1
00:00:03,160 --> 00:00:07,760
Speaker 1: Broadcasting Live to New York, Bloomberg to Washington, d C,

2
00:00:08,000 --> 00:00:13,240
Speaker 1: bloom to Boston, Bloomberg twelve unders to San Francisco, Bloomberg

3
00:00:14,120 --> 00:00:18,320
Speaker 1: to the Country, Channel one nine, and around the globe

4
00:00:18,440 --> 00:00:23,160
Speaker 1: the Bloomberg Radiolus, Bloomberg dot Com. This is Bloomberg Surveillance

5
00:00:24,040 --> 00:00:26,440
Speaker 1: that morning eight thirty on Wall Street and Michael McKey

6
00:00:26,600 --> 00:00:30,000
Speaker 1: along with Tom Keane. Economic Indicators are brought to you

7
00:00:30,040 --> 00:00:33,320
Speaker 1: by Commonwealth Financial Network. When it's time to change the conversation,

8
00:00:33,320 --> 00:00:35,360
Speaker 1: talk with a broker dealer r I A that's ready

9
00:00:35,360 --> 00:00:38,120
Speaker 1: to listen called six six two three six three eight,

10
00:00:38,159 --> 00:00:42,959
Speaker 1: or visit Commonwealth dot com to learn more. No. Eight

11
00:00:43,040 --> 00:00:46,080
Speaker 1: thirty Indicators Today, we do have a report on existing

12
00:00:46,200 --> 00:00:49,680
Speaker 1: home sales do out at ten am this morning, forecast

13
00:00:49,720 --> 00:00:52,519
Speaker 1: to rise three point nine percent. Of course, we were

14
00:00:52,720 --> 00:00:56,080
Speaker 1: forecast to see an increase in housing starts yesterday that

15
00:00:56,240 --> 00:00:59,160
Speaker 1: did not happen, So we'll see what happens with the

16
00:00:59,200 --> 00:01:02,160
Speaker 1: existing homestale. But since we haven't got any bad news,

17
00:01:02,160 --> 00:01:04,759
Speaker 1: it's a perfect time to talk to Chris Ruptis has

18
00:01:04,800 --> 00:01:07,600
Speaker 1: been optimistic, so we don't have any counter factual for

19
00:01:07,959 --> 00:01:11,399
Speaker 1: here so far this morning. He's Chief Financial economist at

20
00:01:11,600 --> 00:01:16,880
Speaker 1: Bank of Tokyo Mitsubishi. The housing numbers, the housing starts

21
00:01:16,959 --> 00:01:22,080
Speaker 1: numbers that came out suggests that maybe the bloom is

22
00:01:22,120 --> 00:01:24,800
Speaker 1: starting to fall off the rows for housing. How do

23
00:01:24,840 --> 00:01:27,800
Speaker 1: you see it, Chris, Where are we in terms of

24
00:01:27,800 --> 00:01:32,039
Speaker 1: housing in its contributions to the economy. Yeah, it's so,

25
00:01:32,400 --> 00:01:36,080
Speaker 1: it's you know, it's one of those indicators. Well, first off,

26
00:01:36,120 --> 00:01:39,319
Speaker 1: housing permits as opposed to starts are go in the

27
00:01:39,400 --> 00:01:43,399
Speaker 1: lead index of leading indicators. It's an important indicator. And

28
00:01:43,520 --> 00:01:48,800
Speaker 1: it's also important because fred share Yelling says, so now,

29
00:01:48,840 --> 00:01:51,960
Speaker 1: I mean she thinks that, you know, her ideas they

30
00:01:51,960 --> 00:01:55,080
Speaker 1: have to go gradual because the economy is still somehow

31
00:01:55,240 --> 00:01:58,040
Speaker 1: I don't believe, but it's somehow. She believes the economy

32
00:01:58,080 --> 00:02:02,440
Speaker 1: is facing headwinds from the Great Recession. You know, never

33
00:02:02,480 --> 00:02:06,560
Speaker 1: mind that year eight of the expansion from the recession

34
00:02:06,560 --> 00:02:09,200
Speaker 1: and starts in July. We've had eight years of growth.

35
00:02:10,720 --> 00:02:12,600
Speaker 1: I don't know how we could be facing a headwind.

