1 00:00:03,040 --> 00:00:07,200 Speaker 1: This is Bloomberg Surveillance. Overall, what we see is a 2 00:00:07,240 --> 00:00:09,879 Speaker 1: slow growth world where the fast growth markets are not 3 00:00:10,000 --> 00:00:11,879 Speaker 1: growing as fast as they used to. I look at 4 00:00:11,880 --> 00:00:14,400 Speaker 1: the banks, and sometimes it's hard to different shape between 5 00:00:14,520 --> 00:00:16,919 Speaker 1: a great large gap versus a great small cap bank. 6 00:00:17,040 --> 00:00:18,840 Speaker 1: On the financial side, I don't want to sit here 7 00:00:18,880 --> 00:00:20,280 Speaker 1: and say we have a crystal ball and we know 8 00:00:20,560 --> 00:00:22,480 Speaker 1: where the price of oil is going in the future. 9 00:00:22,600 --> 00:00:24,440 Speaker 1: We just don't know. I mean, it can't fall forever, 10 00:00:24,560 --> 00:00:26,880 Speaker 1: but we just don't know where it's gonna go. Bloomberg 11 00:00:26,960 --> 00:00:30,680 Speaker 1: Surveillance your link to the world of economics, finance, and 12 00:00:30,800 --> 00:00:35,199 Speaker 1: investment on Bloomberg Radio. Good morning, Michael Okay. It is 13 00:00:35,240 --> 00:00:38,560 Speaker 1: seven am on Wall Street eight pm in Shanghai, where 14 00:00:38,560 --> 00:00:41,440 Speaker 1: the world's most important finance ministers and central bankers will 15 00:00:41,479 --> 00:00:45,120 Speaker 1: gather this weekend to discuss the global economy and the 16 00:00:45,240 --> 00:00:48,720 Speaker 1: fear that grips investors these days. That fear back at 17 00:00:48,720 --> 00:00:52,400 Speaker 1: evidence this morning, European shares lower the stock six hundred 18 00:00:52,400 --> 00:00:55,600 Speaker 1: by almost eight points two point three percent. The docks 19 00:00:55,680 --> 00:00:58,320 Speaker 1: is down two hundred and forty points right now two 20 00:00:58,400 --> 00:01:01,120 Speaker 1: and a half percent. Here in the U S. SMP 21 00:01:01,240 --> 00:01:04,959 Speaker 1: features off sixteen nine tenths, nine tenths for dal features, 22 00:01:05,000 --> 00:01:07,880 Speaker 1: they're down a hundred and forty four. Nazzaki mini features 23 00:01:07,880 --> 00:01:10,679 Speaker 1: are off fifty one point two percent, a lot of 24 00:01:10,800 --> 00:01:14,320 Speaker 1: red on the screen. Fears back in the bond markets 25 00:01:14,360 --> 00:01:17,320 Speaker 1: with yield sliding tenure note yield one point six nine 26 00:01:17,720 --> 00:01:20,600 Speaker 1: seventy three basis points R two year German to your 27 00:01:20,640 --> 00:01:24,360 Speaker 1: negative fifty four basis points, and the action really in 28 00:01:24,400 --> 00:01:27,240 Speaker 1: the currency markets where the dollar index is up four 29 00:01:27,280 --> 00:01:31,520 Speaker 1: tenths today. Look at this end price one eleven seventy eight, 30 00:01:31,920 --> 00:01:35,600 Speaker 1: the Euro one O nine sixty five, and Brexit fears 31 00:01:35,760 --> 00:01:40,080 Speaker 1: driving the pound ever lower breaks through one forty one 32 00:01:39,720 --> 00:01:43,679 Speaker 1: eighty nine at the moment. But if you are hoping, 33 00:01:44,400 --> 00:01:46,919 Speaker 1: if you are trading on the idea that G twenty 34 00:01:47,000 --> 00:01:50,240 Speaker 1: will act this weekend to save you and the world, 35 00:01:50,760 --> 00:01:54,640 Speaker 1: you are wrong. That is the message from US Treasury 36 00:01:54,680 --> 00:01:58,160 Speaker 1: Secretary Jack lou in this remarkable and exclusive interview with 37 00:01:58,200 --> 00:02:01,680 Speaker 1: our David Weston. I'm hopeful that this will meet G 38 00:02:01,760 --> 00:02:05,600 Speaker 1: twenty where we take the commitment that we got in 39 00:02:05,600 --> 00:02:09,600 Speaker 1: in in the last meetings UH for countries to refrain 40 00:02:09,680 --> 00:02:12,960 Speaker 1: from competitive devaluation and push it a little bit and 41 00:02:12,960 --> 00:02:16,840 Speaker 1: and have that be something that that is heard outside 42 00:02:16,840 --> 00:02:19,920 Speaker 1: of the meeting room, but to reassure the world that 43 00:02:19,919 --> 00:02:21,920 Speaker 1: that that was a commitment taken seriously. Were the twenty 44 00:02:21,960 --> 00:02:24,680 Speaker 1: largest economies. What can we hope to see in the 45 00:02:24,680 --> 00:02:27,560 Speaker 1: communicate coming out of these meetings that goes beyond that 46 00:02:27,800 --> 00:02:29,519 Speaker 1: or is it a matter of taking the last communicate 47 00:02:29,520 --> 00:02:32,680 Speaker 1: and marking it up. I think what's different is um 48 00:02:32,720 --> 00:02:36,600 Speaker 1: These last months have made clear that the weakness and 49 00:02:36,639 --> 00:02:40,240 Speaker 1: demand globally is a problem that can't be solved just 50 00:02:40,280 --> 00:02:42,840 Speaker 1: for everyone. Looking to the United States. I've been telling 51 00:02:43,440 --> 00:02:46,839 Speaker 1: my counterparts for a couple of years now, I think 52 00:02:46,840 --> 00:02:49,799 Speaker 1: we're doing pretty well. They think we're doing pretty well. 53 00:02:50,160 --> 00:02:53,079 Speaker 1: But you can't count on the United States providing all 54 00:02:53,120 --> 00:02:55,480 Speaker 1: the demand for the world. We can't be the consumer 55 00:02:55,600 --> 00:02:58,359 Speaker 1: first and last resort. There needs to be more. And 56 00:02:58,560 --> 00:03:01,480 Speaker 1: what does that mean. It means that in countries that 57 00:03:01,720 --> 00:03:04,880 Speaker 1: are big economies, regions that have big economies, they need 58 00:03:04,919 --> 00:03:07,560 Speaker 1: to use policy tools. So you know, when China looks 59 00:03:07,600 --> 00:03:09,080 Speaker 1: at what can it do, it has to look at 60 00:03:09,080 --> 00:03:12,400 Speaker 1: how does that stimulate consumer demand? When Europe looks at 61 00:03:12,400 --> 00:03:15,240 Speaker 1: its tools, it looks beyond monetary policy, but it asks 62 00:03:15,400 --> 00:03:18,040 Speaker 1: what can it do with fiscal policy as well. And 63 00:03:18,440 --> 00:03:21,400 Speaker 1: in a country like Japan, where you know there's been 64 00:03:21,440 --> 00:03:25,360 Speaker 1: two decades now of slower negative growth um, they're careful 65 00:03:25,440 --> 00:03:28,440 Speaker 1: not to make the mistake of stopping the economy with 66 00:03:28,480 --> 00:03:31,160 Speaker 1: fiscal policies that put the brakes on, but instead use 67 00:03:31,160 --> 00:03:34,840 Speaker 1: fiscal policy to drive things forward. Fiscal policy can't solve 68 00:03:34,840 --> 00:03:37,080 Speaker 1: all the problems. There are structural issues that need to 69 00:03:37,120 --> 00:03:40,400 Speaker 1: be addressed. Uh some in some countries it's regulatory, some 70 00:03:40,440 --> 00:03:44,120 Speaker 1: countries it's labor markets, and some countries it's financial reform. 71 00:03:44,240 --> 00:03:48,280 Speaker 1: Those structural issues need to be addressed, but fiscal and 72 00:03:48,320 --> 00:03:51,600 Speaker 1: monetary policy are important tools. When used together, they're powerful, 73 00:03:51,680 --> 00:03:55,280 Speaker 1: and that's the message we bring that combined with sharing 74 00:03:55,320 --> 00:04:00,200 Speaker 1: information about exchange rates, having a clear understanding that it 75 00:04:00,280 --> 00:04:04,160 Speaker 1: is unacceptable to target exchange rates to gain unfair advantage 76 00:04:04,200 --> 00:04:07,880 Speaker 1: outside of your country. That's a begger thy neighbor strategy. 77 00:04:08,240 --> 00:04:11,320 Speaker 1: That's just is a question of who gets more of 78 00:04:11,360 --> 00:04:14,000 Speaker 1: the existing pie. It doesn't grow the pie um And 79 00:04:14,040 --> 00:04:16,160 Speaker 1: I think that as I talked to my counterparts, they 80 00:04:16,200 --> 00:04:18,120 Speaker 1: understand that. That is, they want to be clear that 81 00:04:18,120 --> 00:04:21,800 Speaker 1: that's not a direction that we the world community can 82 00:04:21,839 --> 00:04:24,960 Speaker 1: go in. I'm hoping that this G twenty reinforces that. 83 00:04:25,240 --> 00:04:27,880 Speaker 1: You know, there's a lot of speculation in the world 84 00:04:28,000 --> 00:04:32,400 Speaker 1: that that that these conversations could lead to different kinds 85 00:04:32,440 --> 00:04:35,960 Speaker 1: of decisions on that. So underscoring that, um that that 86 00:04:36,080 --> 00:04:38,360 Speaker 1: is an important principle. I think it's pretty important. So 87 00:04:38,440 --> 00:04:41,480 Speaker 1: in your answer, you started actually with global demand, and 88 00:04:41,600 --> 00:04:44,279 Speaker 1: we hear economists talk about the business leaders say the 89 00:04:44,360 --> 00:04:47,000 Speaker 1: problem we have to some extent is really a demand problem. 