1 00:00:03,080 --> 00:00:06,600 Speaker 1: This is Bloomberg surveyans. I think the notion of signing 2 00:00:06,640 --> 00:00:09,040 Speaker 1: tax pledges or saying we're not making taxes at all, 3 00:00:09,080 --> 00:00:11,560 Speaker 1: it's completely out of touch with what we're spending and 4 00:00:11,600 --> 00:00:14,239 Speaker 1: what people want to spend. The deficit has disappeared from view, 5 00:00:14,400 --> 00:00:16,640 Speaker 1: which is why the debt is only being discussed by 6 00:00:16,680 --> 00:00:19,919 Speaker 1: deficite scold groups. This down swing in oil prices is 7 00:00:19,960 --> 00:00:22,119 Speaker 1: creating habit for a lot of people, but it's a 8 00:00:22,160 --> 00:00:25,120 Speaker 1: huge benefit and consumers aren't really spending all of this yet. 9 00:00:25,160 --> 00:00:29,400 Speaker 1: Bloomberg Surveillance your link to the world of economics, finance, 10 00:00:29,480 --> 00:00:33,880 Speaker 1: and investment on Bloomberg Radio. Good morning, I'm Michael McKie. 11 00:00:33,960 --> 00:00:36,239 Speaker 1: It's seven am on Law Street. We are looking at 12 00:00:36,320 --> 00:00:40,280 Speaker 1: another volatile trading day ahead oil and banks and fear 13 00:00:40,320 --> 00:00:44,479 Speaker 1: itself on Surveillance. Today, China and other markets in Asia 14 00:00:44,560 --> 00:00:47,760 Speaker 1: closed for the New Year holiday, Japan was opened. The 15 00:00:47,840 --> 00:00:51,319 Speaker 1: nick finishes down more than five percent five point four 16 00:00:51,400 --> 00:00:54,520 Speaker 1: percent of the day. Ten year note yield in Japan 17 00:00:54,960 --> 00:00:59,000 Speaker 1: goes negative, negative four basis points. The whole curve there 18 00:00:59,000 --> 00:01:02,720 Speaker 1: now negative. That's the time for a G seven country, 19 00:01:02,920 --> 00:01:05,840 Speaker 1: and the end continues to strengthen. Made it as low 20 00:01:05,880 --> 00:01:09,640 Speaker 1: as one one trading at one fifteen o five. Asia 21 00:01:09,760 --> 00:01:13,000 Speaker 1: just set the stage for a down day in Europe. Oh, 22 00:01:13,040 --> 00:01:18,560 Speaker 1: by the way, le yes, it's Marty grad today. No 23 00:01:18,720 --> 00:01:22,080 Speaker 1: celebration in Europe. The stock six hundred down by h 24 00:01:22,440 --> 00:01:25,600 Speaker 1: right now three points seven tenths of eight percent. The 25 00:01:25,680 --> 00:01:28,800 Speaker 1: docks is off by forty one, that's about a half percent, 26 00:01:28,880 --> 00:01:32,280 Speaker 1: and the foot see in London eleven points lower two 27 00:01:32,280 --> 00:01:34,560 Speaker 1: tents of eight percent. And that's all carried over into 28 00:01:34,600 --> 00:01:38,360 Speaker 1: the United States. SMP futures off by seven four tenths down, 29 00:01:38,440 --> 00:01:42,960 Speaker 1: EMUNI futures down by four tents, and Nasdaq EMUNI futures 30 00:01:43,000 --> 00:01:46,319 Speaker 1: off by seventeen four tens of eight percent. Of the 31 00:01:46,319 --> 00:01:50,200 Speaker 1: bond market US future, the US uh yeld curve is 32 00:01:50,240 --> 00:01:52,760 Speaker 1: not following Japan at the moment. The tenure no yield 33 00:01:52,840 --> 00:01:55,600 Speaker 1: is up by a basis point one point seven six percent, 34 00:01:56,000 --> 00:01:59,880 Speaker 1: the five year one point one seven percent, and the 35 00:02:00,000 --> 00:02:03,440 Speaker 1: two year note yelled at sixty six basis points. The 36 00:02:03,520 --> 00:02:07,000 Speaker 1: dollar index is lower ninety six point four eight too, 37 00:02:07,400 --> 00:02:09,280 Speaker 1: And told you about the yen, and the euro is 38 00:02:09,320 --> 00:02:13,440 Speaker 1: also strengthening, burst through one twelve one twelve seventeen. The 39 00:02:13,520 --> 00:02:19,760 Speaker 1: pound one four thirty two and oil prices. Everybody watching, Oh, 40 00:02:19,800 --> 00:02:22,079 Speaker 1: is the International Energy Agency seeing we're going to have 41 00:02:22,120 --> 00:02:24,919 Speaker 1: a bigger surplus than we fought in the first quarter. 42 00:02:25,400 --> 00:02:28,880 Speaker 1: But that is not pressing on prices. West Texas thirty 43 00:02:28,960 --> 00:02:33,280 Speaker 1: seven is up two percent, Brent crude thirty seven up 44 00:02:33,320 --> 00:02:37,280 Speaker 1: one point two percent. So Tom Keen, it has been 45 00:02:38,000 --> 00:02:41,280 Speaker 1: quite the volatile more a lot going on. We've seemed 46 00:02:41,280 --> 00:02:44,880 Speaker 1: to have switched our fear from fear of what oil 47 00:02:44,919 --> 00:02:47,000 Speaker 1: will do to fear of what's happening in the banking. 48 00:02:47,480 --> 00:02:49,640 Speaker 1: Let's say what Mike and I most agree on, and 49 00:02:49,680 --> 00:02:51,840 Speaker 1: it's not cold play. We'll have more on that's really 50 00:02:51,880 --> 00:02:55,000 Speaker 1: are Did you enjoy your day yesterday with Peyton? I did. 51 00:02:55,360 --> 00:02:58,760 Speaker 1: I enjoyed not having to being able to stay up 52 00:02:58,840 --> 00:03:01,280 Speaker 1: late and watch the Super Bowl and all the postgame festivities. 53 00:03:02,080 --> 00:03:04,600 Speaker 1: Did you convince him to play another year? I? Actually, 54 00:03:04,680 --> 00:03:07,920 Speaker 1: I'm with his mom. She says he should retire, and 55 00:03:07,960 --> 00:03:10,640 Speaker 1: I'm okay. Let me go on top. What we're gonna 56 00:03:10,639 --> 00:03:13,639 Speaker 1: try to do here, folks, away from a collegial discussion 57 00:03:13,720 --> 00:03:16,720 Speaker 1: on the wonderful superho terrific ratings, by the way, is 58 00:03:17,240 --> 00:03:20,480 Speaker 1: to get away from the hysteria our goal on surveillance 59 00:03:20,520 --> 00:03:25,600 Speaker 1: this morning is to inform you about some of the complexities. 60 00:03:25,639 --> 00:03:32,160 Speaker 1: Just as one example, contingent convertible derivative instruments are available 61 00:03:32,160 --> 00:03:35,440 Speaker 1: to Deutsche Bank in Europe. They're not available in the 62 00:03:35,520 --> 00:03:38,720 Speaker 1: United States. I mean, just as one nuance of all 63 00:03:38,760 --> 00:03:40,720 Speaker 1: that's going on. And of course we'll do extra data 64 00:03:40,800 --> 00:03:44,480 Speaker 1: checks with the tape a little bit deteriorating right now. 65 00:03:44,520 --> 00:03:48,000 Speaker 1: Of course, a one fourteen handle onion. Get your intention, 66 00:03:48,080 --> 00:03:52,640 Speaker 1: Bloomberg surveillance brought you by Investco. Investing isn't about meeting benchmarks, 67 00:03:53,040 --> 00:03:56,280 Speaker 1: It's about achieving goals. Find out how invest goes high 68 00:03:56,360 --> 00:04:02,560 Speaker 1: conviction approach can help. Visit investco dot com slash high Conviction. 69 00:04:02,680 --> 00:04:05,400 Speaker 1: Michael our next guest out of LC and out of 70 00:04:05,480 --> 00:04:09,960 Speaker 1: Johns Hopkins on oil. He works with St. Edward Morris. 71 00:04:10,000 --> 00:04:12,440 Speaker 1: That's pretty cool. I mean, the privilege of working with 72 00:04:12,480 --> 00:04:16,400 Speaker 1: that Morris is is way cool. And now that Tom 73 00:04:16,400 --> 00:04:18,680 Speaker 1: has sucked up to Ed for you, Eric Lee can 74 00:04:18,680 --> 00:04:22,200 Speaker 1: go back home to a city bank and uh um, 75 00:04:22,240 --> 00:04:24,400 Speaker 1: you know, have a good day because Ed is going 76 00:04:24,440 --> 00:04:26,720 Speaker 1: to be walking around all puffed up. It is a 77 00:04:26,760 --> 00:04:28,960 Speaker 1: guy that said we were gonna have problems with oil 78 00:04:29,000 --> 00:04:32,640 Speaker 1: and look where we are. Although it is interesting this morning. 79 00:04:32,760 --> 00:04:36,000 Speaker 1: Eric is a commodity strategy research channelist ed City Bank. 80 00:04:36,040 --> 00:04:38,040 Speaker 1: It's interesting this morning the I e. A comes out 81 00:04:38,080 --> 00:04:41,159 Speaker 1: and says more oil, less demand and prices don't go down. 82 00:04:41,440 --> 00:04:47,320 Speaker 1: Does that suggest this may be a bottom? Well, I mean, 83 00:04:47,360 --> 00:04:49,520 Speaker 1: in all of you, we are at a kind of 84 00:04:49,560 --> 00:04:52,080 Speaker 1: bottoming range. We think that we're gonna continue to have 85 00:04:52,200 --> 00:04:56,760 Speaker 1: this volatility UM but um, you know, demond has been 86 00:04:56,839 --> 00:04:59,359 Speaker 1: bad for a while. Supply is going to continue to 87 00:04:59,400 --> 00:05:02,480 Speaker 1: be quite an overhang in our view. I think part 88 00:05:02,520 --> 00:05:04,480 Speaker 1: of the issue was when we saw the big downturn 89 00:05:04,480 --> 00:05:06,920 Speaker 1: and prices in January, we also saw a market position 90 00:05:06,920 --> 00:05:09,800 Speaker 1: and get extremely stretched and extremely shortened. We've come off 91 00:05:09,880 --> 00:05:13,039 Speaker 1: some of that to some extent. Well, what's happened to 92 00:05:13,080 --> 00:05:18,120 Speaker 1: the idea that low prices are the cure for low prices? 