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Speaker 1: This is Bloomberg Surveillance. I view the boom and bust

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Speaker 1: business that might view the time will actually run out

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Speaker 1: the available supply, growth that wants to do more and

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Speaker 1: continues to communicate they'd like to do more. Ultimately, are

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Speaker 1: only able to deliver one more rate hight this year

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Speaker 1: market's discount of future. When interestrates are very very low,

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Speaker 1: you're effectively discounting further out into the future at a

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Speaker 1: time when it's harder to see what's out. Bloomberg Surveillance,

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Speaker 1: You're linked to the world of economics, finance, and investment.

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Speaker 1: On Bloomberg Radio. Good morning everyone, Michael McKee and Tom Kin.

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Speaker 1: Bloomberg Surveillance is Tuesday. Good morning in Florida, Good morning

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Speaker 1: in Ohio, and seriously next time Channel one nineteen, Good

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Speaker 1: morning in Washington, where they'll be watching the results tonight

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Speaker 1: to a fair the well FM Washington and Baltimore. Bloomberg twelve, Boston,

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Speaker 1: Bloomberg Eleven's Rio, you know, sort of a cloudy gray

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Speaker 1: New York and the gorgiosity of San Francisco Bay Area.

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Speaker 1: We say good morning across this great nation as we

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Speaker 1: discuss a little bit of politics, but a lot of economics.

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Speaker 1: Finance and Investment. Alan Ruskin will join us on the

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Speaker 1: dollar here in a moment and other efforts of his

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Speaker 1: economics Deutsche Bank, Bloomberg Surveillance. We brought you by kone

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Speaker 1: REISNEK Accounting Tax Advisory. During times of growth, crisis, are

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Speaker 1: economic uncertainty, your business needs the cone Resnick advisory Group

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Speaker 1: for the strategies to move forward. Find out more at

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Speaker 1: kone Resnick dot com, O h N R e z

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Speaker 1: N I C K cone Resnick dot com and shout

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Speaker 1: out to cone Resnick for their continued support of what

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Speaker 1: we do. We try to bring you voices like Alan

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Speaker 1: Ruskin with Deutsche Bank and he joins us down Allan,

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Speaker 1: Good morning, Allen, Good morning there you are, um, Alan,

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Speaker 1: dollar strength. I want to get right to your wheelhouse.

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Speaker 1: What is your call on the magnitude of dollars twelve months? Yeah,

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Speaker 1: we're actually shaving back some of the strength that we anticipated,

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Speaker 1: in part because of the market's response really to the ECB.

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Speaker 1: As you know, Tom, divergence has been a big story

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Speaker 1: for the last eighteen months to two years, and the

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Speaker 1: ECB has in many ways led the charge. Now I

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Speaker 1: think they to some extent, I wouldn't say running out

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Speaker 1: of bullets, but their impact on the foreign exchange markets

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Speaker 1: much is likely to be more muted. It's really up

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Speaker 1: to the Fed, I think, to drive things forwards. So

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Speaker 1: we're scanting back our year end forecast from zero point

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Speaker 1: nine five on euro dollar to parity um so you know,

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Speaker 1: still a stronger dollar. Directions still very much maintained in

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Speaker 1: favor of a stronger dollar, but the pace and magnitude

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Speaker 1: are are more contained. How do we get there? And

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Speaker 1: the reason I'm asking is the Bank of Japan stands pat,

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Speaker 1: the Fed's expected to stand pat, and we're not seeing

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Speaker 1: any real movement in currencies other than a little jiggle

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Speaker 1: around the status quo lately. Yeah, I think you know,

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Speaker 1: the the the emphasis has to be on what the

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Speaker 1: Federal Reserve does. So look, if the Feds are not

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Speaker 1: going to be in player this year, then we'd like

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Speaker 1: you have to scale back a tad further, but not

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Speaker 1: that much because I think the range has You know

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Speaker 1: that we've seen over the last twelve months of one

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Speaker 1: oh five to one fifteen on euro dollar is you know,

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Speaker 1: it's been solid enough anyway, and it doesn't really even

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Speaker 1: need the ft to be in play to get us

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Speaker 1: to one O one oh five. But the FED is

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Speaker 1: in play, as I would anticipate, and as I think

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Speaker 1: we'll see from uh, you know Janet yelling this week,

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Speaker 1: then you know that will be the kicker. I think,

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Speaker 1: and and and just keep in mind, really a ten

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Speaker 1: percent move in the foreign exchange market is not a

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Speaker 1: huge move, certainly in terms of signaling the low point

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Speaker 1: for euro dollar this year. Well, what did you make

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Speaker 1: of coronison in the Bank of Japan today? Uh? Do

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Speaker 1: they are? They still in play? I think there's still

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Speaker 1: laur in player. I think they're still coming to grips