90 00:04:47,080 --> 00:04:49,799 Speaker 1: At this point, what could be done? Do you hope 91 00:04:49,839 --> 00:04:52,159 Speaker 1: this communicate or the agreement coming out of G twenty 92 00:04:52,240 --> 00:04:56,839 Speaker 1: actually does have specifics about how global demand could be stimulated. So, 93 00:04:57,120 --> 00:04:59,560 Speaker 1: you know, I think if you look at these agreements, 94 00:04:59,720 --> 00:05:02,680 Speaker 1: they are are general principles that apply in different countries 95 00:05:02,680 --> 00:05:05,720 Speaker 1: in different ways, And there's always a lot of discussion 96 00:05:05,720 --> 00:05:08,400 Speaker 1: about the words, because no country wants to sign onto 97 00:05:08,480 --> 00:05:11,880 Speaker 1: general words that it knows it will be uh, it 98 00:05:11,960 --> 00:05:16,800 Speaker 1: will be behaving inconsistently with So getting those principles right, 99 00:05:16,880 --> 00:05:18,920 Speaker 1: getting a little bit more meat on the bones makes 100 00:05:18,920 --> 00:05:21,760 Speaker 1: a difference. I can't get ahead of the process. We're 101 00:05:21,800 --> 00:05:24,120 Speaker 1: still going back and forth before we even meet on 102 00:05:24,200 --> 00:05:26,480 Speaker 1: some of these issues. I don't think this is the 103 00:05:26,560 --> 00:05:29,400 Speaker 1: moment in time when you're going to see individual countries 104 00:05:29,480 --> 00:05:33,240 Speaker 1: make the kinds of specific commitments that have been made 105 00:05:33,480 --> 00:05:37,520 Speaker 1: in some other contexts that have been marked by real crisis. 106 00:05:37,839 --> 00:05:40,520 Speaker 1: This is not a moment of crisis. This is a 107 00:05:40,560 --> 00:05:44,039 Speaker 1: moment where there you know, you've got real economies doing 108 00:05:44,080 --> 00:05:47,719 Speaker 1: better than markets think. You know, in some cases you 109 00:05:47,839 --> 00:05:51,839 Speaker 1: have um a future that could be influenced very much 110 00:05:51,880 --> 00:05:56,120 Speaker 1: by the kinds of policies that I'm describing. And the 111 00:05:56,440 --> 00:05:58,960 Speaker 1: idea is how do you avoid having things go to 112 00:05:59,000 --> 00:06:02,080 Speaker 1: a place that you don't want them to go. That's 113 00:06:02,120 --> 00:06:03,960 Speaker 1: a different conversation than what do you do when you're 114 00:06:03,960 --> 00:06:06,320 Speaker 1: in the middle of a full blown crisis. The only 115 00:06:06,320 --> 00:06:10,159 Speaker 1: time you see the kinds of communicates with that kind 116 00:06:10,160 --> 00:06:14,520 Speaker 1: of detail is once you've gotten beyond the point. So 117 00:06:14,560 --> 00:06:17,960 Speaker 1: I'm hopeful that the kind of conversation that I'm describing 118 00:06:18,320 --> 00:06:20,440 Speaker 1: actually moves the dial Let me put it this way. 119 00:06:20,760 --> 00:06:23,080 Speaker 1: If the conversation were to go the other way and 120 00:06:23,160 --> 00:06:25,640 Speaker 1: you were to see some reticence to make the commitment 121 00:06:25,640 --> 00:06:29,480 Speaker 1: to refrain from competitive evaluation and not take a little 122 00:06:29,480 --> 00:06:31,360 Speaker 1: bit of a step further, that would be a cause 123 00:06:31,360 --> 00:06:33,840 Speaker 1: of real concern, because right now it's a moment in 124 00:06:33,920 --> 00:06:36,600 Speaker 1: time where if one country were to move in that direction, 125 00:06:36,960 --> 00:06:40,160 Speaker 1: there's a triggering effect of knock on policies, and that 126 00:06:40,160 --> 00:06:42,080 Speaker 1: would be a very bad thing for the global economy. 127 00:06:42,279 --> 00:06:44,640 Speaker 1: It wouldn't grow the economy for sure, and I think 128 00:06:44,680 --> 00:06:46,680 Speaker 1: it could lead to it could lead to a very 129 00:06:46,960 --> 00:06:52,600 Speaker 1: negative ramifications both economically and and and geopolitically. So I 130 00:06:52,640 --> 00:06:55,159 Speaker 1: think this is actually an important moment and these kinds 131 00:06:55,160 --> 00:07:00,000 Speaker 1: of principles really matter. There's no substitute for seeing your counterpart. 132 00:07:00,000 --> 00:07:02,200 Speaker 1: It's face to face and talking to them. And the 133 00:07:02,200 --> 00:07:04,880 Speaker 1: world will be watching to some extent, particularly markets will 134 00:07:04,920 --> 00:07:08,040 Speaker 1: be watching, economic actors, were investors were watching. Are you 135 00:07:08,120 --> 00:07:11,200 Speaker 1: concerned that expectations may be too high about what the 136 00:07:11,240 --> 00:07:13,360 Speaker 1: G twenty can deliver as a practical matter when it 137 00:07:13,360 --> 00:07:15,720 Speaker 1: comes to growth. Well, obviously my response in a bit 138 00:07:15,920 --> 00:07:20,000 Speaker 1: is sending a clear message don't don't expect a crisis 139 00:07:20,040 --> 00:07:23,760 Speaker 1: response in a non crisis environment. Um, it's not the 140 00:07:23,840 --> 00:07:26,920 Speaker 1: job of finance ministers and central bank governors to accelerate 141 00:07:26,920 --> 00:07:29,320 Speaker 1: a crisis. It's our job to try and avoid a crisis. 142 00:07:29,640 --> 00:07:32,200 Speaker 1: If you're in a crisis, you do different things. Obviously, 143 00:07:32,240 --> 00:07:35,080 Speaker 1: the meetings after the Financial crisis during the recession had 144 00:07:35,120 --> 00:07:39,360 Speaker 1: a different character to them. Um. You know, I have, 145 00:07:39,800 --> 00:07:43,440 Speaker 1: in my conversations with counterparts, gotten a strong sense that 146 00:07:43,640 --> 00:07:47,000 Speaker 1: there is serious attention being given to how to address 147 00:07:47,040 --> 00:07:50,120 Speaker 1: the issues that we're discussing, and I think together by 148 00:07:50,160 --> 00:07:52,560 Speaker 1: having this kind of conversation, we can lead to better outcomes. 149 00:07:52,720 --> 00:07:54,480 Speaker 1: Does that mean that coming out of this you'll have 150 00:07:54,520 --> 00:07:56,520 Speaker 1: point estimates of what each country is going to do? 151 00:07:56,600 --> 00:07:59,520 Speaker 1: And how you rarely get that out of a meeting 152 00:07:59,600 --> 00:08:01,560 Speaker 1: like the so I think that would not be the 153 00:08:01,680 --> 00:08:04,920 Speaker 1: kind of expectation to have. But I don't think it's 154 00:08:05,040 --> 00:08:07,600 Speaker 1: unreasonable to have the expectations that coming out of this 155 00:08:08,040 --> 00:08:11,800 Speaker 1: will be a more stable understanding of what the future 156 00:08:12,040 --> 00:08:14,400 Speaker 1: may look like. And that and that is um, that 157 00:08:14,600 --> 00:08:18,680 Speaker 1: is an important thing. Because you look at the world's 158 00:08:18,680 --> 00:08:21,640 Speaker 1: reaction to the policy making in China over the last 159 00:08:21,960 --> 00:08:25,160 Speaker 1: two months, really last six months since August UM, it's 160 00:08:25,240 --> 00:08:30,360 Speaker 1: underscored how communication of policy is critically important in order 161 00:08:30,400 --> 00:08:34,160 Speaker 1: to have the market and other counterparts around the world 162 00:08:34,520 --> 00:08:36,920 Speaker 1: know what you intended, what you can be expected to do. 163 00:08:37,440 --> 00:08:40,720 Speaker 1: I think that it's not just a problem a challenge 164 00:08:40,720 --> 00:08:44,160 Speaker 1: in China. It's obviously a problem as as as each 165 00:08:44,160 --> 00:08:47,200 Speaker 1: of us undertakes policies, and these meetings are a chance 166 00:08:47,280 --> 00:08:50,360 Speaker 1: to to work through some of those issues. US Treasury 167 00:08:50,440 --> 00:08:58,240 Speaker 1: Secretary Jack lou Very um forthcoming forthright ended, uh interview 168 00:08:58,320 --> 00:09:01,280 Speaker 1: in which he basically tells dive in Western if you 169 00:09:01,320 --> 00:09:03,360 Speaker 1: are in the markets and you think that there's going 170 00:09:03,400 --> 00:09:05,920 Speaker 1: to be some sort of coordinated effort to save you, 171 00:09:06,400 --> 00:09:09,760 Speaker 1: not gonna happen. Yeah. I thought it was very preg twenty. 172 00:09:09,920 --> 00:09:13,000 Speaker 1: It was way above average in terms of always the 173 00:09:13,120 --> 00:09:16,640 Speaker 1: Luke candor that was there. But but I thought it 174 00:09:16,720 --> 00:09:19,960 Speaker 1: was assertive. And when you link that into the challenges 175 00:09:20,000 --> 00:09:22,679 Speaker 1: that Cherry Yelling has, looking at it better than good 176 00:09:22,800 --> 00:09:26,440 Speaker 1: US economy look at Lowses earnings this morning, like home 177 00:09:26,480 --> 00:09:30,280 Speaker 1: depots yesterday. I really think it's something anybody on global 178 00:09:30,280 --> 00:09:33,199 Speaker 1: Wall Street has to pay attention to, even with markets 179 00:09:33,240 --> 00:09:41,000 Speaker 1: responding of this morning with their collective deterioration. Indeed, and um, 180 00:09:41,120 --> 00:09:44,880 Speaker 1: at this point, uh, you wonder how markets are gonna 181 00:09:44,920 --> 00:09:48,000 Speaker 1: go from where they're gonna go from here, knowing there's 182 00:09:48,040 --> 00:09:50,920 Speaker 1: no safety dat underneath. Well that's what we have. Let 183 00:09:50,920 --> 00:09:52,640 Speaker 1: me do a day to check here first, though, folks. 