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Speaker 1: Broadcasting live to New York, Bloomberg eleventh to Washington, d C,

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Speaker 1: Bloomberg to Boston, Bloomberg twelve hundreds to San Francisco, Bloomberg

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Speaker 1: to the Country, Serious Channel one nine and around the globe.

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Speaker 1: The Bloomberg Radio bus happened. Bloomberg dot Com. This is

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Speaker 1: Bloomberg Surveillance. Good morning on Wall Street. I'm John Tucker.

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Speaker 1: Two hours away from the opening bell and let's catch

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Speaker 1: you have to speed on the news. You need to

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Speaker 1: know half this hour, just an hour away from the

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Speaker 1: March jobs report. That kind of a sayt pay rose

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Speaker 1: probably rose two hundred and five thousand. Unemployment rate held

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Speaker 1: in an eight year low four point nine percent for

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Speaker 1: the third month. We're gonna break down the numbers live

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Speaker 1: with Bill Gross of Janus, a group led by China's

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Speaker 1: and Bang withdrew its fourteen billion dollar takeover offer for

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Speaker 1: Starwood Hotels, a surprise move that ends a three week

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Speaker 1: bidding war also clears the way for an acquisition by Marriott.

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Speaker 1: In an exclusive interview with The Bloomberg News, the Deputy

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Speaker 1: Crown Prince Mohammed bin Salam says Saudi Arabia will only

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Speaker 1: freeze its oil output if Iran and other major producers

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Speaker 1: do so. Also, Saudi Arabia plans to create the world's

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Speaker 1: largest sovereign wealth fund for the kingdom's most prize assets.

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Speaker 1: Oil moving lower on that first news brand right now

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Speaker 1: down two percent, down two cents a barrel at thirty

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Speaker 1: nine one on Wall Street gets news from around the

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Speaker 1: world this morning. Here's Michael barn John, Thank you very much.

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Speaker 1: President Obama is calling for support from the international community

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Speaker 1: to stop Islamic States nuclear ambitions. It comes as the

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Speaker 1: second and final day of the Nuclear Security Summit takes

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Speaker 1: place today in Washington. The U s official says there

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Speaker 1: is no sign yet the Islamic State has nuclear material.

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Speaker 1: Officials at Brussels Airport are hoping to open the facility

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Speaker 1: this evening. Opening the airport, even under reduced capacity, has

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Speaker 1: been most poem because of demands by police for more security.

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Speaker 1: Last week's deadly bombing attack destroy the check in area.

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Speaker 1: Republican presidential candidate John Kasik says it looks like the

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Speaker 1: party we'll have a brokered convention this summer. Yesterday, the

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Speaker 1: chairman of the Republican National Committee, Bryant's Premius, and he

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Speaker 1: met with the presidential front runner for the party, Donald

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Speaker 1: Trump and Washington. Trump's arrival Ted Cruz has been stoking

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Speaker 1: the flames of a stop Trump movement. Trump could fall

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Speaker 1: short of the one thousand, two hundred thirty seven delegates

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Speaker 1: needed to win the nomination. Global News twenty four hours

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Speaker 1: a day, powered by our twenty four hundred journalists more

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Speaker 1: than a hundred fifty news bureaus from around the world. Now,

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Speaker 1: Michael bar John all right, thank you, Michael, seven thirty

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Speaker 1: three straight time down to the Bloomberg NBC Sports Update,

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Speaker 1: and here's John Stash. Thanks John. NHL regular season finally

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Speaker 1: ends week from Sunday. Rangers Islanders almost certainly headed for

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Speaker 1: the postseason right now, jockeying for position with Red On

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Speaker 1: Pittsburgh in the Metropolitan Division. The three teams separated by

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Speaker 1: three points ailsa an for game left. They just beat

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Speaker 1: Columbus four to three John Tavarius a pair of first

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Speaker 1: period goals for just a second time all year, Rangers

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Speaker 1: lost in regulation when they took the lead of the

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Speaker 1: third period. Carolina scored twice, won four three, so the

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Speaker 1: Blue Shirts need one more point. The clints of playoff

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Speaker 1: birthday have dropped the third place behind the Penguins, who

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Speaker 1: would last night's win have taken ten of the last eleven.

