WEBVTT - P&L: Trump Has an Uphill Climb to 270 Electoral Votes 0:00:04.760 --> 0:00:08.080 Welcome to the Bloomberg pim L Podcast. I'm pim Fox. 0:00:08.119 --> 0:00:11.200 Along with my co host Lisa Abramowitz. Each day we 0:00:11.280 --> 0:00:14.480 bring you the most important, noteworthy, and useful interviews for 0:00:14.520 --> 0:00:16.880 you and your money, whether at the grocery store or 0:00:16.920 --> 0:00:20.680 the trading floor. Find the Bloomberg pi L podcast on iTunes, 0:00:20.840 --> 0:00:30.800 SoundCloud and at Bloomberg dot com. All right, let's solve 0:00:30.840 --> 0:00:33.640 some of the issues related to investing in fixed income 0:00:33.680 --> 0:00:35.839 with Jim Bianco. He is the president and the founder 0:00:35.880 --> 0:00:39.400 of Bianco Research, and he joins us now, Jim, great 0:00:39.440 --> 0:00:41.199 to have you with us. As always, I wonder if 0:00:41.200 --> 0:00:45.680 you could just comment on an interview that Bloomberg's Eric 0:00:45.680 --> 0:00:48.960 Schatzka just did with the Ben Melkman Uh formerly of 0:00:49.000 --> 0:00:52.440 Brevan Howard is speaking about the the slope of the 0:00:52.520 --> 0:00:55.080 yield curve and how he sees that that is going 0:00:55.160 --> 0:01:00.320 to increase. Uh. Great conviction, Great conviction. I beg your pardon, 0:01:00.360 --> 0:01:04.840 great conviction that you're going to see this big slope 0:01:04.880 --> 0:01:10.920 we move higher in the yeeld curve. Yeah, not really. 0:01:11.280 --> 0:01:14.000 I I understand why you would think that if you 0:01:14.080 --> 0:01:17.000 thought that inflation was going to come back, and you'd 0:01:17.000 --> 0:01:19.000 say and even if the FED was going to raise rates, 0:01:19.080 --> 0:01:20.880 the long end of the Yelk curve would go up 0:01:20.920 --> 0:01:24.440 a lot faster. But I'm not fully into the inflation 0:01:24.560 --> 0:01:26.960 camp just yet. I know that that's been the popular 0:01:27.040 --> 0:01:28.920 idea for a lot of people, that inflation is going 0:01:28.959 --> 0:01:32.160 to return, and if not, and we see more weakness, 0:01:32.240 --> 0:01:33.920 you're going to see the long end of the yeel 0:01:33.959 --> 0:01:37.040 curve fallen yields relative to the front end of the 0:01:37.120 --> 0:01:38.920 Yelk curve. They're not gonna go down in the front end. 0:01:39.200 --> 0:01:41.280 They might still go up at the FED races rates, 0:01:41.720 --> 0:01:43.760 and you might see still see the curve stay words 0:01:43.800 --> 0:01:46.280 at right now, if not flatten a little bit more. 0:01:46.280 --> 0:01:48.320 But it really comes down to what your view of 0:01:48.320 --> 0:01:54.000 inflation is. That it's it's not here yet. I understand 0:01:54.040 --> 0:01:56.560 that everybody's looking for it. I get the idea that 0:01:56.640 --> 0:01:59.800 wages are percolating a little bit, but they have been 0:01:59.840 --> 0:02:03.840 for about eighteen months. Uh. I also see the idea 0:02:03.880 --> 0:02:06.400 that you know, in the forward measures of inflation, like 0:02:06.440 --> 0:02:09.520 inflation expectations are starting to move a little bit higher. 0:02:09.560 --> 0:02:12.440 But I've seen this movie since two thousand nine, at 0:02:12.520 --> 0:02:15.280 least four or five other times, and it always seems 0:02:15.280 --> 0:02:17.760 to peter her out because at the end of the day, 0:02:18.440 --> 0:02:21.440 you still have way too weak a growth I think 0:02:21.480 --> 0:02:24.880 to create the um the type of inflation demand pull 0:02:25.360 --> 0:02:27.880 that I think most people are looking for, because I 0:02:27.880 --> 0:02:29.320 don't see that. I don't think we're going to get 0:02:29.360 --> 0:02:31.560 the inflation that everybody's hoping for. See, you had Morgan 0:02:31.600 --> 0:02:34.320 Stanley coming out earlier today and talking about how he 0:02:34.720 --> 0:02:37.720 had they expect uh the ten your treasury yield to 0:02:37.760 --> 0:02:39.720 go to two percent by your end. It's currently at 0:02:39.720 --> 0:02:42.239 one point eight percent. What do you think where do 0:02:42.280 --> 0:02:45.040 you think it will end up? You know, two percent? 