184 00:09:52,640 --> 00:09:56,240 Speaker 1: This morning, Bloomberg surveillance brought you buy Investco. Investco believes 185 00:09:56,240 --> 00:09:59,959 Speaker 1: it's time to bench the benchmarks to consider active manage 186 00:10:00,040 --> 00:10:04,320 Speaker 1: been in factor based strategies. Find out more at investco 187 00:10:04,440 --> 00:10:07,920 Speaker 1: dot com. Slash high conviction the futures out to weakness 188 00:10:07,920 --> 00:10:12,640 Speaker 1: this morning the negative sixteen Dow futures negative one too 189 00:10:12,679 --> 00:10:15,960 Speaker 1: much to talk about. Across assets oiled down a dollar 190 00:10:16,040 --> 00:10:19,200 Speaker 1: nine cents, thirty dollars seventy five cents. I'm gonna call 191 00:10:19,280 --> 00:10:22,520 Speaker 1: that indetermined. In the middle. On oil, we had a 192 00:10:22,559 --> 00:10:27,120 Speaker 1: record tenure low in Germany point one three one earlier 193 00:10:27,160 --> 00:10:31,040 Speaker 1: this morning, right now point one three five positive point 194 00:10:31,040 --> 00:10:34,199 Speaker 1: one three five. On the German tenures, Michael McKee mentioned 195 00:10:34,240 --> 00:10:37,280 Speaker 1: the yen stronger one eleven seventy nine right now. In 196 00:10:37,320 --> 00:10:41,840 Speaker 1: the UK the pounds sterling rather one thirty ninety means 197 00:10:41,920 --> 00:10:46,280 Speaker 1: Charles Duma can't travel here anytime soon. So we'll give 198 00:10:46,320 --> 00:10:53,599 Speaker 1: you more data checks through our morning. This hour of 199 00:10:53,840 --> 00:10:56,040 Speaker 1: Vellans brought to you by Volvo Cars, White Planes. Visit 200 00:10:56,080 --> 00:10:58,760 Speaker 1: Volvo Cars, White Plains dot com. Here is John Tucker 201 00:10:58,800 --> 00:11:02,280 Speaker 1: with the latest news headline. Michael and Tom O'donald Trump's 202 00:11:02,320 --> 00:11:05,720 Speaker 1: dominating victory and the Devata concauses pushes him further out 203 00:11:05,720 --> 00:11:09,240 Speaker 1: ahead of his nearest competitors for the Republican presidential domination, 204 00:11:09,640 --> 00:11:12,679 Speaker 1: giving his unorthodox Candida see a major boost heading into 205 00:11:12,760 --> 00:11:16,400 Speaker 1: Super Tuesday contest next week. Hillary Clinton doesn't just want 206 00:11:16,400 --> 00:11:18,640 Speaker 1: to beat Bernie Sanders in South Carolina. She wants to 207 00:11:18,679 --> 00:11:21,680 Speaker 1: beat expectations. She's running more than twenty points ahead of 208 00:11:21,720 --> 00:11:26,359 Speaker 1: Sanders it most polls hold heading into Saturday's Democratic presidential primary, 209 00:11:26,520 --> 00:11:30,480 Speaker 1: buoyed by overwhelming support from the state's black voters, and 210 00:11:30,640 --> 00:11:35,880 Speaker 1: Ober Technologies starting its very first motorcycle taxi service in Bangkok, 211 00:11:36,200 --> 00:11:39,240 Speaker 1: where perennial congestion leads to rush hour traffic speeds in 212 00:11:39,280 --> 00:11:42,240 Speaker 1: the Thailand capital of just about six point eight mile 213 00:11:43,080 --> 00:11:45,360 Speaker 1: Global News twenty four hours a day, powered by our 214 00:11:45,360 --> 00:11:48,880 Speaker 1: two journalists more than one hundred fifty news bureaus around 215 00:11:48,880 --> 00:11:51,920 Speaker 1: the world. I'm John Tucker, Mike and Tom. That's Sandricker. 216 00:11:52,000 --> 00:11:54,680 Speaker 1: Thanks so much on this day of Chumont Damn Trail 217 00:11:54,720 --> 00:11:57,000 Speaker 1: labor with us with Lombard Street Research and we will 218 00:11:57,040 --> 00:12:01,400 Speaker 1: speak to her next on markets On to Move. Bloomberg Surveillance. 219 00:12:05,760 --> 00:12:07,760 Speaker 1: Bloomberg Surveillance is brought to you by your try State 220 00:12:07,800 --> 00:12:11,040 Speaker 1: BMW centers. Visit them online at try State BMW dot com. 221 00:12:11,040 --> 00:12:21,320 Speaker 1: At BMW they make only one thing, the ultimate driving machine. 222 00:12:22,480 --> 00:12:25,840 Speaker 1: Global business news twenty four hours a day at Bloomberg 223 00:12:25,920 --> 00:12:29,000 Speaker 1: dot com, the radio plus mobil and on your radio. 224 00:12:29,280 --> 00:12:33,080 Speaker 1: This is a Bloomberg Business Flash and I'm Karen Moscow. 225 00:12:33,120 --> 00:12:36,640 Speaker 1: This updates brought to you by Eisener Amper. When entrepreneurs 226 00:12:36,720 --> 00:12:40,160 Speaker 1: face challenges like choosing a business structure or access to capital, 227 00:12:40,400 --> 00:12:43,360 Speaker 1: they call the accountants and advisors at Oisner Amper connect 228 00:12:43,360 --> 00:12:47,000 Speaker 1: with them. Eisner Amper dot Com, slash Tech and Global 229 00:12:47,040 --> 00:12:49,720 Speaker 1: Equities are extending the clients. As a sliding oil price 230 00:12:49,760 --> 00:12:52,520 Speaker 1: weight on industry groups from banks to commodity producers and 231 00:12:52,600 --> 00:12:55,560 Speaker 1: drag down emerging markets. To check the markets every fifteen 232 00:12:55,600 --> 00:12:58,160 Speaker 1: minutes throughout the trading day on Bloomberg s and p 233 00:12:58,320 --> 00:13:01,120 Speaker 1: eveny features down nineteen points, Dow EUNY futures down a 234 00:13:01,160 --> 00:13:04,520 Speaker 1: hundred sixty nine, NASA documny futures down fifty seven. The 235 00:13:04,600 --> 00:13:07,440 Speaker 1: dacts in Germany's down two point six percent, ten Your 236 00:13:07,440 --> 00:13:10,040 Speaker 1: treasury up eleven thirty seconds. The yield one point six 237 00:13:10,080 --> 00:13:12,720 Speaker 1: eight percent yield on a two year point seven two 238 00:13:12,720 --> 00:13:15,760 Speaker 1: percent now I'm ex screwed. Oil down three point seven percent, 239 00:13:15,840 --> 00:13:18,480 Speaker 1: or a dollar seventeen to thirty dollars seventy cents in 240 00:13:18,559 --> 00:13:21,080 Speaker 1: barrel co max gold up one point one percent or 241 00:13:21,080 --> 00:13:24,079 Speaker 1: thirteen dollar sixty cents at twelve thirty six twenty ounce, 242 00:13:24,480 --> 00:13:26,679 Speaker 1: the Euro at allar oh nine seven zero, the yen 243 00:13:26,720 --> 00:13:29,480 Speaker 1: one eleven point seven six, the British pound a dollar 244 00:13:29,559 --> 00:13:32,600 Speaker 1: thirty eight ninety three. That's a Bloomberg business flash. Tom 245 00:13:32,600 --> 00:13:35,440 Speaker 1: and Mike Karen, thank you very much. Will you just 246 00:13:35,600 --> 00:13:40,360 Speaker 1: heard a remarkable interview with Treasury Secretary Jack lu by 247 00:13:40,400 --> 00:13:44,800 Speaker 1: our David Weston, in which the Treasury Secretary said, financial 248 00:13:44,800 --> 00:13:48,080 Speaker 1: markets expecting the G twenty finance ministers and central bankers 249 00:13:48,120 --> 00:13:51,240 Speaker 1: to step in and put a floor underneath them, are 250 00:13:51,240 --> 00:13:53,520 Speaker 1: going to be disappointed by this weekend's meeting because the 251 00:13:53,559 --> 00:13:56,760 Speaker 1: world is not in a crisis, despite what a lot 252 00:13:56,800 --> 00:14:00,360 Speaker 1: of people might think. Diana is chief economist, head of 253 00:14:00,480 --> 00:14:03,560 Speaker 1: research at Lombard Street. UH nice enough to sit to 254 00:14:03,600 --> 00:14:05,840 Speaker 1: the interview with us. UH, and you were not in 255 00:14:05,840 --> 00:14:09,720 Speaker 1: your head a lot as Jack lou was speaking. I 256 00:14:09,760 --> 00:14:12,880 Speaker 1: was nodding because he made two points I absolutely agree 257 00:14:12,960 --> 00:14:17,480 Speaker 1: with the first one, which you mentioned. The real economy, 258 00:14:17,559 --> 00:14:21,960 Speaker 1: in particular in UM, the US is not in crisis. 