1 00:00:03,000 --> 00:00:06,440 Speaker 1: This is Bloomberg Surveillance because a road that's opened up 2 00:00:06,480 --> 00:00:08,920 Speaker 1: now with the British decision to leave it could need 3 00:00:09,280 --> 00:00:13,000 Speaker 1: to be more prosperous rope. They'll have to navigate a 4 00:00:13,000 --> 00:00:15,400 Speaker 1: political crisis and they'll have to figure out who the 5 00:00:15,440 --> 00:00:17,800 Speaker 1: next prime minister might be, and that's not really clear. 6 00:00:17,880 --> 00:00:20,479 Speaker 1: I think we can think of it as essentially a 7 00:00:20,720 --> 00:00:26,360 Speaker 1: decreasing relationship with economic distance. Bloomberg Surveillance your link to 8 00:00:26,400 --> 00:00:30,760 Speaker 1: the world of economics, finance, and investment on Bloomberg Radio. 9 00:00:32,320 --> 00:00:34,479 Speaker 1: Good morning. It is seven am on Wall Street and 10 00:00:34,680 --> 00:00:37,040 Speaker 1: in Washington, d C. Where Tom Keene and I are 11 00:00:37,040 --> 00:00:41,559 Speaker 1: presenting a special edition of Surveillance, live from the capital 12 00:00:41,600 --> 00:00:44,519 Speaker 1: of the United States. Later in the program, Tom an 13 00:00:44,600 --> 00:00:48,160 Speaker 1: extended interview with former FED Chairman Alan Greenspan about Brexit 14 00:00:48,280 --> 00:00:52,000 Speaker 1: central banks in the American economy. Extraordinary good fortune to 15 00:00:52,080 --> 00:00:54,400 Speaker 1: speak to Chairman Greenspan. You and I know he's been 16 00:00:54,400 --> 00:00:58,520 Speaker 1: cautious for months. I would suggest it's even increased, as 17 00:00:58,600 --> 00:01:00,760 Speaker 1: you can understand when you look at the screen this morning, 18 00:01:00,760 --> 00:01:03,520 Speaker 1: Mike at seven am. You always go through the data. 19 00:01:03,840 --> 00:01:05,760 Speaker 1: Why don't you do that? And I'll jump in with 20 00:01:05,800 --> 00:01:08,960 Speaker 1: a few observations I'll just start with the fact equities 21 00:01:09,000 --> 00:01:13,000 Speaker 1: to tier it is. Uh. It is a down trend 22 00:01:13,240 --> 00:01:16,560 Speaker 1: since the UM volumes started to pick up as more 23 00:01:16,600 --> 00:01:19,840 Speaker 1: people in it to their trading discs. Although um and 24 00:01:19,920 --> 00:01:22,000 Speaker 1: we should notice nowon in London, so people have been 25 00:01:22,000 --> 00:01:24,280 Speaker 1: trading for a while. Uh, it has been more of 26 00:01:24,319 --> 00:01:27,240 Speaker 1: a grind lower, nothing like the plunge on Friday. Chancellor 27 00:01:27,280 --> 00:01:30,600 Speaker 1: of the Exchequer George Osborne out today saying, uh, the 28 00:01:30,640 --> 00:01:34,080 Speaker 1: government has a contingency place in plan to shore up 29 00:01:34,080 --> 00:01:38,800 Speaker 1: the US UK economy, not convincing people. The pound right 30 00:01:38,800 --> 00:01:41,360 Speaker 1: now at one thirty two, ten off its lows, but 31 00:01:41,480 --> 00:01:44,920 Speaker 1: below Friday, and we're on a one handle watch there. 32 00:01:44,920 --> 00:01:47,000 Speaker 1: I mean, the vectors are all in the wrong direction. 33 00:01:47,040 --> 00:01:50,920 Speaker 1: But as Mike says, without the enthusiasm and anks that 34 00:01:51,000 --> 00:01:53,560 Speaker 1: we saw on Friday, the foot Sea is down one 35 00:01:54,240 --> 00:01:56,960 Speaker 1: hundred and two points right now. The volume of European 36 00:01:57,000 --> 00:02:00,800 Speaker 1: shares changing hands almost three times that any day average 37 00:02:00,960 --> 00:02:05,760 Speaker 1: for British equities, more than uh three times as well 38 00:02:06,160 --> 00:02:10,240 Speaker 1: British banks, helping to put the European Bank Index on 39 00:02:10,440 --> 00:02:13,080 Speaker 1: course for its biggest two day drop on record. It 40 00:02:13,200 --> 00:02:17,040 Speaker 1: is now down by seven point two percent on the day, 41 00:02:17,400 --> 00:02:20,080 Speaker 1: and you were mentioning some of the European banks. Deutsche 42 00:02:20,080 --> 00:02:24,000 Speaker 1: Bank getting hammered again, down nine point four percent to 43 00:02:24,520 --> 00:02:28,399 Speaker 1: twelve euros, just just over twelve euros. Let's color that, 44 00:02:28,520 --> 00:02:30,440 Speaker 1: and it just breaking down to a new low twelve 45 00:02:30,440 --> 00:02:33,400 Speaker 1: point one nine on euros. Let's color the trend of 46 00:02:33,480 --> 00:02:37,000 Speaker 1: Deutsche Bank is a proxy for our global Wall Street audience, 47 00:02:37,040 --> 00:02:40,480 Speaker 1: particularly the American audience. In drive time, down we go 48 00:02:41,200 --> 00:02:46,560 Speaker 1: at five am. There was the McKey bounce, There was bounce, 49 00:02:47,120 --> 00:02:49,520 Speaker 1: and then it just didn't happen, and then another bounce. 50 00:02:49,600 --> 00:02:53,480 Speaker 1: Let me get my official Bloomberg surveillance cursor out here. 51 00:02:53,480 --> 00:02:57,160 Speaker 1: At about six eighteen am Wall Street Time Up we 52 00:02:57,240 --> 00:02:59,800 Speaker 1: go a little bit and Mike, as we go to 53 00:02:59,840 --> 00:03:02,640 Speaker 1: the opening of the show, it ain't happening for the 54 00:03:02,680 --> 00:03:04,920 Speaker 1: European banks. Well, let's set it up now for the 55 00:03:04,960 --> 00:03:07,480 Speaker 1: rest of the markets. The stock six hundred is down 56 00:03:07,480 --> 00:03:11,040 Speaker 1: by three percent right now, a little over nine points. 57 00:03:11,120 --> 00:03:13,320 Speaker 1: The decks in Germany is off a hundred and eighty 58 00:03:13,360 --> 00:03:16,480 Speaker 1: points one point nine percent. Here in the U S 59 00:03:16,680 --> 00:03:19,360 Speaker 1: SMP features are off by fourteen seven tenths. It's the 60 00:03:19,400 --> 00:03:22,840 Speaker 1: seven tenths decline for Dow futures there down one seventeen 61 00:03:23,120 --> 00:03:26,160 Speaker 1: and Nasdaki Mani futures are off thirty four points eight 62 00:03:26,160 --> 00:03:29,040 Speaker 1: tenths of eight percent. The Euro trading at one ten 63 00:03:29,240 --> 00:03:32,240 Speaker 1: sixteen right now is down nine tenths. It's been as 64 00:03:32,280 --> 00:03:34,960 Speaker 1: low as one oh nine eighty four. Will keep an 65 00:03:35,000 --> 00:03:38,160 Speaker 1: eye on that. The yen one oh one sixty four 66 00:03:39,000 --> 00:03:42,680 Speaker 1: is weaker still today, and that is in contrast to 67 00:03:42,680 --> 00:03:45,600 Speaker 1: the Nike, which is the one major stock market in 68 00:03:45,600 --> 00:03:47,640 Speaker 1: the world. It was up today by about two point 69 00:03:47,680 --> 00:03:50,880 Speaker 1: four percent, three hundred and fifty seven points ten ure 70 00:03:50,920 --> 00:03:54,160 Speaker 1: no yield in the United States one point four seven percent, 71 00:03:54,520 --> 00:03:59,080 Speaker 1: the five year one even and fifty seven basis points 72 00:03:59,360 --> 00:04:02,800 Speaker 1: for the two year note yield. In the United Kingdom, 73 00:04:03,240 --> 00:04:05,880 Speaker 1: the two year is going for fifteen basis points. In 74 00:04:06,000 --> 00:04:10,200 Speaker 1: the ten year note yield is at nine basis points. 75 00:04:10,200 --> 00:04:14,520 Speaker 1: It's broken tom below one on the day. So the 76 00:04:14,600 --> 00:04:16,560 Speaker 1: question is where do we go from here? Is this 77 00:04:16,640 --> 00:04:21,560 Speaker 1: a tipping point into a greater global slowdown and recession. 78 00:04:21,680 --> 00:04:26,479 Speaker 1: Sebastian Maloby is Senior Fellow for International Economics at the 79 00:04:26,600 --> 00:04:31,800 Speaker 1: Council on Foreign Relations. Sebastian, you are raising that question 80 00:04:31,880 --> 00:04:35,480 Speaker 1: of whether the whole euro Zone whether the whole EU 81 00:04:35,680 --> 00:04:40,040 Speaker 1: and what that means for the global economy, Yes, thank you. 82 00:04:40,080 --> 00:04:42,680 Speaker 1: My sense is really that for the UK economy is 83 00:04:42,720 --> 00:04:46,760 Speaker 1: the extreme uncertainty which has only gotten worth over the 84 00:04:46,800 --> 00:04:50,360 Speaker 1: weekend with term more than both political parties, not just 85 00:04:50,480 --> 00:04:54,640 Speaker 1: the ruling Conservative party. Um. That that uncertainty looks like 86 00:04:54,680 --> 00:04:57,200 Speaker 1: it's going to be deep and it's going to be prolonged. 87 00:04:57,360 --> 00:05:00,080 Speaker 1: And I can't see any other like here than this 88 00:05:00,120 --> 00:05:02,599 Speaker 1: is going to really kill corporate investment, which was already 89 00:05:02,680 --> 00:05:05,680 Speaker 1: done before the vote, and that's going to have knock 90 00:05:05,720 --> 00:05:09,320 Speaker 1: on consequence for the UK economy, and so I'm very 91 00:05:09,360 --> 00:05:11,320 Speaker 1: pessimistic about that. I think when it comes to the 92 00:05:11,440 --> 00:05:14,760 Speaker 1: Euro you've got a very determined central bank which has 93 00:05:14,800 --> 00:05:19,880 Speaker 1: passed the credibility test with Greece more than once and 94 00:05:19,920 --> 00:05:22,560 Speaker 1: held the system together. I think there's going to be 95 00:05:22,640 --> 00:05:25,320 Speaker 1: new stresses and new challenges for the central bank in 96 00:05:25,360 --> 00:05:30,279 Speaker 1: an environment where they used a lot of policy ammunition already. Um. 97 00:05:30,440 --> 00:05:32,040 Speaker 1: But I think you know, you have to look at 98 00:05:32,080 --> 00:05:35,680 Speaker 1: yet the Spanish vote, which the election there could have 99 00:05:35,680 --> 00:05:39,000 Speaker 1: been worth. It could have produced a bigger result left 100 00:05:39,000 --> 00:05:42,600 Speaker 1: wing neo Marxist um. So you need another political shock. 