0:02:45.120 --> 0:02:47.400 It's probably a ceiling. Because I'm a lot more bullish 0:02:47.440 --> 0:02:50.440 than people think I'm. My my view going into next 0:02:50.560 --> 0:02:52.480 year is still going to be that inflation is not 0:02:52.520 --> 0:02:55.040 going to be there, the growth is gonna stay low. 0:02:55.400 --> 0:02:57.800 We still have the potential of a shock maybe in 0:02:57.880 --> 0:03:02.320 financial markets that could push financial markets down, something similar 0:03:02.320 --> 0:03:04.560 to a Brexit. Maybe it's next week in the election, 0:03:04.720 --> 0:03:07.680 or maybe it's in December with the Italian referendum, which 0:03:07.720 --> 0:03:10.960 I think could be Blexit one point five that the 0:03:10.960 --> 0:03:13.920 Italian referendum is that big. So there's a lot of 0:03:13.960 --> 0:03:17.760 things I see that could push rates lower. As opposed 0:03:17.800 --> 0:03:21.639 to pushing them higher. So yeah, we hit one yesterday. 0:03:22.000 --> 0:03:24.600 Two percent might be an absolute ceiling on the market, 0:03:24.880 --> 0:03:27.200 But I do think that the next big moving rates 0:03:27.240 --> 0:03:32.160 would be lower. All right, next big moving rates lower? Chimpianco. 0:03:32.680 --> 0:03:36.720 Tell me about commodity prices. Are commodity prices at their 0:03:36.920 --> 0:03:41.280 bottom or are we going to see a continued increase? Well, 0:03:41.400 --> 0:03:44.000 you know the thing about commodities right now is you 0:03:44.120 --> 0:03:46.720 almost have to separate them out, you know, Like my 0:03:46.800 --> 0:03:50.720 favorite line about them is carn copper, cocoa, crude oil, um, 0:03:50.760 --> 0:03:53.040 and coffee. I'll start with the letter C. But they're 0:03:53.040 --> 0:03:56.120 not all necessarily commodities in a aggregate because they all 0:03:56.160 --> 0:03:59.440 do very different things. The agricultural markets look very bullish 0:03:59.520 --> 0:04:03.160 right now. They could continue to move higher. The precious 0:04:03.200 --> 0:04:06.640 metals are struggling. I still think that oil is topping 0:04:06.720 --> 0:04:10.240 or the energy complex is topping as well too. And 0:04:10.280 --> 0:04:13.640 you're kind of going sideways with the industrial metals. So 0:04:13.960 --> 0:04:15.800 they're all over the lot. But if you wanted to 0:04:15.800 --> 0:04:17.880 look at it in a big picture, there is no 0:04:18.040 --> 0:04:21.640 strong breakout of the commodity indexes right now. They're probably 0:04:21.640 --> 0:04:25.880 trending sideways to slightly lower and that strong breakout, which 0:04:25.920 --> 0:04:28.760 would suggest world growth is coming. I don't think that 0:04:28.800 --> 0:04:30.480 indicator is going to give it to us right now. 0:04:30.640 --> 0:04:32.240 So you know, you're saying that you think there's the 0:04:32.279 --> 0:04:36.000 next move in rates is going to be lower. Uh, 0:04:36.040 --> 0:04:39.279 it seems like the consensus from well, it seems like 0:04:39.320 --> 0:04:41.120 the consensus is kind of splintering. What do you think 0:04:41.120 --> 0:04:44.320 the big consensus trade is right now? You know, that's 0:04:44.320 --> 0:04:46.719 a good question because it depends on who you talk to. 0:04:46.839 --> 0:04:50.200 If if you ask somebody who's got the title economist, 0:04:50.640 --> 0:04:53.920 they've embarrassed on rates since about two thousand three, and 0:04:54.120 --> 0:04:55.880 you know, don't let a hundred and fifty months of 0:04:55.960 --> 0:04:58.160 being wrong getting away. Their rates are still going to 0:04:58.279 --> 0:05:01.400 keep going up. If you ask a grater, they're much 0:05:01.480 --> 0:05:04.520 more bultless on the market right now, and portfolio managers 0:05:04.839 --> 0:05:07.520 are a little bit in the middle. I would still 0:05:07.600 --> 0:05:11.000 argue to you, though, that the bigger surprise in the 0:05:11.040 --> 0:05:13.839 marketplace would be a move down to one thirty on 0:05:13.880 --> 0:05:16.880 the tenure yield, which was the early July low and 0:05:17.000 --> 0:05:19.720 the all time low, as opposed to a move back 0:05:19.760 --> 0:05:23.680 to the January one high of to So I think 0:05:23.720 --> 0:05:26.320 that the surprise move given all of that would probably 0:05:26.320 --> 0:05:29.320 be a revisit of the All Time Lows, which was 0:05:29.360 --> 0:05:32.000 set just in early July. So we're gonna see this 0:05:32.040 --> 0:05:34.680 movie for another like seven or eight, maybe nine more times. 