259 00:14:23,000 --> 00:14:27,560 Speaker 1: Another crucial point was that competitive evaluation, if all the 260 00:14:27,600 --> 00:14:32,040 Speaker 1: major economies go for it, is not going to solve 261 00:14:32,800 --> 00:14:35,640 Speaker 1: the problems of the world of today. In fact, it's 262 00:14:37,960 --> 00:14:43,880 Speaker 1: lose lose game. But I did agreed with some of 263 00:14:43,920 --> 00:14:48,880 Speaker 1: the assessment uh that he made as to how the 264 00:14:48,960 --> 00:14:52,360 Speaker 1: world can rebalance and move forward and how we can 265 00:14:52,440 --> 00:15:02,600 Speaker 1: generate genuine consumer demand. Well, if if you disagree, without 266 00:15:02,720 --> 00:15:07,760 Speaker 1: how can we rebalance and genuine generate consumer demand? The 267 00:15:07,840 --> 00:15:11,440 Speaker 1: world has a golden opportunity at the moment to achieve 268 00:15:11,560 --> 00:15:17,080 Speaker 1: what I call a deflationary rebalancing Chinese growth of just 269 00:15:17,760 --> 00:15:21,000 Speaker 1: three percent on our estimates currently, it's exactly what this 270 00:15:21,120 --> 00:15:27,200 Speaker 1: world needs because it means lower commodity prices distributing real 271 00:15:27,280 --> 00:15:30,920 Speaker 1: income in the hands of the consumer in the West. 272 00:15:32,000 --> 00:15:36,640 Speaker 1: At the same time, China is not over investing and 273 00:15:36,720 --> 00:15:40,560 Speaker 1: just throwing money at excess capacity anymore, which then allows 274 00:15:40,680 --> 00:15:45,560 Speaker 1: potentially for other profitable investment opportunities in the rest of 275 00:15:45,600 --> 00:15:47,480 Speaker 1: the world. I mean, but I look at the market score, 276 00:15:47,520 --> 00:15:49,440 Speaker 1: I'm looking at the Bloomberg screen, and I understand what 277 00:15:49,480 --> 00:15:51,680 Speaker 1: Secretary Love is coming from. And it's a public voice. 278 00:15:51,920 --> 00:15:54,280 Speaker 1: He's got to say that, and Governor Curney has to 279 00:15:54,320 --> 00:15:57,640 Speaker 1: talk within the milieu of austerity in the United Kingdom. 280 00:15:57,680 --> 00:16:01,040 Speaker 1: I'm looking at a coordinating response on this screen that 281 00:16:01,120 --> 00:16:04,360 Speaker 1: doesn't look for a coordinated effort to save the day 282 00:16:04,360 --> 00:16:07,520 Speaker 1: at the G twenty meetings. But do you agree that 283 00:16:07,560 --> 00:16:10,720 Speaker 1: the screen is saying things are deteriorating? I have a 284 00:16:10,800 --> 00:16:14,840 Speaker 1: German tenure at zero point one, three four. You have 285 00:16:15,200 --> 00:16:18,920 Speaker 1: a headline just crossing the Brazil's debt ratings have been 286 00:16:18,920 --> 00:16:22,600 Speaker 1: cut by Moodies. Okay, well, it's like Central Castics to 287 00:16:23,240 --> 00:16:26,920 Speaker 1: come on. I mean, these are events with the posturing 288 00:16:27,440 --> 00:16:30,560 Speaker 1: that that every single world leader and policymaker has to 289 00:16:30,600 --> 00:16:35,120 Speaker 1: look at the danger of what's going on in markets 290 00:16:35,760 --> 00:16:38,880 Speaker 1: at the moment is that it does feedback to the 291 00:16:38,960 --> 00:16:44,000 Speaker 1: real economy, and the mechanism that would happen would be 292 00:16:44,040 --> 00:16:47,400 Speaker 1: if this continues and abated for another two three months, 293 00:16:48,360 --> 00:16:53,240 Speaker 1: if it then hurts consumer confidence in the US, in 294 00:16:53,320 --> 00:16:56,800 Speaker 1: the Euro Area, and consumers designed to save the real 295 00:16:56,920 --> 00:17:01,720 Speaker 1: income gains rather than spend them. So yes, there is 296 00:17:01,760 --> 00:17:05,600 Speaker 1: a feedback loop. But if we look at what has 297 00:17:05,640 --> 00:17:09,720 Speaker 1: happened since the financial crisis, what we see is that 298 00:17:10,200 --> 00:17:17,040 Speaker 1: quantitative easing worked in terms of underpinning realized prices, largely 299 00:17:17,200 --> 00:17:20,879 Speaker 1: by decreasing the demand for holding money or in other words, 300 00:17:20,920 --> 00:17:27,359 Speaker 1: increasing risk loving, not by injecting actual money in the 301 00:17:27,440 --> 00:17:30,879 Speaker 1: economy supporting asset prices. And I think at this point 302 00:17:30,880 --> 00:17:34,040 Speaker 1: in time the market is coming to terms with the 303 00:17:34,119 --> 00:17:39,080 Speaker 1: fact that actually a lot of that was based on 304 00:17:39,960 --> 00:17:46,359 Speaker 1: optimism rather than an ejection of injection of excess money. 305 00:17:46,520 --> 00:17:50,639 Speaker 1: And my assessment is that investors have actually failed to 306 00:17:50,720 --> 00:17:53,880 Speaker 1: understand to this day what caused the crisis and what 307 00:17:53,920 --> 00:17:58,119 Speaker 1: effectual They are confused. I will go there confused. I 308 00:17:58,520 --> 00:18:02,240 Speaker 1: you sound like you're doovers. I'm looking at a screen. 309 00:18:02,840 --> 00:18:06,960 Speaker 1: The curve flattening this morning is extraordinary on the vanilla. 310 00:18:07,000 --> 00:18:12,760 Speaker 1: Two years, ten years. Spread to our audience, describe when 311 00:18:12,880 --> 00:18:18,200 Speaker 1: policymakers must step in to begin to staunch this. Is 312 00:18:18,240 --> 00:18:22,400 Speaker 1: there a fiscal solution in your London? Just as one example, 313 00:18:23,440 --> 00:18:26,800 Speaker 1: No is the answer, right, there's no fiscal there's no 314 00:18:26,880 --> 00:18:33,160 Speaker 1: apparent fiscal solution. The problem is that if you get 315 00:18:33,200 --> 00:18:36,760 Speaker 1: into a mess, you can't get out of it without pain. 316 00:18:36,960 --> 00:18:41,040 Speaker 1: We just have to accept that. And we had the 317 00:18:41,080 --> 00:18:46,399 Speaker 1: pain of the financial crisis, and some countries adjusted after 318 00:18:46,520 --> 00:18:52,520 Speaker 1: that and did the right thing, notably America, but China, Japan, 319 00:18:53,000 --> 00:18:57,960 Speaker 1: and until three years ago China did not. So now 320 00:18:58,040 --> 00:19:02,640 Speaker 1: the global economy has to pay the pride of that mess, 321 00:19:02,680 --> 00:19:08,440 Speaker 1: and unfortunately financial markets cannot be how to continual um 322 00:19:08,920 --> 00:19:14,320 Speaker 1: rise when the global economy has not rebalanced. The problem 323 00:19:14,520 --> 00:19:18,520 Speaker 1: is that the actions that central bankers have to take 324 00:19:18,840 --> 00:19:27,280 Speaker 1: in order to facilitate a successful rebalancing involved um a 325 00:19:27,320 --> 00:19:31,320 Speaker 1: total involved thinking about monetary policy and a totally different framework, 326 00:19:31,440 --> 00:19:34,080 Speaker 1: which they don't at the moment. So the dangerou is 327 00:19:34,119 --> 00:19:36,639 Speaker 1: that this this does turn into a crisis. And Danna, 328 00:19:36,680 --> 00:19:40,280 Speaker 1: thank you so much. With Lambert Street Research, She's going 329 00:19:40,320 --> 00:19:43,160 Speaker 1: to continue with us and we'll do that. Looking at 330 00:19:43,640 --> 00:19:45,800 Speaker 1: the markets, let me start with the oil thirty dollars 331 00:19:45,800 --> 00:19:49,240 Speaker 1: seventy three cents, range bound in between support and resistance, 332 00:19:49,280 --> 00:19:52,120 Speaker 1: but down a dollar fourteen this morning. Brent thirty two 333 00:19:52,240 --> 00:19:55,720 Speaker 1: forty four as well, looking at sterling, it's it's done. 334 00:19:55,720 --> 00:20:06,840 Speaker 1: Francine Laquix on cable, stay with Bloomberg Surveillance. Bloomberg Surveillance 335 00:20:06,920 --> 00:20:08,720 Speaker 1: is brought to you by Back of America. Merrill Lynch 336 00:20:08,760 --> 00:20:11,159 Speaker 1: committed to bringing higher finance to lower carbon name the 337 00:20:11,200 --> 00:20:14,440 Speaker 1: most innovative investment bank for climate change and sustainability by 338 00:20:14,560 --> 00:20:16,960 Speaker 1: the banker. That's the power of global connections. Bank of 339 00:20:16,960 --> 00:20:24,639 Speaker 1: America n A F D I C broadcasting live to 340 00:20:24,800 --> 00:20:28,639 Speaker 1: New York Gloomberg eleventh Rio to Washington, d C, Bloomberg 341 00:20:29,560 --> 00:20:33,560 Speaker 1: to Boston, Bloomberg twelve hundreds to San Francisco, Bloomberg n 342 00:20:34,240 --> 00:20:37,800 Speaker 1: to the Country series Exam Channel one ninety and around 343 00:20:37,880 --> 00:20:41,440 Speaker 1: the globe the Bloomberg Radio plus Aben Bloomberg dot Com. 344 00:20:41,480 --> 00:20:46,840 Speaker 1: This is Bloomberg Surveillance. Good morning on Wall Street. This 345 00:20:46,880 --> 00:20:50,040 Speaker 1: is Bloomberg Surveillance. And Michael McKee along with Tom Keane, 346 00:20:50,040 --> 00:20:53,920 Speaker 1: a couple of things making news out there. Moody's has 347 00:20:54,000 --> 00:20:59,680 Speaker 1: cut Brazil's finance rating two junk this morning and downgraded 348 00:21:00,080 --> 00:21:05,000 Speaker 1: Brazil's outlook too negative. Home improvement retailer Lows makes fifty 349 00:21:05,040 --> 00:21:07,119 Speaker 1: nine cents of share, matching estimates on better than a 350 00:21:07,600 --> 00:21:10,480 Speaker 1: forecast revenue of thirteen point two billion dollars. That's on 351 00:21:10,880 --> 00:21:13,800 Speaker 1: better than forecast cump store sales. They were up five 352 00:21:13,840 --> 00:21:16,040 Speaker 1: point two percent and boosting their forecast for the year 353 00:21:16,080 --> 00:21:18,560 Speaker 1: as well as Tom notes that is sort of in 354 00:21:18,680 --> 00:21:22,360 Speaker 1: contradiction to the gloomy view of the US economy. Rock 355 00:21:22,359 --> 00:21:25,120 Speaker 1: bottom interest rates are sticking around for American states and cities. 