101 00:05:42,680 --> 00:05:44,800 Speaker 1: I think within the euro Zone for this to get 102 00:05:45,240 --> 00:05:49,120 Speaker 1: scary for the European Central Bank that that should reassure 103 00:05:49,160 --> 00:05:51,919 Speaker 1: you a little bit. The Spanish elections, it tells you 104 00:05:51,960 --> 00:05:55,880 Speaker 1: that it isn't a uniform knee jerk populist response to 105 00:05:56,400 --> 00:05:59,120 Speaker 1: what's going on. Right coming off the British bird, there 106 00:05:59,160 --> 00:06:02,280 Speaker 1: were as many as seven countries in the rest of 107 00:06:02,279 --> 00:06:05,400 Speaker 1: the European Union where somebody or other in politics was 108 00:06:05,520 --> 00:06:09,120 Speaker 1: demanding an immediate referendum to copy the British one. The 109 00:06:09,200 --> 00:06:13,599 Speaker 1: question is whether those demands and those pressures UM actually 110 00:06:14,080 --> 00:06:17,160 Speaker 1: produced results. I mean, will that be votes of this 111 00:06:17,279 --> 00:06:19,800 Speaker 1: sort and the one vote there was schedule, which was 112 00:06:19,839 --> 00:06:24,880 Speaker 1: the Spanish election. UM. Europe has sailed through relatively unscathed. 113 00:06:25,520 --> 00:06:28,440 Speaker 1: Sebastian Malby with us as we begin our coverage is 114 00:06:28,920 --> 00:06:33,720 Speaker 1: our Bloomberg surveillance from Washington, brought you by Investco. Investco's 115 00:06:33,800 --> 00:06:37,520 Speaker 1: high conviction factor based strategies could help investors focus on 116 00:06:37,560 --> 00:06:41,600 Speaker 1: a high quality, low volatility and more. Learn more and 117 00:06:41,680 --> 00:06:46,280 Speaker 1: investco dot com slash high Convictions. Sebastian Mailby with us 118 00:06:46,320 --> 00:06:51,040 Speaker 1: with his magnificent book on the head shown Business UH. 119 00:06:51,240 --> 00:06:54,840 Speaker 1: The idea of his work UH in terms of being 120 00:06:54,839 --> 00:06:59,919 Speaker 1: a finalist for the Pulitzer Prize twice, but far more importantly, Sebastia, 121 00:07:00,279 --> 00:07:04,640 Speaker 1: your father, Sir Christopher, as ambassador to Germany UH and 122 00:07:04,760 --> 00:07:09,400 Speaker 1: indeed ambassador to France, you have a continental UK perspective 123 00:07:09,400 --> 00:07:13,360 Speaker 1: as a child, which you've always brought forward in your work. 124 00:07:14,000 --> 00:07:18,960 Speaker 1: The diplomacy here is about dialogue. Well that dialogue, you know. 125 00:07:19,000 --> 00:07:21,520 Speaker 1: The flinty is the word we use right now. Are 126 00:07:21,560 --> 00:07:24,560 Speaker 1: we going to have a flinty dialogue that Sir Christopher 127 00:07:24,600 --> 00:07:30,560 Speaker 1: never saw? I think Sir Christopher, who is now eighty 128 00:07:30,640 --> 00:07:34,320 Speaker 1: years old almost held his birthday will be next week, UM, 129 00:07:34,560 --> 00:07:37,400 Speaker 1: is feeling a bit depressed that his life's work of 130 00:07:37,640 --> 00:07:40,120 Speaker 1: British diplomacy and integration where the rest of the world 131 00:07:40,120 --> 00:07:45,320 Speaker 1: hasn't been delta a very severe setback. UM. I think 132 00:07:45,360 --> 00:07:48,840 Speaker 1: that the problem right now is not whether it's flinty 133 00:07:48,960 --> 00:07:51,200 Speaker 1: or whatever. It's just that there's no not going to 134 00:07:51,280 --> 00:07:55,120 Speaker 1: be any dialogue initially because the interlocutors have no idea 135 00:07:55,160 --> 00:07:59,280 Speaker 1: what they're gonna say. The kind of disarray politically within 136 00:07:59,400 --> 00:08:02,720 Speaker 1: the Leaf camp in Britain is so deep that they 137 00:08:02,720 --> 00:08:04,280 Speaker 1: didn't know what they want do. They want to have 138 00:08:04,560 --> 00:08:06,960 Speaker 1: more migration on a points based system, which is what 139 00:08:07,240 --> 00:08:09,960 Speaker 1: bit of you know, open to the world side of 140 00:08:10,000 --> 00:08:12,560 Speaker 1: their movement wanted or do they want less migration? Do 141 00:08:12,640 --> 00:08:16,240 Speaker 1: they want you know, are they going to take the 142 00:08:16,280 --> 00:08:19,760 Speaker 1: budget savings from sending money to Brussels and spend it 143 00:08:19,800 --> 00:08:21,280 Speaker 1: on the national health service or are they going to 144 00:08:21,360 --> 00:08:24,320 Speaker 1: cut government? Right? But on this Monday morning, when there's 145 00:08:24,320 --> 00:08:27,040 Speaker 1: a Bloomberg headline that Ubrew will not resign, that gets 146 00:08:27,080 --> 00:08:32,360 Speaker 1: my attention explained to us. European federalism. This is not 147 00:08:32,520 --> 00:08:37,200 Speaker 1: Alexander Hamilton's is it. Yeah. I mean the paradox of 148 00:08:37,280 --> 00:08:41,400 Speaker 1: European federalism is that really nobody wants it anymore. Um 149 00:08:41,640 --> 00:08:44,560 Speaker 1: uh you know, I mean the political temperature in Europe 150 00:08:44,559 --> 00:08:47,520 Speaker 1: has gone against it completely. But there's still a kind 151 00:08:47,559 --> 00:08:51,360 Speaker 1: of technocratic logic that says, when you've got a single 152 00:08:51,440 --> 00:08:55,520 Speaker 1: currency for nineteen of the countries, um, they need to 153 00:08:55,559 --> 00:08:59,640 Speaker 1: integrate fiscally, they need to coordinate tax eave and spending 154 00:08:59,679 --> 00:09:02,720 Speaker 1: and bank paid out funds and so forth. And that 155 00:09:02,960 --> 00:09:07,040 Speaker 1: pushes the system towards deeper integration, even when politically it's toxic. 156 00:09:08,840 --> 00:09:13,560 Speaker 1: Can it be done or can you? I guess the question? 157 00:09:13,600 --> 00:09:15,240 Speaker 1: And this is a longer question. We've all got a 158 00:09:15,240 --> 00:09:16,680 Speaker 1: minute left here before we have to take a break. 159 00:09:16,720 --> 00:09:20,280 Speaker 1: We'll come back and explore this even more death, But um, 160 00:09:20,480 --> 00:09:23,600 Speaker 1: can the integration of Europe on a trade and business 161 00:09:23,600 --> 00:09:27,160 Speaker 1: basis continue as it is? Or do they have to 162 00:09:27,200 --> 00:09:30,720 Speaker 1: do something like go back to individual currencies so that 163 00:09:30,760 --> 00:09:34,520 Speaker 1: they don't have this physically important question. You can't go 164 00:09:34,640 --> 00:09:36,120 Speaker 1: forward and you can't go back. I mean, that's the 165 00:09:36,120 --> 00:09:38,960 Speaker 1: truth of it. Exiting the Euro once you've denominated every 166 00:09:39,000 --> 00:09:42,719 Speaker 1: single contract in your economy and euros is so catastrophically 167 00:09:42,760 --> 00:09:45,000 Speaker 1: painful that Greece looked at that and decided not to 168 00:09:45,040 --> 00:09:48,000 Speaker 1: do it. I did it twice, so I mean going 169 00:09:48,080 --> 00:09:52,040 Speaker 1: back out of the Euro is prohibitively painful, but going 170 00:09:52,080 --> 00:09:55,560 Speaker 1: forward into integration is not something people are ready to do. 171 00:09:55,679 --> 00:09:58,400 Speaker 1: So I mean we're stuck, and that is I mean, 172 00:09:58,400 --> 00:10:00,480 Speaker 1: I think that the upshot of that is a long 173 00:10:00,520 --> 00:10:03,160 Speaker 1: period of muddle and slow growth in sort of the 174 00:10:03,240 --> 00:10:08,520 Speaker 1: Japanization of the Ursine. Well, we'll come back with Sebastian Melboy. 