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Speaker 1: Devils lost at Florida three two Nets lost at Cleveland

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Speaker 1: one oh seven eighty seven. George Washington captured the n

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Speaker 1: I T Final at the Garden, seventy six to sixty

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Speaker 1: over Valparaiso. The Final four begins tomorrow night in Houston.

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Speaker 1: The Yankees named Masahiro Tanaka their opening days starter, and

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Speaker 1: Andrew Miller hopes to keep pitching despite that risk injury

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Speaker 1: suffered Wednesday to his right non throwing risk. Another reliever,

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Speaker 1: Brian Mitchell, is gonna miss three months with a broken toe.

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Speaker 1: With Bloomberg NBC Sports Up Team, I'm John Stasha. Fine,

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Speaker 1: thanks John, and let's give the update on the markets

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Speaker 1: ahead of the open up Wall Street today, and of

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Speaker 1: course the A thirty jobs numbers that that's all gonna change.

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Speaker 1: So I take this with a grain of all to

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Speaker 1: S and B futures seven points lower right now, that's

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Speaker 1: down four tense, the Dow futures down to fifty three,

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Speaker 1: and the Dastic futures eighteen points lower. You're listening to

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Speaker 1: Bloomberg Surveillance right here on Bloomberg Radio seven thirty four

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Speaker 1: of Wall Street. You are listening to Bloomberg's Surveillance. Good morning,

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Speaker 1: I'm John Tucker and time out for the Bloomberg n

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Speaker 1: j I T STEM Report, being brought to you by

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Speaker 1: New Jersey Institute of Technology, investing more than one and

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Speaker 1: dot n J I T dot E d U. We

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Speaker 1: say good morning to Bob Moon. John, Good morning. Here's

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Speaker 1: what's making news in science, technology, engineering, and math. It's

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Speaker 1: not called Uber technologies for nothing. That's the essence of

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Speaker 1: a judge's decision that the technology in Uber's popular right

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Speaker 1: helling app could indeed be used to illegal coordinate high

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Speaker 1: surge pricing fairs. US District Judge Jed Rakoff in Manhattan

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Speaker 1: denied Uber's bid to dismiss the proposed class action lawsuit.

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Speaker 1: Uber officials argued that a conspiracy involving hundreds of thousands

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Speaker 1: of drivers was wildly implausible and physically impossible. In fact,

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Speaker 1: the judge said, the capacity to orchestrate such an agreement

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Speaker 1: is the genius of Uber, which, through the magic of

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Speaker 1: smartphone technology, can invite hundreds of thousands of drivers and

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Speaker 1: far flowing locations to agree to the company's terms. He said.

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Speaker 1: The lawsuits seeks damages on behalf of millions of US writers.

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Speaker 1: US regulators extended a subsidy used for connections to broadband,

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Speaker 1: expanding a program that spends more than a billion dollars annually.

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Speaker 1: On a three to two vote, the Federal Communications Commission

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Speaker 1: decided poor people could use the nine dollars monthly subsidy

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Speaker 1: under the Lifeline program for broadband. The program previously applied

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Speaker 1: to voice service and British wine growers may be overestimating

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Speaker 1: the risks that global warming poses to their butting into stree,

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Speaker 1: according to a study published in the Journal of Grape

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Speaker 1: and Wine Research. The studies conclusion average temperatures that make

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Speaker 1: vine growing more viable are increasing. That's this morning's Bloomberg

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Speaker 1: and j I. T. Stem Report, Bring on the Warm

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Speaker 1: with John. Yeah, that's a journal I'd like to pick

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Speaker 1: up on the newsstands. Thank you, Bob Moon. It's seven

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Speaker 1: thirty six Wall Street and you're listening to Bloomberg's Evaimance

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Speaker 1: right here on Bloomberg Radio with Tom Keane and Barry

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Speaker 1: Ridholtz and for Mike McKee this week. Good morning Barry,

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Speaker 1: Good morning John, And we are privileged to have sitting

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Speaker 1: with us in the studio one Gary Shilling, an old

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Speaker 1: friend and a friend of the show, author of the

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Speaker 1: Age of the Leveraging and what better person to talk

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Speaker 1: Gary good Good morning, Gary. Hey, shame to you, Berry.