93 00:05:18,120 --> 00:05:20,200 Speaker 1: That's still an operative thing. I think the question is 94 00:05:20,240 --> 00:05:23,280 Speaker 1: how low does the price have to go when we've 95 00:05:23,279 --> 00:05:26,479 Speaker 1: had structural change in the oil market. I think I 96 00:05:26,560 --> 00:05:28,480 Speaker 1: feel very lucky to be looking at the oil market 97 00:05:28,560 --> 00:05:31,520 Speaker 1: so much right now because we're really seeing a complete 98 00:05:31,520 --> 00:05:35,280 Speaker 1: game change and shale has really upturned the old rules 99 00:05:35,360 --> 00:05:38,160 Speaker 1: of of UM of how that worked. UM, And and 100 00:05:38,200 --> 00:05:41,000 Speaker 1: that's you know, one of the reasons why why we're 101 00:05:41,000 --> 00:05:45,320 Speaker 1: in the situation where today, UM, do do your models 102 00:05:45,400 --> 00:05:48,720 Speaker 1: work anymore? I mean, you talk about structural change, then 103 00:05:48,760 --> 00:05:53,200 Speaker 1: when you try to well, there's another question. I mean, 104 00:05:53,640 --> 00:05:57,200 Speaker 1: can you effectively model what oil prices are going to be? Uh? 105 00:05:57,440 --> 00:05:59,760 Speaker 1: We're we're doing what we can to do that. And 106 00:06:00,040 --> 00:06:01,800 Speaker 1: of course at the center of that is is thinking 107 00:06:01,839 --> 00:06:04,920 Speaker 1: about these supply demand balances. And I just putting out 108 00:06:04,960 --> 00:06:10,440 Speaker 1: their own set today this morning. UM. I think the 109 00:06:10,640 --> 00:06:12,799 Speaker 1: one of the challenges we tried to get our heads 110 00:06:12,839 --> 00:06:17,080 Speaker 1: around is how does shale respond to prices? I think 111 00:06:17,120 --> 00:06:19,320 Speaker 1: one of the tricky parts is that it's pretty new 112 00:06:19,760 --> 00:06:23,480 Speaker 1: and we're still trying to, you know, catch this falling 113 00:06:23,600 --> 00:06:26,800 Speaker 1: knife in at a time when when shale is still 114 00:06:26,839 --> 00:06:29,880 Speaker 1: actually getting up to stride. So not only is it 115 00:06:29,960 --> 00:06:31,839 Speaker 1: like where's shale on the cost curve? How much does 116 00:06:31,880 --> 00:06:34,600 Speaker 1: it cost to produce it? It's still getting a lot 117 00:06:34,600 --> 00:06:36,440 Speaker 1: better at what it does. Those costs is still falling, 118 00:06:36,600 --> 00:06:39,000 Speaker 1: So you've got kind of got to that's one of 119 00:06:39,040 --> 00:06:41,560 Speaker 1: the tricky things, oh go with. It's a dynamic mystery 120 00:06:41,560 --> 00:06:44,599 Speaker 1: in the United States. Just to pick on Canada. It's 121 00:06:44,640 --> 00:06:49,760 Speaker 1: no mystery. Their costs are more right. What does lower 122 00:06:49,880 --> 00:06:54,520 Speaker 1: for longer mean for high cost oil nations? It means 123 00:06:54,640 --> 00:06:56,800 Speaker 1: a lot of pain. It means a lot of adjustment. 124 00:06:57,040 --> 00:07:01,320 Speaker 1: Has that adjustment begun to occur? Because I don't see it? Aren't? 125 00:07:01,320 --> 00:07:04,880 Speaker 1: Do we see it? Well? We see it in you know, 126 00:07:04,960 --> 00:07:07,600 Speaker 1: we we we see the financial pain, we see the 127 00:07:07,640 --> 00:07:11,000 Speaker 1: capex cuts, but we see the burden of adjustment being 128 00:07:11,840 --> 00:07:14,520 Speaker 1: taken on many fronts. So if you are the producer, 129 00:07:14,640 --> 00:07:17,240 Speaker 1: you're finding also that the company's upstream of you. The 130 00:07:17,240 --> 00:07:21,960 Speaker 1: services sector guys are now you now have you goes, 131 00:07:22,160 --> 00:07:23,640 Speaker 1: You've got your back to the wall, but you're able 132 00:07:23,680 --> 00:07:26,600 Speaker 1: to say, actually we need cost reductions. There's some burden 133 00:07:26,640 --> 00:07:29,080 Speaker 1: that's taken by the services sector we've seen, but but 134 00:07:29,200 --> 00:07:32,120 Speaker 1: some of the burdens taken by the currency for for 135 00:07:32,200 --> 00:07:35,560 Speaker 1: the commodity intensive countries. So I think this adjustment is 136 00:07:35,600 --> 00:07:38,360 Speaker 1: going to take a while to play out. We're in 137 00:07:38,520 --> 00:07:41,080 Speaker 1: a big downside along down cycle. And of you, I 138 00:07:41,320 --> 00:07:44,520 Speaker 1: h S said in a report yesterday or overnight that 139 00:07:44,960 --> 00:07:51,080 Speaker 1: we're going to see more bankruptcies than they had originally forecast. Um, 140 00:07:51,160 --> 00:07:54,720 Speaker 1: what's your outlook? There are more companies in trouble than 141 00:07:55,040 --> 00:07:59,320 Speaker 1: we anticipated. And does that have a positive or negative effect? 142 00:07:59,320 --> 00:08:02,080 Speaker 1: Their view is kind of in it it offsets, because 143 00:08:02,120 --> 00:08:06,559 Speaker 1: what you'll end up doing is forcing more mergers more quickly. Sorry, 144 00:08:06,600 --> 00:08:10,840 Speaker 1: forcing more mergers more quickly. Uh yeah, I mean in 145 00:08:10,960 --> 00:08:13,560 Speaker 1: terms of are we seeing more than we expect? I think, 146 00:08:15,000 --> 00:08:17,480 Speaker 1: at least in the shell patch, we may be seen 147 00:08:17,600 --> 00:08:20,720 Speaker 1: less than we expected over last year. Uh. And and 148 00:08:20,800 --> 00:08:24,840 Speaker 1: that now as we go forward, Um, there's something in 149 00:08:24,840 --> 00:08:27,880 Speaker 1: the timeline that may precipitate quite a few more. And 150 00:08:27,920 --> 00:08:33,960 Speaker 1: that's this April time when when essentially banks redetermined how 151 00:08:34,080 --> 00:08:35,960 Speaker 1: much they're willing to to lend to some of these 152 00:08:35,960 --> 00:08:38,480 Speaker 1: produces based on the value of their reserves, and if 153 00:08:38,480 --> 00:08:41,920 Speaker 1: they revised down their price outlook, then the the these 154 00:08:41,960 --> 00:08:45,719 Speaker 1: credit facilities get hit. So uh in that sense, I 155 00:08:45,720 --> 00:08:48,000 Speaker 1: think it's gotta it's got to take place. It should 156 00:08:48,000 --> 00:08:50,559 Speaker 1: be part of a sign that the market is starting 157 00:08:50,640 --> 00:08:59,280 Speaker 1: to turn around. Well, I was just just you are right, 158 00:08:59,480 --> 00:09:01,480 Speaker 1: I had called play in my head. Excuse me, I'm 159 00:09:01,520 --> 00:09:04,320 Speaker 1: still getting over halftime of the Super Bowl. When I 160 00:09:04,320 --> 00:09:06,360 Speaker 1: look at demand destructure, I mean, we've got a weaker 161 00:09:06,400 --> 00:09:08,800 Speaker 1: accurgate demand. All of the other issues that we see 162 00:09:09,080 --> 00:09:13,080 Speaker 1: within the global economy. Is demand destruction availed study or 163 00:09:13,120 --> 00:09:16,680 Speaker 1: is it just about supply. It's definitely not just about supply, 164 00:09:16,760 --> 00:09:20,280 Speaker 1: although tricky as it is, supply is probably easier to 165 00:09:20,320 --> 00:09:23,480 Speaker 1: get our heads around than the demand part. Demands very 166 00:09:23,520 --> 00:09:26,000 Speaker 1: much part of it. You had. It was part of 167 00:09:26,040 --> 00:09:29,079 Speaker 1: getting us into the downtown to all demand growth was 168 00:09:29,120 --> 00:09:32,200 Speaker 1: a really meager not point eight million bars a day 169 00:09:32,360 --> 00:09:36,720 Speaker 1: with the price impact like dropping fift you saw that 170 00:09:36,960 --> 00:09:39,320 Speaker 1: jump to one point seven million bars day of growth. 171 00:09:39,480 --> 00:09:41,319 Speaker 1: But again this year we think we're back in about 172 00:09:41,360 --> 00:09:43,480 Speaker 1: one million barrels per day of growth out of a 173 00:09:43,800 --> 00:09:48,280 Speaker 1: you know, ninety four million barre play all market. So um, 174 00:09:48,400 --> 00:09:50,360 Speaker 1: it is there and you've got some of these negative 175 00:09:50,360 --> 00:09:52,880 Speaker 1: feedback effects are helping as well. To the Middle East, 176 00:09:53,640 --> 00:09:56,240 Speaker 1: actually a driver of all demand growth for the last decade, 177 00:09:56,880 --> 00:10:01,400 Speaker 1: likely to come in weaker um than expected given the 178 00:10:01,960 --> 00:10:05,440 Speaker 1: feedback effect of level prices on the economy. Edwardly, Eric Lee, 179 00:10:05,440 --> 00:10:08,520 Speaker 1: excuse me erically, thank you so much. Edward Morris, Eric Lee, 180 00:10:08,640 --> 00:10:10,600 Speaker 1: thank you so much, Eric Lee. As with City Group, 181 00:10:10,600 --> 00:10:13,920 Speaker 1: working with Team Morris on commodities, we see a deterioration 182 00:10:14,000 --> 00:10:16,680 Speaker 1: in the tape. Negative thirteen loads for the day down 183 00:10:16,679 --> 00:10:20,480 Speaker 1: futures negative one eleven takes the futures to fifteen thousand, 184 00:10:20,600 --> 00:10:24,079 Speaker 1: eight hundred seventy six. Yields are good with a steeper 185 00:10:24,160 --> 00:10:26,520 Speaker 1: yield curve. I want to make clear that the bond 186 00:10:26,640 --> 00:10:29,880 Speaker 1: market doing better off of what we saw six seven 187 00:10:29,880 --> 00:10:33,560 Speaker 1: and eight pm last night. West Texas thirty dollars eleven 188 00:10:33,600 --> 00:10:36,280 Speaker 1: cents up forty two cents. We'll see where that goes. 189 00:10:36,320 --> 00:10:40,640 Speaker 1: In the yen, a stunning one fourteen nineties seven. We 190 00:10:40,720 --> 00:10:42,959 Speaker 1: now not have a blipped one fourteen, but really a 191 00:10:43,040 --> 00:10:47,360 Speaker 1: sustained valuation with a one fourteen handle. The euro one twelve, 192 00:10:48,240 --> 00:10:53,520 Speaker 1: one twelve in the Bloomberg seven ten On Wall Street 193 00:10:53,520 --> 00:10:54,920 Speaker 1: Time you check out with Michael Byr and get the 194 00:10:54,960 --> 00:10:57,480 Speaker 1: latest world in national headlines. Michael, Mike, Tom, thank you 195 00:10:57,600 --> 00:11:00,000 Speaker 1: very much. The very first votes in today's New Hampshire 196 00:11:00,080 --> 00:11:03,520 Speaker 1: ran Mary come from Dicksville. The tiny town's nine voters 197 00:11:03,559 --> 00:11:07,280 Speaker 1: favored of Republican John Kasig three to over Donald Trump. 