175 00:10:08,520 --> 00:10:12,079 Speaker 1: I was gonna put a very blunt question to you, Sebastian, 176 00:10:12,080 --> 00:10:15,079 Speaker 1: which I'll hold until we come back. Tom Keene and 177 00:10:15,160 --> 00:10:18,160 Speaker 1: I are live in Washington, d C a special edition 178 00:10:18,240 --> 00:10:20,720 Speaker 1: of Bloomberg Surveillance today as we keep track of what 179 00:10:20,880 --> 00:10:23,640 Speaker 1: is happening in the United States and around the world 180 00:10:24,080 --> 00:10:27,160 Speaker 1: post brexit. Tom Peter dear Terris from our data team 181 00:10:27,200 --> 00:10:30,880 Speaker 1: has a fascinating bit of information here. The last time 182 00:10:31,280 --> 00:10:34,640 Speaker 1: the pound was at this level in the SMP was 183 00:10:34,880 --> 00:10:38,040 Speaker 1: one eight three. Well, that would be a bear market 184 00:10:38,080 --> 00:10:40,040 Speaker 1: if we got back to that. We have the vectors 185 00:10:40,040 --> 00:10:42,240 Speaker 1: in the wrong direction, folks. Not the panic that we've 186 00:10:42,240 --> 00:10:46,679 Speaker 1: seen is today futures negative thirteen to futures negative one 187 00:10:46,720 --> 00:10:53,280 Speaker 1: twelve from Washington, Bloomberg Surveillance. All right, let's check in 188 00:10:53,360 --> 00:10:55,760 Speaker 1: with Michael Bart now and get the latest world in 189 00:10:55,880 --> 00:10:58,559 Speaker 1: national headlines. Mike, Tom, thank you very much. British Prime 190 00:10:58,559 --> 00:11:02,560 Speaker 1: Minister David Cameron will addrest Parliament today. Last week's vote 191 00:11:02,600 --> 00:11:04,680 Speaker 1: for Britain to leave the European Union has left the 192 00:11:04,800 --> 00:11:09,479 Speaker 1: UK looking rudderless. The attempt by opposition Labor Party lawmakers 193 00:11:09,520 --> 00:11:12,920 Speaker 1: to throw their leader, Jeremy Corban out comes on the 194 00:11:12,960 --> 00:11:15,440 Speaker 1: heels of Prime Minister Cameron announcing he will step down 195 00:11:15,480 --> 00:11:18,520 Speaker 1: by October. A new round of flooding is possible in 196 00:11:18,559 --> 00:11:21,520 Speaker 1: West Virginia and the same area where at least twenty 197 00:11:21,600 --> 00:11:25,000 Speaker 1: five people died in the past week. More heavy rains 198 00:11:25,000 --> 00:11:28,079 Speaker 1: are forecast and that has prompted a flash flood of 199 00:11:28,080 --> 00:11:31,560 Speaker 1: watch for more than twenty counties. Firefighters advanced on the 200 00:11:31,559 --> 00:11:34,400 Speaker 1: wildfire in central California that has killed two people and 201 00:11:34,440 --> 00:11:38,120 Speaker 1: destroyed about two hundred homes. Find your officialsy The blaze 202 00:11:38,160 --> 00:11:41,640 Speaker 1: that has charted about sixty eight square miles is about contained. 203 00:11:41,960 --> 00:11:44,520 Speaker 1: Global news twenty four hours a day, powered by more 204 00:11:44,559 --> 00:11:47,320 Speaker 1: than twenty hundred journalists and analysts and more than a 205 00:11:47,360 --> 00:11:51,280 Speaker 1: hundred twenty countries and Michaelabar. This is Bloomberg. Mike, Tom 206 00:11:51,320 --> 00:11:53,720 Speaker 1: and Michael, thanks so much, Thank you so much for 207 00:11:53,720 --> 00:11:56,040 Speaker 1: your comments of our work over the weekend. Michael and 208 00:11:56,080 --> 00:11:59,719 Speaker 1: I really appreciate that we are in Washington later this 209 00:12:00,000 --> 00:12:04,760 Speaker 1: earning a conversation with Alan Greenspan. This is Bloomberg Surveillance. 210 00:12:07,880 --> 00:12:10,240 Speaker 1: At nine am this morning, the former FITE chairman will 211 00:12:10,320 --> 00:12:15,040 Speaker 1: join Tom and many from this Bloomberg special edition Washington, 212 00:12:15,200 --> 00:12:23,440 Speaker 1: d C. Live on Bloomberg Radio, worldwide global business news 213 00:12:23,480 --> 00:12:26,400 Speaker 1: twenty four hours a day, at Bloomberg dot com, the 214 00:12:26,520 --> 00:12:29,640 Speaker 1: Radio plus mobile app, and on your radio. This is 215 00:12:29,640 --> 00:12:33,360 Speaker 1: a Bloomberg Business Flash and I'm Karin Moscow. This updates 216 00:12:33,360 --> 00:12:38,080 Speaker 1: brought to you by National Railty Providers of Satisfaction guaranteed 217 00:12:38,080 --> 00:12:41,360 Speaker 1: New York City realty investments. See them at n r 218 00:12:41,480 --> 00:12:45,800 Speaker 1: i A dot net. Mettronics says it'll buy Hardware International 219 00:12:45,880 --> 00:12:49,400 Speaker 1: of Framingham, Massachusetts for about one point one billion dollars. 220 00:12:49,640 --> 00:12:52,560 Speaker 1: Shares of European banks are trading lower this morning following 221 00:12:52,600 --> 00:12:55,920 Speaker 1: Thursday's historic vote for the UK to leave the European Union. 222 00:12:56,320 --> 00:12:59,000 Speaker 1: UK domestic banks are leading declines in the stock six 223 00:12:59,080 --> 00:13:01,880 Speaker 1: hundred as analysts on both sides of the Atlantic cut 224 00:13:01,880 --> 00:13:05,200 Speaker 1: earnings estimates for the biggest investment banks on the expectation 225 00:13:05,240 --> 00:13:07,760 Speaker 1: that security sales and major deals will be thwarted by 226 00:13:07,800 --> 00:13:12,000 Speaker 1: economic and political uncertainty and currency swings. Again. Stocks in 227 00:13:12,000 --> 00:13:14,440 Speaker 1: Europe are lower, with the DACKS in Germany down two percent, 228 00:13:14,520 --> 00:13:17,160 Speaker 1: CAP in Paris down one point nine percent, foot see 229 00:13:17,160 --> 00:13:20,960 Speaker 1: one down one point six percent. U stock index futures declining, 230 00:13:20,960 --> 00:13:24,560 Speaker 1: with SNP emny futures down fifteen points, DOW EMNY futures 231 00:13:24,559 --> 00:13:27,160 Speaker 1: down one D twenty six, and NAS documity futures down 232 00:13:27,160 --> 00:13:30,320 Speaker 1: about thirty seven ten year treasury of twenty six thirty seconds, 233 00:13:30,320 --> 00:13:33,160 Speaker 1: the yeld one point four six percent. Nimex screwed oil 234 00:13:33,200 --> 00:13:36,000 Speaker 1: down one percent or forty seven cents to forty seven nineteen. 235 00:13:36,040 --> 00:13:38,600 Speaker 1: A barrel comes gold up a ten percent or ten 236 00:13:38,600 --> 00:13:41,839 Speaker 1: dollar seventy cents to thirteen thirty three ten announced the 237 00:13:41,960 --> 00:13:44,240 Speaker 1: euro a dollar ten o four, the British pound a 238 00:13:44,280 --> 00:13:46,600 Speaker 1: dollar thirty two oh six, the yen one oh one 239 00:13:46,640 --> 00:13:49,520 Speaker 1: point six two. As a Bloomberg Business Flash, Tom and 240 00:13:49,559 --> 00:13:52,760 Speaker 1: Mike Karen, thanks so much. Michael McKee and Time Keenan 241 00:13:52,800 --> 00:13:57,520 Speaker 1: Washington will be speaking later today with Madeline Albright and 242 00:13:57,600 --> 00:14:01,760 Speaker 1: also with Alan Greenspan. Right now, Bastian Mallaby and the 243 00:14:01,840 --> 00:14:06,800 Speaker 1: spirit of his hugely awaited book of October the man 244 00:14:06,880 --> 00:14:09,679 Speaker 1: who knew the life and times of Alan Greenspan uh 245 00:14:09,720 --> 00:14:12,200 Speaker 1: and with agreement with his publisher, will not speak in 246 00:14:12,320 --> 00:14:15,520 Speaker 1: detail about the book. They're keeping that under wraps. I 247 00:14:15,520 --> 00:14:18,440 Speaker 1: guess we could ask a Sebastian who will play Alan 248 00:14:18,480 --> 00:14:21,720 Speaker 1: Greenspan in the movie, but let's keep that. Let's keep 249 00:14:21,720 --> 00:14:26,360 Speaker 1: away from that, Sebastian. Are central bankers today different? Have 250 00:14:26,480 --> 00:14:31,160 Speaker 1: they moved on to a new process that is removed 251 00:14:31,360 --> 00:14:35,520 Speaker 1: from the older bankers? Sorry, which I was trying to 252 00:14:35,520 --> 00:14:38,480 Speaker 1: say that that you maybe Utah could play Alan Greenspan 253 00:14:38,560 --> 00:14:42,400 Speaker 1: in the meat. I don't. I'm too tall and my 254 00:14:42,520 --> 00:14:45,960 Speaker 1: clarinet and my yes, that's true, that's true. I'm prescient 255 00:14:46,000 --> 00:14:50,440 Speaker 1: lee unintelligible, but I don't play clarinet like the German. 256 00:14:51,360 --> 00:14:54,920 Speaker 1: Are the bankers today, Sebastian, Are they a whole new 257 00:14:55,000 --> 00:14:59,800 Speaker 1: breed because of newsflow globalization of finance? Is it just 258 00:14:59,840 --> 00:15:04,520 Speaker 1: a whole new game? Well, I mean relative to back 259 00:15:04,560 --> 00:15:07,800 Speaker 1: when Alan Greenstein was starting out his public life in 260 00:15:07,840 --> 00:15:10,280 Speaker 1: the late sixties. Yes, absolutely. I mean, you know, he 261 00:15:10,720 --> 00:15:13,360 Speaker 1: became Nixon's advisor in the late sixties at a time 262 00:15:13,400 --> 00:15:15,600 Speaker 1: when the dollar was picked to gold, there were no 263 00:15:15,720 --> 00:15:19,920 Speaker 1: financial derivatives, banking was regulated, interest rates were capped, we 264 00:15:20,120 --> 00:15:23,840 Speaker 1: had regulation Q. And then during his public life of 265 00:15:23,960 --> 00:15:26,640 Speaker 1: four decades, you go right up to the eve of 266 00:15:26,680 --> 00:15:30,000 Speaker 1: the financial crash in two thousand and seven eight and so, 267 00:15:30,120 --> 00:15:32,920 Speaker 1: if you want to understand the making a modern finance, 268 00:15:32,960 --> 00:15:36,200 Speaker 1: and he's the guy who was at the center more 269 00:15:36,240 --> 00:15:40,320 Speaker 1: than anybody else. He for years and I covered him 270 00:15:40,360 --> 00:15:45,400 Speaker 1: for years, was insistent on the ability to use human 271 00:15:45,440 --> 00:15:49,840 Speaker 1: discretion in deciding what monetary policies should be. And even 272 00:15:49,840 --> 00:15:56,520 Speaker 1: physical reactions to downturns. Is that still a viable theory, 273 00:15:56,760 --> 00:15:59,160 Speaker 1: or there's a big move to try to push for 274 00:15:59,600 --> 00:16:05,120 Speaker 1: rules based policy making. Is green spans still the best 275 00:16:05,120 --> 00:16:09,080 Speaker 1: way too to make policy? Well, you know here, I'm 276 00:16:09,080 --> 00:16:11,880 Speaker 1: gonna push us back onto current events in order not 277 00:16:11,960 --> 00:16:14,520 Speaker 1: to bring down the theory of my publisher too much. 278 00:16:14,560 --> 00:16:16,800 Speaker 1: But I think