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Speaker 1: Good to be with you. So let's talk about jobs

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Speaker 1: a little bit. And I also want to talk about

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Speaker 1: the leveraging because it's it's just so relevant to the

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Speaker 1: total situation. Uh let's start from the top and work

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Speaker 1: away down. How's this economy doing, and how's the jobs

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Speaker 1: picture look? Well, the job picture in terms of the

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Speaker 1: headline unemployment number four nine percent. We'll see what it is.

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Speaker 1: Of course we get in an hour. But that is

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Speaker 1: very deceiving because the reason that the unemployment rate has

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Speaker 1: dropped is because people have dropped out of the labor force. UH. Now,

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Speaker 1: about sixty of those were retirees post war babies retiring,

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Speaker 1: but the other forty were people who uh thought they

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Speaker 1: couldn't find jobs, they were discouraged, or younger people have

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Speaker 1: thought they'd stay in school, get a better chance at

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Speaker 1: a job. A lot of them came up with huge

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Speaker 1: student deaths and not better prospects. But if you hadn't

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Speaker 1: had all those people dropping out, the unemployment rate would

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Speaker 1: wouldn't be below five percent, it would So there's a

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Speaker 1: there's a lot of slack in the in the labor market,

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Speaker 1: and of course when you have the effects of globalization,

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Speaker 1: employers don't really need to pay up. I mean, there's

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Speaker 1: there's some competition from abroad and there's a lot of

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Speaker 1: pressure for them not to pay up. So real wages

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Speaker 1: have really been flat for a decade. That's one of

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Speaker 1: the things that is supporting the promp Trump on the

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Speaker 1: one hand and burning on the other hand. You know,

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Speaker 1: it's like the old movie UH Network years ago where

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Speaker 1: the guy gets up of your chair, runs the window

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Speaker 1: and says, I'm at as well. I'm not gonna take

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Speaker 1: it anymore. That's the mood of voters today. They say

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Speaker 1: mainstream politicians have not really done the job. They haven't

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Speaker 1: provided jobs or income and we're employing a lot more people,

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Speaker 1: but with low productivity, we're not getting the uh, we're

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Speaker 1: not getting the income growth because you don't have productivity,

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Speaker 1: don't have the income. So the job picture is not

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Speaker 1: really as auspicious as some of the headline numbers suggests.

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Speaker 1: Let's let's you mentioned a few things I want to

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Speaker 1: touch on. I'm gonna come back to the productivity issue,

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Speaker 1: which is one of my um favorite subjects these days.

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Speaker 1: You mentioned the political picture. There's an article on Bloomberg

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Speaker 1: today the credit collapse opened the door for Trump and

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Speaker 1: saying there's and let me let me read this quote

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Speaker 1: to the man who wrote the book The Age of

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Speaker 1: the Leveraging, because it's so perfect. Quote. Between two thousand

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Speaker 1: and two thousand and seven, borrowed money was adding three

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Speaker 1: hundred and thirty billion dollars a year to America's purchasing power.

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Speaker 1: Since the financial crisis, households are now diverting a hundred

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Speaker 1: and fifty billion to paying back debt to de leveraging.

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Speaker 1: That's a half a trillion dollar swing. What is that

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Speaker 1: de leveraging as opposed to exactly one of the key

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Speaker 1: points in in this book that I wrote in and

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Speaker 1: that was a lot had to do a lot of

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Speaker 1: that had to do with my forecast of two percent

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Speaker 1: real GDP growth until the leveraging was over, and it's

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Speaker 1: been average two not to not too bad. So so

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Speaker 1: let's let's get back to productivity. In the last thirty

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Speaker 1: seconds we have. You know the old jokes productivity is

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Speaker 1: gains are everywhere except the data. How much of the

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Speaker 1: product civity issue is a measurement problem? I think a

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Speaker 1: fair amount of it is because a lot of things.

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Speaker 1: For example, all the things you do on your cell phone,

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Speaker 1: they're not really recorded. And productivity is very easy when

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Speaker 1: you're talking about people making more widgets manufacturing, but when

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Speaker 1: you get into services, when you get into software, social media,

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Speaker 1: you get a lot of other things, and productivity probably

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Speaker 1: isn't isn't properly measured, but but still there are a

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Speaker 1: lot of other forces there. I would not blame productivity

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Speaker 1: for lower wages. I think it's much more globalization. So

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Speaker 1: hold that thought. We're gonna come back with more Gary

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Speaker 1: Shilling talking about why wages are flat, John Tucker, what

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Speaker 1: do you have for us? A thirty is the job's report,

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Speaker 1: of course, will have bill growth of gena's capital breaking

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Speaker 1: it down for us and ahead of that number right now,

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Speaker 1: SMP futures are down nine points. That's not for tense

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Speaker 1: of represent uh down futures Verry sixty one points slower.