356 00:21:25,720 --> 00:21:28,600 Speaker 1: New York City sold yesterday general obligation debt for the 357 00:21:28,600 --> 00:21:31,000 Speaker 1: first time since July. Set to me followed this week 358 00:21:31,040 --> 00:21:34,720 Speaker 1: by deals from Los Angeles and North Carolina and Carlisle 359 00:21:34,720 --> 00:21:38,520 Speaker 1: Group buying a majority stake in the Spanish outsourcing company Digitechts. 360 00:21:38,600 --> 00:21:42,320 Speaker 1: That deal expected to close in the second quarter. Now, 361 00:21:42,400 --> 00:21:44,639 Speaker 1: let's check in with John Tucker and get the latest 362 00:21:44,640 --> 00:21:47,960 Speaker 1: headlines from around the world. John and Michael. With a 363 00:21:48,000 --> 00:21:50,840 Speaker 1: big win in the Nevada Caucuses, Donald Trump has claimed 364 00:21:50,920 --> 00:21:53,200 Speaker 1: a third straight commanding victory of the race with the 365 00:21:53,240 --> 00:21:56,840 Speaker 1: Republican presidential nomination Marco Rubio ted Cruz in a tight 366 00:21:56,960 --> 00:21:59,919 Speaker 1: race for a second Trump promised his supporters an amazing 367 00:22:00,000 --> 00:22:02,160 Speaker 1: two months ahead and has been for the White House. 368 00:22:02,720 --> 00:22:05,560 Speaker 1: Deadly storm system that's spawned tornadoes in the Gulf Coast 369 00:22:05,560 --> 00:22:08,399 Speaker 1: states last night expected to bring severe weather to the 370 00:22:08,440 --> 00:22:11,920 Speaker 1: Carolinas by this ant nooon. The man accused of randomly 371 00:22:12,040 --> 00:22:14,560 Speaker 1: killing six people in Michigan had a personal store of 372 00:22:14,560 --> 00:22:17,720 Speaker 1: weapons that included handguns and long guns, but there was 373 00:22:17,800 --> 00:22:20,199 Speaker 1: nothing in his past that prevented him from owning as 374 00:22:20,280 --> 00:22:23,560 Speaker 1: many guns as he could afford. Anton and Scalias doctor 375 00:22:23,680 --> 00:22:27,960 Speaker 1: says the justice suffered from coronary arty disease, diabetes, chronic 376 00:22:28,000 --> 00:22:32,240 Speaker 1: obstructive pulmonary disease, sleep apnea, high blood pressure, and several 377 00:22:32,280 --> 00:22:35,320 Speaker 1: other ailments that probably contributed to his death February thirteenth. 378 00:22:35,680 --> 00:22:38,480 Speaker 1: The public and reporters who covered the Supreme Court were 379 00:22:38,520 --> 00:22:42,359 Speaker 1: unaware that Scalia had any serious health problems. A Global 380 00:22:42,400 --> 00:22:44,760 Speaker 1: News twenty four hours in a Power via twenty four 381 00:22:45,160 --> 00:22:47,520 Speaker 1: journalists in more than one d fifty news bureaus around 382 00:22:47,520 --> 00:22:51,480 Speaker 1: the world. John Tucker, Michael, thank you, John, time now 383 00:22:51,480 --> 00:22:55,080 Speaker 1: for the Rakotina Auto Group of Bloomberg. NBC Sports Update. 384 00:22:55,160 --> 00:22:58,240 Speaker 1: Here's John Stash all right. Much they had went for 385 00:22:58,400 --> 00:23:00,199 Speaker 1: the Devils, who had lost three in a row, right 386 00:23:00,200 --> 00:23:02,360 Speaker 1: now on the outside looking in for making the playoffs. 387 00:23:02,359 --> 00:23:04,919 Speaker 1: But they've had success with the Rangers this season, taking 388 00:23:04,960 --> 00:23:07,200 Speaker 1: three or four. They scored twice in the second period, 389 00:23:07,280 --> 00:23:09,880 Speaker 1: two more late in the third. In Newark. Devil's beat 390 00:23:09,920 --> 00:23:13,520 Speaker 1: the Rangers five to two, outshot them thirty six and nineteen. 391 00:23:13,840 --> 00:23:16,240 Speaker 1: They're not one point behind Pittsburgh for the last playoff spot. 392 00:23:16,240 --> 00:23:19,679 Speaker 1: In Minnesota Friends, Nielsen scored twice. John Tavaris is twenty 393 00:23:19,720 --> 00:23:22,040 Speaker 1: third of the year. The Islanders won four to one. 394 00:23:22,040 --> 00:23:25,160 Speaker 1: In Portland, started a franchise record nine game road trip 395 00:23:25,200 --> 00:23:27,720 Speaker 1: for the Nets. They battled the Red Hot Trailblazers but 396 00:23:27,840 --> 00:23:30,680 Speaker 1: fell short one twelve one oh. For the Portland backcourt 397 00:23:30,680 --> 00:23:33,600 Speaker 1: of Damian Lillard and C. J. McCollum both scored thirty 398 00:23:33,640 --> 00:23:36,120 Speaker 1: four points. Lillards had five straight games of more than 399 00:23:36,160 --> 00:23:39,440 Speaker 1: thirty brook Lopez had thirty six in the lost Blazers 400 00:23:39,440 --> 00:23:41,640 Speaker 1: of now one six straight eleven of twelve. Next top 401 00:23:41,720 --> 00:23:45,119 Speaker 1: for Brooklyn is tomorrow and Phoenix Nicks visit Indiana tonight. 402 00:23:45,440 --> 00:23:48,560 Speaker 1: College basketball, the big game nationally was Kansas rallying to 403 00:23:48,600 --> 00:23:51,480 Speaker 1: win at Baylor battle of top twenty teams sixty six 404 00:23:51,520 --> 00:23:55,560 Speaker 1: to sixty. Locally, St. Peter's overwhelmed Manhattan sixty one to forty. 405 00:23:55,840 --> 00:23:58,240 Speaker 1: Rutgers fell the oh and fifteen, and the Big Ten 406 00:23:58,280 --> 00:24:01,040 Speaker 1: out scored fifty one to thirty in the second half 407 00:24:01,080 --> 00:24:03,679 Speaker 1: by a Minnesota team that was one and thirteen in 408 00:24:03,760 --> 00:24:07,440 Speaker 1: league play. The final was eighty three to sixty one. 409 00:24:07,600 --> 00:24:12,840 Speaker 1: The Bloomberg NBC Sports Upthing, I'm John Stashammer. Thank you, John. 410 00:24:12,920 --> 00:24:15,960 Speaker 1: We are keeping an eye on financial market sphere back 411 00:24:15,960 --> 00:24:20,120 Speaker 1: in the saddle today and writing the financial markets. We're 412 00:24:20,160 --> 00:24:25,080 Speaker 1: watching US futures deteriorate. SMP futures down by nine tenths 413 00:24:25,160 --> 00:24:28,000 Speaker 1: right now. In Europe it's a two point one percent 414 00:24:28,080 --> 00:24:31,919 Speaker 1: drop for the stocks six hundred. This is bloomberk Surveillance. 415 00:24:32,000 --> 00:24:40,400 Speaker 1: You're listening to Bloomberg Radio worldwide. Welcome back to Bloomberg 416 00:24:40,400 --> 00:24:43,919 Speaker 1: Surveillance and Michael McKey along with Tom Keane. It's a 417 00:24:44,160 --> 00:24:48,200 Speaker 1: risk off day most definitely. Oil is lower this morning. 418 00:24:48,200 --> 00:24:52,560 Speaker 1: West Texas thirty eight three down three two, Brent down 419 00:24:52,600 --> 00:24:56,640 Speaker 1: two point one percent, thirty two dollars and fifty six cents. 420 00:24:56,680 --> 00:25:00,080 Speaker 1: The real action today in the currency markets the and 421 00:25:00,280 --> 00:25:05,400 Speaker 1: one two, the Euro one three, the pound six. We've 422 00:25:05,440 --> 00:25:08,640 Speaker 1: got some haven trades and we've certainly got some Brexit 423 00:25:08,760 --> 00:25:12,640 Speaker 1: trades out there. A lot of people wondering whether the 424 00:25:12,680 --> 00:25:16,560 Speaker 1: G seven finance ministers and even more so the central 425 00:25:16,600 --> 00:25:19,600 Speaker 1: bankers going to actually do anything this weekend when they 426 00:25:19,600 --> 00:25:24,160 Speaker 1: meet in Shanghai to prop up global markets and reintroduce 427 00:25:24,240 --> 00:25:27,560 Speaker 1: some additional confidence out there. And h Leva is the 428 00:25:27,640 --> 00:25:31,920 Speaker 1: chief economist, had of research for Lombard Street and she's uh, 429 00:25:32,040 --> 00:25:33,960 Speaker 1: never mind the pound, she's made her way over here. 430 00:25:33,960 --> 00:25:35,679 Speaker 1: I don't want to see your expense report when you 431 00:25:35,720 --> 00:25:38,960 Speaker 1: go back, Kevin, given it's costing you so much more 432 00:25:39,000 --> 00:25:41,719 Speaker 1: to come over here now, but thank you for coming. Uh. 433 00:25:41,880 --> 00:25:44,040 Speaker 1: You and I were talking off there that a lot 434 00:25:44,080 --> 00:25:48,240 Speaker 1: of what is going on concerns about what is happening 435 00:25:48,320 --> 00:25:52,119 Speaker 1: in Asia, particularly with Japan. There is talk that with 436 00:25:52,240 --> 00:25:57,680 Speaker 1: the yen falling as it has, strengthening as it has, uh, 437 00:25:57,800 --> 00:26:00,840 Speaker 1: we're going to see more