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Speaker 1: with the whole idea air of negative rates, What the

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Speaker 1: implications are, what the mechanics of negative rates are? Um,

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Speaker 1: And you know, I don't think you're going to see

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Speaker 1: a whole lot more in terms of negative rates from

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Speaker 1: the Bank of Japan. I think you are likely to

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Speaker 1: see maybe they're sort of branching out towards buying riskier

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Speaker 1: assets or buying more risky acids going forward. So I

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Speaker 1: think the Bank of Japan is in play, but it's

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Speaker 1: in a sort of a more muted form than we've

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Speaker 1: see him previously. How does this adapt in the just

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Speaker 1: fed Alan Roskin. I hate to tell you this, but

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Speaker 1: I'm misinformed on the dot plot. McKee is encyclopedic on

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Speaker 1: dot plot dynamics. When we bring up the dot plot,

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Speaker 1: there's the belief, the hope, whatever, and then there's the

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Speaker 1: market pricing and reality, which is right, um, somewhere in

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Speaker 1: between us, I think somewhere, and I think that's somewhere

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Speaker 1: in between. I think the Federal Service clearly sort of

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Speaker 1: looking at a fairly normal cycle. I mean, they've obviously

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Speaker 1: muted out the longer term equilibrium funds rate as well.

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Speaker 1: The market is taking a um, you know, a far

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Speaker 1: less sanguine view in terms of the real economy prospects

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Speaker 1: going forward. So I think, uh, you know, correct me

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Speaker 1: if I'm wrong your time. But I think the two

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Speaker 1: thousand and eight market view is uh, you know, less

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Speaker 1: hawkish effectively than uh, you know what we have for

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Speaker 1: two thousand and sixteen from you know, the federal reserves. Such.

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Speaker 1: So the market is obviously taking a very very very

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Speaker 1: duvish line going forward, but I think that could change

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Speaker 1: quite quickly, so, you know, to fair actually does tighten,

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Speaker 1: for example, in June, then the market is going to

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Speaker 1: have to reconsider because there's really not much priced in

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Speaker 1: there for two thousand and sixteen and two thousand and

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Speaker 1: seventeen in particular, isn't it really what you want to

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Speaker 1: look at is inflation and what you think inflation is

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Speaker 1: going to be. That's going to drive the Fed's decisions,

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Speaker 1: I should drive your investment decision to an extent, although

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Speaker 1: keeping mind, inflation is a lagging indicators, So the FED

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Speaker 1: is you know, like I think a lot of the

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Speaker 1: market is hanging onto concepts that relate to predicting inflation

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Speaker 1: and output gap and spec capacity in the labor market

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Speaker 1: indicators in particular. There you know, what they tell us

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Speaker 1: about spec capacity is absolutely crucial in that um. And

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Speaker 1: you know, obviously the interesting element you're seeing in the

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Speaker 1: market at the moment is this decoupling between you know,

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Speaker 1: the employment data and some of the forward looking signals

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Speaker 1: in terms of financial conditions, the yield curve and maybe

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Speaker 1: even GDP in facts. So you know how long that

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Speaker 1: will continue? Is? I think that, you know, probably the

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Speaker 1: key question for the market. I look at Ellen, the

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Speaker 1: key question here of back to back central banks. I

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Speaker 1: said this is this morning to Francine, look and no

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Speaker 1: one's looking at what Bank of England is going to do,

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Speaker 1: and to me it's maybe the most interesting meeting because

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Speaker 1: they have to play really play off what Mr Drag did.

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Speaker 1: Did Mr Drag adjust what Mr Kearney will say on Thursday.

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Speaker 1: I don't think materially, Tom, because you know, what the

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Speaker 1: UK is still facing is a large scale fiscal consolidation.

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Speaker 1: So let's see what the UK budget actually brings. But

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Speaker 1: I think that you know, the expectation is there as

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Speaker 1: you get some sort of contraction reinfluence there. The economy

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Speaker 1: seems to be slowing in any event, so the mix

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Speaker 1: is really meant that the Bank of England, I can

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Speaker 1: you can think, will hold tight really for the next

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Speaker 1: for pretty much this year. At this point, you know,

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Speaker 1: it looked much more likely that the Bank of England

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Speaker 1: was going to tighten and be the only other G

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Speaker 1: ten central bank that would follow the fat in terms

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Speaker 1: of tightening this year. But of late, I think one's

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Speaker 1: had his scale back those expectations, asking with us with

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Speaker 1: Dutch Bank, we're going to come back on that. We

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Speaker 1: have to interrupt. It's important discussion on Mr Ruskin to

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Speaker 1: look at the implosion of Valiant two new loves. I

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Speaker 1: would have said we don't have to do that right now,

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Speaker 1: we can save it for another day, but it has

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Speaker 1: not found a bid this morning. Is people digest non