that this question about discretion and central 279 00:16:16,840 --> 00:16:22,000 Speaker 1: banking maybe facing an interesting cast right now because you've 280 00:16:22,000 --> 00:16:25,200 Speaker 1: had this big market shark, because you've been reporting sterling 281 00:16:25,280 --> 00:16:27,760 Speaker 1: is down to you know, the lowest has been as 282 00:16:27,760 --> 00:16:30,920 Speaker 1: thad years. How the central bankers respond to that? And 283 00:16:31,000 --> 00:16:35,040 Speaker 1: my guess is that there's some overt um, you know, 284 00:16:35,160 --> 00:16:38,320 Speaker 1: a sort of lender of last resort liquidity provision trying 285 00:16:38,320 --> 00:16:41,720 Speaker 1: to stabilize all those banks whose shares have been falling today, 286 00:16:41,720 --> 00:16:44,400 Speaker 1: as you've been saying. So that's the thing that they're 287 00:16:44,440 --> 00:16:47,280 Speaker 1: kind of quite open about. There's also going to be 288 00:16:47,320 --> 00:16:51,080 Speaker 1: I think some exchange rate management, which they may not 289 00:16:51,120 --> 00:16:52,960 Speaker 1: be quite so open about because you created one way 290 00:16:53,040 --> 00:16:56,120 Speaker 1: bet for traders as you're obviously defending a level, so 291 00:16:56,200 --> 00:16:58,920 Speaker 1: there may be some covert decent of levels going on. 292 00:16:59,360 --> 00:17:01,680 Speaker 1: The Swiss Central Bank is the only one I'm aware 293 00:17:01,720 --> 00:17:04,600 Speaker 1: of that's been open and saying it's trying to prevent 294 00:17:04,640 --> 00:17:07,800 Speaker 1: the Swiss rank from appreciating too much. But when you 295 00:17:07,840 --> 00:17:11,480 Speaker 1: see the Japanese yen uh, you know, falling today as 296 00:17:11,480 --> 00:17:15,520 Speaker 1: opposed to rising, I mean I immediately imagine that you know, 297 00:17:15,560 --> 00:17:20,080 Speaker 1: that's the Bank of Japan acting. Well. You you end 298 00:17:20,160 --> 00:17:23,560 Speaker 1: up then with the fiscal authorities who are refusing to act. 299 00:17:24,119 --> 00:17:26,600 Speaker 1: So to take us back to Europe and the question 300 00:17:26,680 --> 00:17:29,000 Speaker 1: I wanted to ask you before the break, has the 301 00:17:29,000 --> 00:17:33,680 Speaker 1: Eurozone failed? I mean I think it's it's it's a 302 00:17:33,760 --> 00:17:38,160 Speaker 1: fail yet it's failed um and it's locked countries into 303 00:17:38,200 --> 00:17:41,200 Speaker 1: this rigid strait jacket where you know, Greece needs a 304 00:17:41,240 --> 00:17:44,679 Speaker 1: totally different interst rate structure than what Germany wants, and 305 00:17:44,760 --> 00:17:47,159 Speaker 1: Grease can't get out of it now. The problem is 306 00:17:47,200 --> 00:17:49,280 Speaker 1: that you know, getting out is even more painful, and 307 00:17:49,320 --> 00:17:52,280 Speaker 1: so I think Europe has to live in this straight jacket, 308 00:17:52,359 --> 00:17:55,600 Speaker 1: uncomfortable though it is, and I just don't see I 309 00:17:55,640 --> 00:17:58,720 Speaker 1: don't see an alternative to a painful, slow grind of 310 00:17:58,800 --> 00:18:03,440 Speaker 1: muddling through. This just going to be quite depressing. Sebastian. 311 00:18:03,480 --> 00:18:06,960 Speaker 1: I was in Mayfair the other day after the referendum. 312 00:18:06,960 --> 00:18:10,320 Speaker 1: Looking at non hedge fund people, you are the authority 313 00:18:10,400 --> 00:18:14,240 Speaker 1: on this, your wonderful book More Money than God is 314 00:18:14,240 --> 00:18:18,520 Speaker 1: a hedge fund game over. You know. I also with 315 00:18:18,520 --> 00:18:23,080 Speaker 1: with a bunch of very smart hedge fund people right 316 00:18:23,160 --> 00:18:25,199 Speaker 1: on the day before the vote, in the day of 317 00:18:25,400 --> 00:18:29,879 Speaker 1: the result, UM and everybody expected, especially when Sterling was 318 00:18:30,040 --> 00:18:33,280 Speaker 1: rising on the Thursday of the vote, that you know, 319 00:18:33,320 --> 00:18:35,000 Speaker 1: this is a done deal. We were going to vote 320 00:18:35,000 --> 00:18:36,920 Speaker 1: to stay in. And the shock the next morning was 321 00:18:37,000 --> 00:18:40,879 Speaker 1: quite probable. Of course, those smart people have got a 322 00:18:40,920 --> 00:18:43,440 Speaker 1: scenario for even stuff they don't expect, so I think 323 00:18:44,000 --> 00:18:46,560 Speaker 1: it was quite remarkable to see people, you know, I'm 324 00:18:46,720 --> 00:18:49,320 Speaker 1: at a conference. People were still you know, showing up 325 00:18:49,359 --> 00:18:51,520 Speaker 1: to the events. They were trading, but they kind of 326 00:18:51,560 --> 00:18:54,480 Speaker 1: had their strategy fixed assance. They didn't have to do 327 00:18:54,640 --> 00:18:57,200 Speaker 1: much more than just press the hit buttons, the sund button. 328 00:18:57,880 --> 00:19:00,320 Speaker 1: I get different opinions, you know, when I to my 329 00:19:00,400 --> 00:19:03,600 Speaker 1: friends in the industry as to whether the markets, whether 330 00:19:03,680 --> 00:19:07,280 Speaker 1: the whether the industry is um in some sort of 331 00:19:07,480 --> 00:19:10,480 Speaker 1: serious decline. I mean, I think, what's care is it 332 00:19:10,520 --> 00:19:15,160 Speaker 1: in a low interest rate environment where you know, returns 333 00:19:15,160 --> 00:19:18,080 Speaker 1: on most assets are going to be very low you're 334 00:19:18,080 --> 00:19:21,040 Speaker 1: doing pretty well if you're making six seven percent a year, 335 00:19:21,280 --> 00:19:25,440 Speaker 1: and yet that doesn't support the two and twenty traditional structure. 336 00:19:26,040 --> 00:19:29,320 Speaker 1: If you take two of the seven right off the bat, 337 00:19:29,359 --> 00:19:31,800 Speaker 1: and then you take the of the of the remainder 338 00:19:32,560 --> 00:19:37,560 Speaker 1: the hedge fund deal with the outside exact partner, that 339 00:19:37,600 --> 00:19:40,080 Speaker 1: has to be renegation. And I think that's why pressure 340 00:19:40,119 --> 00:19:43,840 Speaker 1: on the on the industry. I will be with the 341 00:19:43,920 --> 00:19:47,280 Speaker 1: Counsel of Foreign Relations, among other gifts. Again in his 342 00:19:47,359 --> 00:19:49,720 Speaker 1: book The Man Who Knew The Life and Times of 343 00:19:49,760 --> 00:19:54,159 Speaker 1: Alan Greenspan, Eagerly it waited for the Fall. Michael McKee 344 00:19:54,160 --> 00:19:58,240 Speaker 1: and Tom Keane, We are in Washington. A conversation later 345 00:19:58,800 --> 00:20:08,040 Speaker 1: with Alan Greenspan. Good at Morning Bloomberg Surveillance by Willoughby, 346 00:20:09,160 --> 00:20:12,000 Speaker 1: New York City's boutique camera store for precision crafted Hostibald 347 00:20:12,080 --> 00:20:14,280 Speaker 1: like A cameras plus a full selection of go pro 348 00:20:14,400 --> 00:20:17,199 Speaker 1: action adventure cameras. Will It Beys Corner, Fifth Avenue and 349 00:20:17,320 --> 00:20:26,320 Speaker 1: thirty first Street broadcasting Live to New York, Cloomberg eleventh 350 00:20:26,880 --> 00:20:31,600 Speaker 1: to Washington, d C, Bloomberg to Boston, Bloomberg twelve, Unders 351 00:20:31,680 --> 00:20:36,800 Speaker 1: to San Francisco, Bloomberg to the Country, Channel one nine 352 00:20:37,160 --> 00:20:40,680 Speaker 1: and around the globe, the Bloomberg Radio plus an Bloomberg 353 00:20:40,680 --> 00:20:45,239 Speaker 1: dot Com. This is Bloomberg Surveillance. Good morning, said, I'm 354 00:20:45,240 --> 00:20:47,720 Speaker 1: thirty on Wall Street. I'm John Tucker, two hours away 355 00:20:47,760 --> 00:20:50,159 Speaker 1: from the opening Dell. Yeah. Let's get you updated on 356 00:20:50,200 --> 00:20:52,720 Speaker 1: the news. You need to know. The after shocks of 357 00:20:52,800 --> 00:20:55,919 Speaker 1: the UK's vote to leave the European Union reverberating across 358 00:20:55,920 --> 00:20:59,800 Speaker 1: the financial markets after a weekend, the political turmoil, the 359 00:21:00,040 --> 00:21:03,440 Speaker 1: Hound extending its records, sell off, European equities dropping to 360 00:21:03,560 --> 00:21:08,200 Speaker 1: levels last seen back in February. Italy is considering injecting 361 00:21:08,200 --> 00:21:11,680 Speaker 1: capital into some lenders after the vote by the UK 362 00:21:11,840 --> 00:21:14,680 Speaker 1: to leave the European Union sparked to sell off among 363 00:21:14,760 --> 00:21:18,920 Speaker 1: banks and Medtronics says it will buy HeartWare International for 364 00:21:18,960 --> 00:21:22,600 Speaker 1: about one point one billion dollars, gaining technology to treat 365 00:21:22,720 --> 00:21:28,119 Speaker 1: heart failure patients. It's let's get news from around the 366 00:21:28,119 --> 00:21:31,720 Speaker 1: world now, and here is Bloomberg's Michael Barr, John, thank 367 00:21:31,760 --> 00:21:34,320 Speaker 1: you very much. British Prime Minister David Cameron will meet 368 00:21:34,320 --> 00:21:37,880 Speaker 1: with members of Parliament. It is his first meeting since 369 00:21:37,960 --> 00:21:41,639 Speaker 1: last week's Brexit vote to leave the EU. Meanwhile, Secretary 370 00:21:41,640 --> 00:21:44,760 Speaker 1: of State John Kerry has meeting scheduled in Brussels and 371 00:21:44,960 --> 00:21:48,679 Speaker 1: London today on the Brexit carry urged Britain and the 372 00:21:48,720 --> 00:21:52,320 Speaker 1: European Union to work together to call markets. One West 373 00:21:52,359 --> 00:21:57,040 Speaker 1: Virginia residents said her community smelled like death. More storms 374 00:21:57,040 --> 00:22:00,800 Speaker 1: are forecasts for flood ravaged West Virginia. People are trying 375 00:22:00,840 --> 00:22:03,800 Speaker 1: to survey the damage caused by the flooding, including one 376 00:22:03,800 --> 00:22:06,760 Speaker 1: man who lives in Rennell. Michael Mitchell come here to 377 00:22:06,800 --> 00:22:09,840 Speaker 1: boat to rescue people. Last week. I got nine kids 378 00:22:09,880 --> 00:22:11,280 Speaker 1: that you know, have to look at me as a 379 00:22:11,280 --> 00:22:13,679 Speaker 1: fog of their figure and also as a hero. You know, 380 00:22:13,840 --> 00:22:17,760 Speaker 1: my daughter thinks that I'm better than Superman. At least 381 00:22:17,760 --> 00:22:20,879 Speaker 1: twenty five people were killed from last week's flooding. The 382 00:22:20,920 --> 00:22:24,040 Speaker 1: holiday weekend could be very busy on the nation's roadways. 