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

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Speaker 1: Bloomberg to Boston Bloomberg dwelve honors to San Francisco, Bloomberg

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Speaker 1: n to the Country Series Exam Channel one ninety and

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Speaker 1: around the globe the Bloomberg Radio plus Bloomberg dot Com.

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Speaker 1: This is Bloomberg Surveillance. Good morning. It is a thirty

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Speaker 1: on Wall Street. I'm Michael McKee along with Francine Lacroix

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Speaker 1: in London today in for Tom Keane. Our economic indicators

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Speaker 1: are brought to you by Commonwealth Financial Network. When it's

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Speaker 1: time to change the conversation, talk with the broker dealer

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Speaker 1: r I A that's ready to listen call eight six

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Speaker 1: six six two three six three eight Or is it

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Speaker 1: Commonwealth dot com to learn more? Vinydale Judas is at

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Speaker 1: the first Word desk, and you've got word on durable

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Speaker 1: goods manufacturing, Michael A. Rather, let's say LIMP report durable

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Speaker 1: goods orders according to the Commerce Department up point eight

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Speaker 1: percent March. That's half less than half of what economists

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Speaker 1: we're looking for in a Bloomberg survey the prior month

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Speaker 1: down three point one percent. That's a bit sharper than

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Speaker 1: the prior estimate. Now, as far as excluding transportation, we're

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Speaker 1: seeing a decline in the orders economists that expected then increase.

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Speaker 1: That's down point two percent from March, and that followed

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Speaker 1: a one point three percent decline in February. Again, the

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Speaker 1: headline number durable goods orders up point eight percent less

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Speaker 1: than forecast, ex transportation down point two percent. At the

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Speaker 1: Bloomberg First Word Desk, I'm Finique del jun So let's

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Speaker 1: go back to New York and London. Thank you very much, Vinny.

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Speaker 1: No real reaction in the markets. Will give it a

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Speaker 1: few minutes, but nothing showing up in the boom market

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Speaker 1: that would suggest this is even though I didn't need

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Speaker 1: expectations that it's going to bother anyone at the moment. Uh.

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Speaker 1: There is a country where I'm sure they would love

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Speaker 1: to have numbers like this, and that is Greece, still

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Speaker 1: fighting its way out of years of recession. Somebody who

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Speaker 1: did his best to try to help and unfortunately for him,

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Speaker 1: did not succeed, the honest, very facasty economist and former

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Speaker 1: finance minister. He has now written a book about his experience,

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Speaker 1: the Greek Experience the Eurozone Experience, called and the weak

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Speaker 1: suffer what they must. He is here with us. Good

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Speaker 1: to see you again. They're us great to be him.

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Speaker 1: We uh. Just a few moments ago on surveillance, we

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Speaker 1: had Joe Stiglitz with us, the Nobel Prize meaning economist,

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Speaker 1: and he said, quote, the Eurozone has been a dismal failure.

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Speaker 1: I presume you would not argue with the Nobel laureate. No, no,

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Speaker 1: of course I wouldn't argue that. This is what my

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Speaker 1: book is about. It's not about Greece. It's about you know,

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Speaker 1: posing a very single question, why is it that the

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Speaker 1: greater the good in Europe in the ninety nine is

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Speaker 1: designed the gold standard like currency which was neither state

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Speaker 1: money nor a fixed the change rate regime, which had

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Speaker 1: no um shock absorbers and no means of preventing bonds

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Speaker 1: of growth as a result of esynami of capital that

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Speaker 1: goes from circlus to deficit countries. And why is it that,

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Speaker 1: after this currency proved unfit to purpose, has Europe so

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Speaker 1: spectacularly failed to deal with the inatiquacies of the edifice

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Speaker 1: of the architecture. And we have this comedy of errors

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Speaker 1: of every time the euro Group, the European Union Council meets,

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Speaker 1: we have an extending and pretending and the perpetuation of

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Speaker 1: you know, one error upon the other. So this is

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Speaker 1: what the book is about. It's about, you know, what's

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Speaker 1: in the DNA of the European Union that firstly makes

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Speaker 1: a design a terrible carriacy. In secondly, UH does not

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Speaker 1: bring together the creative forces that do exist in Europe

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Speaker 1: in order to fix it. Well, it clearly has designed flaws.