198 00:11:07,640 --> 00:11:10,480 Speaker 1: For the Democrats, Ernie Sanders got all four votes over 199 00:11:10,559 --> 00:11:13,719 Speaker 1: Hillary Clinton. At least nine people are dead after two 200 00:11:13,720 --> 00:11:17,040 Speaker 1: commuter trains crashed head on this morning in southern Germany. 201 00:11:17,200 --> 00:11:21,319 Speaker 1: Another one hundred fifty people were injured. Scientists are analyzing 202 00:11:21,320 --> 00:11:24,400 Speaker 1: a small blue object that fell from the sky to 203 00:11:24,480 --> 00:11:27,280 Speaker 1: determine if it's a meteorite that it caused the death 204 00:11:27,520 --> 00:11:30,360 Speaker 1: of a man in southern India. Global News twenty four 205 00:11:30,360 --> 00:11:32,520 Speaker 1: hours a day, powered by Where It's twenty four hundred 206 00:11:32,559 --> 00:11:35,120 Speaker 1: journalists and more than one hundred fifty news bureaus from 207 00:11:35,160 --> 00:11:38,240 Speaker 1: around the world. I'm Michael Barr. Oh, Michael. We missed 208 00:11:38,240 --> 00:11:40,760 Speaker 1: Michael McKee so much, didn't we. I mean, Michael Barr. 209 00:11:40,760 --> 00:11:43,959 Speaker 1: It was just it wasn't the same here without Michael McKee. Yesterday, 210 00:11:44,080 --> 00:11:48,720 Speaker 1: I and and congratulates to the Denver broncos. Let's punish 211 00:11:48,800 --> 00:12:06,720 Speaker 1: McKee hit it ken Bloomberg Savants from New York. Bloomberg 212 00:12:06,679 --> 00:12:08,520 Speaker 1: Surveils is brought to you by New York Committity Bank 213 00:12:08,520 --> 00:12:10,920 Speaker 1: and New York Commercial Bank, the NYCB Family of Banks 214 00:12:10,920 --> 00:12:13,600 Speaker 1: Bank with Confidence. Anywhere you see the NYCB logo throughout 215 00:12:13,600 --> 00:12:23,040 Speaker 1: the New York Metro, Visit NYCB family dot com. Global 216 00:12:23,120 --> 00:12:26,520 Speaker 1: Business News twenty four hours a day at Bloomberg dot com, 217 00:12:26,720 --> 00:12:29,560 Speaker 1: the Radio plus mobile app, and on your radio. This 218 00:12:29,960 --> 00:12:33,599 Speaker 1: is a Bloomberg Business Flash And I'm Karen Moscow. This 219 00:12:33,679 --> 00:12:36,920 Speaker 1: updates brought to you by National Realty Returns on cash 220 00:12:36,920 --> 00:12:38,920 Speaker 1: and rented real estate find them at n r i 221 00:12:39,040 --> 00:12:43,880 Speaker 1: A dot net and European stocks resuming losses falling for 222 00:12:43,920 --> 00:12:46,959 Speaker 1: a seventh day as banks and mining companies lead to klines. 223 00:12:47,080 --> 00:12:49,679 Speaker 1: US dock Index Future is also lower. We check the 224 00:12:49,720 --> 00:12:52,640 Speaker 1: markets every fifteen minutes throbout the trading day on Bloomberg, 225 00:12:53,000 --> 00:12:56,000 Speaker 1: SNP Emni futures down fourteen points and Dowie Mini futures 226 00:12:56,000 --> 00:12:58,719 Speaker 1: down a hundred fifteen. NASA DOCU Miuni future is down 227 00:12:58,760 --> 00:13:00,719 Speaker 1: twenty six. The Daccenter man He is down one and 228 00:13:00,760 --> 00:13:03,640 Speaker 1: a half percent ten Your treasury down one thirty second. 229 00:13:03,679 --> 00:13:06,920 Speaker 1: They yield one point seven five percent. Nimax Screwed oil 230 00:13:07,000 --> 00:13:09,000 Speaker 1: is up one point one percent, or thirty three cents 231 00:13:09,040 --> 00:13:11,800 Speaker 1: to thirty dollars two cents of barrel. Comax gold is 232 00:13:11,840 --> 00:13:14,280 Speaker 1: down four tens percent or five dollars thirty cents to 233 00:13:15,200 --> 00:13:18,000 Speaker 1: sixty announced. The euro a dollar twelve twenty two, the 234 00:13:18,120 --> 00:13:21,760 Speaker 1: end one fifteen even, and Coca Cola reported profit that 235 00:13:21,800 --> 00:13:24,959 Speaker 1: beat analysts estimates, while Viacom and CBS Health and met 236 00:13:25,080 --> 00:13:28,520 Speaker 1: that's a Bloomberg business flash. Tom and Mike Karen, thank 237 00:13:28,559 --> 00:13:31,000 Speaker 1: you very much. We're talking with deerically about oil in 238 00:13:31,040 --> 00:13:33,800 Speaker 1: our last segment. That's been the boogeyman for investors through 239 00:13:33,880 --> 00:13:36,920 Speaker 1: much of the year so far, but this week, at least, 240 00:13:36,920 --> 00:13:41,000 Speaker 1: starting yesterday and into today, it's financials. Deutsche Bank how 241 00:13:41,559 --> 00:13:44,280 Speaker 1: reassuring investors it has the money to pay its bills. 242 00:13:44,320 --> 00:13:46,080 Speaker 1: And you know Tom the old saying if you have 243 00:13:46,160 --> 00:13:50,120 Speaker 1: to tell people you have the money. Uh, they're shocking headlines. 244 00:13:50,520 --> 00:13:52,960 Speaker 1: I mean, anyway you put it in, folks were not 245 00:13:53,000 --> 00:13:56,880 Speaker 1: gonna get into hysteria. Here boy, I'll tell you you 246 00:13:56,960 --> 00:13:59,120 Speaker 1: see it coming across a Bloomberg. I should get my 247 00:13:59,160 --> 00:14:02,160 Speaker 1: phone and take a oh no, those headlines and put 248 00:14:02,160 --> 00:14:04,480 Speaker 1: it out on Twitter. Might jump in here. Andrew Milligan 249 00:14:04,720 --> 00:14:07,240 Speaker 1: is head of Global strategy for Standard Life Investment. He 250 00:14:07,320 --> 00:14:11,560 Speaker 1: joins us now from Edinburgh. Andrew, when you from from 251 00:14:11,559 --> 00:14:14,400 Speaker 1: your perch, when you look over the European banking system, 252 00:14:14,440 --> 00:14:19,280 Speaker 1: when you look over the global economic outlook, how realistic 253 00:14:19,400 --> 00:14:23,080 Speaker 1: are fears that Deutsche could stubble, that the banking system 254 00:14:23,160 --> 00:14:26,040 Speaker 1: is in real trouble. Is the sell off that we're 255 00:14:26,120 --> 00:14:33,840 Speaker 1: seeing reflecting actual risk or perceived risk? Herd mentality well, 256 00:14:33,840 --> 00:14:35,000 Speaker 1: I think we've got to have a little bit of 257 00:14:35,000 --> 00:14:37,440 Speaker 1: perspective here. I mean, what of central banks and regulator 258 00:14:37,440 --> 00:14:39,800 Speaker 1: has been doing for the last seven of eight years, 259 00:14:39,880 --> 00:14:42,440 Speaker 1: but putting in place a whole series of measures to 260 00:14:42,520 --> 00:14:45,680 Speaker 1: make sure that the global banking system is far, far, 261 00:14:45,840 --> 00:14:48,880 Speaker 1: far away from the problems that we had back in 262 00:14:49,040 --> 00:14:53,280 Speaker 1: two thousand and seven. Eight. Well, undoubtedly there are risks 263 00:14:53,320 --> 00:14:56,520 Speaker 1: from you were just talking about the phone in aial 264 00:14:56,520 --> 00:14:59,320 Speaker 1: prices knock on risks for the energy sector for example, 265 00:14:59,480 --> 00:15:03,360 Speaker 1: and the is a major debate raging across the investing 266 00:15:03,360 --> 00:15:05,280 Speaker 1: community about whether or not the U S economy is 267 00:15:05,280 --> 00:15:07,360 Speaker 1: about to go into a session or not, and of 268 00:15:07,400 --> 00:15:10,040 Speaker 1: course that would be have implications for non performing loans 269 00:15:10,080 --> 00:15:12,200 Speaker 1: in such sites. But I think, as as well as 270 00:15:12,200 --> 00:15:15,560 Speaker 1: trying to piece together stories about why events are happening, 271 00:15:15,680 --> 00:15:17,720 Speaker 1: you know, we do have to step back and say, 272 00:15:17,920 --> 00:15:20,080 Speaker 1: there does seem to be a degree of forced selling 273 00:15:20,160 --> 00:15:23,040 Speaker 1: taking place in markets at present. I would certain point 274 00:15:23,040 --> 00:15:26,440 Speaker 1: my finger at some soft and will funds with oil 275 00:15:26,480 --> 00:15:29,560 Speaker 1: exposure who are probably trying to raise assets as quickly 276 00:15:29,560 --> 00:15:32,240 Speaker 1: as they can. You're the second person that's smorring to 277 00:15:32,360 --> 00:15:37,800 Speaker 1: mention this forced selling to me tells me, you can't 278 00:15:37,840 --> 00:15:40,760 Speaker 1: find the bid. This is what you do best in 279 00:15:40,960 --> 00:15:45,239 Speaker 1: or you're in Edinburgh ascance running quiet long term money. 280 00:15:45,440 --> 00:15:47,560 Speaker 1: Can you find a bid out there this morning on 281 00:15:47,600 --> 00:15:51,280 Speaker 1: your Bloomberg. I would absolutely accept the fact that market 282 00:15:51,320 --> 00:15:56,320 Speaker 1: liquidity has been weak for some months now, and obviously 283 00:15:56,360 --> 00:15:59,520 Speaker 1: into January and February that is becoming more difficult. But 284 00:15:59,640 --> 00:16:02,360 Speaker 1: again we have to go back. For example, European insurance 285 00:16:02,400 --> 00:16:05,320 Speaker 1: companies have been under the caution in the last couple 286 00:16:05,360 --> 00:16:07,640 Speaker 1: of days because of words about the side of their 287 00:16:07,680 --> 00:16:09,960 Speaker 1: credit books, but of course their credit books had largely 288 00:16:09,960 --> 00:16:13,200 Speaker 1: held to maturity. This is these are not trading organizations. 