383 00:22:24,080 --> 00:22:27,840 Speaker 1: Triple A says a record forty three million Americans planned 384 00:22:27,840 --> 00:22:31,119 Speaker 1: to travel this Independence Day weekend, the Triple A says. 385 00:22:31,160 --> 00:22:33,959 Speaker 1: With gas prices about forty six cents cheaper than they 386 00:22:33,960 --> 00:22:37,439 Speaker 1: were a year ago, more families are taking trips this summer. 387 00:22:38,200 --> 00:22:41,280 Speaker 1: First Lady Michelle Obama and her daughters are set to 388 00:22:41,359 --> 00:22:43,919 Speaker 1: arrive this afternoon in Liberia for a start of an 389 00:22:43,960 --> 00:22:47,520 Speaker 1: overseas trip promoting education for girls. Global News twenty four 390 00:22:47,560 --> 00:22:50,320 Speaker 1: hours a day, powered by more than twenty journalists and 391 00:22:50,359 --> 00:22:53,240 Speaker 1: analysts and more than a hundred twenty countries. Michael bar 392 00:22:53,440 --> 00:22:59,000 Speaker 1: this is Bloomberg. Thank you, Michael, and st now with 393 00:22:59,040 --> 00:23:04,120 Speaker 1: the Bloomberg ending CE sports update. He's Rob Busk, Marty John. 394 00:23:04,200 --> 00:23:06,720 Speaker 1: Yankees continued their five hundred ways as they fell to 395 00:23:06,800 --> 00:23:09,320 Speaker 1: the Twins seven and one at the Stadium, and they 396 00:23:09,359 --> 00:23:11,960 Speaker 1: conjured up just two base hits. New York trailed one 397 00:23:12,040 --> 00:23:15,000 Speaker 1: nothing entering the six when it came unraveled for Nathan 398 00:23:15,400 --> 00:23:18,160 Speaker 1: Valdi as he fell the six and five years take 399 00:23:18,200 --> 00:23:21,240 Speaker 1: for five runs. Eight Yankees struck out, drawing no walks. 400 00:23:21,480 --> 00:23:23,359 Speaker 1: They did take two of three. Doesn't get any easier 401 00:23:23,400 --> 00:23:25,520 Speaker 1: tho best record in the American League comes to town tonight. 402 00:23:25,560 --> 00:23:29,000 Speaker 1: The Rangers pay a visit. Cheechi Gonzalez battling Ivan Nova. 403 00:23:29,320 --> 00:23:32,240 Speaker 1: Similar tune for the Mats, falling five to in Atlanta. 404 00:23:32,320 --> 00:23:35,520 Speaker 1: No run support for Bartotal Cologne. Tough luck losses. He 405 00:23:35,800 --> 00:23:38,680 Speaker 1: allowed just one run in seven innings, met still three 406 00:23:38,680 --> 00:23:40,600 Speaker 1: back of the Gnats. They had to Washington to night. 407 00:23:40,840 --> 00:23:44,160 Speaker 1: Noah sinder Guard gets the call. Giants have won thirteen 408 00:23:44,320 --> 00:23:47,240 Speaker 1: of fifteen Hottest team in the Big leagues as fell 409 00:23:47,280 --> 00:23:50,199 Speaker 1: to the Angels. Copa America play second time in as 410 00:23:50,200 --> 00:23:53,199 Speaker 1: many years. Chili beats Argentina in the championship match. They 411 00:23:53,280 --> 00:23:55,920 Speaker 1: do so on penalty kicks. And that is your NBC 412 00:23:56,040 --> 00:23:59,320 Speaker 1: Bloomberg Sports Update. John all right, thanks so Rob, and 413 00:23:59,760 --> 00:24:01,960 Speaker 1: let's get you have to speed on how stocks are fairing. 414 00:24:02,080 --> 00:24:04,360 Speaker 1: Check the markets every fifteen minutes during the trading day 415 00:24:04,840 --> 00:24:07,399 Speaker 1: right here in Bloomberg, and the U S SMP futures 416 00:24:07,480 --> 00:24:11,959 Speaker 1: right now fourteen points lower. That's down seven tents, Dalimni 417 00:24:12,040 --> 00:24:16,240 Speaker 1: futures down one two the Nasdaq futures thirty seven points lower. 418 00:24:16,280 --> 00:24:19,200 Speaker 1: That's down nine tenths of a percent. As we check 419 00:24:19,200 --> 00:24:21,720 Speaker 1: a sterling for you right now, British pounds sterling one 420 00:24:21,840 --> 00:24:26,600 Speaker 1: thirty two thirteen. That is another three point four percent decline. 421 00:24:27,119 --> 00:24:31,840 Speaker 1: And uh comis gold up eleven twenty thirteen, thirty three sixty. 422 00:24:32,000 --> 00:24:41,119 Speaker 1: Right now, you're listening to Bloomberg Surveillance. Welcome back to 423 00:24:41,200 --> 00:24:44,800 Speaker 1: Bloomberg Surveillance I Michael McKee, along with Tom King's special 424 00:24:44,920 --> 00:24:48,720 Speaker 1: edition from Washington, d C. Today. Later, an interview with 425 00:24:49,000 --> 00:24:53,600 Speaker 1: former FED chairman Alan Greenspan stocks are grinding lower. We 426 00:24:53,640 --> 00:24:56,639 Speaker 1: should say SMP futures down by fifteen right now. The 427 00:24:56,640 --> 00:24:59,520 Speaker 1: foot seat in London is off a hundred and fifteen points. 428 00:24:59,840 --> 00:25:02,399 Speaker 1: The found going for one ten at the moment, the 429 00:25:02,400 --> 00:25:05,960 Speaker 1: low of the day one. The Bloomberg n j I 430 00:25:06,040 --> 00:25:08,560 Speaker 1: T Stam Report brought to you by New Jersey Institute 431 00:25:08,560 --> 00:25:10,920 Speaker 1: of Technology. Investing more than a hundred and ten million 432 00:25:10,960 --> 00:25:13,760 Speaker 1: dollars a year, it applied research to solve problems and 433 00:25:13,800 --> 00:25:16,600 Speaker 1: to improve life. Learn more at Stories of Innovation dot 434 00:25:16,720 --> 00:25:19,480 Speaker 1: n j I T dot E DU Here's John Tucker. Yeah, 435 00:25:19,520 --> 00:25:23,120 Speaker 1: let's say see what's making news and science, technology, engineering, 436 00:25:23,119 --> 00:25:27,040 Speaker 1: and math. Michael Baltimore based Centrexion is developing a new 437 00:25:27,080 --> 00:25:31,480 Speaker 1: generation of non addictive pain killers, and hot peppers could 438 00:25:31,560 --> 00:25:34,600 Speaker 1: play a role. The problem with narcotics is that in 439 00:25:34,720 --> 00:25:36,520 Speaker 1: treating pain, they affect an area of the brain that 440 00:25:36,560 --> 00:25:41,040 Speaker 1: registers intense pleasure. Centraxians drugs are designed to target pain 441 00:25:41,119 --> 00:25:45,320 Speaker 1: directly without triggering the brain's reward system. The company says 442 00:25:45,359 --> 00:25:48,520 Speaker 1: it's developing an injectable drug to treat arthritis and foot 443 00:25:48,520 --> 00:25:53,399 Speaker 1: pain that contains a synthetic version of capsican substance and 444 00:25:53,480 --> 00:25:57,200 Speaker 1: chili plants. It's the furthest along of five drugs. Centrexion 445 00:25:57,280 --> 00:26:02,040 Speaker 1: has in development and could hit the market by Comcast, A, 446 00:26:02,119 --> 00:26:05,439 Speaker 1: T and T, Verizon and other Internet service providers are 447 00:26:05,480 --> 00:26:09,560 Speaker 1: trying to sway the FCC to abandon proposed privacy rules 448 00:26:09,600 --> 00:26:12,040 Speaker 1: that would hamper their efforts to use and share customer 449 00:26:12,119 --> 00:26:15,280 Speaker 1: data for advertising. The rules let I s p s 450 00:26:15,359 --> 00:26:19,120 Speaker 1: use the data only if users opt in. The Internet 451 00:26:19,160 --> 00:26:22,119 Speaker 1: service providers want to give an opt out option and 452 00:26:22,200 --> 00:26:25,199 Speaker 1: say the rules are unlawful. The rules would apply to 453 00:26:25,320 --> 00:26:28,360 Speaker 1: I s p s, but not Internet and add companies 454 00:26:28,359 --> 00:26:32,000 Speaker 1: such as Google and Facebook. At That is this morning's 455 00:26:32,160 --> 00:26:36,800 Speaker 1: Bloomberg and j I t Stem Report. Mike John Tucker 456 00:26:36,880 --> 00:26:39,879 Speaker 1: thinks so much. Tom Keene here with Michael McKee in Washington. 457 00:26:40,520 --> 00:26:43,160 Speaker 1: We will speak with Alan Greenspan Medal and all right 458 00:26:43,880 --> 00:26:47,280 Speaker 1: later in the morning. It has been a blur. Michael, 459 00:26:47,359 --> 00:26:49,399 Speaker 1: Let's do a quickick data check before we get to 460 00:26:49,440 --> 00:26:53,159 Speaker 1: sir Martin. The idea of futures negative fifteen down, futures 461 00:26:53,200 --> 00:26:56,000 Speaker 1: negative one twenty nine. As you said earlier, this is 462 00:26:56,040 --> 00:26:58,760 Speaker 1: not the panic of Friday, but nevertheless, we got to 463 00:26:58,800 --> 00:27:02,280 Speaker 1: do more data checks. Yeah, it's definitely a grind lower. 