36
00:02:12,600 --> 00:02:14,760
Speaker 1: But what she wants to kind of see is more

37
00:02:15,360 --> 00:02:18,600
Speaker 1: home building, residential home building in the country, which is

38
00:02:18,639 --> 00:02:21,640
Speaker 1: still you know, less than half of the old level

39
00:02:21,720 --> 00:02:25,200
Speaker 1: during the housing bubble. So fair enough, I mean, We're

40
00:02:25,240 --> 00:02:28,120
Speaker 1: still getting a g DP effect from housing. It's adding

41
00:02:28,120 --> 00:02:31,280
Speaker 1: about three tenths to GDP growth, almost as much as

42
00:02:31,320 --> 00:02:34,400
Speaker 1: it's ever going to do, even during the housing bubble.

43
00:02:34,480 --> 00:02:37,480
Speaker 1: But yeah, everything seemed to turn down in March, and

44
00:02:37,560 --> 00:02:40,560
Speaker 1: housing starts in permits was one of those numbers. I mean,

45
00:02:40,600 --> 00:02:44,120
Speaker 1: we have car sales down in March, in desperate production

46
00:02:44,200 --> 00:02:48,000
Speaker 1: down in March, consumer spending not so red hot. You

47
00:02:48,080 --> 00:02:50,560
Speaker 1: kind of wonder what's going on in the first quarter here,

48
00:02:50,600 --> 00:02:54,520
Speaker 1: But hopefully we'll see things be a little bit better

49
00:02:55,040 --> 00:02:59,919
Speaker 1: in the second quarter, a little bit better in how

50
00:03:00,400 --> 00:03:05,840
Speaker 1: or across the board. Yeah, I think yeah, I mean

51
00:03:05,880 --> 00:03:09,280
Speaker 1: pretty much across the board. Um, you know, I mean,

52
00:03:09,919 --> 00:03:13,000
Speaker 1: let's put it this way. We've never had people talk

53
00:03:13,080 --> 00:03:15,440
Speaker 1: up procession a lot. I mean, it's amazing to me

54
00:03:15,600 --> 00:03:19,360
Speaker 1: that when Janet Yelling goes out and speaks, she she

55
00:03:19,480 --> 00:03:22,120
Speaker 1: still gets questions about what would the said do if

56
00:03:22,120 --> 00:03:24,720
Speaker 1: they went and if we went into a recession, And

57
00:03:24,840 --> 00:03:26,640
Speaker 1: you kind of have to scratch your head. It's like,

58
00:03:26,880 --> 00:03:29,720
Speaker 1: aren't they the best of best times right now with

59
00:03:29,800 --> 00:03:33,880
Speaker 1: the economy at full employment, unemployment down at five point oh,

60
00:03:34,040 --> 00:03:36,360
Speaker 1: and yet she still have to say what would she do?

61
00:03:36,560 --> 00:03:40,040
Speaker 1: If we fall back. But yeah, the headlines are getting

62
00:03:40,040 --> 00:03:44,360
Speaker 1: a little weird now, aren't they. Intel cutting twelve thousand

63
00:03:44,440 --> 00:03:49,120
Speaker 1: jobs PC. Demand is down. I haven't bought a personal

64
00:03:49,160 --> 00:03:51,840
Speaker 1: computer for a long time. I have to think about that.

65
00:03:52,440 --> 00:03:55,400
Speaker 1: Autos are turning down in March. The banking industry is

66
00:03:55,440 --> 00:03:59,280
Speaker 1: not so good. It sounds like a gloomy Chris rupty,

67
00:03:59,400 --> 00:04:03,000
Speaker 1: which is a once in a lifetime within that Chris.

68
00:04:03,040 --> 00:04:05,080
Speaker 1: There was a great shirt on on Twitter this morning,

69
00:04:05,880 --> 00:04:09,640
Speaker 1: a reputable source. I was thunderstruck how full time male

70
00:04:09,720 --> 00:04:13,400
Speaker 1: employment is now adding for the first time since the

71
00:04:13,400 --> 00:04:17,440
Speaker 1: beginning of the crisis. Tell me that the self employed

72
00:04:17,520 --> 00:04:22,039
Speaker 1: full time dynamic you see now? I mean, or is

73
00:04:22,080 --> 00:04:27,040
Speaker 1: it a self employed America? I don't know. I mean

74
00:04:27,520 --> 00:04:31,880
Speaker 1: a lot of times, yeah, I mean people whatever happens, right,

75
00:04:32,640 --> 00:04:35,279
Speaker 1: the unemployment rate comes down and then people start to

76
00:04:35,279 --> 00:04:37,640
Speaker 1: go Are they good jobs? You know? Is it a

77
00:04:37,680 --> 00:04:41,760
Speaker 1: gig economy? It's always kind of difficult to respond to that.

