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

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Speaker 1: This is a Bloomberg Business Flash and I'm kring Moscow.

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Speaker 1: This updates brought to you by National Realty Returns on

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Speaker 1: cash and rented real Estate Fund them at n r I,

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Speaker 1: a dot net data company. I HS agreeing to buy

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Speaker 1: market and a deal that values that can bind firms

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Speaker 1: and more than thirteen billion dollars. Starwood Hotels and Resource

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Speaker 1: Worldwide accepting an improved bid from Marriott International valued at

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Speaker 1: thirteen point six billion dollars and topic and offer from

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Speaker 1: a group of investors led by China's Angbang insurance company.

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Speaker 1: Starwood is up more than four percent this morning. Marriott

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Speaker 1: is down about one percent. U S Stock Index futures

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Speaker 1: meanwhile little change to lower SNP eveny futures down one

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Speaker 1: and a half points now E many futures down ten

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Speaker 1: and as DAT eveny futures down three and a half dacks.

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Speaker 1: In Germany's down two tenths per cent ten. Your treasury

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Speaker 1: down eight thirty seconds. The one point zero percent yield

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Speaker 1: on the two year point eight five percent. I'm ex screwed.

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Speaker 1: Oil up half percent or twenty cents to thirty sixty

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Speaker 1: four of barrel called my skull. There's down nine tenths

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Speaker 1: per cent or eleven dollars to twelve forty three thirty

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Speaker 1: announced the euro An dollar twelve seventy the end one

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Speaker 1: eleven point five four. That's a Bloomberg Business Flash. Tom

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Speaker 1: and Mike the turing A. Thanks for mentioning the bond

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Speaker 1: on three basis points higher yield three basis points one

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Speaker 1: point nine zero percent. It is on Wall Street. The

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Speaker 1: following is from Bloomberg View. Opinions and commentary from Bloomberg columnists.

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Speaker 1: I'm Lined Bushitski, a columnist for Bloomberg View. I live

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Speaker 1: in Berlin and I'm Russian. But I've spent the last

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Speaker 1: two months on the road covering the presidential primaries. I've

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Speaker 1: noticed that all the candidates love to say that America

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Speaker 1: is a great country, but they all mean completely different things.

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Speaker 1: One thinks it means being an unbeatable bully. Another sees

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Speaker 1: American greatness and its enterprise and ingenuity. A third talks

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Speaker 1: about this capacity to lead the world in healthcare and

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Speaker 1: then education. My own vision of America's greatness is simpler

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Speaker 1: and more visual. Everywhere, even in sparse rural areas, there's

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Speaker 1: a bustle. This is the biggest economy in the world,

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Speaker 1: and it feels like it. It feels like a great nation.

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Speaker 1: I come from a country that used to be great

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Speaker 1: as an empire and as a feltarian state. Greatness was

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Speaker 1: always a preoccupation of Russian rulers. Today's Russia would do

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Speaker 1: well to focus on more mundane priorities. If only U

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Speaker 1: S leaders could do that as well. But presidential candidates

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Speaker 1: can stop talking about American greatness or ship its burden

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Speaker 1: until there's a consensus about what it means for America

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Speaker 1: to be great. Every presidential election will be an attempt

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Speaker 1: to settle the question. They are likely to be as

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Speaker 1: contentious and as angry as this one. I'm leaving Pushitski,

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Speaker 1: a columnist for Bloomberg View. For more Bloomberg opinion and commentary,

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Speaker 1: please go to Bloomberg View dot com or view go

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Speaker 1: on the Bloomberg terminal. This has been Bloomberg View and

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Speaker 1: bloom Review commentary. It's gonna be heard hourly weekdays. I'm

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Speaker 1: Bloomberg Radio Mike Housing Housing Housing this week, get a

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Speaker 1: lot of housing numbers, um and you have to wonder

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Speaker 1: how long housing continues to rise. Diane Slunk from DS

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Speaker 1: Economics is with us, and Diane, housing has been contributing

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Speaker 1: for the last couple of years to GDP. Do we

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Speaker 1: still see that in two thousand sixteen, Yeah, we still

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Speaker 1: see it. One of the interesting issues though, and this

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Speaker 1: really gets back to the labor market issues, is where

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Speaker 1: is housing to leave fallen short. It's fallen short in

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Speaker 1: the prime age categories that sort of forty and fifth

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Speaker 1: year old owning homes. Now, home ownership rates in those

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Speaker 1: categories has fallen along with other categories, but that's really

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Speaker 1: your prime age for owning homes. And remember we also

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Speaker 1: lost some ground in labor force participation rates among those