0:05:34.760 --> 0:05:38.359 Jim Bianco, thank you so much for coming and joining us. 0:05:38.839 --> 0:05:51.680 Jim Bianco of Bianco Research in Chicago. I want to 0:05:51.760 --> 0:05:54.880 learn more about Suicide Squad. I want to learn more 0:05:54.920 --> 0:05:57.680 about Suicide Squad from Paul Sweeney, the director of North 0:05:57.720 --> 0:06:01.880 American Research and Media UH for Bloomberg Intelligence. Paul, did 0:06:01.920 --> 0:06:04.600 you see it? I did not, but fortunately a lot 0:06:04.640 --> 0:06:06.919 of other people did. And that was one of the 0:06:06.960 --> 0:06:10.159 contributors to a pretty strong quarter from Time Warner this morning. 0:06:10.560 --> 0:06:13.359 You know, their movie Studio did did did well as expected. 0:06:13.839 --> 0:06:16.200 The cable networks actually did a little bit better than expected, 0:06:16.240 --> 0:06:18.320 and that those are the real cash flow drivers for 0:06:18.360 --> 0:06:21.159 the company. UH and HBO, the third leg of that stool. 0:06:21.240 --> 0:06:23.360 At that the company also had a pretty good quarter. 0:06:23.440 --> 0:06:26.560 So the company beat expectations here in the quarter. They 0:06:26.560 --> 0:06:29.440 were able to raise their guidance for the year a 0:06:29.440 --> 0:06:32.240 little bit in terms of profitability, so I'm sure they 0:06:32.240 --> 0:06:33.760 feel pretty good about it. I'm sure A T and 0:06:33.760 --> 0:06:35.440 T does as well. Well. Yeah, so this is this 0:06:35.520 --> 0:06:38.080 is what surprises me. Right, Time Warner should feel good, 0:06:38.160 --> 0:06:42.039 A T and T should feel good. Both stocks down. Yeah, 0:06:42.080 --> 0:06:44.920 I think the you know, it's interesting about this deal, 0:06:44.960 --> 0:06:47.640 the A T. T and Time Warner deal. The marketplace 0:06:47.760 --> 0:06:51.040 is very dubious about this deal getting approved. I mean, 0:06:51.080 --> 0:06:53.280 it's it's a transaction that's not scheduled closing to the 0:06:53.360 --> 0:06:55.440 end of twenty seventeen. But even if you kind of 0:06:55.440 --> 0:06:58.920 do the arbitrage math, that suggests that, I think the 0:06:58.960 --> 0:07:01.320 market is dis kind of a less than fifty fifty 0:07:01.400 --> 0:07:04.120 chance that this deal gets approved by by the regulators. 0:07:04.120 --> 0:07:06.560 And so you know, we're gonna have to see how 0:07:06.600 --> 0:07:08.400 things play out with the election and then see how 0:07:08.400 --> 0:07:10.520 the things play out with the regulators. But a lot 0:07:10.520 --> 0:07:13.200 of uncertainty around this deal. Hey, Paul, can we just 0:07:13.240 --> 0:07:15.600 go through the three areas that Time Warner is on 0:07:16.120 --> 0:07:20.080 involving because you mentioned the cable channels, right, the cable 0:07:20.120 --> 0:07:25.200 broadcast monthly subscription fees higher, right, So it's you know, 0:07:25.240 --> 0:07:28.040 the monthly subscription fees. Those those are the fees that 0:07:28.160 --> 0:07:32.480 the cable companies like Comcast and pay to the media 0:07:32.520 --> 0:07:35.280 owners like Time Warner and by via com to carry 0:07:35.320 --> 0:07:38.480 the channels. Those have typically have been growing a revenue 0:07:38.480 --> 0:07:41.480 stream for the media companies in the high single digit range. Uh. 0:07:41.520 --> 0:07:44.000 Time Warner actually did a little bit better. Um, they 0:07:44.160 --> 0:07:47.600 were able to renegotiate some of their contracts recently. That 0:07:47.640 --> 0:07:51.720 took advantage that we're that priced in the NBA UH contract, 0:07:51.760 --> 0:07:54.640 which they were able to charge them higher fees because 0:07:54.640 --> 0:07:57.360 they're now carrying some NBA games. So UH, that was 0:07:57.400 --> 0:08:00.880 a pretty strong driver for them. Advertising UH is still 0:08:01.400 --> 0:08:04.920 relatively strong in the