78
00:04:41,880 --> 00:04:45,400
Speaker 1: I think it's kind of those type of questions don't

79
00:04:45,440 --> 00:04:49,920
Speaker 1: really help us understand where we are in the business cycle.

80
00:04:49,960 --> 00:04:52,560
Speaker 1: I still think they I'm with Yellen on this that

81
00:04:52,680 --> 00:04:55,279
Speaker 1: the unemployment rate is still the single best indicator of

82
00:04:55,279 --> 00:04:58,680
Speaker 1: where we are and these other side issues you know,

83
00:05:00,160 --> 00:05:03,400
Speaker 1: you know, wage inequality, things like that. That that's different.

84
00:05:03,480 --> 00:05:06,080
Speaker 1: You know, are they good jobs? You know Bill Clinton

85
00:05:06,320 --> 00:05:10,080
Speaker 1: that put that out the first time, the other jobs,

86
00:05:10,080 --> 00:05:13,200
Speaker 1: but are they good jobs? I don't know if economics

87
00:05:13,400 --> 00:05:16,080
Speaker 1: or you know, the understanding where we are in the

88
00:05:16,120 --> 00:05:20,520
Speaker 1: business cycle, whether that helps our our understanding of where

89
00:05:20,560 --> 00:05:22,120
Speaker 1: we are. I don't. I don't see a lot of

90
00:05:22,160 --> 00:05:25,719
Speaker 1: slack out there in the economy based on how we've

91
00:05:25,760 --> 00:05:31,279
Speaker 1: done it for thirty or forty years of watching the economy. Well,

92
00:05:31,320 --> 00:05:38,200
Speaker 1: if that's the case, then, um, what turns things around? Well,

93
00:05:38,240 --> 00:05:41,760
Speaker 1: that's an interesting question here. Sometimes you kind of wonder

94
00:05:41,960 --> 00:05:46,280
Speaker 1: is the cycle broken? Um, because I kept rates down

95
00:05:46,360 --> 00:05:50,719
Speaker 1: here for so long, we never got rates normalize. What

96
00:05:50,880 --> 00:05:54,159
Speaker 1: turns things around? I don't know, because you know, a

97
00:05:54,160 --> 00:05:57,120
Speaker 1: lot of times it feels like the said believes that

98
00:05:57,160 --> 00:06:00,480
Speaker 1: they're going to keep rates down here to stimulate more

99
00:06:00,720 --> 00:06:05,919
Speaker 1: business investment that will push the economy faster. You know,

100
00:06:06,040 --> 00:06:09,240
Speaker 1: we're facing some headwinds, they think. But I would argue

101
00:06:09,279 --> 00:06:11,400
Speaker 1: that it's been eight years since the end of the

102
00:06:11,480 --> 00:06:14,680
Speaker 1: last recession that a lot of companies have ordered all

103
00:06:14,680 --> 00:06:18,359
Speaker 1: the equipment they're going to need for some time to

104
00:06:18,680 --> 00:06:22,040
Speaker 1: meet the demand for goods and services from consumers. And

105
00:06:22,480 --> 00:06:24,560
Speaker 1: you know, we're kind of closer. I don't know if

106
00:06:24,560 --> 00:06:28,440
Speaker 1: it's closer to the end of the cycle. I don't

107
00:06:28,440 --> 00:06:31,200
Speaker 1: know if it has to stall out and you know,

108
00:06:31,640 --> 00:06:35,039
Speaker 1: flip over into a ditch the economy or a recession.

109
00:06:35,080 --> 00:06:37,200
Speaker 1: It's just that we're not going to really a lot

110
00:06:37,200 --> 00:06:39,080
Speaker 1: of the areas of the economy aren't going to get

111
00:06:39,120 --> 00:06:42,159
Speaker 1: any better. Car sales aren't going to go above eighteen million.

112
00:06:43,279 --> 00:06:48,200
Speaker 1: Business equipment durable goods orders were at uh, pretty high

113
00:06:48,279 --> 00:06:50,400
Speaker 1: levels a year and a half ago. I don't think

114
00:06:50,440 --> 00:06:53,359
Speaker 1: they can go back above that level. Chris, Thank you

115
00:06:53,440 --> 00:06:56,040
Speaker 1: so much. Chris ropping quickly this morning with Bank of Tokyo.