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Speaker 1: That's down four tense. You're listening to Bloomberg Surveillance. Bloomberg

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Speaker 1: com for details. Global business news twenty four hours a

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Speaker 1: day at Bloomberg dot com, the Radio plus Mobile Act

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Speaker 1: and on your radio. This is a Bloomberg Business Flash

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Speaker 1: and I'm Cameron Moscow. This updates brought to you by

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Speaker 1: oil global stocks. Meanwhile, following the most in more than

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Speaker 1: three weeks, as a new quarter got under way, with

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Speaker 1: Japanese equities leading losses and the yen strengthening. Treasuries are

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Speaker 1: declining before US pay rolls data. We checked the markets

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Speaker 1: every fifteen minutes throughout the trading day on Bloomberg ten.

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Speaker 1: Your treasuries down to thirty seconds. The yield one point

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Speaker 1: seven seven percent, yield on the two year point seven

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Speaker 1: four percent future is lower. SNP eveny futures down nine points,

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Speaker 1: DOWI Mini futures down sixty five, NASDAC came any futures

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Speaker 1: down twenty one. The decks in Germany's down two point

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Speaker 1: two percent. Ni Max screwed oil down two point seven

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Speaker 1: percent or a dollar two to thirty seven, thirty one

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Speaker 1: of Arrol comes goal down four tenths per cent or

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Speaker 1: four dollars eighty cents to twelve thirty nine. Announce the

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Speaker 1: euro and dollar fourteen twenty seven, and the yen one

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Speaker 1: twelve point oh seven. That's a Bloomberg Business flash, Tom

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Speaker 1: and Barry. Very good, Karen, I thank you so much

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Speaker 1: showing with us. I'm gonna get the news here. I

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Speaker 1: just have an April question. It's April one, the beginning

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Speaker 1: of the quarter. Two bees hibernate. Oh no, no, that's

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Speaker 1: why they make honey to get through the winter. Uh.

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Speaker 1: They're all from the Old World. Uh. Now there's lots

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Speaker 1: of New World bees, yellow, yellow jackets, wilse hornets. They hibernate,

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Speaker 1: so they only make enough honey to feed their larva.

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Speaker 1: But honey bees don't show. If you're in then high

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Speaker 1: in the winter, you've got a metabolize to keep warm,

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Speaker 1: and that means you've got to eat. And that's why

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Speaker 1: they make honey. Now they're working fools. They make more

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Speaker 1: than they need to get through the winter, which in

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Speaker 1: this climate is about sixty pounds per high. And that's

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Speaker 1: where we come in. You're leave them sixty pounds, take

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Speaker 1: off the rep there's a metaphor in that for saving

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Speaker 1: for retirement, isn't there. I know it's it's someone there.

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Speaker 1: It's too too early for me to put my finger

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Speaker 1: on it. Oh, absolutely absolutely. And bees have been around

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Speaker 1: the love. They've been around about a billion years, a

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Speaker 1: lot longer than we've been around. I want to go

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Speaker 1: to something of Gary showing that people don't know other

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Speaker 1: than the be up stuff you do great minutia New

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Speaker 1: York City, Newark, New Jersey, wage gains one point four

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Speaker 1: so a Delphia one five. Washington County, Oregon, where they

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Speaker 1: eat the honey Gary shilling makes six point four percent.

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Speaker 1: It is not one America, it's two America's. There's America

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Speaker 1: thriving and there's America that's not right. Well, yeah, that's right.

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Speaker 1: And of course a lot of this is a phenomenon

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Speaker 1: which what's going on for about three d years people

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Speaker 1: moving west and that's where the action are. Hey, we

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Speaker 1: have we have four kids, they're all grown and gone,

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Speaker 1: and three of them live on the West Coast, which

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Speaker 1: is not unusual, but that's where a lot of people are.

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Speaker 1: And of course the old manufacturing America which has was

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Speaker 1: bine large wiped out by globalization, the Chinese and elsewhere.