from the Bank of Japan 438 00:26:00,920 --> 00:26:05,080 Speaker 1: next week, We're going to see additional Uh, they're gonna 439 00:26:05,080 --> 00:26:08,480 Speaker 1: go farther in the negative rate. If this happens, the 440 00:26:08,560 --> 00:26:13,040 Speaker 1: world economy and financial markets are on the route to 441 00:26:13,119 --> 00:26:20,160 Speaker 1: a real crisis. Abnomics has largely amounted to a competitive evaluation, which, 442 00:26:20,240 --> 00:26:24,560 Speaker 1: given Japan's primary structural problem of too much income in 443 00:26:24,600 --> 00:26:28,439 Speaker 1: the business sector and too little in the household sector, 444 00:26:28,520 --> 00:26:32,879 Speaker 1: has actually made the real economy situation was there, but 445 00:26:33,840 --> 00:26:37,399 Speaker 1: the real damage has been done to the rest of 446 00:26:37,440 --> 00:26:42,920 Speaker 1: the world because we are operating in a global economy 447 00:26:43,000 --> 00:26:48,960 Speaker 1: which is deficient, lacking consumer demand and competitive evaluation. If 448 00:26:49,040 --> 00:26:51,560 Speaker 1: everyone goes for it from the major economy is not 449 00:26:51,640 --> 00:26:59,000 Speaker 1: going to benefit anyone. Japan is playing very dangerously also 450 00:26:59,400 --> 00:27:02,359 Speaker 1: with the likelihood of this ending up in a public 451 00:27:02,400 --> 00:27:07,640 Speaker 1: that default and also an inflationary explosion. Probably not through 452 00:27:07,680 --> 00:27:09,639 Speaker 1: the course of this year, But when we look to 453 00:27:09,720 --> 00:27:12,560 Speaker 1: twenty seventeen, let's been the Kyle Bass argument for quite 454 00:27:12,560 --> 00:27:17,160 Speaker 1: some time. How did they get to an inflationary explosion? Well, look, 455 00:27:18,119 --> 00:27:22,879 Speaker 1: they didn't have a private sector excessive debt and a 456 00:27:23,000 --> 00:27:25,600 Speaker 1: huge need for de leverage in which quantitative is ing 457 00:27:26,280 --> 00:27:31,520 Speaker 1: would offset. What they have done is quei on the 458 00:27:31,560 --> 00:27:35,040 Speaker 1: front foot. And the only reason this injection of money 459 00:27:35,200 --> 00:27:38,080 Speaker 1: has not spilled into the real economy is that the 460 00:27:38,119 --> 00:27:41,760 Speaker 1: majority of the bonds they're buying are from banks which 461 00:27:41,760 --> 00:27:46,280 Speaker 1: are not correspondingly lending. Now banks are running out of 462 00:27:46,359 --> 00:27:49,760 Speaker 1: jgbs by the end of the year. If they step 463 00:27:49,840 --> 00:27:55,879 Speaker 1: up quantitatives in as well as um lower negative rates, 464 00:27:56,560 --> 00:28:01,119 Speaker 1: then the likelihood is that this will go in the 465 00:28:01,160 --> 00:28:05,159 Speaker 1: real economy. But because they're not changing or improving the 466 00:28:05,240 --> 00:28:09,040 Speaker 1: real trend growth rate, it's going to spill over in 467 00:28:09,280 --> 00:28:12,679 Speaker 1: prices quickly. Before we let you go, I have to 468 00:28:12,680 --> 00:28:16,840 Speaker 1: ask about China. The market seem to want the Chinese 469 00:28:17,080 --> 00:28:22,240 Speaker 1: to devalue. Yes, if the Chinese were to open up 470 00:28:22,240 --> 00:28:25,719 Speaker 1: the capital account fully, the U one will depreciate. And 471 00:28:25,760 --> 00:28:30,320 Speaker 1: I keep stressing depreciate versus de values because the Bank 472 00:28:30,359 --> 00:28:34,040 Speaker 1: of the People's Bank of Chinese not intervening to devalue 473 00:28:34,080 --> 00:28:37,200 Speaker 1: the une. In fact, they're intervening to stop it from 474 00:28:37,240 --> 00:28:44,080 Speaker 1: depreciating further given the market forces. But where internationally policymakers 475 00:28:44,080 --> 00:28:47,160 Speaker 1: in Central Bank make a mistake is to bundle China 476 00:28:47,240 --> 00:28:51,040 Speaker 1: with Japan and the EU area. And that's wrong because 477 00:28:51,120 --> 00:28:57,000 Speaker 1: the U one is overvalued. China has massive excessive capital 478 00:28:57,000 --> 00:28:59,920 Speaker 1: that he has to unwind. If it tries to do 479 00:29:00,080 --> 00:29:04,280 Speaker 1: that with an overvalued currency, sapping export income as well, 480 00:29:05,040 --> 00:29:08,120 Speaker 1: Beijing has to be some sort of magician at reform 481 00:29:08,240 --> 00:29:11,719 Speaker 1: in order to produce a rebouncing towards consumer spending. In 482 00:29:11,760 --> 00:29:14,920 Speaker 1: other words, China needs a weaker currency to help its 483 00:29:14,920 --> 00:29:20,360 Speaker 1: rebalancing towards consumer spending. And when Secretary Lou was talking 484 00:29:20,400 --> 00:29:25,240 Speaker 1: about competitive evaluation, he put China in the same pot 485 00:29:25,720 --> 00:29:29,040 Speaker 1: as Japan and the UR area. And that's a serious 486 00:29:29,080 --> 00:29:33,360 Speaker 1: mistake because China, actually, from the major economies, is the 487 00:29:33,400 --> 00:29:36,920 Speaker 1: only one which in terms of its structural policies is 488 00:29:37,000 --> 00:29:40,520 Speaker 1: on the right route, and thank you very much, never 489 00:29:40,600 --> 00:29:42,960 Speaker 1: enough time. Thank you for coming in and hopefully you'll 490 00:29:42,960 --> 00:29:45,800 Speaker 1: be able to afford to come back soon. The pound 491 00:29:46,200 --> 00:29:50,360 Speaker 1: at the moment one ninety down almost a full unit 492 00:29:50,480 --> 00:29:54,360 Speaker 1: on the day. The offshore u N is down by 493 00:29:54,840 --> 00:29:58,040 Speaker 1: ten of eight percent at six fifty four oh eight. 494 00:29:58,200 --> 00:30:02,160 Speaker 1: The official fixing six fifty eight almost down two tenths 495 00:30:02,160 --> 00:30:05,240 Speaker 1: of a percent. Time now for the Bloomberg n j 496 00:30:05,400 --> 00:30:07,200 Speaker 1: I T STEM Report, brought to you by New Jersey 497 00:30:07,240 --> 00:30:10,040 Speaker 1: Institute of Technology, partnering with government and industry to apply 498 00:30:10,080 --> 00:30:13,240 Speaker 1: the university's world class research assets to innovate and spur 499 00:30:13,320 --> 00:30:16,080 Speaker 1: economic growth. Learn more at n j I T dot 500 00:30:16,080 --> 00:30:18,600 Speaker 1: E d U. Here's problem, my thank you, and Here's 501 00:30:18,600 --> 00:30:21,480 Speaker 1: what's making news in science, Technology, engineering and math. Uper 502 00:30:21,560 --> 00:30:26,200 Speaker 1: Technologies is starting its very first motorcycle taxi service in Bangkok, 503 00:30:26,520 --> 00:30:29,440 Speaker 1: where perennial congestion leads to rush hour traffic speeds in 504 00:30:29,480 --> 00:30:32,360 Speaker 1: the Thailand capital around seven miles an hour. The startup 505 00:30:32,400 --> 00:30:35,040 Speaker 1: that began life as a limousine service in the affluent 506 00:30:35,080 --> 00:30:38,000 Speaker 1: San Francisco Bay area now wants to tackle the workman 507 00:30:38,040 --> 00:30:40,960 Speaker 1: like vehicles that hoards of Bangkok residents rely on to 508 00:30:41,080 --> 00:30:44,400 Speaker 1: navigate jam pack streets. It says it can help untangle 509 00:30:44,440 --> 00:30:47,440 Speaker 1: the traffic snarls that result in two hour daily commutes. 510 00:30:47,680 --> 00:30:50,240 Speaker 1: And Western Digital's plan to sell a fifteen percent stake 511 00:30:50,280 --> 00:30:53,080 Speaker 1: to a Chinese investor fell apart after the deal came 512 00:30:53,200 --> 00:30:57,040 Speaker 1: under a U S National security review, highlighting the government's 513 00:30:57,080 --> 00:31:00,680 Speaker 1: ability to chill agreements that could give Chinese companies access 514 00:31:00,760 --> 00:31:04,360 Speaker 1: to US technology. And that's this morning's Bloomberg n J 515 00:31:04,480 --> 00:31:07,160 Speaker 1: I T STEM reports. Thank you very much, Bob Moon. 516 00:31:07,200 --> 00:31:10,120 Speaker 1: The other story we are following in the currency markets 517 00:31:10,120 --> 00:31:15,520 Speaker 1: and markets overall is Brazil downgraded and the resilient real 518 00:31:15,680 --> 00:31:19,320 Speaker 1: falls below four to three point nine nine one five. 519 00:31:22,440 --> 00:31:24,920 Speaker 1: Bloomberk Surveillance brought to you by T two Computing, a 520 00:31:24,960 --> 00:31:27,240 Speaker 1: new kind of I T solutions company for workflow, mobility 521 00:31:27,240 --> 00:31:29,680 Speaker 1: and infrastructure. Let them explain how their expertise can help 522 00:31:29,720 --> 00:31:32,080 Speaker 1: you gain greater business value. Visit T to computing dot 523 00:31:32,080 --> 00:31:39,840 Speaker 1: com for more information. Global business news twenty four hours 524 00:31:39,840 --> 00:31:43,000 Speaker 1: a day. If Bloomberg dot com, the Radio plus