116
00:06:57,640 --> 00:07:00,440
Speaker 1: Most interesting, Mike, I think that's a gloom Yes, I've

117
00:07:00,440 --> 00:07:04,120
Speaker 1: ever heard Chris Ruppie. He's not a gloomy guy. Still

118
00:07:04,240 --> 00:07:07,000
Speaker 1: our little ray of sunshine. I mean, you and I

119
00:07:07,040 --> 00:07:08,960
Speaker 1: got to talk about this later about where we go

120
00:07:09,200 --> 00:07:13,840
Speaker 1: from this second quarter on the American economy futures exactly

121
00:07:13,960 --> 00:07:20,440
Speaker 1: up to Well Street. This hour of Surveillance brought to

122
00:07:20,440 --> 00:07:23,760
Speaker 1: you by Westchester Subaru is at Westchester subar dot com.

123
00:07:23,840 --> 00:07:26,080
Speaker 1: Here's Michael bar with the latest World of National headlines.

124
00:07:26,240 --> 00:07:28,880
Speaker 1: My Tom, thank you very much. President Obama is now

125
00:07:28,920 --> 00:07:31,880
Speaker 1: in Saudi Arabia. The President will meet with Saundi leaders

126
00:07:31,880 --> 00:07:35,000
Speaker 1: and ri ODD. Defense Secretary Ash Carter met with the

127
00:07:35,040 --> 00:07:38,880
Speaker 1: Gulf ministers today ahead of the president's visit. Carter talked

128
00:07:38,920 --> 00:07:41,800
Speaker 1: about some of the topics President Obama will discuss with

129
00:07:41,800 --> 00:07:48,080
Speaker 1: the saudiast delivering Isle a lasting defeat, countering Iran's destabilizing

130
00:07:48,160 --> 00:07:53,200
Speaker 1: activities across the region, and ensuring that our nation's combined

131
00:07:53,240 --> 00:07:57,920
Speaker 1: capabilities against both of these threats match our combined commitments.

132
00:07:58,280 --> 00:08:01,760
Speaker 1: Ecuadora's death toll as ris into five hundred twenty five.

133
00:08:02,000 --> 00:08:06,720
Speaker 1: Officials say more bodies will be found following Saturday's massive earthquake. Overnight,

134
00:08:06,760 --> 00:08:10,320
Speaker 1: there was a strong six point one aftershock. The NATO

135
00:08:10,520 --> 00:08:13,360
Speaker 1: Russia Console has convened for the first time in about

136
00:08:13,440 --> 00:08:16,560
Speaker 1: two years. The US Let Alliance is planning to object

137
00:08:16,640 --> 00:08:20,800
Speaker 1: to what it deems provocative and dangerous actions by Moscow's military.

138
00:08:21,440 --> 00:08:25,360
Speaker 1: US officials say Russian war planes repeatedly buzzed the U. S.

139
00:08:25,440 --> 00:08:29,040
Speaker 1: Navy destroyer in the Baltic Sea last week. Global News

140
00:08:29,080 --> 00:08:32,199
Speaker 1: twenty four hours a Day, powered by our twenty four

141
00:08:32,280 --> 00:08:35,319
Speaker 1: hundred journalists more than a hundred shifty news bureaus from

142
00:08:35,360 --> 00:08:38,960
Speaker 1: around the world on Michael bar like Tom, Thank you, Michael.

143
00:08:39,160 --> 00:08:41,640
Speaker 1: Time now for the land over a Parcipani Bloomberg NBC

144
00:08:41,800 --> 00:08:45,400
Speaker 1: Sports Update with John Stash Mike. Rangers have now lost

145
00:08:45,440 --> 00:08:47,240
Speaker 1: twice in this playoff series, and they've been beaten by

146
00:08:47,280 --> 00:08:49,880
Speaker 1: two different goalies. In Pittsburgh's yet to use its top

147
00:08:49,920 --> 00:08:52,240
Speaker 1: goal they Mark Andre Fleury remains out of the concussion.

148
00:08:52,280 --> 00:08:54,959
Speaker 1: Jeff z that Loft one Game one, Matt Murray one

149
00:08:55,040 --> 00:08:57,520
Speaker 1: last night Pittsburgh on a Matt Cullen breakaway goal third

150
00:08:57,520 --> 00:08:59,480
Speaker 1: through its snapped to tie. They had an empty edner.