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Speaker 1: groups as well. So these aren't people that just maybe

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Speaker 1: had a home and then lost a home. There are

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Speaker 1: also people who aged into the age bracket and then

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Speaker 1: couldn't afford to buy a home with the new hurdles

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Speaker 1: out there, some deservedly so. But I think it's really

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Speaker 1: interesting if you look at the demographics alone, you would

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Speaker 1: actually expect to see higher homeownership's rates today than we

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Speaker 1: did in say two thousand, which is against what most

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Speaker 1: people would have expected. If you just look at the

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Speaker 1: household formation and the demographics, but if you look more

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Speaker 1: broadly at everything from the economics, which we know have

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Speaker 1: not been terrific, but also social trends. In addition to

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Speaker 1: the sort of age group not participating as much, particularly

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Speaker 1: among men in the labor force, and that's only beginning

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Speaker 1: to come back. We've also seen women who now have

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Speaker 1: a higher chance of getting a college degree than a man.

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Speaker 1: That is a flip flop from what it used to be.

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Speaker 1: Those college educated women tend to stay single longer. They're

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Speaker 1: a little more chicky about who they pick at mate,

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Speaker 1: and they stay renters longer too, we know exactly, and

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Speaker 1: they stay renters. One of the great stories floating around

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Speaker 1: Diana is is almost the price discrimination of housing, and

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Speaker 1: that we talk about housing as a general idea, yet

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Speaker 1: there's stupid priced housing, expensive housing, sort of expensive housing

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Speaker 1: and not expensive housing. And to me, the gaps of

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Speaker 1: never ever been wider, and affordability in some of those

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Speaker 1: death stiles or quartiles. That's exactly right, and that's one

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Speaker 1: of the things. Affordability is the number one issue. There

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Speaker 1: isn't a lot of for some buy our homes out there,

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Speaker 1: there's not a lot of rental property. We've rent we've

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Speaker 1: built a lot in the luxury and the high end apartments,

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Speaker 1: and in fact, in many of the major markets now

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Speaker 1: there's a lot of people looking out there at there's

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Speaker 1: a pie coming out, and even in places like Chicago

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Speaker 1: my own back, I don't care where now the luxury

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Speaker 1: rentals are going to see a decline in runs after

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Speaker 1: a rapid overshoot um in recent years because of everyone

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Speaker 1: thought everyone's going to be high end renters. Well, not

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Speaker 1: right to be a high end rent Well, you suggest

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Speaker 1: that public policy can steer home production towards where it's

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Speaker 1: needed or but we've seen that unfortunately, it's it's not numb,

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Speaker 1: not always ended up. I'm sorry to laugh, but we

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Speaker 1: did see it in the boom that worked out. Yeah,

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Speaker 1: real well, um. I do think that there is a

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Speaker 1: role for policy, but not you know, policy has become

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Speaker 1: this dirty word. We don't get policy in this country anymore.

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Speaker 1: And I think that's part of what you heard about

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Speaker 1: the opinions of is America great or not? And what

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Speaker 1: is greatness mean? There's no one talking about serious policy

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Speaker 1: options out there. We no longer execute serious policy options.

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Speaker 1: We've been in good luck for years now in Washington,

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Speaker 1: and I think unfortunately that's given us an ability to

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Speaker 1: sort of talk about policy in a very um, sort

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Speaker 1: of grand way that's not at all realistic, and we're

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Speaker 1: seeing that in terms of insults instead of issues by

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Speaker 1: the candidates as well. There is a role for policy,

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Speaker 1: But that said, there's also where why do we have

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Speaker 1: so little affordable housing? In part Becauzonian laws have tightened

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Speaker 1: up quite a bit, and this is nothing surprising. I mean,

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Speaker 1: in some areas it's because of legitimate polician pollution issues

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Speaker 1: and people concerned about that, but it's also because those

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Speaker 1: people are in certain places don't want you to build

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Speaker 1: anymore because they want the value of their land to

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Speaker 1: go up. It's sort of shutting the door after they

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Speaker 1: get in. And that is a real big issue in

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Speaker 1: many of these areas is you can't get inexpensive inexpensive land.

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Speaker 1: We are seeing in places outside of Los Angeles, which

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Speaker 1: will call Exurbia, really far out that we thought we'd

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Speaker 1: never develop again. I guess with lower gas prices, you're

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Speaker 1: now seeing some developers develop way for very affordable housing

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Speaker 1: because it is where they can actually sell some housing

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Speaker 1: as well. San Francisco a prime example of housing the

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Speaker 1: there's a whole movement that's rising there called build more

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Speaker 1: blank blank housing. Uh Uh, And people don't want to

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Speaker 1: because they're already there and they don't want to destroy

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Speaker 1: the character of it, uh, the of the value of

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Speaker 1: what they've got. That remember its supply and demand, right,

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Speaker 1: pretty simple economics, but withhold supply the rest of the country.