marketplace, and Time Warners cable networks 0:08:05.080 --> 0:08:07.360 are big beneficiary of that as well. Is is the 0:08:07.680 --> 0:08:10.840 HBO now that stand alone streaming service they give any 0:08:10.840 --> 0:08:14.240 indication or how that's performing, Uh, it's performing pretty well. 0:08:14.280 --> 0:08:17.560 There's there's north of one million new subscribers or stand 0:08:17.560 --> 0:08:20.440 alone subscribers to HBO. Now, UM, you know, the real 0:08:20.520 --> 0:08:23.400 question that I think investors have is are these new 0:08:23.480 --> 0:08:26.760 subscribers to HBO or they cannabalizing some of their existing 0:08:27.080 --> 0:08:29.800 subscribers that get it through a cable system. Time Warners 0:08:29.840 --> 0:08:33.480 suggesting that the vast majority of these are our new subscribers, UH, 0:08:33.600 --> 0:08:37.160 younger demos, people that were not subscribing to HBO in 0:08:37.160 --> 0:08:41.240 the future. But that's clearly I think where the industry 0:08:41.280 --> 0:08:44.640 is going, which is to make your programming available not 0:08:44.960 --> 0:08:49.040 just on the traditional cable systems, but also direct to consumers, 0:08:49.920 --> 0:08:53.440 very similar to help people get their Netflix. So at 0:08:53.600 --> 0:08:55.680 the end of the day, we're going to know everything 0:08:55.679 --> 0:08:57.800 that we need to know about media, the current state 0:08:57.800 --> 0:08:59.600 of media in the world. We're gonna get some earnings 0:08:59.600 --> 0:09:03.640 from twenty first century Fox as well as Facebook. So 0:09:03.800 --> 0:09:05.960 when you wake up tomorrow morning, what's the narrative going 0:09:06.000 --> 0:09:07.640 to be. Well, the narrative is going to be that 0:09:07.679 --> 0:09:10.400 the traditional media companies like twenty one century Fox are 0:09:10.440 --> 0:09:12.960 in pretty good shape, but the real growth, the real 0:09:13.040 --> 0:09:15.480 ad dollars are shifting continuing to shift to the media 0:09:15.559 --> 0:09:18.839 to the online media companies like Facebook. So Facebook is 0:09:18.880 --> 0:09:21.320 going to put up a revenue growth north of fifty 0:09:21.400 --> 0:09:23.640 percent um, and you compare that to some of the 0:09:23.720 --> 0:09:26.440 high single digit revenue we've seen from the traditional media 0:09:26.440 --> 0:09:28.120 companies and just shows you the way of the world. 0:09:28.520 --> 0:09:31.080 I'm just gonna say, take a look at the annual 0:09:31.200 --> 0:09:33.920 revenue growth of Facebook. We're going I know we're going 0:09:33.960 --> 0:09:37.040 to get quarterly after the close of trading, but you're 0:09:37.040 --> 0:09:40.840 talking going from five billion to seven point eight billion 0:09:40.920 --> 0:09:45.240 to twelve to seventeen. The estimate now twenty two billion, 0:09:45.280 --> 0:09:47.520 and this is in four years. A company goes from 0:09:47.600 --> 0:09:50.760 five billion to twenty two billion. Yeah, it's just amazing. 0:09:50.800 --> 0:09:55.240 And if you think about online uh, you know, internet advertising, 0:09:55.720 --> 0:09:58.360 two companies take more than fifty of it, and that 0:09:58.480 --> 0:10:01.559 is Facebook and Google. If you're a big brand advertiser 0:10:01.600 --> 0:10:03.400 like a Ford Motor Company or a Coca Cola and 0:10:03.440 --> 0:10:07.000 you want to advertise digitally, only two places you can 0:10:07.080 --> 0:10:09.120 really spend your money, and that's Google and Facebook. And 0:10:09.120 --> 0:10:12.480 they also integrate the advertising and marketing. They actually have 0:10:12.600 --> 0:10:16.000 employees from both companies. The advertisers plus Facebook and Google 0:10:16.040 --> 0:10:18.920 actually get together on a regular basis, uh, to make 0:10:19.000 --> 0:10:21.120 those kinds of decisions. Yeah, it's it's it's really been 0:10:21.240 --> 0:10:22.800 been amazing kind of what what they're doing, and it's 0:10:22.840 --> 0:10:24.360 kind of frozen out a lot of the other players. 0:10:24.400 --> 0:10:26.040 So you see like a Twitter sitting there with three 0:10:26.040 --> 0:10:29.840 and twenty million uh subscribers are users onto their platform. 