151
00:08:59,520 --> 00:09:02,240
Speaker 1: They won three of one. Rangers coach Eline Vigneo on

152
00:09:02,320 --> 00:09:05,520
Speaker 1: his team managing just seventeen shots on goal, couldn't make

153
00:09:05,559 --> 00:09:08,160
Speaker 1: any place with the puck and made you know, whether

154
00:09:08,200 --> 00:09:11,000
Speaker 1: it be uh breaking out of our end or coming

155
00:09:11,000 --> 00:09:13,920
Speaker 1: through the neutral's owner once we got in there and

156
00:09:14,120 --> 00:09:16,760
Speaker 1: just didn't make enough plays. And uh, I mean you

157
00:09:16,840 --> 00:09:19,160
Speaker 1: gotta give them credit. I mean, that was a real

158
00:09:19,240 --> 00:09:23,520
Speaker 1: solid defensive performance there. We didn't get a lot done,

159
00:09:23,559 --> 00:09:25,480
Speaker 1: and uh, we're gonna have to get back to work

160
00:09:26,320 --> 00:09:29,920
Speaker 1: Pittsburgh game for tomorrow, Islanders in Florida game for tonight

161
00:09:29,960 --> 00:09:32,920
Speaker 1: in Brooklyn. Afenning Stanley Cup champions are in trouble. Chicago

162
00:09:33,000 --> 00:09:35,120
Speaker 1: lost to St. Louis fourth three. Blues lead the series

163
00:09:35,160 --> 00:09:39,160
Speaker 1: three one. Celtics only seven first quarter points, fell seventy

164
00:09:39,200 --> 00:09:42,000
Speaker 1: two at Atlanta. Mets were facing a hot pitcher, Vince

165
00:09:42,040 --> 00:09:45,120
Speaker 1: Alaska's last time out shut struck out six team, but

166
00:09:45,200 --> 00:09:46,840
Speaker 1: the Mets pounded. I mean he was gone in the

167
00:09:46,840 --> 00:09:49,400
Speaker 1: fifth name Mets all over the Phillies eleven to one.

168
00:09:49,440 --> 00:09:52,160
Speaker 1: They had six more home runs, two by Neil Walker,

169
00:09:52,280 --> 00:09:55,000
Speaker 1: Yankee bats for Quiet and the three two Elevenning lost

170
00:09:55,000 --> 00:09:58,280
Speaker 1: to Oakland Castadium Red Socks only one hit in tennings

171
00:09:58,320 --> 00:10:01,240
Speaker 1: fell three nothing to Tampa Bay Washington at four home

172
00:10:01,320 --> 00:10:03,120
Speaker 1: runs in a seven run seventh. I need to win

173
00:10:03,400 --> 00:10:06,679
Speaker 1: seven nothing. In Miami, Bryce Harper is second Grand Slam

174
00:10:06,720 --> 00:10:09,680
Speaker 1: of the past week. The Giants have resigned Titan Larry Dennell,

175
00:10:09,720 --> 00:10:11,480
Speaker 1: who went down last year with the neck injury. The

176
00:10:11,559 --> 00:10:15,120
Speaker 1: Jets still have not resigned quarterback line Fitzpatrick, so they

177
00:10:15,160 --> 00:10:18,599
Speaker 1: are talking to free agent veteran Brian Hoyer. At the

178
00:10:18,600 --> 00:10:22,839
Speaker 1: Bloomberg NBC Sports Update I'm John, John, thanks so much,

179
00:10:22,920 --> 00:10:26,200
Speaker 1: appreciate that We've got a really special treat for you folks,

180
00:10:26,200 --> 00:10:29,480
Speaker 1: with the President in Riadden and the President moving on

181
00:10:29,559 --> 00:10:33,840
Speaker 1: to London for um birthday festivities for the Queen and

182
00:10:33,880 --> 00:10:37,800
Speaker 1: I believed Germany after that. It is a wonderful time

183
00:10:37,840 --> 00:10:41,840
Speaker 1: to speak to Robert Hormat's ambassador. Hormats, of course recently

184
00:10:41,880 --> 00:10:45,720
Speaker 1: working with the President's Secretary Clinton on the economics of

185
00:10:45,720 --> 00:10:49,560
Speaker 1: our diplomacy, but for years his public service and private

186
00:10:50,160 --> 00:10:54,760
Speaker 1: private sector service at Colban Sacks International. Coming up only,

187
00:10:54,800 --> 00:11:02,080
Speaker 1: I'm Bloomberg's Surveillance Robert Hormets. The Sports Report was brought

188
00:11:02,080 --> 00:11:05,040
Speaker 1: to by landrober PARCIPII in the spring sales event is

189
00:11:05,040 --> 00:11:08,800
Speaker 1: happening now. Visit landroper Parcipi dot com. Landrower above and

190
00:11:08,880 --> 00:11:09,280
Speaker 1: beyond