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Speaker 1: That's in the east, and you have the legacy of

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Speaker 1: very high wages, very high cost and people have simply

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Speaker 1: moved out of there. They they voted with their feet,

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Speaker 1: they moved to the West coast. And of course with it,

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Speaker 1: with the tech center there is created tremendous wealth and

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Speaker 1: high could Just so you understand, the West coast is

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Speaker 1: Hudson Yards. Hey, I just got back from Portland, Oregon,

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Speaker 1: and I couldn't possibly agree with Gary Moore with with

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Speaker 1: with Gary anymore. One of the columns I did for

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Speaker 1: Bloomberg View was boom Town Economies, which brings us to

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Speaker 1: the bigger question when we see this bifurcation, when you

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Speaker 1: see some people who are not feeling it and therefore

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Speaker 1: going for the Trumps and the Bernie Sanders and everybody

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Speaker 1: else is saying, well, things are pretty good. How bifurcated

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Speaker 1: has our economy become compared to pass cycles, oh, very

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Speaker 1: much more shore because again globalization, and I think that's

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Speaker 1: a great and the biggest phenomenon hitting the world economically

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Speaker 1: in the last thirty years, and that has that has

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Speaker 1: decimated many of these high paid but basically low, low

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Speaker 1: hill jobs, and a lot of people just don't understand

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Speaker 1: that they are eating with Chinese and now Bangladesh Ease

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Speaker 1: and Vietnamese and so on. So for the working working

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Speaker 1: a fraction what they are and producing the same good

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Speaker 1: as the same quality, the same equipment and so on.

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Speaker 1: And it's a very tough, very tough transition, and that

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Speaker 1: has left a lot of people again, they're they're they're

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Speaker 1: very very frustrated they're they're looking for alternatives. They shall

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Speaker 1: now think that government's going to bail him out. And

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Speaker 1: the and the and the issue is that really sense

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Speaker 1: a new deal? The government has essentially said to people,

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Speaker 1: we will we will ensure your regional incomes. We will

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Speaker 1: take care of this. The the the idea of self

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Speaker 1: sufficiency is no longer dominant in this country. So when

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Speaker 1: people don't get get incomes, they complain to government. And

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Speaker 1: you're reading of our fall reserve up through Machesty Martin

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Speaker 1: and then forward. Is there any potential for a central

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Speaker 1: bank to manage for one America? Or by definition when

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Speaker 1: Janet Yellen is it the economic club in New York?

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Speaker 1: And even if she mentioned slack, do you just assume

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Speaker 1: she's managing for the elites in New York and those

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Speaker 1: doing elitely well in Portland, Oregon. Well, I don't know

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Speaker 1: that Janet Mellot Yellen has ever met a payroll, so

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Speaker 1: I'm not sure how closely she is connected to some

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Speaker 1: of these to a lot of people in this country

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Speaker 1: who haven't had any wage increases, real wage increases for

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Speaker 1: for over a decade. But yeah, it is, it is difficult.

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Speaker 1: But again, I'm not sure that it makes a lot

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Speaker 1: of difference. So FET is basically input in central banks.

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Speaker 1: They they're pushing on a string. It's a change in

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Speaker 1: liquidity trap. They've done just about everything they can. I mean,

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Speaker 1: when they went to negative real negative interest rates, I

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Speaker 1: think that was really desperation and they've gotten a lot

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Speaker 1: of unintended consequences out of that. So let's bring this

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Speaker 1: back to the question that seems to be hanging around,

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Speaker 1: and you mentioned Keynes, how much of this is the

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Speaker 1: fact that we try to do the work that should

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Speaker 1: have been done on the fiscal side with monetary policy. Well,

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Speaker 1: that's right, because fiscal policy got scared off with a

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Speaker 1: trillion dollar posits and then you got this austerity measures,

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Speaker 1: taxing increases, sequestering and so on and so forth. Now

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Speaker 1: that went out the window late last year. They really

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Speaker 1: junk that whole policy. You know, they came in with

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Speaker 1: a seven billion highway bill. I think we're gonna probably

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Speaker 1: see a big, big push for infrastructure, maybe defense spending,

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Speaker 1: but monetary policies. And you look at monetary policy, if

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Speaker 1: you look at Japan and the European Central Bank, they

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Speaker 1: are basically making loans. I mean, the assumption that the

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Speaker 1: money is actually invested in capital, capital spending and so on.