464 00:27:02,320 --> 00:27:06,520 Speaker 1: On the day, the tenure guilt yield in England goes 465 00:27:06,560 --> 00:27:10,800 Speaker 1: down below one percent for the first time ever. Basis points. 466 00:27:11,280 --> 00:27:14,399 Speaker 1: We have any number of themes with Sir Martin sorrel 467 00:27:14,560 --> 00:27:18,640 Speaker 1: of w PP, but there could only be one theme today, 468 00:27:18,720 --> 00:27:21,040 Speaker 1: which is how Sir Martin will address his team at 469 00:27:21,160 --> 00:27:24,600 Speaker 1: w p P and their new world sirmartin good morning, 470 00:27:24,600 --> 00:27:26,879 Speaker 1: thrilled that you could take the home of those fullest 471 00:27:26,920 --> 00:27:31,000 Speaker 1: percentage pretends is to me here you're in Washington, Well, 472 00:27:31,040 --> 00:27:33,040 Speaker 1: we were in London, Mike, and I have been thank 473 00:27:33,080 --> 00:27:36,480 Speaker 1: you British share with I mean, we were going to 474 00:27:36,560 --> 00:27:42,680 Speaker 1: take a survey of that stream advertorial n advertising. Maybe 475 00:27:42,680 --> 00:27:44,600 Speaker 1: we'll come back to Britain. The way things are going 476 00:27:45,000 --> 00:27:46,920 Speaker 1: with their data, Sir Martin, we can. Let's get to 477 00:27:46,960 --> 00:27:49,920 Speaker 1: Brexit in a moment. What do you tell your leadership 478 00:27:49,960 --> 00:27:52,720 Speaker 1: at WPP today. Do you just go in and say 479 00:27:53,040 --> 00:27:57,639 Speaker 1: cut costs by five percent of anything I said? We 480 00:27:58,000 --> 00:28:02,040 Speaker 1: say festival. We regretted because from a personal point of 481 00:28:02,080 --> 00:28:03,840 Speaker 1: viewing made it quite clear I thought we had better 482 00:28:03,880 --> 00:28:06,320 Speaker 1: in and out. But putting that to one side, the 483 00:28:06,320 --> 00:28:09,640 Speaker 1: electorate has spoken. We we said our top top out 484 00:28:09,640 --> 00:28:13,960 Speaker 1: of our top ten markets TOM four and Western Continental Europe, 485 00:28:14,119 --> 00:28:18,080 Speaker 1: ignoring UK, which is the second largest market. Germany is 486 00:28:18,200 --> 00:28:21,160 Speaker 1: number four, France and number six, Italy is number nine, 487 00:28:21,280 --> 00:28:24,239 Speaker 1: Spain is number ten. These are really important markets for US. 488 00:28:24,280 --> 00:28:26,680 Speaker 1: They have g dps of between two and a half 489 00:28:26,680 --> 00:28:29,639 Speaker 1: and three and our trillion dollars each and they're not 490 00:28:29,680 --> 00:28:33,800 Speaker 1: going to go away. So even given the uncertainty because 491 00:28:33,800 --> 00:28:37,080 Speaker 1: we may have Brexit tight referenda in Europe itself. But 492 00:28:37,240 --> 00:28:40,400 Speaker 1: given that answer, even given that uncertainty, those markets are 493 00:28:40,440 --> 00:28:44,000 Speaker 1: important to us and we have to increase our presence there. 494 00:28:44,520 --> 00:28:47,920 Speaker 1: And last but not least, whilst some people have views 495 00:28:47,920 --> 00:28:51,720 Speaker 1: about Brussels and the bureaucracy and the government there, they're 496 00:28:51,760 --> 00:28:54,600 Speaker 1: important and Belgium is important in that context. So those 497 00:28:54,640 --> 00:28:58,080 Speaker 1: five markets markets where we will increase our presence. As 498 00:28:58,120 --> 00:29:00,560 Speaker 1: far as the UK is concerned, you have to see 499 00:29:00,600 --> 00:29:03,440 Speaker 1: what happens in terms of economic growth. Clearly Brexit will 500 00:29:03,440 --> 00:29:06,160 Speaker 1: have a negative impact on GDP growth in the UK, 501 00:29:06,320 --> 00:29:09,920 Speaker 1: probably the most significant impact on the EU as well, 502 00:29:10,800 --> 00:29:13,600 Speaker 1: even X the UK or the EU X the UK, 503 00:29:13,800 --> 00:29:16,480 Speaker 1: and on the world's economy. I see the Chinese Premier 504 00:29:16,560 --> 00:29:19,280 Speaker 1: making the comments that he made about the impact of 505 00:29:19,320 --> 00:29:23,400 Speaker 1: brexit on the Chinese economy. Does does bring to bring 506 00:29:23,440 --> 00:29:25,960 Speaker 1: it home? You've seen other comments in relation to India 507 00:29:26,000 --> 00:29:29,840 Speaker 1: and Mexico and all points in between. Does bring it home? 508 00:29:29,920 --> 00:29:34,640 Speaker 1: How significant a decision this isolation is, decision has been 509 00:29:35,160 --> 00:29:37,320 Speaker 1: or can be. And then we have the uncertainty. I 510 00:29:37,320 --> 00:29:40,920 Speaker 1: mean business did tests uncertainty. It's the enemy of growth, 511 00:29:40,920 --> 00:29:43,880 Speaker 1: as you know, Tom, and we're going to have uncertainty 512 00:29:43,920 --> 00:29:47,800 Speaker 1: for a significant period of time in the negotiation. I 513 00:29:47,800 --> 00:29:49,960 Speaker 1: think it's inevitable. It's going to take a long time. 514 00:29:50,040 --> 00:29:52,720 Speaker 1: One ex member of the Foreign Office said to me 515 00:29:53,200 --> 00:29:55,760 Speaker 1: that it would take ten years to read negoat this 516 00:29:55,800 --> 00:29:58,600 Speaker 1: is before the vote. Ten years to renegotiate all those 517 00:29:58,880 --> 00:30:01,720 Speaker 1: trade agreements that we will have to do on on 518 00:30:01,760 --> 00:30:04,640 Speaker 1: an item by um basis. This is exactly where we 519 00:30:04,640 --> 00:30:06,920 Speaker 1: want to go. We just have a minute left, Sir Martin, 520 00:30:06,960 --> 00:30:10,360 Speaker 1: this is Michael. We But how long does the uncertainty last? 521 00:30:10,400 --> 00:30:12,400 Speaker 1: At what point do you have to say let's just 522 00:30:12,440 --> 00:30:14,840 Speaker 1: get on with it. Well, you have to do that. 523 00:30:14,880 --> 00:30:17,120 Speaker 1: When you're running a business. You have no choice but 524 00:30:17,240 --> 00:30:21,200 Speaker 1: to make decisions or you have to delay decisions as 525 00:30:21,200 --> 00:30:23,400 Speaker 1: a result. But just look at the uncertains in front 526 00:30:23,440 --> 00:30:25,800 Speaker 1: of us. We we will have a new prime minister. 527 00:30:26,080 --> 00:30:28,040 Speaker 1: We'll have a question about whether there be a general election. 528 00:30:28,080 --> 00:30:31,040 Speaker 1: There's a question over Scotland and a referendum, even question 529 00:30:31,080 --> 00:30:34,840 Speaker 1: whether Scottish will block the Act of Parliament that has 530 00:30:34,880 --> 00:30:39,320 Speaker 1: to be enacted post the referendum decision. Problem in questions 531 00:30:39,320 --> 00:30:42,440 Speaker 1: in Ireland, Northern Ireland, Ireland, questions in Wales. Then you 532 00:30:42,520 --> 00:30:46,000 Speaker 1: switch to Europe itself. Will we have the Spanish results 533 00:30:46,040 --> 00:30:48,760 Speaker 1: were quite interesting, the electoral results, Yes, they could seem 534 00:30:48,800 --> 00:30:51,120 Speaker 1: to indicate sort a little bit of a switch from 535 00:30:51,160 --> 00:30:54,960 Speaker 1: the podlast the populous trend. But we've got an Italian 536 00:30:55,040 --> 00:30:58,920 Speaker 1: constitution national coming coming up in October. Anglo Merkel has 537 00:30:58,960 --> 00:31:00,560 Speaker 1: to decide what you're gonna have a fourth term on 538 00:31:00,840 --> 00:31:04,200 Speaker 1: which I think is that, Yeah, that's important. Let's come 539 00:31:04,240 --> 00:31:08,200 Speaker 1: back with Sir Martin on his Disunited Kingdom. What you 540 00:31:08,240 --> 00:31:10,800 Speaker 1: need to know right now is the tape deteriors futures 541 00:31:10,840 --> 00:31:15,360 Speaker 1: negative sixteen, Dow futures negative one from Washington, Michael McKee 542 00:31:15,360 --> 00:31:21,960 Speaker 1: and Tom Keane Bloomberg surveillance. We are counting out of 543 00:31:22,000 --> 00:31:23,880 Speaker 1: the opening bill brought to you by the Jeep Grand Cherokee. 544 00:31:23,920 --> 00:31:26,280 Speaker 1: The most awarded suv. Ever, the Grand Cherokee continues to 545 00:31:26,360 --> 00:31:28,960 Speaker 1: raise the bar with its luxurious interior and legendary four 546 00:31:28,960 --> 00:31:36,120 Speaker 1: by four capability. Drive one at your local jeep dealer. Today. 547 00:31:37,520 --> 00:31:40,960 Speaker 1: Bloombo Business News twenty four hours a day. It's Bloomberg 548 00:31:40,960 --> 00:31:44,040 Speaker 1: dot Com the radio plus mobile lapt and on your radio. 549 00:31:44,320 --> 00:31:48,280 Speaker 1: This is a Bloomberg business flash and I'm cared Moscow. 550 00:31:48,320 --> 00:31:51,280 Speaker 1: This updates brought to you by SEI. Have evolving investor 551 00:31:51,360 --> 00:31:56,000 Speaker 1: and regulatory demands affected your investment firms operational readiness. Imagine 552 00:31:56,040 --> 00:31:59,320 Speaker 1: transforming your business with SEIS Global platform at see I 553 00:31:59,360 --> 00:32:03,280 Speaker 1: see dot com, um slash imagine Mettronics saying it'll buy 554 00:32:03,320 --> 00:32:07,240 Speaker 1: Hardware International of Framingham, Massachusetts for about one point one 555 00:32:07,280 --> 00:32:11,400 Speaker 1: billion dollars getting technology to treat heart failure patients, and 556 00:32:11,480 --> 00:32:15,160 Speaker 1: HeartWare International is up almost ninety two percent this morning. 