0:10:30.040 --> 0:10:32.280 They are really finding it hard to really get the 0:10:32.320 --> 0:10:35.280 attention at Madison Avenue and a big advertisers, so it's 0:10:35.320 --> 0:10:38.600 really become a dual woppily from the perspective of uh, 0:10:38.679 --> 0:10:41.280 you know, the big online advertisers. So you know that's 0:10:41.280 --> 0:10:42.640 one of the things A T and T says, A 0:10:42.760 --> 0:10:44.720 T and T says, we are going to create a 0:10:44.840 --> 0:10:49.480 big advertising alternative to the Google and facebooks of the world. Well, 0:10:49.559 --> 0:10:52.679 as Lisa just mentioned, shares of A T and T 0:10:52.920 --> 0:10:55.880 there down about a quarter of a percent today. Thank 0:10:55.880 --> 0:10:59.200 you very much for joining us. Paul Sweeney, head of Research, 0:10:59.320 --> 0:11:12.160 Director of Research for Bloomberg Intelligence. Well, he's a human 0:11:12.200 --> 0:11:15.720 and he's been tracking human feelings about the election. Mark 0:11:15.800 --> 0:11:19.760 Niquette is our politics and national government reporter for Bloomberg News. 0:11:20.000 --> 0:11:24.080 He can be followed on Twitter at m Niquette. All right, Mark, 0:11:24.720 --> 0:11:27.400 we got a pole and then there's something from President 0:11:27.400 --> 0:11:29.680 Obama having to do with the FBI. Let's start with 0:11:29.720 --> 0:11:34.199 the independent of the Poll of Independence by Bloomberg Politics. 0:11:34.280 --> 0:11:36.600 What what does it show. It's actually a bit of 0:11:36.600 --> 0:11:39.720 good news for Hillary Clinton after several days here of 0:11:39.760 --> 0:11:43.400 bad news related to the release of the FBI letter 0:11:43.840 --> 0:11:47.160 showing there is more scrutiny on emails. The Poll of 0:11:47.240 --> 0:11:51.080 Independence folks who say they haven't decided yet showed her 0:11:51.120 --> 0:11:56.720 with a slight advantage over Donald Trump. About that's important 0:11:56.720 --> 0:11:59.000 because this is a group of swing voters that can 0:11:59.000 --> 0:12:01.880 often decide an election in particularly in key battleground states. 0:12:02.200 --> 0:12:04.559 And it's a group that Republican met Romney won by 0:12:04.600 --> 0:12:07.560 five percentage points in twelve. So it shows that Donald 0:12:07.600 --> 0:12:10.520 Trump is still having some trouble sort of building the 0:12:10.559 --> 0:12:15.240 coalition of of Republicans and independence that you know helped 0:12:16.080 --> 0:12:19.199 Romney and twelve and even then he lost. So it 0:12:19.240 --> 0:12:20.960 shows he still has some work to do to get 0:12:21.200 --> 0:12:23.800 these folks to build a coalition that wins. It seems like, 0:12:23.880 --> 0:12:27.000 just based on market action, that a lot of traders 0:12:27.080 --> 0:12:31.520 certainly think that Trump is that Mr Trump is is 0:12:32.040 --> 0:12:35.360 positioning in a better position right now to become our 0:12:35.400 --> 0:12:38.440 next president than Secretary Clinton. And you know, from the 0:12:38.440 --> 0:12:41.679 people you speak with, the analysts, do you do, they 0:12:41.720 --> 0:12:47.400 seem to suggest that Trump has seriously improved his odds 0:12:47.400 --> 0:12:49.760 of becoming president in the past couple of days. Now 0:12:49.800 --> 0:12:52.880 there are signs and suggestions that you know, he has 0:12:52.920 --> 0:12:55.600 better position today than he was a last week. I mean, 0:12:55.800 --> 0:12:59.240 certainly before the news that fb FBI letter broke, you know, 0:12:59.280 --> 0:13:01.440 the sense was we were headed towards a pretty solid 0:13:01.440 --> 0:13:05.280 Clinton victory and that the race has tightened now significantly now, 0:13:05.440 --> 0:13:08.239 you know, we always expected the race to get closer 0:13:08.280 --> 0:13:11.240 as Republican voters sort of came home in the final 0:13:11.320 --> 0:13:15.440 days before the election. Um, but the FBI revelation seemed 0:13:15.440 --> 0:13:18.480 to have sort of shifted the thinking and feeling about 0:13:18.520 --> 0:13:20.480 this race. I mean, it's still I think gonna be 0:13:20.480 --> 0:13:24.400 an uphill climb for Trump to get to electoral votes. 