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Speaker 1: gap and gap earnings and the mystery of this. I

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Speaker 1: don't pretend to be up to speed on it. We'll

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Speaker 1: get a guest on this as we go. But to

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Speaker 1: remind everybody, we've enjoyed moving from two dred and forty

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Speaker 1: three dollars a share down to sixty nine in a

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Speaker 1: low of sixty one, and right now, Mike, we've broken

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Speaker 1: through that March fourth low to fifty seven. We're down

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Speaker 1: sevent on this company, for those who haven't been following

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Speaker 1: the news, valued out this morning with a downgrade of

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Speaker 1: its forecast, a significant downgrade of its earnings forecast, and

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Speaker 1: that has obviously investors concerned. Valiant business model under attack,

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Speaker 1: and it had been defended by Mr Ackman and company

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Speaker 1: hedge investor. So it, even if it's a relatively small company,

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Speaker 1: is has an outsized presence in the news and a

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Speaker 1: very different structure here Michael Pearson back from illness clearly,

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Speaker 1: but with three basically three chairmen, which I don't pretend

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Speaker 1: to understand. Eric Abramson, Ariy Kellen and Whittaker as well

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Speaker 1: out of Bridgewater, New Jersey, and uh this bears watching.

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Speaker 1: I I don't know why I say that, Mike, other

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Speaker 1: than stock price says a lot. And the way it's

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Speaker 1: acting off the news of I'm gonna say, forty five

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Speaker 1: minutes ago is unbecoming to the mysteries that are out there.

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Speaker 1: Hitting a low of fifty seven UM fifty six sixty

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Speaker 1: two eight oh two, six minutes ago as well. So

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Speaker 1: there's Valiant. I don't mean to interrupt Mr Ruskin on

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Speaker 1: but this is moving in real time. We'll try to

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Speaker 1: get some perspective on this, uh this morning as well.

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Speaker 1: Valiant pharmaceuticals uh south and are really difficult. Ernie's might

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Speaker 1: help me with a data check here. The b o

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Speaker 1: J really didn't adjust the day, did it. It did

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Speaker 1: not well, I mean it did in the sense that

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Speaker 1: people were uh disappointed that they didn't get any more

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Speaker 1: easy K finished down by seven tents a hundred and

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Speaker 1: seven little points on the day, and that hangover has

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Speaker 1: spread to Europe and into the US markets ahead of

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Speaker 1: the fat A little wait stronger yea one twelve eighty three,

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Speaker 1: A full stick one eighty three stronger the euro one

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Speaker 1: eleven one it earlier one eleven oh two on the

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Speaker 1: euro flat with some a little bit of dollar strength

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Speaker 1: this morning. Commodities really giving it up after a great run.

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Speaker 1: West Texas thirty six thirty six two cents, Brent thirty

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Speaker 1: eight sixty one down ninety two cents, Oil soft Gold

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Speaker 1: down thirteen dollars twelve thirty one the ounce. All right,

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Speaker 1: let's check in with mykel r and get the latest

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Speaker 1: world and national headlines. Mike Tom, thank you very much.

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Speaker 1: Campaigns of Florida's Marco Ruby, oh and Ohio's John Casey

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Speaker 1: could hang the balance today. They need to win their

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Speaker 1: home states to have a chance at catching Republican leader

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Speaker 1: Donald Trump. Through other states sold primaries today. Big wins

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Speaker 1: today by Trump and Democrat Hillary Clinton could pad their leads.

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Speaker 1: There was more confirmation of the death of the Islamic

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Speaker 1: State group's top military commander in Syria. Spokesman for the

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Speaker 1: US led coalition battling in the RACK says it has

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Speaker 1: been able to determine that Omar al Shashani is dead

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Speaker 1: after being wounded last week in an air strike. Russian

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Speaker 1: officials say it's military forces have started leaving Syria The

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Speaker 1: surprise move by Russian President of Vladimir Putin puts pressure

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Speaker 1: on the regime of Syrian President Assad and opposition groups

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Speaker 1: to reach a peace deal at talks in Geneva. Global

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Speaker 1: News twenty four hours a day, powered by our two

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Speaker 1: hundred journalists more than a hundred fifty news bureaus from

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Speaker 1: around the world. Not Michael bar Michael, thanks so much,

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Speaker 1: Worldwide Economics, financial invest that we are with Alan Ruskin

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Speaker 1: of Deutsche Bank as you look at three Central Bank meetings.

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Speaker 1: This is Bloomberg's surveillance. The news Update brought to you

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Speaker 1: by Mercedes Benz this month. Here Mercedes Ben's Tri state

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Speaker 1: dealers welcome Spring with limited time offers on select models

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Speaker 1: each engineered and price to move. Visitt n B USA

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Speaker 1: dot com today