289 00:16:14,040 --> 00:16:18,080 Speaker 1: They obviously are holding credit for matching annuities or other products, 290 00:16:18,360 --> 00:16:21,520 Speaker 1: so I think they do not get me wrong. Of course, 291 00:16:21,520 --> 00:16:24,800 Speaker 1: there are major concerns and debates are present about the 292 00:16:24,840 --> 00:16:27,240 Speaker 1: state of the world economy and whether there are knock 293 00:16:27,280 --> 00:16:30,600 Speaker 1: on effects from the market stress we've seen in January 294 00:16:30,680 --> 00:16:34,240 Speaker 1: into February, and whether that actually does cause a globe 295 00:16:34,320 --> 00:16:37,680 Speaker 1: out global downturn to take place. As of present today, 296 00:16:37,920 --> 00:16:40,640 Speaker 1: at our morning meeting, immediately after discussing Deutsche Bank, we 297 00:16:40,720 --> 00:16:43,280 Speaker 1: talked about the very good car sales in January, and 298 00:16:43,280 --> 00:16:45,320 Speaker 1: of course that Monday, we talked about the very good 299 00:16:45,680 --> 00:16:49,640 Speaker 1: employment figures for the United States. This dichotomy between what's 300 00:16:49,640 --> 00:16:54,440 Speaker 1: happening in financial markets and the way of concern about 301 00:16:54,520 --> 00:16:58,200 Speaker 1: what's happening in the real economy is extremely marks at present. Michael. 302 00:16:58,800 --> 00:17:01,720 Speaker 1: The bonds do OK right now, the Yan threw one 303 00:17:04,160 --> 00:17:07,800 Speaker 1: and West Texas just broke through thirty again, Just to 304 00:17:07,800 --> 00:17:11,960 Speaker 1: bring that up a bit of a there there was 305 00:17:12,640 --> 00:17:17,920 Speaker 1: a very nasty confluence of events taking place between currency 306 00:17:17,920 --> 00:17:21,399 Speaker 1: and oil, which I think is more at the cause 307 00:17:21,440 --> 00:17:24,760 Speaker 1: of what we've been seeing in recent weeks. And absolutely 308 00:17:24,920 --> 00:17:28,119 Speaker 1: people who are asking questions now about European financials, but 309 00:17:28,160 --> 00:17:30,399 Speaker 1: I think there's deeper questions still about whether or not 310 00:17:30,760 --> 00:17:35,000 Speaker 1: what we're seeing in various markets is a supply demanding balances, 311 00:17:35,040 --> 00:17:39,119 Speaker 1: balance sheet freshes, or the six four trillion dollar question, 312 00:17:39,760 --> 00:17:42,360 Speaker 1: is the U s economy about to go into a session? Well, 313 00:17:42,359 --> 00:17:45,000 Speaker 1: I noted this morning that earnings in the United States 314 00:17:45,119 --> 00:17:49,960 Speaker 1: sparings down four point seven percent so far for the 315 00:17:49,960 --> 00:17:52,000 Speaker 1: fourth quarter, but if you take out oil, they're up 316 00:17:52,040 --> 00:17:54,800 Speaker 1: two percent if you take if you take out energy, 317 00:17:54,960 --> 00:17:57,080 Speaker 1: And you're talking about your morning meeting and how you're 318 00:17:57,080 --> 00:18:00,879 Speaker 1: talking about the dicademy between what's happening in financial markets 319 00:18:00,920 --> 00:18:04,040 Speaker 1: and what's happening in the real world. And you're sort 320 00:18:04,040 --> 00:18:07,280 Speaker 1: of the second person today to say, we at the 321 00:18:07,320 --> 00:18:10,919 Speaker 1: investment house aren't worried. We're not under the desk, but 322 00:18:11,040 --> 00:18:15,160 Speaker 1: our customers are. And I'm wondering why that is. Well, 323 00:18:15,800 --> 00:18:19,840 Speaker 1: I wouldn't say that our customers are under their desks 324 00:18:19,880 --> 00:18:22,040 Speaker 1: at all. I mean that we we have been putting 325 00:18:22,040 --> 00:18:25,040 Speaker 1: out reports all during the course of last year, warning 326 00:18:25,040 --> 00:18:28,360 Speaker 1: about the difficulties facing the world economy, of the slowdown 327 00:18:28,359 --> 00:18:31,200 Speaker 1: in US profits, grope, the need to take a more 328 00:18:31,240 --> 00:18:33,800 Speaker 1: cautious stance, and this is a world of low numbers. 329 00:18:34,640 --> 00:18:38,119 Speaker 1: Putting aside the difficulties of the last six weeks or so, 330 00:18:38,359 --> 00:18:40,120 Speaker 1: this was always going to be a year where if 331 00:18:40,119 --> 00:18:43,280 Speaker 1: you made small returns in any attic class, that was 332 00:18:43,359 --> 00:18:45,920 Speaker 1: likely to be the best that you could get. So 333 00:18:46,200 --> 00:18:48,760 Speaker 1: I think a lot of this is actually about expectations 334 00:18:49,400 --> 00:18:52,840 Speaker 1: UH and making sure that clients are as ever well 335 00:18:52,880 --> 00:18:59,840 Speaker 1: diversified and well prepared, rather than being hit by unexpected shops. Well, 336 00:19:00,520 --> 00:19:04,440 Speaker 1: one last start your neutral unrisk going forward, When do 337 00:19:04,560 --> 00:19:10,480 Speaker 1: we pull out of this this this negative worldview? I 338 00:19:10,520 --> 00:19:14,560 Speaker 1: think I think we we probably do need to see 339 00:19:14,600 --> 00:19:18,040 Speaker 1: further moves in the dollar. UM. I was hopeful that 340 00:19:19,160 --> 00:19:22,960 Speaker 1: the People's Bank of China effort to stabilize the currency 341 00:19:23,640 --> 00:19:26,159 Speaker 1: Chinese New Year might act as a circuit breaker. That 342 00:19:26,240 --> 00:19:28,800 Speaker 1: doesn't seem to have happened. I was hopeful that some 343 00:19:28,880 --> 00:19:31,639 Speaker 1: of the early signs that actually oil supply demand was 344 00:19:31,720 --> 00:19:34,919 Speaker 1: beginning to be balanced would help break uh this this 345 00:19:35,040 --> 00:19:37,639 Speaker 1: NEXTUS events. UM, I think we probably are moving on 346 00:19:37,680 --> 00:19:39,879 Speaker 1: to the stage now where this topping out process in 347 00:19:39,880 --> 00:19:44,600 Speaker 1: the US dollar has to start to see a lower 348 00:19:44,720 --> 00:19:46,919 Speaker 1: currency that I think would then start to believe a 349 00:19:46,920 --> 00:19:49,560 Speaker 1: lot of the pressures that about Thank you so much 350 00:19:49,600 --> 00:19:53,000 Speaker 1: with a standard life at Mberal Scottland giving us perspective 351 00:19:53,320 --> 00:19:59,280 Speaker 1: on a longer term perspective. Here's your perspective Futures negative fourteen. 352 00:19:59,400 --> 00:20:08,040 Speaker 1: It's Bloomber surveillance. Bloomberg Surveillance breting by benzel Bush Motorcar 353 00:20:08,080 --> 00:20:10,440 Speaker 1: in Englewood, New Jersey. Offer you a commitment to service, 354 00:20:10,520 --> 00:20:14,280 Speaker 1: luxury and value with total transparency from America's premiere automotive dealership. 355 00:20:14,440 --> 00:20:16,280 Speaker 1: To find the way you drive in benzel Bush dot 356 00:20:16,280 --> 00:20:27,720 Speaker 1: Com broadcasting live to New York. Bloomberg eleventh Rio to Washington, 357 00:20:27,840 --> 00:20:32,840 Speaker 1: d C. Bloomberg to Boston, Bloomberg dwelve hours to San Francisco, 358 00:20:32,960 --> 00:20:37,399 Speaker 1: Bloomberg to the country Suis Exam Channel one ninety and 359 00:20:37,520 --> 00:20:41,520 Speaker 1: around the globe the Bloomberg Radio Plus Appen Bloomberg dot Com. 360 00:20:41,600 --> 00:20:45,359 Speaker 1: This is Bloomberg Surveillance. Good morning at seven thirty on 361 00:20:45,440 --> 00:20:48,720 Speaker 1: Wall Street and Michael McKee along with Tom Keene. Here's 362 00:20:48,760 --> 00:20:51,560 Speaker 1: some of the company news that we are following this morning. 363 00:20:51,600 --> 00:20:54,200 Speaker 1: Everybody with our eyes on Deutsche Bank. A memo out 364 00:20:54,240 --> 00:20:58,000 Speaker 1: from co chief executive officer John Cryin this morning saying 365 00:20:58,040 --> 00:21:01,159 Speaker 1: Deutsche Bank is absolutely rock solid, and he told employees 366 00:21:01,200 --> 00:21:04,240 Speaker 1: he isn't concerned about their ability to meet legal costs. 