557 00:32:15,480 --> 00:32:18,080 Speaker 1: The aftershocks of the UK's vote to leave the European 558 00:32:18,240 --> 00:32:22,600 Speaker 1: Union reverberating across financial markets after a weekend of political turmoil, 559 00:32:22,880 --> 00:32:25,680 Speaker 1: but the pound extending its records sell off and European 560 00:32:25,720 --> 00:32:28,880 Speaker 1: equities dropping to levels last scene in February. We checked 561 00:32:28,880 --> 00:32:31,520 Speaker 1: the markets every fifteen minutes throughout the trading day On 562 00:32:31,560 --> 00:32:35,720 Speaker 1: Bloomberg SNP eveny futures lower down seventeen points now even 563 00:32:35,720 --> 00:32:38,400 Speaker 1: a futures down a hundred forty two NASADAC, even a 564 00:32:38,480 --> 00:32:41,160 Speaker 1: futures down forty one. The decks in Germany's down two 565 00:32:41,160 --> 00:32:43,600 Speaker 1: point one percent, the CAC in Paris and the foot 566 00:32:43,640 --> 00:32:46,240 Speaker 1: Sea one hundred both down more than one point eight percent. 567 00:32:46,560 --> 00:32:49,160 Speaker 1: Ten Your treasury up twenty thirty seconds, the yield one 568 00:32:49,160 --> 00:32:51,880 Speaker 1: point for six percent yield on the two year point 569 00:32:51,920 --> 00:32:55,120 Speaker 1: five six percent NIMAX. Scrude oil down nine tenths percent 570 00:32:55,200 --> 00:32:57,680 Speaker 1: or forty five cents to forty seven nineteen. A barrel 571 00:32:57,880 --> 00:33:00,840 Speaker 1: COMEXS gold is up one percent or third dollar seventy 572 00:33:00,920 --> 00:33:04,280 Speaker 1: cents to thirteen thirty five sixty announced. The euro at 573 00:33:04,280 --> 00:33:06,880 Speaker 1: dollar oh nine nine to the British founded allar thirty 574 00:33:06,880 --> 00:33:09,440 Speaker 1: one seventy one and the yen one oh one point 575 00:33:09,520 --> 00:33:13,360 Speaker 1: five six, and Italy's government considering injecting capital into some 576 00:33:13,480 --> 00:33:15,560 Speaker 1: lenders battered by a fresh sell off in the wake 577 00:33:15,600 --> 00:33:18,600 Speaker 1: of the UK's decision to leave the EU. That's according 578 00:33:18,640 --> 00:33:21,320 Speaker 1: to people with knowledge of the talks. As a Bloomberg 579 00:33:21,360 --> 00:33:24,640 Speaker 1: Business flash, Tom and Mike Karen, thanks so much. Michael 580 00:33:24,680 --> 00:33:26,520 Speaker 1: McKee is going to come back with sir Martin Sora. 581 00:33:26,640 --> 00:33:29,239 Speaker 1: We are in Washington, but I need to give some 582 00:33:29,280 --> 00:33:32,280 Speaker 1: of the vectors. The first and second derivatives to that 583 00:33:32,320 --> 00:33:35,600 Speaker 1: wonderful data check that Karen did two s ten. Spread 584 00:33:36,240 --> 00:33:38,920 Speaker 1: is flattening out this morning. We really didn't see that 585 00:33:39,000 --> 00:33:41,960 Speaker 1: on Friday. We did, but nothing like you would have 586 00:33:42,000 --> 00:33:45,400 Speaker 1: thought that changed this morning. Eighty nine basis points. What 587 00:33:45,480 --> 00:33:48,800 Speaker 1: you need to know is a curve is flatter this morning, 588 00:33:49,120 --> 00:33:52,920 Speaker 1: and that is a new occurrence. The yen so far 589 00:33:53,600 --> 00:33:57,480 Speaker 1: has been very resilient. It is not moved stronger. Is 590 00:33:57,520 --> 00:34:00,720 Speaker 1: safe Haven a one oh one fifty five? Yes, stronger, 591 00:34:00,760 --> 00:34:03,200 Speaker 1: but maybe not like I would expect it to be. 592 00:34:03,360 --> 00:34:07,320 Speaker 1: And we've got legitimate dollar strength. Is Karen mentioned sterling 593 00:34:07,360 --> 00:34:09,840 Speaker 1: as a life of its own. It is just spiked 594 00:34:10,000 --> 00:34:13,640 Speaker 1: down to one sixty one low for the day, one 595 00:34:13,760 --> 00:34:17,400 Speaker 1: thirty one fifty eight, So we're watching Sterling obviously is 596 00:34:17,440 --> 00:34:21,200 Speaker 1: a core data point correctly, but Mike, I would suggest 597 00:34:21,360 --> 00:34:24,880 Speaker 1: is is dean current brilliantly said I think it was 598 00:34:24,920 --> 00:34:29,520 Speaker 1: on Sunday. In this blur, you've got correlated markets away 599 00:34:29,560 --> 00:34:32,560 Speaker 1: from equities and then equities catch up, and we're seeing 600 00:34:32,560 --> 00:34:36,000 Speaker 1: that right now futures negative eighteen. We're starting to see 601 00:34:36,000 --> 00:34:38,440 Speaker 1: a lot more correlation. Sir Martin's all is with this. 602 00:34:38,600 --> 00:34:42,280 Speaker 1: He is the CEO of w PP and you are based, 603 00:34:42,760 --> 00:34:46,600 Speaker 1: Sir Martin normally in London, London, and you actually to 604 00:34:46,640 --> 00:34:49,280 Speaker 1: be fair about a third and the third and the third. 605 00:34:50,000 --> 00:34:52,960 Speaker 1: But the corporate I'm trying to get at the financial 606 00:34:52,960 --> 00:34:57,960 Speaker 1: headquarters because the question, yes, yes, yeah, The question I 607 00:34:58,000 --> 00:35:00,440 Speaker 1: want to ask is how do you reorganize or do 608 00:35:00,480 --> 00:35:06,640 Speaker 1: you reorganize the business to to deal with the situation 609 00:35:06,719 --> 00:35:10,640 Speaker 1: in which you find yourself. Now, what are companies domiciled 610 00:35:10,680 --> 00:35:14,120 Speaker 1: in the United Kingdom going to do? Well? You? You? 611 00:35:14,239 --> 00:35:16,439 Speaker 1: I think actually answer that is you have to wait 612 00:35:16,480 --> 00:35:19,360 Speaker 1: and see and don't do you make rash decisions or 613 00:35:19,440 --> 00:35:22,160 Speaker 1: quick decisions on the We have a decision on a referendum, 614 00:35:22,160 --> 00:35:24,000 Speaker 1: it has to be implemented. We don't know how long 615 00:35:24,000 --> 00:35:27,280 Speaker 1: it's going to be implemented. There are other other forces 616 00:35:27,320 --> 00:35:30,480 Speaker 1: at work, both within the United Kingdom and outside in 617 00:35:30,520 --> 00:35:32,240 Speaker 1: Europe that you have to see through. As we talked 618 00:35:32,239 --> 00:35:36,200 Speaker 1: before before the break. But basically what we are doing, 619 00:35:36,400 --> 00:35:39,839 Speaker 1: or in the already doing as of Friday morning is 620 00:35:40,120 --> 00:35:44,080 Speaker 1: we will ironically up our presence in those top four 621 00:35:44,120 --> 00:35:47,040 Speaker 1: markets of our top ten Germany, France, Italy and Spain, 622 00:35:47,400 --> 00:35:50,640 Speaker 1: rather than reducing them. They're important to us because of 623 00:35:50,680 --> 00:35:53,040 Speaker 1: their size and their scale, and that there are four 624 00:35:53,080 --> 00:35:56,880 Speaker 1: of the top ten markets. Belgium and Brussels is important 625 00:35:56,920 --> 00:35:59,840 Speaker 1: to us because it's it's the home of the EU 626 00:36:00,000 --> 00:36:06,359 Speaker 1: administration even without the UK. So ironically or paradoxically, we're 627 00:36:06,360 --> 00:36:09,200 Speaker 1: actually probably going to invest more in those markets as 628 00:36:09,239 --> 00:36:13,279 Speaker 1: a result of this fracture and and fission now as 629 00:36:13,320 --> 00:36:15,120 Speaker 1: far as far as the UK as so we have 630 00:36:15,239 --> 00:36:18,120 Speaker 1: to see how it sorts out in terms of GDPB 631 00:36:18,239 --> 00:36:21,840 Speaker 1: growth and advertising as a proportion of GDP growth. How that, 632 00:36:22,120 --> 00:36:25,160 Speaker 1: how that turns out will affect our jobs. In employment, 633 00:36:25,440 --> 00:36:27,640 Speaker 1: the number of people in w PP has increased the 634 00:36:27,680 --> 00:36:31,839 Speaker 1: seventeen thousand people in the UK alone in the last 635 00:36:31,880 --> 00:36:34,759 Speaker 1: three or four years through growth. Do you buy the 636 00:36:34,880 --> 00:36:38,600 Speaker 1: argument made by the Leave care that as a as 637 00:36:38,600 --> 00:36:41,480 Speaker 1: a corporation you will be better off domiciled in London 638 00:36:41,719 --> 00:36:45,000 Speaker 1: after a divorce from the EU. Well, you know, somebody, 639 00:36:45,120 --> 00:36:49,400 Speaker 1: the CEO of the Leave campaign made the argument on 640 00:36:49,440 --> 00:36:53,480 Speaker 1: another channel this morning that you know, he likened it 641 00:36:53,560 --> 00:36:58,920 Speaker 1: to American independence, where I found that analogy interesting but 642 00:36:59,040 --> 00:37:02,160 Speaker 1: bit nonsense of call is that we're a few hundred 643 00:37:02,200 --> 00:37:05,319 Speaker 1: years on and the world has globalized. It is far 644 00:37:05,400 --> 00:37:09,480 Speaker 1: more interconnected than in the in the eighteenth century, so 645 00:37:09,520 --> 00:37:14,680 Speaker 1: it's a nonsense to make that comparison. Absolutely, and we're 646 00:37:14,719 --> 00:37:17,680 Speaker 1: not We're not isolated, We're all interconnected. I mean, for 647 00:37:17,680 --> 00:37:19,680 