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Speaker 1: But is it a failure of design or a failure

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Speaker 1: of those who joined it? No, it's it's the former.

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Speaker 1: There's no doubt about that that there are many different

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Speaker 1: my lignances and failures in a different member states, There's

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Speaker 1: no doubt. But when you put together a montery union

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Speaker 1: and effectively you create a very large, very substantial central

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Speaker 1: bank without the state having its back, and you have

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Speaker 1: nineteen member states without a central bank ready and willing

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Speaker 1: and capable even legally, of coming to their assistance at

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Speaker 1: the time when they're separate and segregated banking sectors are

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Speaker 1: experiencing trouble while you're asking for trouble. Alright, Janice, it's

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Speaker 1: friends in here in London, and I completely understand your

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Speaker 1: point of view. But let's not forget. But also the

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Speaker 1: mess that greases in is due to years, if not decades,

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Speaker 1: of financial and propriety as well. What I'm saying, let

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Speaker 1: me put it very simple to you. There is I'm

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Speaker 1: the last person who is going to sit here in

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Speaker 1: front of view and defend them my lignances of the

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Speaker 1: Greek state for the last two hundred years. But consider this.

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Speaker 1: Suppose the Greek prime minister, certain gentlemen cost the Summites,

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Speaker 1: had an epiphany in the middle of the night that

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Speaker 1: case should not have entered the year zone. You and

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Speaker 1: I would not be talking about Chrise now. Chris would

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Speaker 1: not be littering the headlines for the last seven years.

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Speaker 1: Why because after the two thou we would have had

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Speaker 1: the tepid growth about one one and a half percent,

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Speaker 1: and then in two thousand and eight, following the financial

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Speaker 1: sector collapse globally, Greece would have had the evaluation recession

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Speaker 1: and then within a year it would start growing again

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Speaker 1: and it would not be the cessipul of deflationary forces

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Speaker 1: and the Great depression which is now. You still believe

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Speaker 1: that actually Greece even nowadays, would be better off not

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Speaker 1: being in the Eurozone. Despite the fact that China is

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Speaker 1: getting stronger, the fact the fact that we need to

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Speaker 1: have a common voice to counter the US, absolutely and

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Speaker 1: you don't. We don't have a common voice at the

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Speaker 1: moment we are being divided by a common currency. There

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Speaker 1: is absolutely no doubt that the years of was a

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Speaker 1: spectacular fire pressing consider this, which were the countries that

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Speaker 1: integrated better with the powerhouse of Europe Germany. It wasn't

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Speaker 1: Portugal and Greece in Spain who were members of the

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Speaker 1: common Cuurreency. It was countries like the Czech Republic, Poland Hungary.

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Speaker 1: If you look at for the indirective investment their manufacturing sectors,

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Speaker 1: their economies became far better integrated with Holland and with

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Speaker 1: Germany than the user members state. So the the euro

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Speaker 1: was indeed a complete and spectacular failure. Now, lest I

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Speaker 1: be misunderstood, this is not an argument for getting out.

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Speaker 1: We should not have created it, and we certainly should

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Speaker 1: not have created the way we did. But now that

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Speaker 1: we have created created I'm not advocating getting out of

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Speaker 1: it or disintegrating because it's disintegration would bring uh just huge,

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Speaker 1: huge costs to all of us. Let's start when we

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Speaker 1: come back about what should be done then to make

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Speaker 1: it work better going forward. We're talking with the host

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Speaker 1: of Focus, former finance minister in Greece, author of the

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Speaker 1: new book and the week suffer what they must. This

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Speaker 1: is Bloomberg Surveillance on Bloomberg Radio Worldwide. I'm Michael McKee

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Speaker 1: with Francine Lacklock. This hour of surveillance brought you by

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Speaker 1: mont Kisco Volvo. Visit Montisco Volvo dot com. Here's Michael

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Speaker 1: Byr with the latest headline. Mike Francine, thank you very much.

