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Speaker 1: Global business news twenty four hours a day. If Bloomberg

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Speaker 1: dot Com the radio plus Globile lapp and on your radio.

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Speaker 1: This is a Bloomberg business flag from Bloomberg World Headquarters.

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Speaker 1: I'm Charlie Pelt. A mixed picture for stocks were brought

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Speaker 1: to you by national Realty Providers of one percent satisfaction

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Speaker 1: guaranteed New York City Realty Investments. See them at n

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Speaker 1: r i A dot net. Now let's head right over

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Speaker 1: the first word breaking news desk for today's afternoon called

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Speaker 1: areas Bell Maloney, Good afternoon, Charlie. Manuals averages are quite today,

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Speaker 1: with the Dow currently hired by sixteen points, S ANDPS

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Speaker 1: are unchanged and NAZAC is lower by twelve. Markets were

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Speaker 1: lower over in Europe. Italy led to the downside, dropping

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Speaker 1: one point two percent back In the US, small cap

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Speaker 1: six hundred is down two points and the U S

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Speaker 1: ten yield at one point for seven percent. Seven out

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Speaker 1: of Tennessee sectors are higher, led by games, utilities, telecom

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Speaker 1: and consumer staples, Energy, financials and consumer discretionary foul down.

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Speaker 1: Transports jump fifty and as a box text drop thirty five,

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Speaker 1: and the VIX is down by four percent down leaders

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Speaker 1: including Microsoft, United Health Group, and Verizon, while Home Dupot,

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Speaker 1: Apple and Exxon Mobile led to the down side. Rail

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Speaker 1: CSX reported intra day Q two EPs and revenue Beat

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Speaker 1: shares gained as much as four and a half percent,

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Speaker 1: and look for young brands to report after the bell

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Speaker 1: Live from the First Breaking News desk on Bill Maloney, Charlie,

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Speaker 1: all right, thank you very much, Bill Maloney. Into hear

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Speaker 1: live breaking news over your Bloomberg Time Squawk A SQ

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Speaker 1: you a w K on your terminal. I'm Charlie Pellett.

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Speaker 1: That's a Bloomberg business flash you're listening to Taking stock

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Speaker 1: with Kathleen Hay and Pim Box on Bloomberg Radio. Flaver

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Speaker 1: Putin congratulated Theresa May today with her appointment as you

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Speaker 1: K Prime Minister, hoping for some constructive dialogue with the UK,

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Speaker 1: and of course his relationship with leaders around the world,

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Speaker 1: particular the United States, is a very important topic for investors.

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Speaker 1: Russia has had its own share of challenges with the

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Speaker 1: big run up and oil prices than the big drop,

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Speaker 1: and so many more issues involvement in Syria. Where does

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Speaker 1: Russia stand now? Where is the country heading? What should

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Speaker 1: the investors be watching. We're very happy to have Richard

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Speaker 1: con joining us now. He's managing partner at Eurasia Advisors.

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Speaker 1: It's a problem solving and deal making firm that focuses

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Speaker 1: on Russia and the c I S, the Commonwealth of

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Speaker 1: Independent States. Richard, welcome to taking Stock. Thank you. So,

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Speaker 1: first of all, you have to tell us about you.

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Speaker 1: You speak Russian, you studied there, You worked for Yeltsin's

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Speaker 1: team when you started around them and round the Moscow

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Speaker 1: office of the international law firm Latham and Walking. You

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Speaker 1: did so much. Tell us about what took you to

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Speaker 1: Russia and what you did have done there. In a nutshell,

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Speaker 1: when I went to college, I had already learned a

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Speaker 1: few of the Romance languages, and I wanted one really

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Speaker 1: difficult language. I chose Russian the because at the time

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Speaker 1: I was very interested in chess, and also I enjoyed

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Speaker 1: Russian literature, so it seemed to make some sense to me.

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Speaker 1: But little did I suspect that it would lead to

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Speaker 1: a lifetime of involvement with Russia. And you mentioned the

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Speaker 1: word chess, and let's just be clear here, you ran

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Speaker 1: for the Deputy Presidency of the World Chess Federation so

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Speaker 1: you're not just somebody coming new to the game, and

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Speaker 1: you're not coming new to Russia. No, but I wish

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Speaker 1: the loftiness of the position I sought in some way.