Mobile 525 00:31:43,040 --> 00:31:46,360 Speaker 1: Act and on your radio. This is a Bloomberg Business 526 00:31:46,400 --> 00:31:49,280 Speaker 1: flash and I'm Karen Moscow. This updates brought to you 527 00:31:49,320 --> 00:31:52,400 Speaker 1: by CBO e vix options and futures volatility can be 528 00:31:52,480 --> 00:31:56,080 Speaker 1: harnessed with cbo E VIX Options in futures, ce disclosures 529 00:31:56,080 --> 00:31:58,760 Speaker 1: and learn more at cbo E dot com. Slash Powerful 530 00:31:58,800 --> 00:32:02,200 Speaker 1: Outcomes VIX Global Equity is extending the clients as a 531 00:32:02,280 --> 00:32:05,040 Speaker 1: sliding oil price weighs on industry groups from banks to 532 00:32:05,080 --> 00:32:08,560 Speaker 1: commodity producers and drags down emerging markets. We check the 533 00:32:08,600 --> 00:32:11,520 Speaker 1: markets every fifteen minutes throughout the trading day. On Bloomberg 534 00:32:11,920 --> 00:32:15,160 Speaker 1: SNP emuny futures down eighteen points now eveny futures down 535 00:32:15,200 --> 00:32:18,480 Speaker 1: a hundred fifty nine Nas documenty futures down fifty five 536 00:32:18,560 --> 00:32:20,720 Speaker 1: the decks in Germany's down two and a half percent 537 00:32:21,120 --> 00:32:23,520 Speaker 1: ten Your treasury up eight thirty seconds to yield one 538 00:32:23,520 --> 00:32:26,040 Speaker 1: point six nine percent yield on the two year point 539 00:32:26,120 --> 00:32:29,080 Speaker 1: seven two percent nimax screwed Oil down three and a 540 00:32:29,120 --> 00:32:31,800 Speaker 1: half percent or a dollar twelve to thirty dollars seventy 541 00:32:31,880 --> 00:32:34,440 Speaker 1: five cents of barrel comes. Gold up one point two 542 00:32:34,440 --> 00:32:37,080 Speaker 1: percent or fourteen dollars ten cents to twelve thirty six 543 00:32:37,080 --> 00:32:40,160 Speaker 1: seventy announced the Euro at dollar oh nine six six 544 00:32:40,240 --> 00:32:43,840 Speaker 1: the n one eleven point eight zero Low's posting fourth 545 00:32:43,880 --> 00:32:47,160 Speaker 1: quarter sales that beat analysts estimates, following larger rival home 546 00:32:47,240 --> 00:32:49,880 Speaker 1: depot and taking advantage of a year's long real estate 547 00:32:49,960 --> 00:32:53,280 Speaker 1: rally that's spurring consumers to spend on their homes. Chesapeake 548 00:32:53,400 --> 00:32:55,840 Speaker 1: Energy saying it intends to pay a half billion dollar 549 00:32:55,920 --> 00:32:58,760 Speaker 1: dead that's coming due in three weeks after exceeding its 550 00:32:58,800 --> 00:33:02,080 Speaker 1: first quarter at target for asset sales. It shares are 551 00:33:02,080 --> 00:33:05,480 Speaker 1: down four percent this morning, and that's a Bloomberg business flash. 552 00:33:05,560 --> 00:33:09,160 Speaker 1: Tom and Mike Karen moscow Well, the news of the morning. 553 00:33:09,240 --> 00:33:12,280 Speaker 1: Jack lou the Treasury Secretary telling our David Weston there 554 00:33:12,400 --> 00:33:14,760 Speaker 1: is not a crisis out there that the G twenty 555 00:33:14,920 --> 00:33:18,120 Speaker 1: needs to respond to. We were talking with Diana Leva 556 00:33:18,200 --> 00:33:21,480 Speaker 1: just a moment ago from Lombard Street. She agrees there's 557 00:33:21,480 --> 00:33:25,000 Speaker 1: not an economic crisis. The US doing better than most 558 00:33:25,040 --> 00:33:29,320 Speaker 1: people think, Europe doing better than most people think. Is 559 00:33:29,320 --> 00:33:32,920 Speaker 1: there a political crisis, a geopolitical crisis out there? And 560 00:33:33,040 --> 00:33:35,960 Speaker 1: there's Core is, the founder of Court Analytics, and he 561 00:33:36,120 --> 00:33:40,000 Speaker 1: joins us now to follow up again on the Secretary's remarks. 562 00:33:40,040 --> 00:33:43,160 Speaker 1: And there's a lot going on. We've got a face 563 00:33:43,200 --> 00:33:50,560 Speaker 1: off between Iran Saudi Arabia, the US, Europe, Russia in Syria. Uh, 564 00:33:50,680 --> 00:33:54,600 Speaker 1: and you've got issues in Ukraine popping up again. A 565 00:33:54,720 --> 00:33:57,600 Speaker 1: lot of questions about whether or not there is a 566 00:33:57,680 --> 00:34:03,120 Speaker 1: geo political threat to the global economy. What do you think, Well, 567 00:34:03,160 --> 00:34:07,480 Speaker 1: there's certainly UM some concern there. Uh. The extent to 568 00:34:07,520 --> 00:34:10,440 Speaker 1: which it hits the economy as another is another issue. 569 00:34:10,480 --> 00:34:13,880 Speaker 1: But the UM I mean right now, the US and 570 00:34:14,040 --> 00:34:20,880 Speaker 1: RUSH are under negotiations about Syria, and UM exactly what 571 00:34:21,840 --> 00:34:25,520 Speaker 1: the ground reality is going to be there. Remarkably, the 572 00:34:25,560 --> 00:34:28,680 Speaker 1: negotiations are getting down to the point of how much 573 00:34:28,920 --> 00:34:33,080 Speaker 1: territory is news RUG gonna hold, how much territories isis 574 00:34:33,080 --> 00:34:35,880 Speaker 1: can hold? In The question really is UM, what you 575 00:34:36,160 --> 00:34:40,760 Speaker 1: will these entities, these terrorist entities actually listen to whatever 576 00:34:40,800 --> 00:34:43,880 Speaker 1: the US and Russia say. My I would say doubtful. 577 00:34:44,840 --> 00:34:48,560 Speaker 1: And there's I am really enlightened to know how you 578 00:34:48,680 --> 00:34:53,560 Speaker 1: link oil dynamics and the global oil OPEC non opec 579 00:34:53,800 --> 00:34:58,239 Speaker 1: us industry into your international relations. How's it fit in 580 00:34:58,360 --> 00:35:01,719 Speaker 1: right now? What we US and Saudi Arabia are very 581 00:35:01,760 --> 00:35:06,800 Speaker 1: close allies on this and UM some of the speculation 582 00:35:07,400 --> 00:35:11,920 Speaker 1: that I've heard is that somehow Saudi Arabia's decision to 583 00:35:13,160 --> 00:35:17,120 Speaker 1: keep pumping oil and even increase pumping oil over the 584 00:35:17,200 --> 00:35:22,680 Speaker 1: last year or so, is in parts to punish Russia. Now, uh, 585 00:35:22,800 --> 00:35:25,680 Speaker 1: total speculation. I haven't really seen evidence on that, but 586 00:35:25,960 --> 00:35:32,200 Speaker 1: I think it's an interesting, uh interesting theory. Well, where 587 00:35:32,360 --> 00:35:36,719 Speaker 1: where does that end up? At this point, we've got 588 00:35:36,719 --> 00:35:39,880 Speaker 1: more I understand they're starting to turn away oil and 589 00:35:40,000 --> 00:35:42,840 Speaker 1: cushing some grades of oil and it just don't have 590 00:35:42,880 --> 00:35:47,080 Speaker 1: a storage left. So how does this play out? Saudi 591 00:35:47,160 --> 00:35:49,640 Speaker 1: Arabia has said that they're willing to go down to 592 00:35:49,680 --> 00:35:55,160 Speaker 1: twenty barrel uh in order to let the market work. UM. 593 00:35:55,320 --> 00:35:59,640 Speaker 1: Their point is that, uh, you know, they can produce 594 00:35:59,719 --> 00:36:02,480 Speaker 1: at very very low levels. The U S. Shale producers 595 00:36:02,800 --> 00:36:06,120 Speaker 1: cannot produce, cannot produce at those low levels, and so 596 00:36:06,200 --> 00:36:10,799 Speaker 1: they rightfully have market share at their old at their 597 00:36:10,840 --> 00:36:15,160 Speaker 1: old market share levels. UM. So they're looking to squeeze 598 00:36:15,200 --> 00:36:19,319 Speaker 1: out um the U. S. Shale producers. I ran once 599 00:36:19,360 --> 00:36:21,840 Speaker 1: the game market share. So there's a market share battle 600 00:36:21,880 --> 00:36:23,760 Speaker 1: going on right now, and that's why we see oil 601 00:36:23,880 --> 00:36:27,759 Speaker 1: keep dropping. Unders Within international relations, the migrant issue and 602 00:36:27,800 --> 00:36:31,680 Speaker 1: the refugee issue is front and center across all of Europe. 603 00:36:31,760 --> 00:36:37,239 Speaker 1: Can you fold that into the present market dynamics. I mean, 604 00:36:37,280 --> 00:36:40,200 Speaker 1: I I don't buy the idea it's all Brexit, all Brexit, 605 00:36:40,239 --> 00:36:43,120 Speaker 1: I just are all Super Tuesday for that matter. But 606 00:36:43,560 --> 00:36:49,000 Speaker 1: how does the crushing scale of the migrant refugee debate 607 00:36:49,080 --> 00:36:55,319 Speaker 1: fold into if it does euro economics, well, the I 608 00:36:55,360 --> 00:36:59,680 Speaker 1: mean the refugees. UM. Some people argue that the refugees 609 00:37:00,400 --> 00:37:06,880 Speaker 1: can produce, can yield more labor um in Europe. UM. 610 00:37:06,920 --> 00:37:11,279 Speaker 1: But Europe is already awashing in labor. I mean there's 611 00:37:11,280 --> 00:37:13,319 Speaker 1: a lot, there's you know, there's a lot of the 612 00:37:13,360 --> 00:37:17,279 Speaker 1: southern European countries that have very high unemployment rates. And 613 00:37:17,320 --> 00:37:20,200 Speaker 1: so when you have all these refugees flooding in UM 614 00:37:20,239 --> 00:37:24,880 Speaker 1: from war torn countries, UM, it's really a destabilizing factor. 