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Speaker 1: Donald Trump and Hillary Clinton are hoping for big nights

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Speaker 1: in five Northeast primaries today. Voters were ahead to the

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Speaker 1: polls in Delaware, Maryland, Pennsylvania, Connecticut, and Rhode Island. Donald

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Speaker 1: Trump is hoping to put some more distance between himself

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Speaker 1: and his rivals Dead Cruz and John Ksy. For the Democrats,

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Speaker 1: a big day from Hillary Clinton could put her very

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Speaker 1: close to the number of delegates needed to win the nomination. However,

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Speaker 1: he arrival Bernie Sanders says he will keep fighting the

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Speaker 1: idea that we should not contest in California or lodges state.

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Speaker 1: Let the people of California determine what the agenda of

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Speaker 1: the Democratic body is and who the candidate for president

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Speaker 1: should be is pretty crazy. So we're in this to

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Speaker 1: the end. Another computer security firm is raising concerns about

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Speaker 1: the potential for hackers to access users personal data from

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Speaker 1: phone apps released by the campaigns of Republican presidential contenders

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Speaker 1: Ted Cruz and John Kainsick. The analysis by Somevantech found

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Speaker 1: potential security risk with both the Cruise Crew and KS

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Speaker 1: sixteen apps, and okainda Wing says it is hacked to death.

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Speaker 1: A gay rants activists in Bangladesh. Police are looking for

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Speaker 1: five men who posed his careers. Global News twenty four

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

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Speaker 1: more than a hundred fifty news beurles from around the

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Speaker 1: world Now Michael Barr, Mike Francing, Thank you, Michael, time

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Speaker 1: for the landing of our participity Bloomberg. NBC Sports Update

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Speaker 1: with John Stasha, Thanks Mike Yankee. Bats still pretty quiet,

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Speaker 1: but good pitching can solve those problems, and the Aanks

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Speaker 1: certainly got it from Nathan of all. The last night

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Speaker 1: in Texas, he took a no hitter to the seventh

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Speaker 1: inning team with Dellan Batansens and Van Miller to win

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Speaker 1: three to one of all these first win Miller got

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Speaker 1: his fifth saved Jacobe Elsberry and Starling Castro Homeward for

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Speaker 1: New York Mets. He had three more home runs Lucas

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Speaker 1: du To, Michael Conford, oh Neil Walker's two run shot seventh.

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Speaker 1: The didn't snapped the tie. Mets made it four straight

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Speaker 1: nine in the last eleven, five three over Cincinnati Cata

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Speaker 1: Travis Darnault had to leave the game with an injured shoulder.

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Speaker 1: Steph Curry's knee injury is gonna keep Mad at least

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Speaker 1: two weeks. But if Golden State moves on and plays

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Speaker 1: Los Angeles in the next round, the Clippers have their

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Speaker 1: own injury to their own star, Chris call and last

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Speaker 1: night's lost at Portland broke his hand. He's likely done

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Speaker 1: for the year Clippers and Trailblazers, or two too so

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Speaker 1: with the Hornets and Heat. After Charlotte one last night,

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Speaker 1: Oklahoma City asked to Dallas NHL St. Louis one game

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Speaker 1: seven over Chicago three two. The ball's back in Tom

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Speaker 1: Brady's court after a judge last year ruled for him.

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Speaker 1: Three appeals judges in a two one decision ruled against

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Speaker 1: him and the four game. The flake Gate suspension is

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Speaker 1: for now. Back on Patriots. Devin mccordy speaks for everyone,

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Speaker 1: it's pretty ridiculous. I mean, I think everybody'll be ready

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Speaker 1: to go and do whatever we have to do, but

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Speaker 1: I'm pretty sure a lot of people are just just

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Speaker 1: over everything that has to deal with this whole situation.

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Speaker 1: Thanking us over. It's not over. There's been fifteen months.

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Speaker 1: So we'll just move on and do whatever we have

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Speaker 1: to do. Exploring is legal options with the Bloomberg NBC

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Speaker 1: Sports Update, I'm John Staphwer. Thank you, John. Well, we're

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Speaker 1: looking at maybe a slightly higher open today as futures

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Speaker 1: continue to hold in the three point higher range for

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Speaker 1: S ANDP futures that's just under two tenths of eight

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Speaker 1: percent down. Futures are down right, are up right now

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Speaker 1: by thirty five points, also two tenths. We were looking

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Speaker 1: for some reaction to the Derro Goods numbers, and we're

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Speaker 1: not finding it. The two year note yield is still

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Speaker 1: at eighty five basis points to five year, one point

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Speaker 1: three seven to tenure at one point nine percent. Perhaps

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Speaker 1: because everybody's focused on what the fed will do that,

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Speaker 1: meaning should get underwagh in about twenty minutes from now.