0:13:24.679 --> 0:13:26.679 I mean, his campaign has essentially laid out that he 0:13:26.720 --> 0:13:31.680 needs to win Florida, North Carolina, Ohio, and Iowa and 0:13:31.679 --> 0:13:34.120 then another battleground state to really have a good shot 0:13:34.200 --> 0:13:36.320 at two torn it to the in seventy electoral votes. 0:13:36.600 --> 0:13:38.760 So Clinton can stop him in any one of those states, 0:13:38.800 --> 0:13:41.120 you know, she would still be the favorite, I think. 0:13:41.120 --> 0:13:44.000 But you know, as it has been through this entire election, 0:13:44.120 --> 0:13:46.400 people are weary now of making predictions, and it's been 0:13:46.440 --> 0:13:49.240 so unpredictable. You know, we're gonna have to see what 0:13:49.280 --> 0:13:52.199 happens on election day for sure. Another big question are 0:13:52.200 --> 0:13:54.720 certainly among the people who I speak with, is will 0:13:55.000 --> 0:13:59.480 Congress back Donald Trump's proposals, Particularly is economic proposals, which 0:13:59.480 --> 0:14:03.200 are rather expansive and don't really kind of cohere with 0:14:03.320 --> 0:14:08.000 traditional uh sort of fiscal conservatism. Uh So you know, 0:14:08.000 --> 0:14:10.079 what's your sense, do you use your sense that that 0:14:11.000 --> 0:14:13.920 the House and Senate will back his proposals as is, 0:14:14.720 --> 0:14:16.360 well a lot will be turned down. What the composition 0:14:16.400 --> 0:14:18.360 of Congress looks like after this election. I mean, we're 0:14:18.360 --> 0:14:21.600 still waiting to see, you know what, who controls the Senate. 0:14:21.680 --> 0:14:23.400 You know, there's a there's a chance at least for 0:14:23.440 --> 0:14:26.320 the Democrats to regain control there and with the mix 0:14:26.440 --> 0:14:29.720 of sort of very conservative members versus you know, more 0:14:29.760 --> 0:14:34.120 moderate Republicans in the House will be assuming they continue 0:14:34.200 --> 0:14:37.440 controlling that chamber. Um, And you're right, I mean, there's 0:14:37.480 --> 0:14:40.440 there's Trump's proposals have kind of a mix of sort 0:14:40.440 --> 0:14:44.560 of more traditional Reaganesque kind of elements, like his tax 0:14:44.600 --> 0:14:48.200 proposals I think would would have more broadest acceptance there. 0:14:48.200 --> 0:14:49.720 But you know there's other things that I think he 0:14:49.720 --> 0:14:52.760 would have trouble getting through Congress. But you know, a 0:14:52.760 --> 0:14:54.600 lot of variables there to be determined before we can 0:14:54.600 --> 0:14:57.080 sort of guess on how you know, anything specific might 0:14:57.160 --> 0:15:01.880 play out. Mark the President. President Barack Obama has said 0:15:02.200 --> 0:15:06.840 he was giving a interview and online he describes He 0:15:06.960 --> 0:15:10.960 said that the FBI Director James Comby's decision to renew 0:15:10.960 --> 0:15:16.600 a probe of Hillary Clinton's emails had become a political controversy. Yeah, 0:15:16.640 --> 0:15:18.520 I think there's no question about that. I mean, President 0:15:18.560 --> 0:15:20.400 Obama is in a tough position, and as much as 0:15:20.680 --> 0:15:23.840 this is his appointed right and he can't sort of 0:15:23.840 --> 0:15:26.480 be out there publicly, you know, sort of questioning him 0:15:26.560 --> 0:15:29.160 or or undermining him. Um, but you know there's no 0:15:29.280 --> 0:15:33.080 question that you know, having the FBI director, you know, 0:15:33.760 --> 0:15:36.640 send this letter to Congress eleven days before election sort 0:15:36.640 --> 0:15:39.440 of raises the question of whether you know, the FBI 0:15:39.680 --> 0:15:43.320 is you know, interfering or at least you know, influencing 0:15:43.360 --> 0:15:46.840 election by doing this so close to the voting, and 0:15:47.120 --> 0:15:49.280 you know, whether that was the intent or not. Sort 0:15:49.400 --> 0:15:52.600 the practical outlook impact of that could be that this 0:15:52.840 --> 0:15:55.600 ways you know, votes in the race, which is something 0:15:55.640 --> 0:15:58.360 that you know, the Justice Department and FBI you know, 0:15:58.400 --> 0:16:00.920 sort of a rule that right to avoid you know, 0:16:00.920 --> 0:16:03.440 pretty fastidiously. I mean, this is basically like Obama saying 0:16:03.440 --> 0:16:04.920 we breathe there. I mean, of course, has become a 0:16:04.920 --> 0:16:07.080 political controversy. I mean every poll has kind of showed 0:16:07.480 --> 0:16:10.280 that it's certainly being taken to some degree, uh like 0:16:10.360 --> 0:16:12.480 that whether or not it's justified or not is a 0:16:12.480 --> 0:16:15.040 whole other question. It certainly has become a political story. 