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Speaker 1: We operated under the theory for many, many years, and

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Speaker 1: Alan Greenspan admitted dis guiding into trouble that, uh, it

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Speaker 1: was not one housing market. It was many, many different

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Speaker 1: housing markets. And then it was one housing market and

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Speaker 1: all collapsed. Uh. Where are we now? Are we back

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Speaker 1: to differentiating between housing markets? And there's some but you know,

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Speaker 1: it's a good point because this was also the truth,

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Speaker 1: you know, the truth globally It was a global housing boom.

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Speaker 1: It happened across the world. And so what was the

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Speaker 1: commonality we saw in the UK, We saw it in Spain.

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Speaker 1: Spain and the UK were showing signs of a bubble

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Speaker 1: before anyone else and yet no one would um sort

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Speaker 1: of acknowledge it. And what was the commonality across the world. Well,

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Speaker 1: even though you do have individual markets where say a

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Speaker 1: lot of porn investors come in like London or New

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Speaker 1: York and buy up and bid up the housing prices

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Speaker 1: in those areas that may or may not live in them. Actually,

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Speaker 1: you also have the flip side of what is the

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Speaker 1: commonality low interest rates? We had low interest rates and

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Speaker 1: easy Morgan mortgage standards the world over, and and that

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Speaker 1: was something was a commonality. Didn't matter where you lived,

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Speaker 1: you could get it was easier to buy a home.

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Speaker 1: And so I think it's important to keep that in mind, Diana.

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Speaker 1: The time we got left, it's been a theme this morning.

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Speaker 1: We touched on this with Van Emmon's of Leader Capital.

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Speaker 1: The basic idea that whether we like it or not,

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Speaker 1: our economists are becoming nominal GDP based economists, and that

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Speaker 1: there's this fixation now on inflation dynamics. Real g d

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Speaker 1: P is moldy. So are we there? Are we almost

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Speaker 1: talking our way into a nominal analysis combining economic dynamics

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Speaker 1: with price dynamics. You know, it's interesting you bring it up,

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Speaker 1: because of course the flip side was true back in

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Speaker 1: the early nineties, and we have double there's an inflation

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Speaker 1: we all you know, is when we started talking about

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Speaker 1: things in real terms, because it mattered, and so this

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Speaker 1: is a moving target. I think the problem. The real

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Speaker 1: issue is what are we measuring and how we measuring

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Speaker 1: it accurately. And one of the real concerns I have

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Speaker 1: is that we've neglected a lot of our measurements in

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Speaker 1: the government statistics. And it's not that there's a conspiracy

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Speaker 1: because frankly, these people wouldn't if you sit around with them.

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Speaker 1: There's no conspiracy there at all. Um. They've been their

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Speaker 1: their bureaucrats, but on the other side of it, they

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Speaker 1: have been starved for financial um funding and many the

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Speaker 1: Housings Survey, for instance, the personal consumption expenditure for what

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Speaker 1: we spend on shelter, it's based on a two thousand

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Speaker 1: one benchmark. The world has changed a lot, exactly what

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Speaker 1: I worry about the moment. Dans Funk DS Economics, thank you,

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Speaker 1: thank you, thank you so much for a great Monday briefing, Michael. Um,

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Speaker 1: is that why you gave me the sedatives? Yes? I

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Speaker 1: knew you earlier here. I knew you would be excited. Uh,

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Speaker 1: and it's only going to get better. It's snowing out.

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Speaker 1: So what are we gonna talk about next? Baseball? The

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Speaker 1: Boston Rid Sox Sam Kennedy talk to Business of Baseball

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Speaker 1: and Tom you can get all depressive and manning. I

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Speaker 1: just want to know about third base. I mean he

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Speaker 1: wants to talk about StubHub and taking over to the

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Speaker 1: digital I he grew up in Brookline, Massachusetts. He must

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Speaker 1: be as depressed as I am. Well, they had a

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Speaker 1: couple of bad years. Now then get back into it.

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Speaker 1: Who knows, what can you say? You have to take

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Speaker 1: us out. I can't talk. It's okay, it's still spring training,

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Speaker 1: but a lot of folks taving the Red Sox to

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Speaker 1: be in contention for the American Lieu Pennant this year.

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Speaker 1: We'll talk with Red Sox President Sam Kennedy next on

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Speaker 1: surveillance