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Speaker 1: The decision two pm tomorrow, Wall Street Time. The sports

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Speaker 1: repart was brought to you you by Landrover Parcipitate. The spring

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Speaker 1: sales event is happening now is a Landover Parcipiti dot com,

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Speaker 1: Landrover above and bl Global Business News twenty four hours

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Speaker 1: a day. If Bloomberg dot Com the radio plus mobile

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

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

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Speaker 1: by Columbia University's Executive Technology Management Graduate Program, which prepares

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Speaker 1: technology professionals to drive business performance information at SPS dot

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Speaker 1: Columbia dot e d U slash tech. Orders for US

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Speaker 1: durable goods climbed a less than forecast in Marches. Demand

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Speaker 1: for capital equipment remained weak. Bookings for items meant to

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Speaker 1: last at least three years rose eight tenths percent after

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Speaker 1: a revised three point one percent slump a month earlier.

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Speaker 1: Orders for business equipment where little change last month also

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Speaker 1: weaker than projected. The S and P K shill Her

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Speaker 1: Home Price Index is out in just about thirteen minutes

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Speaker 1: from now. US Dot Index futures, meanwhile, are moving higher

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Speaker 1: amid results from Procter and Gable to DuPont and as

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Speaker 1: investors await this week's federal reserve policy update. We checked

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Speaker 1: the markets every fifteen minutes throughout the trading day. On

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Speaker 1: Bloomberg SNP EVENI future is up four points nowI Mini

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Speaker 1: futures up thirty four, Nazdaki mini futures up five and

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Speaker 1: a half. The ten year treasury is up to thirty seconds.

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Speaker 1: The yield one point nine zero percent yield on the

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Speaker 1: two year point eight four percent. Ni Max Screwed oil

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Speaker 1: up one point three percent, or fifty seven cents to

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Speaker 1: forty three twenty one a barrel. Comex's gold is down

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Speaker 1: four ten percent or four dollars forty cents to twelve

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Speaker 1: thirty five eight and ounce the euro at all our

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Speaker 1: thirteen thirteen again one ten point nine nine and coach

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Speaker 1: said it's cutting jobs and shaking up its management as

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Speaker 1: it's it seeks to continue its turnaround. It shares her

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Speaker 1: of about two percent this morning. That's a Bloomberg business flash,

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Speaker 1: Mike and Francine Karen, thank you very much. It's on

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Speaker 1: Wall Street. The following is from Bloomberg View, opinions and

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Speaker 1: commentary from Bloomberg columnists. I'm Justin Fox, a columnist for

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Speaker 1: Bloomberg View. In a poll in December, Gallup asked Americans

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Speaker 1: what they thought was the biggest threat to the country,

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Speaker 1: Big business, big labor, or big government. Responded big government.

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Speaker 1: That was down from seventy two percent two years before,

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Speaker 1: but otherwise higher than at any time since Gallop first

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Speaker 1: asked the question in nineteen sixty five. What has big

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Speaker 1: government done to these people? According to political scientists Jacob

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Speaker 1: Hacker and Paul Pearson, has improved their lives over the

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Speaker 1: past century. Government investment and regulation have left Americans better educated,

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Speaker 1: longer lived, and richer than they were before. In their

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Speaker 1: new book American Amnesia, Hacker and Pearson argue that decades

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Speaker 1: of conservative anti government activism have soured Americans on the

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Speaker 1: idea that government can accomplish great things. I don't think

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Speaker 1: that's the only explanation. Many Americans fear big government simply

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Speaker 1: because it's big, or because it is run by a

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Speaker 1: specialist elite that they neither understand nor trust. But it

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Speaker 1: is worth recalling that the US has always had a

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Speaker 1: mixed economy with government playing a key role from the beginning.

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Speaker 1: That role grew much bigger in the twentieth century, and

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Speaker 1: not entirely coincidentally, the US prospered. Sometimes big government isn't

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Speaker 1: the problem. I'm justin Fox, a columnist for Bloomberg View.

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Speaker 1: For more Bloomberg opinion and commentary, please go to Bloomberg

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Speaker 1: View dot com or view go on the Bloomberg terminal.