0:16:15.240 --> 0:16:18.840 Mark going forward, what is the one thing that you're 0:16:18.840 --> 0:16:21.000 looking at today that you think that is sort of 0:16:21.000 --> 0:16:25.640 the underreported story. I think the underreported story, UM is 0:16:25.840 --> 0:16:29.760 what's happening with early vote among key elements of the 0:16:29.800 --> 0:16:33.520 Obama coalition. This is the sort of African Americans, young 0:16:33.640 --> 0:16:38.600 voters in particular Latinos who supported Barack Obama and are 0:16:38.640 --> 0:16:41.680 they UM is going to go with with Hillary Clinton 0:16:41.680 --> 0:16:44.560 in the numbers that she needs to UM to win. 0:16:44.720 --> 0:16:47.040 And we're seeing a little bit of that insight with 0:16:47.120 --> 0:16:49.800 the early voting totals that are coming out suggest that 0:16:49.840 --> 0:16:54.160 there might be less enthusiasm among African Americans, for example, 0:16:54.200 --> 0:16:56.680 for Hillary Clinton and there was for Obama. And I 0:16:56.720 --> 0:16:59.720 think diving into those numbers and how that coalition votes 0:16:59.760 --> 0:17:02.440 will a little long wait or to turning whether Hillary 0:17:02.440 --> 0:17:04.680 Clinton wins. Mark Niqette, thank you so much for being 0:17:04.680 --> 0:17:07.560 with us. Mark Niquette, politics and national government reporter for 0:17:07.600 --> 0:17:11.560 Bloomberg News breaking down all things related to this presidential election. 0:17:11.560 --> 0:17:15.159 I'm Lisa Bramo. It's here with pim Fox. This is Bloomberg. 0:17:25.880 --> 0:17:29.240 The Shares of te connectivity. They are higher by about 0:17:29.280 --> 0:17:31.720 one and a half percent. Many people may not know 0:17:31.760 --> 0:17:36.359 about t E Connectivity. It has a former name, Tycho Electronics. 0:17:36.640 --> 0:17:38.920 And here to tell us more about t E Connectivity 0:17:39.080 --> 0:17:42.880 and its future is Tom Lynch. He is the chairman 0:17:43.000 --> 0:17:47.119 of the Connectivity. He's also the outgoing chief executive. Also 0:17:47.200 --> 0:17:50.119 with us is the president and the incoming chief executive, 0:17:50.200 --> 0:17:55.040 Terrence Curtain. Thank you, gentlemen for being here here. I 0:17:55.080 --> 0:17:57.480 was gonna say that must be some kind of special ceremony, 0:17:57.520 --> 0:18:00.000 you know, a secret password or something. But I'm wondering 0:18:00.000 --> 0:18:03.240 if you could just describe Tom, what kind of company 0:18:03.280 --> 0:18:05.760 are you? I know you're gonna remain chairman, but what 0:18:05.920 --> 0:18:08.800 kind of company do you feel you're handing over to 0:18:09.040 --> 0:18:13.080 Terrence to to take charge of a very good company. 0:18:13.160 --> 0:18:15.919 We have lots of opportunity to get better detailed. Give 0:18:16.040 --> 0:18:17.720 I know, but give us the d because I was 0:18:17.760 --> 0:18:19.560 reading there's a lot of cool stuff you've been You 0:18:19.600 --> 0:18:22.600 work with companies like Google and Facebook. People may not 0:18:22.760 --> 0:18:25.040 know this. Tell us what what is t E Connectivity. 