relationship, which is strength and relations with the

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Speaker 1: European community on security issues, on energy issues, on trade issues,

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Speaker 1: a whole range of things. Were We were a great

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Speaker 1: power after World War Two in part because we were

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Speaker 1: a power. We survived the war quite well, but we

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Speaker 1: would not have been as great a power without strong allies.

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Speaker 1: You need strong allies to be a great power, and

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Speaker 1: Europe and Japan are critical allies. No matter what goes

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Speaker 1: on in the world, you need them and we need

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Speaker 1: to strengthen that relationship might help them in the economy.

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Speaker 1: Speaks to the theme of Ian Bremer and Eurisia Group

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Speaker 1: and their annual report this year. The Atlantic is important.

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Speaker 1: Was it a mistake to invade Iraq in hindsight now

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Speaker 1: because it's set in motion the toppling of strong men

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Speaker 1: whom we may not have uh, we may not have liked,

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Speaker 1: but they kept order. It was highly this uptive and

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Speaker 1: the problem was with US policy in many parts of

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Speaker 1: the world, Iraq in particular. We don't really analyze what

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Speaker 1: happens on day two and day three and year two

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Speaker 1: and year three. We don't look at the secondary and

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Speaker 1: tertiary implications of what we do and the disruption that

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Speaker 1: occurred not only after the invasion, but dismantling the police

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Speaker 1: force and all other things. This deteriorated into chaos. You

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Speaker 1: would not have had Isis, I think, or at least

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Speaker 1: not as strong an Isis if you had a stable

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Speaker 1: Iraq today, And we don't have a stable Iraq today,

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Speaker 1: and with various other parts of the world. The United

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Speaker 1: States has to take a much more strategic view of

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Speaker 1: what it does. Not so much on the day it doesn't,

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Speaker 1: but what are the implications down the road? Do we

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Speaker 1: have the ability to put in a moderate, rational, pro

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Speaker 1: American government after the invasion, after the chaos? And the

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Speaker 1: answer is demonstrably and repeatedly that we're very, very poor

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Speaker 1: at shaping new governments predicting new governments UH that are

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Speaker 1: supportive of the United States. It is not, it is

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Speaker 1: not happening in the Middle East. We intervene. We need

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Speaker 1: to know what the next implications are down the road,

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Speaker 1: and we're not good at doing that, and we're not

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Speaker 1: good at shaping the futures of these countries. We need

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Speaker 1: a much more strategic view. History would suggest that if

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Speaker 1: you've left things alone, new strongmen would arise in these

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Speaker 1: UH societies. But the extra state actors that you talked

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Speaker 1: about are the new factor in this. How does the

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Speaker 1: US deal with them. Do we go after them, do

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Speaker 1: we attack Isis? Do we militarily try to remove the threat?

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Speaker 1: I think you have to attack Isis now that they've

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Speaker 1: been let loose and triggered and given a refuge and

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Speaker 1: part of Syrian and and part of a rock. The

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Speaker 1: United States has to go after them, but it needs

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Speaker 1: allies and the reach. And we've seen just yesterday with

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Speaker 1: the Saudis are now leading a coalition primarily of sunny

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Speaker 1: governments of the region, including Egypt and others, that will

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Speaker 1: do this. They realize it's an existential threat to them.

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Speaker 1: And finally we're seeing some of these countries banned together

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Speaker 1: and they're gonna They're gonna put troops together in order

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Speaker 1: to take action against size of what you need American

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Speaker 1: you need American intelligence, you need special forces, and you

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Speaker 1: need the Europeans and others to do it as well.

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Speaker 1: And you need to work with the Russians and the

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Speaker 1: Chinese because they're these Isis threats are are are not

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Speaker 1: just in the Middle East and not just Europe and

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Speaker 1: not just the US. Russia and China are worried about

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Speaker 1: Islamic extremism and radicalism too, because they can destabilize parts

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Speaker 1: of Russian, parts of China. I only get thirty seconds.

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Speaker 1: Bob horn Man said, we can expand on this in

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Speaker 1: another visit. Did Mr Snowdon change forever how we're going

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Speaker 1: to approach going after thugs with our technology. Yes, it

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Speaker 1: was very harmful what he did. It made it harder

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Speaker 1: to collect intelligence, It made it harder for other governments

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Speaker 1: to trust us. It was very harmful to to American

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Speaker 1: and national sc Robert Hormet's is with Kissinger associates and

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Speaker 1: of course for years associated with his Tough University and

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Speaker 1: the Fletcher School. Will continue this discussion. Of course, all

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Speaker 1: of our news across Bloomberg Radio will give you updates

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Speaker 1: from Belgium. There has been news this morning of the

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Speaker 1: third attacker arrested, as the other two were suicide bombers,

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Speaker 1: and we'll have much more on that through the morning.

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Speaker 1: I'd like to tell you the data screen is moving,

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Speaker 1: it's not oil down fractionally forty three cents West Texas

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Speaker 1: for two. I'm still not used to saying that after

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Speaker 1: what we've seen and the twenties and thirties as well.

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Speaker 1: Futures flat coming up. Michael McKee and myself our conversation

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Speaker 1: with James Buller to the St. Louis FED. Look for

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Speaker 1: that in about ninety minutes from New York. Bloomberg Surveillance

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