367 00:21:04,440 --> 00:21:07,080 Speaker 1: They will have to add to their provisions for legal 368 00:21:07,119 --> 00:21:09,680 Speaker 1: this year, but have already accounted for it in its 369 00:21:09,720 --> 00:21:13,160 Speaker 1: financial planning. Dutch Bank shares off one point eight percent 370 00:21:13,480 --> 00:21:16,920 Speaker 1: in European trading. Coca Cola posting fourth quarter profit beating 371 00:21:16,920 --> 00:21:20,920 Speaker 1: analysts estimates. Cost cutting programs helped improve margins, earnings thirty 372 00:21:20,960 --> 00:21:23,520 Speaker 1: eight cents of share pending, better than the thirty seven 373 00:21:23,600 --> 00:21:27,359 Speaker 1: cent analyst estimate, net revenue of ten billion dollars better 374 00:21:27,400 --> 00:21:30,960 Speaker 1: than the nine point eight nine billion consensus forecast and 375 00:21:31,040 --> 00:21:35,000 Speaker 1: cable TV programmer Viacom reporting lower fiscal first quarter sales 376 00:21:35,000 --> 00:21:38,200 Speaker 1: and profit profit fell nine percent. A dollar eighteen is 377 00:21:38,320 --> 00:21:42,199 Speaker 1: share that matches analysts estimates. Sales fell six percent to 378 00:21:42,320 --> 00:21:45,080 Speaker 1: three point one five billion, The projection was for three 379 00:21:45,080 --> 00:21:49,320 Speaker 1: point to seven billion. Time now to check out with 380 00:21:49,400 --> 00:21:52,800 Speaker 1: Michael Barr and get the latest world and national headlines. Michael, Mike, 381 00:21:52,840 --> 00:21:54,840 Speaker 1: thank you very much. New Hampshire voters what head to 382 00:21:54,840 --> 00:21:57,760 Speaker 1: the polls today to vote in the presidential primary. Three 383 00:21:57,880 --> 00:22:02,200 Speaker 1: tiny villages in the state already have voted, including Dixville, 384 00:22:02,240 --> 00:22:05,720 Speaker 1: where there are nine registered voters For the Republicans, John 385 00:22:05,800 --> 00:22:08,520 Speaker 1: case had got three and Donald Trump got to. Bernie 386 00:22:08,520 --> 00:22:12,479 Speaker 1: Sanders got all four Democratic votes. His rival, Hillary Clinton 387 00:22:12,640 --> 00:22:15,639 Speaker 1: campaigned in Hudson, New Hampshire along with her husband, former 388 00:22:15,680 --> 00:22:18,560 Speaker 1: President Bill Clinton last night. If you really want in 389 00:22:18,640 --> 00:22:24,720 Speaker 1: America for everyone economically, socially, politically, if you want a 390 00:22:24,760 --> 00:22:27,720 Speaker 1: security policy that keeps the site and tries to build 391 00:22:27,720 --> 00:22:30,520 Speaker 1: a world with more friends and fewer enemies, you only 392 00:22:30,560 --> 00:22:33,879 Speaker 1: have one choice. President Obama will unveil his eighth and 393 00:22:34,000 --> 00:22:37,320 Speaker 1: final budget today. It is a four trillion dollar plus 394 00:22:37,359 --> 00:22:40,400 Speaker 1: proposal that calls for a ten dollar per barrel tax 395 00:22:40,480 --> 00:22:43,439 Speaker 1: hike on oil, and there's also likely to increase taxes 396 00:22:43,480 --> 00:22:46,639 Speaker 1: on the wealthy and corporations. Authorities in Germany say at 397 00:22:46,680 --> 00:22:49,200 Speaker 1: least nine people were killed after a head on collision 398 00:22:49,200 --> 00:22:52,119 Speaker 1: between two trains the trans crash this morning in a 399 00:22:52,160 --> 00:22:55,600 Speaker 1: remote area of Bavaria. About a hundred fifty others were hurt. 400 00:22:55,840 --> 00:22:58,920 Speaker 1: Global News twenty four hours a day, powered by our 401 00:22:58,480 --> 00:23:01,359 Speaker 1: two hundred journalists and more than a hundred fifty news 402 00:23:01,400 --> 00:23:06,240 Speaker 1: bureaus from around the world. Michael Barr Mike Time Now 403 00:23:06,280 --> 00:23:09,160 Speaker 1: for the Bloomberg NBC Sports Update with John Station John 404 00:23:09,600 --> 00:23:12,760 Speaker 1: all Right, Mike. Despite no previous coaching experience, the Knicks 405 00:23:12,760 --> 00:23:15,280 Speaker 1: and Phil Jackson gave Derek Fisher four year, twenty million 406 00:23:15,320 --> 00:23:17,960 Speaker 1: dollar contract. Now he's gone before the All Star break 407 00:23:17,960 --> 00:23:20,760 Speaker 1: of his second season. The Knicks were a five hundred team, 408 00:23:20,800 --> 00:23:23,960 Speaker 1: but they've dropped nine of ten, and Jackson made the move, 409 00:23:24,000 --> 00:23:27,240 Speaker 1: promoting assistant Kurt Rambis, who will finish out the season. 410 00:23:27,320 --> 00:23:30,000 Speaker 1: His first game as tonight at the Garden against Washington 411 00:23:30,119 --> 00:23:33,480 Speaker 1: the Barkley Center. Last night, Nets and Nuggets to the wire. 412 00:23:33,720 --> 00:23:36,119 Speaker 1: Braw will in battle the front course that's down to 413 00:23:36,640 --> 00:23:39,160 Speaker 1: one point three left. I'll talk Joe Johnson all Callot's 414 00:23:39,200 --> 00:23:45,440 Speaker 1: three take it in. That's when whoa Johnson at the whole? 415 00:23:47,320 --> 00:23:51,160 Speaker 1: One oh five, one oh four the final on That's Radio. 416 00:23:51,280 --> 00:23:53,879 Speaker 1: That is Daddy's Young twenty points at the Garden. Rangers 417 00:23:53,920 --> 00:23:55,880 Speaker 1: top the Devils to one. They've got their first three 418 00:23:55,880 --> 00:23:58,919 Speaker 1: game win streak since November. Another loss for St. John's. 419 00:23:58,920 --> 00:24:01,199 Speaker 1: That's fifteen in the rows since mid December, eaten by 420 00:24:01,200 --> 00:24:05,560 Speaker 1: Georgetown two sixty seven to Bloomberg NBC Sports Update. I'm 421 00:24:05,640 --> 00:24:10,240 Speaker 1: John step Shilling. Thank you, John. We're watching the bond 422 00:24:10,320 --> 00:24:14,640 Speaker 1: market after Japanese yields turned negative all across the curve, 423 00:24:14,720 --> 00:24:18,520 Speaker 1: their tenure note yielding negative four basis points. Here in 424 00:24:18,600 --> 00:24:22,160 Speaker 1: the US, we're seeing a drop in yields. Tenure yield 425 00:24:22,400 --> 00:24:25,120 Speaker 1: now one point seven three percent, the five year at 426 00:24:25,160 --> 00:24:28,480 Speaker 1: one point one five percent, and the two year at 427 00:24:28,680 --> 00:24:33,240 Speaker 1: sixty five basis points. This is Bloomberg surveillance on Bloomberg 428 00:24:33,320 --> 00:24:42,000 Speaker 1: Radio worldwide. This is Bloomberg surveillance and Michael McKee along 429 00:24:42,119 --> 00:24:45,320 Speaker 1: with Tom Keene, we're keeping an eye on volatile markets 430 00:24:45,480 --> 00:24:48,480 Speaker 1: right now. SMP features down by sixteen points to out 431 00:24:48,520 --> 00:24:51,919 Speaker 1: Futures down a hundred and thirty three NAS day features 432 00:24:51,920 --> 00:24:56,000 Speaker 1: are off by twenty six they continue to deteriorate throughout 433 00:24:56,160 --> 00:24:59,119 Speaker 1: the morning time for the Bloomberg n j I T 434 00:24:59,280 --> 00:25:02,520 Speaker 1: STEM report by New Jersey Institute of Technology partnering with 435 00:25:02,560 --> 00:25:06,240 Speaker 1: government and industry to to apply the university's world class 436 00:25:06,280 --> 00:25:09,720 Speaker 1: research assets to innovate and spur economic growth. Learn more 437 00:25:09,800 --> 00:25:13,480 Speaker 1: at n j I T dot EU. Here's John will Michael, 438 00:25:13,560 --> 00:25:16,719 Speaker 1: multiple sclerosious of patients may one day have the option 439 00:25:16,840 --> 00:25:21,040 Speaker 1: of having an intelligent camera system track the diseases progress 440 00:25:21,400 --> 00:25:26,000 Speaker 1: using super precise measurements of physical symptoms to enable better, faster, 441 00:25:26,080 --> 00:25:29,879 Speaker 1: and cheaper treatments. Microsoft researchers have teamed up with pharma 442 00:25:29,920 --> 00:25:34,840 Speaker 1: giant Lavartis to develop a system called access MS, which 443 00:25:34,920 --> 00:25:38,840 Speaker 1: uses the company's connected motion camera and machine learning software 444 00:25:39,119 --> 00:25:43,000 Speaker 1: to track movements, analyzing things like gait and ability to 445 00:25:43,000 --> 00:25:46,840 Speaker 1: touch one's nose with a finger. In racent way, speculation 446 00:25:46,960 --> 00:25:49,120 Speaker 1: is a matter that Amazon dot Com plans to launch 447 00:25:49,160 --> 00:25:52,440 Speaker 1: a global shipping and logistics operation that will compete with 448 00:25:52,440 --> 00:25:55,560 Speaker 1: the United Parcel Service and Federal Express asked about the 449 00:25:55,600 --> 00:25:58,760 Speaker 1: reports that the company was leasing planes and had registered 450 00:25:58,760 --> 00:26:03,119 Speaker 1: an ocean freight looking Business. The chief financial officer downplaying 451 00:26:03,160 --> 00:26:06,600 Speaker 1: Amazon's ambitions last month in an earnings call. He said 452 00:26:06,600 --> 00:26:10,080 Speaker 1: the company was simply looking to supplement its delivery partners. 453 00:26:10,359 --> 00:26:14,800 Speaker 1: But Amazon documents rewed reviewed by Bloomberg News reveal a 454 00:26:14,840 --> 00:26:19,240 Speaker 1: far boulder plan. Reports the Amazon senior management team proposed 455 00:26:19,240 --> 00:26:24,480 Speaker 1: an aggressive global expansion of the company's Fulfillment by Amazon Service. 456 00:26:25,000 --> 00:26:27,679 Speaker 1: And that is this morning's Bloomberg and g I t 457 00:26:27,880 --> 00:26:31,760 Speaker 1: Stem report. Mike, thank you very much, John Well. The 458 00:26:31,880 --> 00:26:35,120 Speaker 1: concern of the day for the last two days, rather 459 00:26:35,320 --> 00:26:37,560 Speaker 1: we should say, has been Deutsche Bank and whether or 460 00:26:37,600 --> 00:26:43,520 Speaker 1: not it has credit problems. The concerns center around convertible bonds, 461 00:26:43,800 --> 00:26:49,000 Speaker 1: called Coco's. Bloomberg strategist credit risk strategist Simon Ballant joins 462 00:26:49,080 --> 00:26:51,639 Speaker 1: us now from London to help put this all in perspective. 463 00:26:51,680 --> 00:26:55,280 Speaker 1: And so I'm gonna first if you could and put 464 00:26:55,400 --> 00:26:58,680 Speaker 1: Coco's into plain language so people can understand what we're 465 00:26:58,720 --> 00:27:05,480 Speaker 1: talking about. Okay, so we don't have we don't have 466 00:27:05,520 --> 00:27:09,639 Speaker 1: a good audio line there. Well, we'll fix that with first, Simon, 467 00:27:10,280 --> 00:27:13,280 Speaker 1: and tell you that right now, the stock six D 468 00:27:13,800 --> 00:27:17,280 Speaker 1: is down five points one point six percent, led by financials. 