0:18:25.119 --> 0:18:28.200 T Connectivity is a twelve billion dollar global company with 0:18:28.720 --> 0:18:31.479 seventy of our revenue outside the US, and we're right 0:18:31.520 --> 0:18:38.320 in the middle of the connected world phenomena. So automotive, aircraft, machinery, 0:18:38.680 --> 0:18:41.679 communications equipment, sent medic a lot of sensors, a lot 0:18:41.720 --> 0:18:45.560 of connectors, and a lot of connectors, uh twelve billion 0:18:45.600 --> 0:18:48.920 plus of them. So we're in a great a great industry, 0:18:48.960 --> 0:18:52.040 say multiple industries. Everybody's our customers, we like to say, well, 0:18:52.080 --> 0:18:54.680 and it's a very competitive industry. So, Terrence, I wanted 0:18:54.720 --> 0:18:58.200 to talk with you a little bit about going forward. Yes, 0:18:58.280 --> 0:19:01.160 this is the future as far as is everything under 0:19:01.200 --> 0:19:04.600 the sun being connected, but there is everyone also wanting 0:19:04.600 --> 0:19:06.320 to get in that from Google to Amazon to who 0:19:06.320 --> 0:19:09.240 knows whoever h So what's the competitive landscape like and 0:19:09.280 --> 0:19:11.399 how big do you think the business could grow when 0:19:11.400 --> 0:19:13.160 when we look at the business day, like Tom says, 0:19:13.160 --> 0:19:15.760 about twelve billion dollars, and when we look at the landscape, 0:19:15.800 --> 0:19:18.639 it's a pretty diverse landscape. The customers that you mentioned 0:19:18.640 --> 0:19:20.720 are more of our customers and competitors to Googles and 0:19:20.720 --> 0:19:23.880 the Facebook's. Our engineers were fortunate. We have over seven 0:19:23.920 --> 0:19:27.320 thousand engineers that actually enable some of the customers that 0:19:27.400 --> 0:19:30.119 you talked about, as well as the automotive companies that 0:19:30.200 --> 0:19:33.520 Tom talked about. So what's great is how we're globally deployed, 0:19:33.720 --> 0:19:35.439 and I think we get the benefit of the trends 0:19:35.440 --> 0:19:38.280 of the connected world as well as the various industries 0:19:38.280 --> 0:19:41.280 we have so that can be automotive, medical. From a 0:19:41.400 --> 0:19:45.120 competitive standpoint, it's many different type of competitors. There isn't 0:19:45.119 --> 0:19:48.320 one single competitor we go up against. It really depends 0:19:48.400 --> 0:19:50.520 upon the applications we play into, and that's one of 0:19:50.560 --> 0:19:52.439 the things that we think we excel at bringing that 0:19:52.520 --> 0:19:56.280 engineering to our customers to really enable where they want 0:19:56.280 --> 0:19:59.560 to take the connected world. Terrence, I got to mention 0:19:59.600 --> 0:20:02.200 a couple of projects this kind of give some flesh 0:20:02.240 --> 0:20:05.520 to all of this Pacific Light cable network. You have 0:20:05.720 --> 0:20:08.560 just chosen, I believe to be a contractor there for 0:20:08.680 --> 0:20:11.800 this is a Facebook Google project. You've also got the 0:20:11.840 --> 0:20:15.159 new Cross Pacific and Maria and I wonder if you 0:20:15.200 --> 0:20:17.080 could just tell us about each of those and and 0:20:17.080 --> 0:20:20.520 how that defines the company. Yeah, him, great questions are 0:20:20.560 --> 0:20:22.720 projects we've had in our SubCom business, which is a 0:20:22.720 --> 0:20:26.320 little bit less than temporary to tell people's SubCom, SubCom, SUBM, 0:20:26.760 --> 0:20:30.280 submarine communications, and really what we do in our SubCom 0:20:30.320 --> 0:20:35.760 business is really build out the long haul oceanic systems 0:20:35.800 --> 0:20:38.560 for the world, and they actually support the cloud. So 0:20:38.600 --> 0:20:41.679 anytime you think about a cloud application, really, where do 0:20:41.720 --> 0:20:43.600 you get to the data senators support? And that's where 0:20:43.600 --> 0:20:47.000 the Facebook's, the Google's, the Microsoft that are building the 0:20:47.240 --> 0:20:50.359 cloud applications. We support them by building systems that they 0:20:50.440 --> 0:20:53.080 actually own and use to make sure they can bring 0:20:53.560 --> 0:20:56.160 their services down to their customers. And that's what's great 0:20:56.200 --> 0:20:59.200 about what t E does is we enable our customers 0:20:59.200 --> 0:21:02.240 to bring that great connected world tour. Tom, You've been 0:21:02.280 --> 0:21:06.240 the CEO since two thousand and six. The world has 0:21:06.320 --> 0:21:08.720 changed a lot in the ten years. What's been the 0:21:08.720 --> 0:21:13.280 biggest change in your industry? Well, the trends have accelerated 0:21:13.320 --> 0:21:15.879 for connectivity, that's the biggest thing. You know, it has 0:21:16.000 --> 0:21:17.960