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Speaker 1: We're related to my abilities in the game. I play seriously,

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Speaker 1: but there are a lot of people who play better well.

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Speaker 1: So lucky thing it is, though, for those find people

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Speaker 1: in your raised advisors that you didn't become the grand

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Speaker 1: champion or chess master right of the world, and you're

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Speaker 1: you're working with them. So I'm gonna hear a little

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Speaker 1: bit more though. So here's the guy who studies Roman

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Speaker 1: Romance languages, and I can speak Russia in Russian and Russia, right,

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Speaker 1: you know, I can see the places of Russian literature.

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Speaker 1: But then how do you take a step into law

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Speaker 1: and business and what has your focus been there? Well,

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Speaker 1: I made the decision years ago to go into law,

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Speaker 1: and uh, this is back during the Soviet time period,

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Speaker 1: so there really wasn't much going on in US Russian

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Speaker 1: business at that time, and I focused on law and

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Speaker 1: the law firm Lathan Watkins became an equity partner there, uh,

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Speaker 1: practicing in areas such as litigation, insolvency. Wrote a book

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Speaker 1: for lawyers on insolvency restructuring and ended up really I

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Speaker 1: guess you would say, almost out of the blue, when

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Speaker 1: Yelton came to power, approaching the head of our law firm,

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Speaker 1: gentleman who had turned out had studied some Russian about

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Speaker 1: the idea of going over to be part of the transition,

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Speaker 1: both for purposes of business development of course for a

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Speaker 1: law firm Lathan being one of the largest law firms

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Speaker 1: in the world, but also UH to be of assistance

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Speaker 1: during that time period of Russia, and the firm was

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Speaker 1: extremely supportive as far as Brexit and THEIRS role in

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Speaker 1: the European Union Visa v. Russia. I mean, you've got

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Speaker 1: these two geographical extremes, and if you could talk a

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Speaker 1: little bit about what the vote means for internal European

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Speaker 1: relations and Russia as it kind of tries to find

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Speaker 1: its role in Europe, well, I would start by saying that, certainly, UH,

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Speaker 1: the the classic view right now is that Russia is

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Speaker 1: doing all that it can to assist in the dismemberment

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Speaker 1: of the EU. And because they certainly, from one perspective view,

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Speaker 1: the UH sanctions that are currently in place as in

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Speaker 1: parts sustainable because of the cohesion of the EU in

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Speaker 1: supporting that effort, and so from that perspective, Brexit could

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Speaker 1: be viewed as welcome news uh to Putin and those

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Speaker 1: who take that view. I would add though, that China

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Speaker 1: takes a very diff from view of it. They take

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Speaker 1: the perspective that the EU is an excellent counterweight to

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Speaker 1: the US, and they feel that it's helpful to have

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Speaker 1: that in existence and that worthy EU to break apart

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Speaker 1: or to at least slowly disintegrate that. Ultimately that would

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Speaker 1: um frankly make it more amenable for the US to

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Speaker 1: have its views in the world. So um so, you

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Speaker 1: can take take different slices of it. But in the

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Speaker 1: short term, Russia certainly is focused on getting sanctions out

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Speaker 1: of the way and wants to peel off, you know,

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Speaker 1: from a short term strategic perspective, as many countries as

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Speaker 1: possible to to weaken sanctions and view that as leverage

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Speaker 1: as part of the resolution of the Ukrainian situation. Getting

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Speaker 1: breaking news now from the UK then appointment everyone has

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Speaker 1: been waiting for. David Davis appointed Chief Minister for Brexit

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Speaker 1: by Theresa May, the new Prime Minister, and of course

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Speaker 1: everyone was said that the most Horton position that she

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Speaker 1: would be announcing is that of bregsit Czar. So we're

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Speaker 1: watching that very closely as Teresa May takes over as

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Speaker 1: Prime Minister of the UK today. Richard Kahan is our guest.

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Speaker 1: He's managing partner at Eurasia Advisors, talking to us about

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Speaker 1: Russia froster relationships with the US and interesting that China.