469 00:27:17,320 --> 00:27:20,240 Speaker 1: The whole de Deutsche Bank issue UH financials in Europe 470 00:27:20,320 --> 00:27:23,840 Speaker 1: right now down by two point eight percent, The docks 471 00:27:24,000 --> 00:27:26,600 Speaker 1: is off a hundred and twenty points one point three percent, 472 00:27:26,960 --> 00:27:30,080 Speaker 1: the CAC forty is off by ninety two point two percent, 473 00:27:30,560 --> 00:27:34,080 Speaker 1: and the foot seat in London down by that's nine 474 00:27:34,119 --> 00:27:36,960 Speaker 1: tenths of eight percent. And as we noted, this has 475 00:27:36,960 --> 00:27:41,040 Speaker 1: been deteriorating all day the futures outlook in the US 476 00:27:41,119 --> 00:27:45,879 Speaker 1: and stocks in Europe. The decline began in Japan with 477 00:27:45,920 --> 00:27:48,840 Speaker 1: a KNIK down five point four percent, after the tenure 478 00:27:48,880 --> 00:27:51,440 Speaker 1: note yield there went negative and the whole curve first 479 00:27:51,440 --> 00:27:54,200 Speaker 1: for a G seven country went negative. The ten uere 480 00:27:54,200 --> 00:27:58,000 Speaker 1: note yield in Japan down negative four basis points. China 481 00:27:58,520 --> 00:28:02,120 Speaker 1: Hong Kong uh CR all closed for the New Year 482 00:28:02,240 --> 00:28:06,439 Speaker 1: holiday in Asia, so they're not behind any of this. 483 00:28:07,040 --> 00:28:09,880 Speaker 1: The end. On the back of what happened in the 484 00:28:09,960 --> 00:28:14,840 Speaker 1: yield markets, they're a hundred and fourteen twenty one right 485 00:28:15,560 --> 00:28:17,760 Speaker 1: It reached as low as a hundred fourteen twenty one, 486 00:28:17,760 --> 00:28:20,840 Speaker 1: which is a two thousand fourteen price right now, one 487 00:28:20,960 --> 00:28:25,440 Speaker 1: fifteen oh one. Now, let's check it with Patricia Kara 488 00:28:25,440 --> 00:28:28,560 Speaker 1: and get the Bloomberg Green Report. What is lunar New 489 00:28:28,640 --> 00:28:32,160 Speaker 1: Year without fireworks a lot quieter, and a big reason 490 00:28:32,320 --> 00:28:35,880 Speaker 1: is pollution plagued by a worsening smog problem. Local governments 491 00:28:35,920 --> 00:28:39,479 Speaker 1: throughout China are cracking down on firecrackers of all shapes 492 00:28:39,520 --> 00:28:42,680 Speaker 1: and sizes. Cheng Jou is one of five provincial capitals 493 00:28:42,680 --> 00:28:46,239 Speaker 1: that have banned fireworks altogether. Shanghai is also banning them 494 00:28:46,280 --> 00:28:49,360 Speaker 1: in the city center. In Beijing, firework sales are down 495 00:28:49,400 --> 00:28:52,640 Speaker 1: by half this year, after already falling thirty last year. 496 00:28:53,000 --> 00:28:55,600 Speaker 1: Winter smog is common in that city, and the government 497 00:28:55,640 --> 00:28:58,240 Speaker 1: has blanketed the streets with signs urging moderation in the 498 00:28:58,280 --> 00:29:01,480 Speaker 1: use of the explosives for pollution and public safety. The 499 00:29:01,520 --> 00:29:04,240 Speaker 1: subway system features posters with a Teddy bear wearing a 500 00:29:04,280 --> 00:29:07,240 Speaker 1: gas mask a string of firecrackers dangling from a paw. 501 00:29:07,880 --> 00:29:11,280 Speaker 1: Fireworks makers are also trying to develop alternative products made 502 00:29:11,280 --> 00:29:14,520 Speaker 1: with new chemicals that make the more environmentally friendly. Even 503 00:29:14,560 --> 00:29:17,720 Speaker 1: the biggest fireworks maker in Beijing, Panda, still needs to 504 00:29:17,760 --> 00:29:20,360 Speaker 1: make changes in the face of decreasing market demand. It 505 00:29:20,400 --> 00:29:23,600 Speaker 1: now prioritizes small and medium sized products that are cheaper, 506 00:29:24,040 --> 00:29:27,840 Speaker 1: and that's a Bloomberg green business report. I'm Patris Sakora, 507 00:29:28,880 --> 00:29:31,920 Speaker 1: Thank you. Patris. Italy's finance Mrs says the expected decline 508 00:29:31,960 --> 00:29:34,200 Speaker 1: of that country's public debt this year will mark a 509 00:29:34,320 --> 00:29:37,400 Speaker 1: turnaround for the euroregion's third biggest economy, and that will 510 00:29:37,480 --> 00:29:42,320 Speaker 1: change financial markets skeptical view of the country. Given real 511 00:29:42,360 --> 00:29:45,840 Speaker 1: growth and possibly given a bit more inflation that's beyond 512 00:29:45,920 --> 00:29:49,160 Speaker 1: a control. Of course, we will see dynamics of the 513 00:29:49,240 --> 00:29:53,000 Speaker 1: debt accelerating downwards and this will change the perception of 514 00:29:53,000 --> 00:29:57,120 Speaker 1: the markets. That was Pierre Carlo Patawan speaking in an 515 00:29:57,120 --> 00:30:03,000 Speaker 1: exclusive interview with Bloomberg News Editor in chief John Michael Flwaite. Well, 516 00:30:03,040 --> 00:30:07,720 Speaker 1: markets across Europe are lower right now, including in Italy. 517 00:30:07,840 --> 00:30:11,240 Speaker 1: We're looking at the foot Seaman uh down on the 518 00:30:11,320 --> 00:30:16,640 Speaker 1: day sixteen oh twenty one, and we're also looking at 519 00:30:16,680 --> 00:30:20,719 Speaker 1: the German decks down right now a hundred and eighteen points, 520 00:30:20,720 --> 00:30:26,000 Speaker 1: that's one point three SMP features continue to deteriorate, off 521 00:30:26,040 --> 00:30:28,640 Speaker 1: sixteen points eight tenths of a percent, an e tents 522 00:30:28,720 --> 00:30:31,000 Speaker 1: drop for Dow futures, they're down a hundred and twenty 523 00:30:31,040 --> 00:30:35,400 Speaker 1: seven NASDAC features down twenty seven, seven tenths of a percent. 524 00:30:35,800 --> 00:30:38,360 Speaker 1: One of the issues seems to be whether investors can 525 00:30:38,400 --> 00:30:40,760 Speaker 1: get used to the idea that central banks may not 526 00:30:40,840 --> 00:30:43,960 Speaker 1: be able to pull their irons out of the fire anymore. 527 00:30:44,240 --> 00:30:46,840 Speaker 1: Coming up at the top of the hour, muhammadal Arian 528 00:30:47,000 --> 00:30:49,920 Speaker 1: in his new book The Only Game in Town, Central Banks, 529 00:30:49,920 --> 00:30:53,200 Speaker 1: Instability and Avoiding the Next Collapse. Tom Keen and I 530 00:30:53,240 --> 00:30:56,200 Speaker 1: will ask him about this idea that central banks have 531 00:30:56,240 --> 00:31:00,440 Speaker 1: reached the limit of their power. Dr al Arian's adjusting 532 00:31:00,440 --> 00:31:04,280 Speaker 1: it is time for the fiscal authorities to get involved. 533 00:31:05,320 --> 00:31:09,000 Speaker 1: Gold price is one thousand down three dollars. That breaks 534 00:31:09,000 --> 00:31:11,600 Speaker 1: a week long winning streak for gold, at least so far. 535 00:31:12,000 --> 00:31:17,600 Speaker 1: Copper prices two oh four forty two. This is Bloomberg surveillance. 536 00:31:20,880 --> 00:31:23,000 Speaker 1: Bloomberg Surveillance is brought to you you by Flushing Bank. Over 537 00:31:23,040 --> 00:31:25,600 Speaker 1: a complete business checking account with fifteen thousand dollars or 538 00:31:25,640 --> 00:31:28,040 Speaker 1: more and get a free sixteen gig WiFi tablet. Visit 539 00:31:28,080 --> 00:31:30,560 Speaker 1: flushing back dot com for details. Remember f D I C, 540 00:31:30,840 --> 00:31:40,200 Speaker 1: Equal Housing, Glendon Global Business News twenty four hours a day. 541 00:31:40,440 --> 00:31:43,400 Speaker 1: If Bloomberg dot Com the radio plus mobile app and 542 00:31:43,520 --> 00:31:47,200 Speaker 1: on your radio. This is a Broomberg business flash and 543 00:31:47,240 --> 00:31:49,800 Speaker 1: I'm covering Moscow. There's updates broth to you buy cbo 544 00:31:49,880 --> 00:31:52,800 Speaker 1: E VIS Options and Futures. Volatility can be harnessed with 545 00:31:52,880 --> 00:31:56,240 Speaker 1: cbo E VIS options and futures. See disclosures and learn 546 00:31:56,280 --> 00:31:59,600 Speaker 1: more at cbo e dot com. Slash powerful outcomes of 547 00:31:59,720 --> 00:32:03,120 Speaker 1: VICK and futures are lower with smb emni futures down 548 00:32:03,120 --> 00:32:06,280 Speaker 1: eighteen points DOWNEY Mini futures down on fifty four and 549 00:32:06,360 --> 00:32:09,360 Speaker 1: nasdach E mini futures down thirty eight. Dacks in Germany 550 00:32:09,440 --> 00:32:11,840 Speaker 1: is down one point nine percent ten Your treasury up 551 00:32:11,920 --> 00:32:14,480 Speaker 1: nine thirty seconds, the yeld one point seven one percent, 552 00:32:14,880 --> 00:32:16,920 Speaker 1: nimex scred oil up a tenth of upper cent or 553 00:32:16,960 --> 00:32:20,280 Speaker 1: three cents a seventy three of barrel comex golled down 554 00:32:20,280 --> 00:32:22,080 Speaker 1: a tenth of upper cent or a dollar eighty to 555 00:32:22,200 --> 00:32:26,320 Speaker 1: eleven ninety six twenty unnounced. And that's a Bloomberg business flash. 