615 00:37:24,920 --> 00:37:29,799 Speaker 1: It's leading to a lot of disagreement among the EU countries. UM. 616 00:37:29,960 --> 00:37:34,040 Speaker 1: People are questioning Schengen, which is the freedom of movement 617 00:37:34,080 --> 00:37:38,880 Speaker 1: between uh, you know, of of people between the countries 618 00:37:38,920 --> 00:37:42,799 Speaker 1: of the EU. UH. It's playing into the Brexit or 619 00:37:42,840 --> 00:37:48,600 Speaker 1: British exit UH movement in Britain. It's very it's very disaggregating, 620 00:37:48,719 --> 00:37:53,160 Speaker 1: very disistabilizing. And I think putin who you know, is 621 00:37:53,200 --> 00:37:56,960 Speaker 1: in part responsible for the refugee exodus out of Syria 622 00:37:57,000 --> 00:38:00,400 Speaker 1: because he supports I mean, his own planes are arming 623 00:38:01,120 --> 00:38:05,960 Speaker 1: villages there, and he's supporting Assad's plans farming villages, and 624 00:38:06,040 --> 00:38:09,520 Speaker 1: that's what's creating this exodus. So in part, you know 625 00:38:09,680 --> 00:38:13,400 Speaker 1: this he it's playing into his desire to destabilize Europe 626 00:38:13,400 --> 00:38:17,239 Speaker 1: and maybe punish Europe for what it's doing. Mike, I mean, Mike, 627 00:38:17,239 --> 00:38:19,160 Speaker 1: we've got a little bit of strengthen the tape. It's 628 00:38:19,160 --> 00:38:21,560 Speaker 1: been a really ugly two hours and there's a little 629 00:38:21,560 --> 00:38:23,880 Speaker 1: bit of a bid to the tape. But you do 630 00:38:23,880 --> 00:38:28,600 Speaker 1: you wonder, Mike, the international relations overlay goes on a 631 00:38:28,680 --> 00:38:32,560 Speaker 1: Europe trying to find marginal growth. I would think migratsin 632 00:38:32,640 --> 00:38:36,880 Speaker 1: refugees could almost be growth stimulating. Well, we're not there yet, 633 00:38:37,280 --> 00:38:41,520 Speaker 1: as Andrews, there's some there's a little bit of a 634 00:38:41,560 --> 00:38:45,440 Speaker 1: fallacy in that. Actually, the concern some people have Anders 635 00:38:45,520 --> 00:38:49,480 Speaker 1: is that by the summertime, when the migrant christ crushes 636 00:38:49,840 --> 00:38:52,840 Speaker 1: expected to be in full swing because the weather is 637 00:38:52,880 --> 00:38:56,000 Speaker 1: good enough for them to really try to get across 638 00:38:56,000 --> 00:39:01,200 Speaker 1: the Mediterranean, that we're going to see maybe even Greece 639 00:39:02,320 --> 00:39:05,960 Speaker 1: back in a Grexit movie. I think it's possible. I 640 00:39:05,960 --> 00:39:11,600 Speaker 1: mean Greece has Greece has threatened to scupper the deal, uh, 641 00:39:12,040 --> 00:39:16,200 Speaker 1: any kind of British deal in terms of keeping Britain 642 00:39:16,200 --> 00:39:20,279 Speaker 1: happy in the in the EU. UM. And you know 643 00:39:20,520 --> 00:39:23,640 Speaker 1: the SERISA, which is the Britain the very left wing 644 00:39:23,719 --> 00:39:28,760 Speaker 1: British UM party that's now in power, has been friendly 645 00:39:28,800 --> 00:39:31,319 Speaker 1: with Putin in the past. We remember, uh, you know 646 00:39:31,360 --> 00:39:35,360 Speaker 1: a while ago when the Prime Minister Cyprus was visiting 647 00:39:35,400 --> 00:39:38,680 Speaker 1: Putin and threatening to take money from Putin instead of 648 00:39:39,239 --> 00:39:41,960 Speaker 1: UH deal with the Troika, the I, m F and 649 00:39:42,000 --> 00:39:45,200 Speaker 1: the the others. So it's it's you know, SISA is 650 00:39:45,239 --> 00:39:51,120 Speaker 1: not a friendly party for the EU. What about the 651 00:39:51,239 --> 00:39:55,799 Speaker 1: US presidential election we have, I don't you want to 652 00:39:55,880 --> 00:40:01,279 Speaker 1: characterize has like five degrees from fancies schools and we're 653 00:40:01,320 --> 00:40:04,399 Speaker 1: gonna sink into the morass. We're not going to sink. 654 00:40:04,719 --> 00:40:07,319 Speaker 1: We're gonna try to stay away from the morass. But 655 00:40:08,239 --> 00:40:13,400 Speaker 1: you have candidates running around talking about how terrible things 656 00:40:13,400 --> 00:40:15,759 Speaker 1: are in this country with no plan to do anything 657 00:40:15,800 --> 00:40:18,680 Speaker 1: about it except to make people angry. How much of 658 00:40:18,680 --> 00:40:24,560 Speaker 1: a threat is that to global order? Well, I mean 659 00:40:24,680 --> 00:40:29,680 Speaker 1: I think that internationally people really despise Trump and so 660 00:40:30,360 --> 00:40:34,160 Speaker 1: he's on the front and center on the TV all 661 00:40:34,200 --> 00:40:38,399 Speaker 1: the time, and uh, it's we're really not showing our 662 00:40:38,440 --> 00:40:42,439 Speaker 1: best side, uh to world public opinion when we when 663 00:40:42,520 --> 00:40:46,240 Speaker 1: when he says things that are anti immigrant or um, 664 00:40:46,280 --> 00:40:50,360 Speaker 1: you know, close to racist. So it's a it's um, 665 00:40:50,400 --> 00:40:52,200 Speaker 1: you know, it's not it's not our best side. But 666 00:40:52,239 --> 00:40:55,480 Speaker 1: it is a democracy and that's that's. Uh, that's a 667 00:40:55,600 --> 00:40:58,359 Speaker 1: plus at least. But does it does it have knock 668 00:40:58,400 --> 00:41:02,040 Speaker 1: on effects to I'll see, to the world order that 669 00:41:02,600 --> 00:41:05,759 Speaker 1: we're going to have to deal with? What what what 670 00:41:05,880 --> 00:41:08,160 Speaker 1: sort of knock on effects you thinking about? Well, I'm 671 00:41:08,320 --> 00:41:11,120 Speaker 1: I'm just wondering if you know, if it limits our 672 00:41:11,160 --> 00:41:14,359 Speaker 1: ability to gain international cooperation on some of these key 673 00:41:14,360 --> 00:41:16,520 Speaker 1: issues we're talking about. I think so, I mean, it's 674 00:41:16,560 --> 00:41:20,160 Speaker 1: definitely it's a it's it kind of um. You know, 675 00:41:20,200 --> 00:41:21,960 Speaker 1: people look at us in wonder. I think I think 676 00:41:22,000 --> 00:41:25,440 Speaker 1: there's a big question, you know, how how will the 677 00:41:25,520 --> 00:41:28,840 Speaker 1: next president respond to Russia? How will the next president 678 00:41:28,880 --> 00:41:34,160 Speaker 1: respond to China? Um, everyone's looking at how these presidents 679 00:41:34,480 --> 00:41:36,960 Speaker 1: are they tough on Russia, likely to be tough on 680 00:41:37,040 --> 00:41:39,920 Speaker 1: Russia or not. Bernie Sanders is very very soft on 681 00:41:40,000 --> 00:41:44,600 Speaker 1: Russia and China. Um, you know, I think Hillary Clinton 682 00:41:44,680 --> 00:41:49,080 Speaker 1: will be similar on Russia and China to what Obama did. 683 00:41:49,200 --> 00:41:50,880 Speaker 1: Maybe she'll have a bit of more of a chip 684 00:41:50,880 --> 00:41:52,680 Speaker 1: on her shoulder and she'll have to prove herself a 685 00:41:52,760 --> 00:41:57,400 Speaker 1: bit more so she might be marginally tougher. Um. You know, 686 00:41:57,480 --> 00:42:01,560 Speaker 1: Trump will be tough on China and soft on Russia. 687 00:42:01,680 --> 00:42:04,359 Speaker 1: He said, he he loves, he likes put on his course, 688 00:42:04,360 --> 00:42:07,239 Speaker 1: thank you so much, on his core with Core Analytics, Mike, 689 00:42:07,280 --> 00:42:10,440 Speaker 1: that was interesting. I mean, an international relations take on 690 00:42:10,520 --> 00:42:13,560 Speaker 1: our domestic politics and particularly what we're seeing in the markets, 691 00:42:14,160 --> 00:42:16,640 Speaker 1: m this morning. Let me go granular with you right now. 692 00:42:17,520 --> 00:42:20,719 Speaker 1: And a surveillance correction, thank you, Bob sinch Um. The 693 00:42:20,760 --> 00:42:23,440 Speaker 1: interday low and not a record low. The record low 694 00:42:23,560 --> 00:42:25,600 Speaker 1: was like a year ago or low. We almost went 695 00:42:25,600 --> 00:42:28,520 Speaker 1: down to zero in the German tenure. But we hit 696 00:42:28,640 --> 00:42:32,520 Speaker 1: a res low on the German tenure early this morning. 697 00:42:32,560 --> 00:42:34,920 Speaker 1: Just for half a cup of coffee right now. A 698 00:42:34,960 --> 00:42:38,280 Speaker 1: little bit of a rebound point one four seven percent 699 00:42:38,440 --> 00:42:40,960 Speaker 1: on a German tenure, and you're gonna take that across 700 00:42:40,960 --> 00:42:43,960 Speaker 1: really everything out there. A little bit of a sire relief. 701 00:42:44,040 --> 00:42:47,920 Speaker 1: Futures negative eighteen up to negative sixteen. Another hour of 702 00:42:47,920 --> 00:42:49,080 Speaker 1: Bloomberg surveillance