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Speaker 1: When China looks at Bregsit they see a possibility for

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Speaker 1: the EU to offset the influence of the United States

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Speaker 1: in the world. I'm Kathleen Hayes along with pim Fox.

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Speaker 1: This is taking stock on Bloomberg. This is Bloomberg Bloomberg.

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Speaker 1: Taking Stock has brought you by the accountants and advisors

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Speaker 1: business leader managing cyber risk should be to get started

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Speaker 1: General one nineteen and around the Globe, the Bloomberg Radio

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Speaker 1: plus SAP and Bloomberg got gone. This is Taking Stock.

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Speaker 1: Coming up on Taking Stock, we're gonna be speaking about

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Speaker 1: Secretary of State John Kerry. He will be meeting Russia's

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Speaker 1: top diplomat and possibly President Vladimir Putin in Moscow later

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Speaker 1: this week. The topic serious civil war and the future

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Speaker 1: of Bashar Assad. We've got more details. We're gonna be

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Speaker 1: turning now to our Bloomberg news room for Charlie Pellett.

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Speaker 1: He's got another Bloomberg Business Flash and I thank you

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Speaker 1: very much. Kathleen Hayes, thank you, Pim Fox. The TAO

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Speaker 1: is Higher SMP and nez Dak, both trading Laura were

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Speaker 1: or call one six six Sector e t F But

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Speaker 1: a couple of key appointments today from the UK's Prime Minister,

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Speaker 1: Theresa May Boris Johnson, the former London mayor, has been

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Speaker 1: named Foreign Minister and now they have a Brexit zar.

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Speaker 1: Minutes ago we learned that David Davis, who advocated British

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Speaker 1: withdrawal from the European Union will be given the official

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Speaker 1: title of Secretary of State for exiting the European Union.

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Speaker 1: Federal Reserve and its Page Book reports said the U

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Speaker 1: s economy expanded at a modest pace since mid May,

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Speaker 1: a mid quote slight price pressures and some softening in

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Speaker 1: consumer spending. Oil tubled after a government report showed US

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Speaker 1: fuel inventories unexpectedly grew, adding to concerns about oversupply. Todd

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Speaker 1: Colvin is senior vice president at Ambrasino Brothers got the

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Speaker 1: free Brexit look at oil, and then you've got the

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Speaker 1: post Brexit look at oil. And I use that as

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Speaker 1: a line in the sand because all the markets have

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Speaker 1: really changed and corrected since then. Oil has been no

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Speaker 1: different except for oil is such a two headed beast

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Speaker 1: that it trades supply and demand, It trades on geopolitical risks,

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Speaker 1: and it trades on disruptions production. You name it. Crude

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Speaker 1: oil West Texas Intermedia down four percent forty four ninety

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Speaker 1: four barrel right now, Gold up eighty three, a gain

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Speaker 1: of six tenths of one percent the ten year of

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Speaker 1: ten thirty seconds. Zeal there one point four seven percent,

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Speaker 1: SMP five hundred index Flat Dow up eighteen, a gain

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Speaker 1: of point one percent. NAS backed down three tenths of

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Speaker 1: one percent three thirty two on Wall Street. Now, let's

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Speaker 1: take a look at other news from around the world.

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Speaker 1: Thank you, Charlie from the Bloomberg news room. I'm Jill Schneider.

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Speaker 1: This news update is brought to you by the Deep

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Speaker 1: Grand Cherokee, the most awarded suv ever. The Grand Cherokee

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Speaker 1: legendary four by four capability. Drive one at your local

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Speaker 1: jeep dealer today. British Prime Minister Theresa May has started

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Speaker 1: assembling her new government, appointing Philip Hammond as Treasury Chief.