556 00:32:26,360 --> 00:32:29,120 Speaker 1: Tom and Mike, thank you. Karen. Well, we have fixed 557 00:32:29,200 --> 00:32:32,000 Speaker 1: our line between here in London. It's amazing, Tom, the 558 00:32:32,200 --> 00:32:34,400 Speaker 1: technology that we have these days. We can talk to 559 00:32:34,480 --> 00:32:38,000 Speaker 1: London live, we can talk to Simon Ballard. He is 560 00:32:38,240 --> 00:32:43,520 Speaker 1: a credit risk analyst for Bloomberg in London. And the 561 00:32:43,520 --> 00:32:45,920 Speaker 1: thing that everybody has been worried about the last forty 562 00:32:45,920 --> 00:32:48,800 Speaker 1: eight hours. Simon is Deutsche Bank and its ability to 563 00:32:48,800 --> 00:32:53,680 Speaker 1: make coupon payments on contingent convertibles, popularly known as coco's. 564 00:32:54,200 --> 00:32:57,640 Speaker 1: For our audience, can you explain what a COCO is 565 00:32:57,760 --> 00:33:01,880 Speaker 1: and why we should be concerned? Very interesting question, very 566 00:33:01,880 --> 00:33:05,680 Speaker 1: relevant question. The COCO, the contingent convertible bond is like 567 00:33:05,720 --> 00:33:09,080 Speaker 1: a like a regular convertible bond that will convert from 568 00:33:09,120 --> 00:33:12,120 Speaker 1: a bond to equity at a time of stress m 569 00:33:12,240 --> 00:33:15,640 Speaker 1: but this bond, the COCO, is contingent on a specified event, 570 00:33:15,680 --> 00:33:17,920 Speaker 1: such as the stock price of the company exceeding a 571 00:33:17,960 --> 00:33:20,920 Speaker 1: particular level for a certain period of time. So obviously 572 00:33:20,920 --> 00:33:24,360 Speaker 1: when the when the stock price sells off during during 573 00:33:24,400 --> 00:33:26,720 Speaker 1: week periods, then you can convert the bond through to 574 00:33:27,120 --> 00:33:30,040 Speaker 1: through to equity um. The The idea is that the the 575 00:33:30,120 --> 00:33:32,800 Speaker 1: regulators hope that this then helps to buttress the bank's 576 00:33:32,800 --> 00:33:36,239 Speaker 1: finances in times of stress. So an actual fact, if 577 00:33:36,240 --> 00:33:38,560 Speaker 1: you look at it from a certain perspective, the COCO, 578 00:33:38,840 --> 00:33:42,240 Speaker 1: the cocoa bond, the contingent convertible bond is designed to 579 00:33:42,280 --> 00:33:45,080 Speaker 1: fail at the end of the day without triggering a 580 00:33:45,120 --> 00:33:47,000 Speaker 1: default of the bank itself, So it's seen as a 581 00:33:47,200 --> 00:33:49,240 Speaker 1: it's a. It's a buffer for the for the balance 582 00:33:49,280 --> 00:33:52,640 Speaker 1: sheet of the of the financial institution itself to convert 583 00:33:52,720 --> 00:33:55,520 Speaker 1: bonds through the equities that are given at a contingent price. 584 00:33:55,680 --> 00:33:57,720 Speaker 1: They do it in Europe, they don't do it here. 585 00:33:57,880 --> 00:34:01,560 Speaker 1: Why did Americans satan, We're not going to do Coco paths. 586 00:34:02,440 --> 00:34:05,480 Speaker 1: I guess it was the the the development from the 587 00:34:05,560 --> 00:34:08,640 Speaker 1: from the ECB, the financial the financial markets over here 588 00:34:08,680 --> 00:34:11,000 Speaker 1: in Europe that we're trying to sort of extend the envelope, 589 00:34:11,040 --> 00:34:13,399 Speaker 1: if you wish, in terms of you know, balance sheet 590 00:34:13,440 --> 00:34:16,440 Speaker 1: repair and at the same time offering investors, you know, 591 00:34:16,520 --> 00:34:20,080 Speaker 1: a yield enhancing asset um. And therein I think lies 592 00:34:20,080 --> 00:34:22,040 Speaker 1: the problem. It's not so much with Deutsche Bank itself 593 00:34:22,080 --> 00:34:23,879 Speaker 1: over the last twenty four hours, but it's the it's 594 00:34:23,880 --> 00:34:25,880 Speaker 1: the questions that have been raised now as far as 595 00:34:26,120 --> 00:34:28,879 Speaker 1: you know, the extent of the risk that's embedded into 596 00:34:28,920 --> 00:34:32,680 Speaker 1: these contingent convertible bonds that investors haven't necessarily been fully 597 00:34:32,680 --> 00:34:35,719 Speaker 1: cognizant of, as they've been sort of, you know, complacently 598 00:34:35,760 --> 00:34:38,279 Speaker 1: almost buying into into yielding in assert world, in the 599 00:34:38,360 --> 00:34:41,000 Speaker 1: zero interest rate policy world, within the world that Mr 600 00:34:41,120 --> 00:34:45,480 Speaker 1: Cryan's living in, does he control the decision tree and 601 00:34:45,719 --> 00:34:49,960 Speaker 1: Coco derivative securities, or are there people telling him what 602 00:34:50,040 --> 00:34:55,240 Speaker 1: to do given certain triggers or mechanisms. Given given certain 603 00:34:55,239 --> 00:34:57,480 Speaker 1: triggers or mechanisms, I think the market will be in 604 00:34:57,560 --> 00:35:00,680 Speaker 1: charge of the you know, the contingent convert able market. 605 00:35:01,400 --> 00:35:05,520 Speaker 1: Mr kron can can can assure us that their solvency 606 00:35:05,640 --> 00:35:08,920 Speaker 1: is adequate to make their coupon payments and that indeed 607 00:35:08,960 --> 00:35:12,000 Speaker 1: has has relieved the markets this morning. We've we've we've 608 00:35:12,040 --> 00:35:14,319 Speaker 1: improved from the from the recent volatility. Okay, we're off 609 00:35:14,360 --> 00:35:17,400 Speaker 1: the early morning tights that we hit here in Europe. Um. 610 00:35:17,560 --> 00:35:21,480 Speaker 1: But nevertheless, it's the market pricing will will dictate what 611 00:35:21,520 --> 00:35:23,880 Speaker 1: it feels is the is the embedded risk in these products? 612 00:35:23,960 --> 00:35:26,400 Speaker 1: Simon Ballard, thank you so much. Folks. Read Simon Ballard, 613 00:35:26,400 --> 00:35:31,200 Speaker 1: Bloomberg First Word and Bloomberg Intelligence Today on derivative instruments. Mike, 614 00:35:31,320 --> 00:35:34,520 Speaker 1: New Hampshire is not derivative, is it? Uh? Well, it 615 00:35:34,600 --> 00:35:37,240 Speaker 1: may be. That's the issue here is does New Hampshire 616 00:35:37,640 --> 00:35:40,359 Speaker 1: set us on a different course or not. Chuck Todd 617 00:35:40,520 --> 00:35:42,480 Speaker 1: is the host of NBC's Meet the Press, which you 618 00:35:42,520 --> 00:35:46,279 Speaker 1: can hear here on Bloomberg Grade eleven and three on 619 00:35:46,640 --> 00:35:51,480 Speaker 1: Sundays and Chuck Um. This seems to be sort of 620 00:35:51,520 --> 00:35:56,000 Speaker 1: a replay of last week, except there are more moderates 621 00:35:56,160 --> 00:35:58,400 Speaker 1: in the middle, which may leave us with more of 622 00:35:58,440 --> 00:36:01,799 Speaker 1: a muddle when it's over. I think it is gonna 623 00:36:01,800 --> 00:36:05,120 Speaker 1: be that's possible. I mean, if we're but I kind 624 00:36:05,120 --> 00:36:07,520 Speaker 1: of think we are focusing too much on who's gonna 625 00:36:07,520 --> 00:36:10,319 Speaker 1: finish second and not enough fund who's looking like they're 626 00:36:10,360 --> 00:36:13,520 Speaker 1: finishing first. I mean, I think that in this case 627 00:36:13,560 --> 00:36:16,600 Speaker 1: where it's not like I was, we have polls shown 628 00:36:16,760 --> 00:36:19,960 Speaker 1: both Standers and Trump with double digit leads. Let's think 629 00:36:19,960 --> 00:36:22,200 Speaker 1: about this, and six months ago that we had a 630 00:36:22,239 --> 00:36:23,920 Speaker 1: conversation that said, you know who's gonna win the New 631 00:36:23,920 --> 00:36:26,279 Speaker 1: Hampshire primary. On each side of the It's gonna be 632 00:36:26,320 --> 00:36:29,120 Speaker 1: Trump and Sanders. The guys would have said, I was nuts. 633 00:36:29,880 --> 00:36:33,680 Speaker 1: I mean, this is a this is a big deal, 634 00:36:34,400 --> 00:36:36,480 Speaker 1: uh if the two of them, because what New Hampshire 635 00:36:36,520 --> 00:36:41,200 Speaker 1: is doing and is reflecting the same you know, uncertaintly 636 00:36:41,239 --> 00:36:43,279 Speaker 1: we've seen in the country, anger in the country, and 637 00:36:43,320 --> 00:36:45,799 Speaker 1: they're basically saying, yeah, we agree, let's up end both 638 00:36:45,840 --> 00:36:49,360 Speaker 1: political parties. And it's a remarkable result. If indeed, the 639 00:36:49,400 --> 00:36:52,719 Speaker 1: polls are are correct. When it comes to who's gonna 640 00:36:52,719 --> 00:36:54,920 Speaker 1: win again, I know, second place, third place, we're all 641 00:36:54,920 --> 00:36:57,680 Speaker 1: trying to figure that out. But let's not ignore who's 642 00:36:57,680 --> 00:36:59,600 Speaker 1: going to be at the top. Well, let's take it 643 00:36:59,719 --> 00:37:03,040 Speaker 1: part by party. On the Republican side. The last time 644 00:37:03,360 --> 00:37:05,319 Speaker 1: New Hampshire it's were mad as hell and not going 645 00:37:05,360 --> 00:37:08,879 Speaker 1: to take it anymore. They voted for Pat Buchanan, who 646 00:37:08,960 --> 00:37:12,719 Speaker 1: was then never heard from again. Uh. Do we think 647 00:37:12,760 --> 00:37:17,680 Speaker 1: that Donald Trump is different than Pat Buchanan. Well, in 648 00:37:17,719 --> 00:37:22,040 Speaker 1: some ways he's very similar to Buchanan. Uh, it's the 649 00:37:22,160 --> 00:37:25,360 Speaker 1: same frustration. He is sort of representing his working class 650 00:37:25,360 --> 00:37:28,200 Speaker 1: way at the Republican Party. In Buchanan was the first 651 00:37:28,239 --> 00:37:31,520 Speaker 1: Republican to acknowledge the existence of this voter uh, and 652 00:37:31,600 --> 00:37:33,799 Speaker 1: to tap into that voter sentiment, and then it was 653 00:37:33,840 --> 00:37:36,520 Speaker 1: ignored pro a wile. So on one hand, it is similar. 