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Speaker 1: They are morphing into phiscal policy because it has been

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Speaker 1: a vacuum. Gary thinking so much showing with perspective on

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Speaker 1: bees and perspective on monetary policy, were expecting the honeyship

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Speaker 1: and at any point there right now, that's later in

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Speaker 1: the year. I mean, the girls are just getting started here.

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Speaker 1: Very riddle is one of the secrets we have is

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Speaker 1: getting in thirty and forty research notes before jobs to

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Speaker 1: try to make a smarter one of them that I

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Speaker 1: always open and rats from John Herman of mintelmichi u

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Speaker 1: f J. Let me give you his pre jobs summary

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Speaker 1: here at seven fifty four a m. Wall Street time,

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Speaker 1: thirty minutes away from the job to port Jim Glassman

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Speaker 1: and Bill gross Uh to join. Herman brackets it with

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Speaker 1: a gain of excess two hundred and thirty thousand would

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Speaker 1: be quote a strong gain approaching records again closer to

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Speaker 1: a hundred and seventy five or lower quote quite a disappointment. Again,

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Speaker 1: close to two hundred is respectable and keeps alive the

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Speaker 1: risk at share yelling will hike interst rates before year end.

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Speaker 1: That shows how Mr Herman is clearly away from the

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Speaker 1: four rate hike to even to rate hike camp. The

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Speaker 1: U three UH model barry to drift lower is labor

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Speaker 1: forces forecast to pose a small decline that's critical to

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Speaker 1: see the jobs the unemployment rate move downward. Confound a

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Speaker 1: lot of people and change the R no doubt about it.

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Speaker 1: Liz and Sanders of Schwab just tweeted a graph showing

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Speaker 1: by her analysis, UH, the falling labor force is between

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Speaker 1: sixty and structural and demographic and it's not uh, it's

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Speaker 1: it's not a clause of worry. The article I want

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Speaker 1: to bring to people's attentions today is from Greg ipp

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Speaker 1: in the Wall Street Journal Healthy Job Market at odds

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Speaker 1: with global gloom and he suggests sinking unemployment means productivity,

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Speaker 1: not demands, is the world's biggest problem. And finally, John Herman,

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Speaker 1: growth in wages is critical due to the quote mix

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Speaker 1: of jobs. John Herman suggests a minuscule gain zero point

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Speaker 1: two percent. He calls that insufficient offset last month's weakness.

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Speaker 1: So Mr Herman has focused, as are many others, on labor.

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Speaker 1: That's what we like to do here at all of

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Speaker 1: Bloomberg is to aggregate all of the global sources on research.

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Speaker 1: Of course, with respect of the copyright, please contact miss

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Speaker 1: Saunders and John Herman and of course Gregg Ifen, the

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Speaker 1: good people that he's working with for their original copy.

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Speaker 1: But there's a good summation of that. Futures a negative

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Speaker 1: ten they to tierate downfu Chilling once again, Gary Schilling

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Speaker 1: driving down the market. Futures negative nun down futures negative

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Speaker 1: sixty six. Yields were higher earlier. Once again Schilling driving

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Speaker 1: down the market to four digits a two year yield

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Speaker 1: point seven four zero two. John mikels Waite driving down

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Speaker 1: the oil market, his important interview with the Deputy Crown

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Speaker 1: Prince of Saudi Arabia, really taking it to oil seven

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Speaker 1: down cents almost a dollar Brent crude and West Texas

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Speaker 1: bears watching thirty seven thirty six down cents. For that

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Speaker 1: to get to a thirty six handle would be a

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Speaker 1: different scope and scale from what we saw even a

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Speaker 1: week ago. Yen driving towards one eleven. Shilling once again

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Speaker 1: driving again stronger one twelve zero nine on a Japanese yen.

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Speaker 1: It is jobs gain. We are job's day. Rather we

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Speaker 1: go into the next hour with you gaining from the

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Speaker 1: perspective of Jim Blastman of JP Morgan and then worldwide.

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Speaker 1: I'm Bloomberg Radio, I'm Bloomberg Television, Bill Gross from New

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Speaker 1: York Berry Dholts in Tom king Job's day, Bloomberg surveillance