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Speaker 1: Hammond is the former Foreign Secretary. He replaces George Osborne,

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Speaker 1: who had held the job for six years. Osborne had

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Speaker 1: resigned from the government. She also appointed Amber Rudd as

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Speaker 1: Home Secretary. Funerals are being held today for three of

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Speaker 1: the five Dallas police officers killed last week. Pastor Rick

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Speaker 1: Lamb addressed those gathered to more and Dart officer Brent

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Speaker 1: Thompson at the Potter's House Church in Dallas. Today is

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Speaker 1: about Brent, and today is about trying to bring some

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Speaker 1: closure and trying to help this family. Thompson's wife, Emily,

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Speaker 1: also a Dallas police officer, spoke at the service, saying

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Speaker 1: she will put on her uniform and return to policing

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Speaker 1: the streets. A federal appeals court has denied Tom Brady's

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Speaker 1: attempt to get a new hearing on his deflate Gate suspension.

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Speaker 1: A three judge panel said in April that NFL Commissioner

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Speaker 1: Roger Goodell was within his powers when he suspended the

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Speaker 1: Star Quarterback War Games for his role in a scheme

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Speaker 1: subway riders need to exercise patients as they wait for

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Speaker 1: their trains. Today, the m t A is reporting extensive

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Speaker 1: delays on the one, two, three, four, or five and

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Speaker 1: six lines. City officials say have power outage at a

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Speaker 1: rail control center is to blame. No word on when

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Speaker 1: service will be restored. Global News twenty four hours a day,

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Speaker 1: powered by more than journalists and analysts in more than

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Speaker 1: one twenty countries. I'm Jill Schneider. This is Bloomberg, Charlie,

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Speaker 1: and we thank you and again recapping stocks advancing now

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Speaker 1: with the SMP five dred Index upp A point little

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Speaker 1: change three. That's a gain of less than point one percent.

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Speaker 1: I'm Charlie Palatin. That's a Bloomberg business flash. You're listening

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Speaker 1: to Taking Stock with Kathleen Hay and Pim Fox on

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Speaker 1: Bloomberg Radio Russia. Russia's stock market is actually up nearly

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Speaker 1: ten so far this year. This comes despite economics sayings

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Speaker 1: because of Russia's role in ongoing tension in Ukraine. Here

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Speaker 1: to tell us more about Russia its relationship with Europe

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Speaker 1: and the United States is Richard Kahn. He is managing

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Speaker 1: partner for Eurasia Advisers. He joins us here in the studio, Richard,

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Speaker 1: in your work in Russia, I wonder if you could

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Speaker 1: tell us their perception of the United States and Americans. Well,

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Speaker 1: like I first break it apart, because obviously there's no

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Speaker 1: one view. As you might imagine, Russia has its equivalent

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Speaker 1: of red and Blue States, as you know, far greater

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Speaker 1: levels of education in the cities and their business communities.

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Speaker 1: And then you have the ruling elite in the country.

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Speaker 1: I would say, generally, and this is held all the

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Speaker 1: way through from the period when I was over there,

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Speaker 1: back in the Soviet days. Um, there is a tremendous

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Speaker 1: level of respect and admiration for the United States. UH.

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Speaker 1: That really has not changed in my view, notwithstanding the

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Speaker 1: UH current or I said the last two years sort

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Speaker 1: of of a nationalistic type of push within within Russia,

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Speaker 1: you know, at the leadership level. I think there's likewise

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Speaker 1: begrudging admiration and respect, but similarly a a sense that

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Speaker 1: that is not reciprocated, that they're treated discourteous, lee and disrespected.

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Speaker 1: So there is a certain level of animosity h bruzd

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Speaker 1: gooes that plays a significant role, actually, I think in

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Speaker 1: the relationship, even in the way things played out in

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Speaker 1: Ukraine years ago. Well, that's what you make me think of,

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Speaker 1: because that's there's such a different view. If you the

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Speaker 1: US UH crimea annexing crimea wrong. You can't do that.