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Speaker 1: This has been Bloomberg View. Bloomberg View commentaries can be

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Speaker 1: heard hourly weekdays on Bloomberg Radio. We're talking with Yatis

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Speaker 1: Vera Facas. He's the former finance minister of Greece and

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Speaker 1: the author of the new book and the Week Suffer

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Speaker 1: What they must You were saying before the break that

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Speaker 1: you agreed that the Eurozone has been a failure, but

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Speaker 1: that doesn't mean it should be dismantled. What then must

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Speaker 1: we do in the in the famous UH saying from

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Speaker 1: Uh from from Asia, what do we need to do

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Speaker 1: is when need to simulate federal institutions. We can't federate

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Speaker 1: in Europe because the crisis is unleashing centrifugal forces that

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Speaker 1: are tearing us apart. So European nations are further apart

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Speaker 1: to day than they have ever been in the last

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Speaker 1: forty years. So even the discussion of federation is impossible.

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Speaker 1: But we can simulate federal instruments. For instance, uh take banking.

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Speaker 1: We have proclaimed the Banking Union in name to deny

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Speaker 1: it in part. In practice, we could reverse that by

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Speaker 1: creating a Eurozone jurisdiction for banks that are failing. So

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Speaker 1: when an Italian bank or a Portuguese bank is in

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Speaker 1: dire straits, the government can waive its authority over it

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Speaker 1: and it can be shifted to a Eurozone jurisdiction where

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Speaker 1: TART like or f D I C like it can

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Speaker 1: be capitalized and restructured through funding from the European Stability

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Speaker 1: make a this with a new border directs is appointed

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Speaker 1: by the c B. So this is the kind of

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Speaker 1: simulation of a federal system which is perfectly within the

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Speaker 1: treaties and rules and regulations of the European Union. We

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Speaker 1: can do the same thing with public debt. We can

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Speaker 1: have an investment policy that combines actions by the European

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Speaker 1: Investment Bank with quantity of easing from a c B,

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Speaker 1: where the CP purchases the i B bonds, you know,

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Speaker 1: to affect a green new deal for Europe. There's a

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Speaker 1: lot we can do to stabilize the Eurozone. The only

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Speaker 1: thing that is solely missing is the political will. Well

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Speaker 1: that and money. I mean, can even if you got

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Speaker 1: all the ministers and prime ministers to agree on those changes,

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Speaker 1: can that? Can the Eurozone succeed unless the countries that

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Speaker 1: are so heavily in debt, Greece obviously being at the

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Speaker 1: head of the line, get debt forgiveness from There are

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Speaker 1: many way is of skinning a cat. As you know,

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Speaker 1: Michael Uh. If you look at the proposal that my

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Speaker 1: ministry put forward regarding the Greek that last year, Proposals

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Speaker 1: that I've worked on with good people like Jeff Sax

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Speaker 1: from Colombia, like the Lazard from France, the Bank, the

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Speaker 1: Investment Bank we put foll really very sensible moderate debt

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Speaker 1: swaps and debt restruction proposals that we would in the

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Speaker 1: end return more money, more present value to our creditors.

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Speaker 1: The reason why these proposals were not taken seriously was

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Speaker 1: because it wasn't politically expedient for the powers that be

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Speaker 1: to to cut a deal with us. So the money

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Speaker 1: is not the problem technically speaking, um Europe is rich

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Speaker 1: enough and we have to think about it. Our greatest

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Speaker 1: problem in Europe at the moment is that we have

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Speaker 1: the highest level of savings in the post war period

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Speaker 1: and the lowest level of investment, especially including in places

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Speaker 1: like Germany. Now this is prepository, so that there is

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Speaker 1: so much money slashing around in the financial sector, it's

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Speaker 1: a question of putting it to use. And this is

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Speaker 1: why I'm advocating using the European Investment Bank, which is

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Speaker 1: a very interesting institutions, three times the size of the

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Speaker 1: World Bank by the way, in terms of its balance sheet,

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Speaker 1: and it has a you know, triple A rated bond.

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Speaker 1: We can do a great deal of good things channeling

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Speaker 1: the idle savings into investment opportunities that are um all

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Speaker 1: over the place. We have we have a very significant

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Speaker 1: challenge when it comes to an energy to clean energy

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Speaker 1: UH to make Europe independent and sovereign. From Vladimir Putting.