Speaker 1: the Chinese premier to make the comments that we made 648 00:37:19,680 --> 00:37:22,480 Speaker 1: about the impact of Brexit on the process of the 649 00:37:22,520 --> 00:37:26,400 Speaker 1: Chinese economy is not of itself extremely interesting, bearing in 650 00:37:26,480 --> 00:37:29,799 Speaker 1: mind that Britain has not penetrated the Chinese markets our 651 00:37:29,840 --> 00:37:32,239 Speaker 1: third largest market, but generally that has not been the 652 00:37:32,280 --> 00:37:35,960 Speaker 1: case amongst amongst produced businesses, so that the tragedy here 653 00:37:36,040 --> 00:37:39,759 Speaker 1: is interconnection. The answer to your question about domicile and 654 00:37:39,800 --> 00:37:42,600 Speaker 1: where you'd be located, the banks clearly are going to 655 00:37:42,640 --> 00:37:45,400 Speaker 1: be the financial services sector, which is so important to 656 00:37:45,440 --> 00:37:48,200 Speaker 1: the UK economy. Services as a whole provide about third 657 00:37:48,200 --> 00:37:51,920 Speaker 1: of GDP. The financial services sector is a large element 658 00:37:52,080 --> 00:37:54,319 Speaker 1: of the growth of employment. Job that is the one 659 00:37:54,320 --> 00:37:57,040 Speaker 1: that's going to be impacted and has been impacted by 660 00:37:57,239 --> 00:38:00,759 Speaker 1: rumor already as of front sitting there where the bank 661 00:38:00,840 --> 00:38:03,359 Speaker 1: starts this morning. Yes, well, the banks are worried about 662 00:38:03,400 --> 00:38:07,640 Speaker 1: their passports for activities. Mark, I believe correctly if I'm wrong, 663 00:38:07,680 --> 00:38:10,280 Speaker 1: but you are a card carring member of the British elite, 664 00:38:10,719 --> 00:38:15,680 Speaker 1: you disagree with that. I'm a second generation immigrants, so 665 00:38:15,680 --> 00:38:19,600 Speaker 1: so therefore therefore this campaign actually was rather important from me. 666 00:38:19,760 --> 00:38:22,160 Speaker 1: When you have when you have dinner with the Duke 667 00:38:22,239 --> 00:38:25,000 Speaker 1: and Duchess of Cambridge and New York, I guess you're 668 00:38:25,080 --> 00:38:28,440 Speaker 1: part of the elite. What does the elite need to 669 00:38:28,520 --> 00:38:33,120 Speaker 1: do to change the dialogue and message with the people 670 00:38:33,320 --> 00:38:35,720 Speaker 1: of your United king Well, the trouble was the elite 671 00:38:35,719 --> 00:38:38,120 Speaker 1: were talking to themselves. I mean for the private poster 672 00:38:38,200 --> 00:38:40,960 Speaker 1: of the Prime Minister to say to say that they 673 00:38:40,960 --> 00:38:45,520 Speaker 1: were ten points ahead on on Wednesday night for Remain 674 00:38:45,640 --> 00:38:49,080 Speaker 1: shows how out of touch we were. And if you 675 00:38:49,120 --> 00:38:51,280 Speaker 1: look at the southeast of England, I thought it was fascinating. 676 00:38:51,400 --> 00:38:55,040 Speaker 1: Only five constituencies in the southeast of England voted to remain. 677 00:38:55,160 --> 00:38:58,480 Speaker 1: So outside London in the southeast would you would have 678 00:38:58,560 --> 00:39:02,040 Speaker 1: expected just intuitive need to be in favorable The older 679 00:39:02,040 --> 00:39:05,799 Speaker 1: people wanted to remain, younger people so I wanted to leave, 680 00:39:05,840 --> 00:39:09,520 Speaker 1: and the younger people wanted to remain. So it was 681 00:39:09,640 --> 00:39:12,319 Speaker 1: it's a very split nation. Now. The answer to your 682 00:39:12,440 --> 00:39:16,840 Speaker 1: question is is a very difficult one because there are bubbles. 683 00:39:16,920 --> 00:39:19,680 Speaker 1: I mean the London is a bubble. It is driven 684 00:39:19,760 --> 00:39:24,480 Speaker 1: by forces outside the UK and there has to be 685 00:39:25,120 --> 00:39:29,000 Speaker 1: greater harmonization. And my own view at the end of 686 00:39:29,000 --> 00:39:32,400 Speaker 1: the day is what this is all about is fiscal policy, 687 00:39:32,719 --> 00:39:36,000 Speaker 1: not about monetary policy. What we've had since two thousand 688 00:39:35,960 --> 00:39:39,080 Speaker 1: and eight, since Layman is a focus on monetary policy 689 00:39:39,200 --> 00:39:42,359 Speaker 1: and close to zero or low interest rates. What we 690 00:39:42,440 --> 00:39:48,440 Speaker 1: need is infrastructure, investment of Arkansian stimulus to stimulate employment 691 00:39:48,880 --> 00:39:53,200 Speaker 1: and reduce that inequality. Globalization is good, but we haven't 692 00:39:53,239 --> 00:39:56,800 Speaker 1: been able to explain effectively the impact on car workers 693 00:39:56,800 --> 00:39:59,560 Speaker 1: in Detroit when they lose their jobs to Chinese car workers. 694 00:39:59,680 --> 00:40:05,440 Speaker 1: Can we have to retrain, subsidize, recreate redeveloped industries? And 695 00:40:05,480 --> 00:40:08,239 Speaker 1: the other big issue is does the web and new 696 00:40:08,280 --> 00:40:12,200 Speaker 1: technology create employment or destroyer? Can I ask you this 697 00:40:12,280 --> 00:40:16,840 Speaker 1: as you go forward? What is WPP? What is British 698 00:40:16,920 --> 00:40:22,239 Speaker 1: business going to do about trying to influence the Brexit negotiations? 699 00:40:22,360 --> 00:40:25,640 Speaker 1: Will you have people in Brussels lobbying how how does 700 00:40:25,680 --> 00:40:30,839 Speaker 1: it work with a devolved and yet semi federal kind 701 00:40:30,840 --> 00:40:35,520 Speaker 1: of UH organization such as the EU. Well, it's it's 702 00:40:35,560 --> 00:40:39,440 Speaker 1: gonna the negotiations will take place at governmental level. I'm 703 00:40:39,480 --> 00:40:42,080 Speaker 1: sure that there will be governments will be asking on 704 00:40:42,120 --> 00:40:45,759 Speaker 1: both sides for input from from business. But essentially it's 705 00:40:45,800 --> 00:40:48,520 Speaker 1: down to the civil servants on either side to negotiate. 706 00:40:48,600 --> 00:40:50,799 Speaker 1: And one civil servant used to be in the Foreign 707 00:40:50,840 --> 00:40:52,800 Speaker 1: Office in the UK said to me before the election 708 00:40:53,120 --> 00:40:55,759 Speaker 1: that we just don't have the resources in the UK, 709 00:40:56,360 --> 00:40:59,520 Speaker 1: the talent that about ten people, according to him, who 710 00:40:59,520 --> 00:41:02,680 Speaker 1: could renegotiate these trade agreems. It will take in his view, 711 00:41:02,760 --> 00:41:06,120 Speaker 1: and he was writing the teeth of it before before 712 00:41:06,800 --> 00:41:09,480 Speaker 1: before he retired. It will take ten years in his 713 00:41:09,560 --> 00:41:11,839 Speaker 1: view to renegotiate his greem. So the answer your question 714 00:41:11,880 --> 00:41:14,399 Speaker 1: is extremely tough. From that, we don't have the administrative 715 00:41:14,440 --> 00:41:17,600 Speaker 1: capability yet to be able to do it now Smartin, 716 00:41:17,719 --> 00:41:21,239 Speaker 1: Thank you so much, Smartin, and we look forward to 717 00:41:21,239 --> 00:41:24,879 Speaker 1: speaking him in our studios in London and in New York. 718 00:41:25,719 --> 00:41:27,520 Speaker 1: Is well, Mike, we've got to do a data check 719 00:41:27,560 --> 00:41:30,640 Speaker 1: here extended out a little bit. Mike, why don't you start, 720 00:41:30,680 --> 00:41:32,759 Speaker 1: because I really don't know where to begin. Well, I'll 721 00:41:32,760 --> 00:41:35,879 Speaker 1: start with Sterling in the city with Sterling on thirty 722 00:41:35,960 --> 00:41:38,879 Speaker 1: one sixty seven. It's off its new low of one 723 00:41:38,920 --> 00:41:41,359 Speaker 1: thirty one fifty two, but it keeps grinding lower, as 724 00:41:41,360 --> 00:41:43,239 Speaker 1: we said at the top of the show. And the 725 00:41:43,400 --> 00:41:46,960 Speaker 1: foot see is at one down one and thirty one 726 00:41:46,960 --> 00:41:50,960 Speaker 1: points two point one percent, and the correlations rising with 727 00:41:51,120 --> 00:41:53,600 Speaker 1: the US futures. There's more people come into the office, 728 00:41:53,640 --> 00:41:57,239 Speaker 1: volume increases. SMP futures had down seventeen eight tens of 729 00:41:57,320 --> 00:42:00,239 Speaker 1: it again. Finally a touch of strength at one one 730 00:42:00,360 --> 00:42:04,880 Speaker 1: five at a point six seven UH move nothing like Sterling, 731 00:42:04,920 --> 00:42:07,000 Speaker 1: but going the other way as a safe haven. Yet 732 00:42:07,800 --> 00:42:10,840 Speaker 1: one on one fifty five. Let me get up Deutsche 733 00:42:10,880 --> 00:42:16,360 Speaker 1: Bank here on the wonderful Volmer Bloomberg apparatus that we 734 00:42:16,480 --> 00:42:20,600 Speaker 1: have UH today and the basic idea of of Deutsche 735 00:42:20,640 --> 00:42:29,400 Speaker 1: Bank just just over just over eight and three quarters percent. Yeah, 736 00:42:29,440 --> 00:42:32,120 Speaker 1: with a little bit of a fragile bid right now. 737 00:42:33,120 --> 00:42:37,320 Speaker 1: Uh SB futures negative eighteen down, futures negative on seven. 738 00:42:37,719 --> 00:42:41,000 Speaker 1: With more data checks this morning, this Monday from Washington. 739 00:42:41,800 --> 00:42:43,279 Speaker 1: This is Bloomberg Surveyance