654 00:37:36,760 --> 00:37:38,840 Speaker 1: Where it's different is that, you know, Buchanan didn't have 655 00:37:38,840 --> 00:37:41,839 Speaker 1: any resources. Buchanan was a one state guy. He just 656 00:37:41,880 --> 00:37:45,040 Speaker 1: came up here to win it. Trump's different, right, Trump's 657 00:37:45,040 --> 00:37:48,000 Speaker 1: a national figure. Trump has got money. If you choose 658 00:37:48,040 --> 00:37:51,080 Speaker 1: to suspend it to be a big deal candidacy and 659 00:37:51,960 --> 00:37:56,319 Speaker 1: he's turned into a different candidate, So I wouldn't I think, Look, 660 00:37:56,600 --> 00:37:58,799 Speaker 1: he may not be the nominee, but let's not Let's 661 00:37:58,840 --> 00:38:01,600 Speaker 1: also not dismissed the fact that he may find win 662 00:38:01,680 --> 00:38:06,359 Speaker 1: his first presidential primary. That's not a small thing, Chuck. 663 00:38:06,520 --> 00:38:10,280 Speaker 1: What is Karl Rove watching for in New Hampshire today? 664 00:38:10,360 --> 00:38:15,000 Speaker 1: If he is the machinist of the Republican establishment, what 665 00:38:15,040 --> 00:38:20,080 Speaker 1: are people like Mr Rove attempting to observe? Well? I 666 00:38:20,120 --> 00:38:21,960 Speaker 1: think I want to see which one of the four guys, 667 00:38:22,400 --> 00:38:26,840 Speaker 1: case of Jeff Christie or Review pops Um. You know, 668 00:38:26,920 --> 00:38:29,440 Speaker 1: he's an establish name kind of guy, and he wants 669 00:38:30,000 --> 00:38:32,839 Speaker 1: he thinks that, you know, that the party should find 670 00:38:32,880 --> 00:38:36,359 Speaker 1: the most electable conservative, not the most conservative, not the 671 00:38:36,400 --> 00:38:40,120 Speaker 1: loudest conservative, not the biggest populace, but the most electable. 672 00:38:40,600 --> 00:38:43,839 Speaker 1: And so in his mind he's looking for the Let's 673 00:38:43,880 --> 00:38:48,719 Speaker 1: see if particularly Busher or Casey, who both seemed to 674 00:38:48,760 --> 00:38:51,439 Speaker 1: be the Canada's on the move here in the last 675 00:38:51,480 --> 00:38:54,120 Speaker 1: twenty four hours, if one of them is the second? 676 00:38:54,160 --> 00:38:56,600 Speaker 1: Do they are they built to last? Can you build 677 00:38:56,600 --> 00:38:59,480 Speaker 1: a national campaign after you leave New Hampshire, after the 678 00:39:00,080 --> 00:39:02,839 Speaker 1: after the tumultuous six months that they've been through dealing 679 00:39:02,920 --> 00:39:05,200 Speaker 1: with Trump and all of that stuff. So look, I 680 00:39:05,280 --> 00:39:07,080 Speaker 1: think that's what he's looking for, is which one of 681 00:39:07,080 --> 00:39:10,759 Speaker 1: those four shows a sign of life tonight? Well? Does do? 682 00:39:11,600 --> 00:39:13,800 Speaker 1: This is the reason I'm focused on who finishes second? 683 00:39:14,040 --> 00:39:17,719 Speaker 1: Does anybody break out enough that others drop out of 684 00:39:17,760 --> 00:39:20,839 Speaker 1: the race? Boy? Not after I would have said if 685 00:39:20,840 --> 00:39:22,480 Speaker 1: you'd asked me that Friday, I would have said yes. 686 00:39:23,160 --> 00:39:27,000 Speaker 1: But after the Rubio debacle on Saturday, I think the 687 00:39:27,040 --> 00:39:30,280 Speaker 1: message that all of these candidates got is Boy, it isn't. 688 00:39:30,520 --> 00:39:33,400 Speaker 1: I'm not kidding back yet. This thinks to Rubyo was 689 00:39:33,400 --> 00:39:35,759 Speaker 1: on the verge of I think being coming of that 690 00:39:35,920 --> 00:39:38,759 Speaker 1: guy and uniting the party. He had a nomination in 691 00:39:38,760 --> 00:39:41,960 Speaker 1: his hand. Had that, had his debate performance been as 692 00:39:42,000 --> 00:39:45,200 Speaker 1: good as it was bad, we would be talking about 693 00:39:45,200 --> 00:39:48,759 Speaker 1: three guys hit out tonight or tomorrow morning. Instead, they're 694 00:39:48,760 --> 00:39:52,080 Speaker 1: all stick up. Everybody's sticking, and I think that that 695 00:39:52,080 --> 00:39:54,600 Speaker 1: that's the message of Saturday night. The only guy actually 696 00:39:54,640 --> 00:39:57,680 Speaker 1: see not making into South Carolina is Christie if he 697 00:39:57,760 --> 00:40:01,439 Speaker 1: ends up finishing six, because he does have a financialership. 698 00:40:01,520 --> 00:40:04,880 Speaker 1: I understand it's a time of offense and taking risks, 699 00:40:04,920 --> 00:40:08,120 Speaker 1: but who's being the Denver Broncos. Chuck, I mean, I 700 00:40:08,160 --> 00:40:10,520 Speaker 1: don't know if you're aware, but Michael McKee's team needed 701 00:40:10,960 --> 00:40:13,440 Speaker 1: and went all the way and McKees been playing cold 702 00:40:13,440 --> 00:40:16,160 Speaker 1: play all the morning for some reason. Chuck, can you 703 00:40:16,239 --> 00:40:20,640 Speaker 1: explain to me who in this process is being Denver 704 00:40:21,040 --> 00:40:23,960 Speaker 1: trying not to make mistakes. I don't see it. It's 705 00:40:23,960 --> 00:40:27,560 Speaker 1: almost helter skelter, isn't it. Well it is a little bit. 706 00:40:27,600 --> 00:40:30,120 Speaker 1: I mean, I guess if you look at it, you 707 00:40:30,160 --> 00:40:33,919 Speaker 1: know it makes a Super Bowl comparison. Who's who's gonna 708 00:40:33,920 --> 00:40:35,759 Speaker 1: play the role of the Carolina Panthers, which is not 709 00:40:35,840 --> 00:40:38,480 Speaker 1: that bother to put together a game plan? Now that 710 00:40:38,480 --> 00:40:41,239 Speaker 1: would be your Donald Trump, right. Uh, you know that 711 00:40:41,760 --> 00:40:44,320 Speaker 1: Carolina should have won, but they didn't. Apparently they decided 712 00:40:44,360 --> 00:40:48,000 Speaker 1: not to watch film. Uh, Denver being you know, blocking 713 00:40:48,000 --> 00:40:50,279 Speaker 1: and tackling, being prepared, doing what they know how to do. 714 00:40:50,400 --> 00:40:53,920 Speaker 1: Who is that? John Kai Interesting? He's a guy that's 715 00:40:53,960 --> 00:40:56,200 Speaker 1: run his own rate the whole time. He's not let 716 00:40:56,280 --> 00:40:59,240 Speaker 1: himself be impacted by the national poll, not let himself 717 00:40:59,280 --> 00:41:02,960 Speaker 1: be just diracted by Donald Thompsonnanigin has stayed out of 718 00:41:03,000 --> 00:41:05,919 Speaker 1: the fight in on the debate stage. He never goes 719 00:41:05,960 --> 00:41:08,480 Speaker 1: after others. So in this case, if you look at 720 00:41:08,480 --> 00:41:11,600 Speaker 1: it that way, where Denver was methodical in what pair 721 00:41:11,719 --> 00:41:14,360 Speaker 1: game plan, was methodical in the type of you know, 722 00:41:14,360 --> 00:41:17,719 Speaker 1: they put together an offense that even Peyton mannag could accomplished. Right, 723 00:41:17,760 --> 00:41:21,080 Speaker 1: you know, short passes, don't make mistakes. That's John Kasick 724 00:41:21,760 --> 00:41:25,440 Speaker 1: um Kassi von Miller ticket. I guess in two thousand. 725 00:41:25,440 --> 00:41:28,160 Speaker 1: There you go. We only have a minute left, so 726 00:41:28,280 --> 00:41:30,719 Speaker 1: very quickly check. We haven't talked about the Democrats, but 727 00:41:30,800 --> 00:41:32,880 Speaker 1: a lot of people looking past New Hampshire because this 728 00:41:32,960 --> 00:41:37,480 Speaker 1: is the backyard of Bernie Sanders. I think that's naive. 729 00:41:38,280 --> 00:41:40,480 Speaker 1: I think in Bernie Sanders is winning by double digits. 730 00:41:40,520 --> 00:41:43,080 Speaker 1: This is a state that has been good to the Clintons. 731 00:41:43,880 --> 00:41:46,600 Speaker 1: Bernie Sanders winning by double digits, I think means that 732 00:41:47,040 --> 00:41:49,080 Speaker 1: the Clinton campaign is going to have a rough three 733 00:41:49,160 --> 00:41:51,759 Speaker 1: or four weeks. You're gonna have national polls showing this 734 00:41:51,880 --> 00:41:54,840 Speaker 1: race dead even You're gonna have the fact that Sanders 735 00:41:54,960 --> 00:41:57,760 Speaker 1: is out raised dur in January. He might raise fifty 736 00:41:57,800 --> 00:42:01,959 Speaker 1: million dollars in February. Uh, Nevada is a jump ball. 737 00:42:02,200 --> 00:42:03,960 Speaker 1: He went to Nevada and all of a sudden, you've 738 00:42:03,960 --> 00:42:06,440 Speaker 1: got a guy who's basically one Nevada in one New 739 00:42:06,440 --> 00:42:09,720 Speaker 1: Hampshire and came in in a whisper of win in Iowa, 740 00:42:10,040 --> 00:42:13,160 Speaker 1: in South Carolina. I didn't have into this race in 741 00:42:13,200 --> 00:42:15,960 Speaker 1: a way that we haven't really fully appreciated. And I'll 742 00:42:15,960 --> 00:42:19,359 Speaker 1: go back to something. Sanders wins big tonight. The guy 743 00:42:19,400 --> 00:42:23,040 Speaker 1: whose name is on this radio around station, he's gonna 744 00:42:23,120 --> 00:42:27,960 Speaker 1: see his name talk about more and more and more uncomfortable. 745 00:42:28,040 --> 00:42:30,320 Speaker 1: We'll talk well, well, we'll talk to Chuck Todd about 746 00:42:30,360 --> 00:42:35,080 Speaker 1: that next time. Chuck with me for Chuck Todd Goalway 747 00:42:35,239 --> 00:42:42,680 Speaker 1: with me. The president, of course, the disclaimer he is 748 00:42:42,719 --> 00:42:46,400 Speaker 1: talking about the founder and majority owner Bloomberg LP, the 749 00:42:46,480 --> 00:42:49,080 Speaker 1: parent of this radio station. Got through that