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Speaker 1: This is why we should be putting all this money.

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Speaker 1: The money is there, it's a question of mobilizing it. Yes,

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Speaker 1: I want to pivot a little bit to America because

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Speaker 1: in your book, of course, you talk about your crisis,

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Speaker 1: and on the show in the past you've already said

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Speaker 1: that you believe the UK should remain within the EU.

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Speaker 1: But I want to ask you about negative rates and

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Speaker 1: if you were general yelling at the moment, and or

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Speaker 1: if you're leading US economist, would you look at negative

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Speaker 1: rates in Japan and run the other side and saying, guys,

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Speaker 1: we're never trying this financial experiment because at the end

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Speaker 1: of the day can only be a disaster. We should

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Speaker 1: never shoot the messenger when negatives or negatives, when interstates

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Speaker 1: shifting into negative territory, this simply indicates that it is

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Speaker 1: that there is a huge quantity of excess savings. So

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Speaker 1: when you have a mountain mountain of savings and you

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Speaker 1: have far far lower levels of investment, then something has

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Speaker 1: to give. Interstates will shift into the negative of the

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Speaker 1: minus territory. Now in the United States, Janet Yellen doesn't

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Speaker 1: is not facing this much of an imbalance between savings

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Speaker 1: and investment. So she can stay the course that she

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Speaker 1: has planned for the last five six months. Maybe taper taper.

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Speaker 1: Maybe she she must do what she's clearly thinking of doing,

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Speaker 1: which to delay any interstate hikes. The problem is global.

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Speaker 1: If you look at the three major blocks, the independ Union,

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Speaker 1: the United States, and China. The imbalance between savings and

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Speaker 1: investment is quite frightening at the global level, and the

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Speaker 1: weak link is Europe. Janet Yellen cannot stabilize the American

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Speaker 1: economy and tiling unless there is some kind of rational

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Speaker 1: coordination between the United States, Europe and China. I mean

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Speaker 1: the weekly at the moment as China as well. Right,

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Speaker 1: if you look at China, we are concerned about the deadload,

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Speaker 1: and we're concerned about the PBC doing some kind of

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Speaker 1: policy mistake. It's not only about beating up on Europe. Now,

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Speaker 1: that is correct, But you have to remember, I'm sure

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Speaker 1: you remember that China after two thousand and eight took

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Speaker 1: on a very important role of rebalancing Atlantic capitalism, both

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Speaker 1: the United States and Europe. At the time when Europe

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Speaker 1: and the United States was falling into a black whole

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Speaker 1: and deliveraging, the Chinese intentionally created credit bubble and the

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Speaker 1: real estate bubble, the purpose of which was to maintain

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Speaker 1: their level of growth and to rebalance US Europeans and Americans,

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Speaker 1: hoping that they would be They were buying time for

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Speaker 1: America and for Europe to get their act together. But

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Speaker 1: we haven't gotten an act together, and the Chinese bubble

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Speaker 1: is begun in deflating fast and the response of Beijing

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Speaker 1: was to try to reinflate it. So the new credit

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Speaker 1: boost which is, as you said, turning China into a

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Speaker 1: potential new Greece at a much much larger level. But

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Speaker 1: the solution cannot come from within China. The solution must

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Speaker 1: come from the developed markets, that developed economies. And looking

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Speaker 1: at the developed economies, the United States and the European Union,

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Speaker 1: it is the European Union which is the sick man

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Speaker 1: of the global economy. We are exporting deflation massively as

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Speaker 1: we speak because we have this six shouldn't be the complex. Well,

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Speaker 1: we're gonna have to leave it there. Unfortunately, as I said,

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Speaker 1: uh to Joe Stiglas, never enough time. So I hope

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Speaker 1: you will come back and join us again here on

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Speaker 1: surveillance and we can talk more about the years on

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Speaker 1: and about politics going forward. Janice fair Focus, former Greek

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Speaker 1: finance minister, and the new book is and the week

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Speaker 1: suffer what they must. Thank you also to Francine Lackawford

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Speaker 1: joining us from London right now. The foot seas up

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Speaker 1: twenty three points four tenths of a percent,