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Speaker 1: You just grab something putin Russia saying hey, wait a minute,

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Speaker 1: that's really ours. We're just taking it back, you know,

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Speaker 1: it's Uh. How do you understand it? As someone who

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Speaker 1: lives in both worlds and understands both so well, well,

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Speaker 1: I think not with ending all my time there, I

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Speaker 1: will never understand Russia the way Russians do. But I

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Speaker 1: do feel that the Russian perspective is not particularly well

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Speaker 1: understood in the West, and again it's I'm not justifying it,

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Speaker 1: but I can certainly say their view is close to

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Speaker 1: what you said, that there is a history of both

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Speaker 1: of the relationship with Ukraine and with Crimea that even

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Speaker 1: predated the Soviet period UM, and that of course they've

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Speaker 1: had for a long time, and you know, a large

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Speaker 1: naval installation on Crimea. Their perspective is we have some

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Speaker 1: whatever seven hundred military bases in the world. They've got

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Speaker 1: two with Syria and UH and Crimea, and they were

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Speaker 1: certainly loath to see that UM be part of a

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Speaker 1: Western leaning Ukraine UM. And I think from their perspective, UH,

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Speaker 1: you know, they felt, and there's no question that this

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Speaker 1: is their view, because they've expressed it many times, that

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Speaker 1: they were essentially double crossed by the West in connection

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Speaker 1: with how Ukraine was handled, that a deal had been

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Speaker 1: reached with the West regarding the treatment of Yanukovich and

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Speaker 1: the process that would be followed. And they blame us

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Speaker 1: essentially for UH the uprising that took place. They do

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Speaker 1: not for a moment believe that this was a spontaneous

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Speaker 1: act by the citizens of Ukraine. Now our perspective is

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Speaker 1: quite different than that. But the Russians certainly feel that

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Speaker 1: uh that Ukraine never Yukine, never really in their mind

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Speaker 1: uh has been outside of Russia. Uh. They had viewed

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Speaker 1: until recently it is being necessarily part of their sphere

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Speaker 1: of influence, and they've been very uncomfortable and have signaled

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Speaker 1: that to have the buffer zone, they're taken away from

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Speaker 1: them and visa vi cremea. You know, they point to

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Speaker 1: the history of Kristcheff essentially symbolically giving it to Ukraine

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Speaker 1: at a point when Ukraine was part of the Soviet Union,

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Speaker 1: and so from their perspective that really was a non event.

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Speaker 1: And again you tie that together with the military aspects,

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Speaker 1: and what they view is is our getting into their

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Speaker 1: neighborhood that they were quite uncomfortable about it. Now you

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Speaker 1: add all that together, there might be a solution. But

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Speaker 1: for the fact that the Ukrainians, certainly in the west

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Speaker 1: and maybe now five percent of the country themselves, want

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Speaker 1: to be facing westward. They they they've made that quite clear,

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Speaker 1: and so once you consider the perspectives of the individuals

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Speaker 1: living in the country, that dramatically complicates any sort of

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Speaker 1: if you will, a superpower type of solution. UM, And

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Speaker 1: there in lies part of the dilemma. And not not

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Speaker 1: that we should focus exclusively on problems, but because I

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Speaker 1: think there's a lot of common issues we can focus on.

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Speaker 1: But but that one certainly is going to remain a

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Speaker 1: problem for some time into the next administration. UM Secretary

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Speaker 1: of State John Kerry, he will be meeting in Moscow

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Speaker 1: later this week, perhaps with the President of bottom Reproof,

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Speaker 1: but certainly with the Foreign minister talking about Syria. Is

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Speaker 1: there any way, based on your understanding of the situation,

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Speaker 1: that there can be some kind of coordinated effort on

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Speaker 1: the part of the Russians and Americans on Syria. Yeah.

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Speaker 1: I think both countries have done a good job in

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Speaker 1: trying to focus on the positive elements of cooperation in Syria.

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Speaker 1: And obviously this has been far from perfect. There's um

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Speaker 1: as you've no doubt have noted a deep level of

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Speaker 1: distrust between the US and Russia right now that's spilled

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Speaker 1: over or even into the diplomatic realm. But I do

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Speaker 1: think that that they can make headway with Syria. It

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Speaker 1: can be an example of an area of cooperation. Uh.

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Speaker 1: But I don't think we need to limit areas of

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Speaker 1: cooperation to the problem points. All right, Richard con thank

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Speaker 1: you so very much for joining his managing partner at

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Speaker 1: Eurasia Advisors. I'm Kathleen Hayes along with pim Fox. This

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Speaker 1: is taking Stock, and this is Bloomberg. Coming up on

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Speaker 1: with your money to make more. That's next