1 00:00:03,480 --> 00:00:06,840 Speaker 1: This is Bloomberg Surveillance. I view on the Boom and 2 00:00:06,880 --> 00:00:09,760 Speaker 1: Buster business that my view, at a time will actually 3 00:00:09,840 --> 00:00:12,760 Speaker 1: run out to available supply. Gruss that wants to do 4 00:00:12,880 --> 00:00:16,160 Speaker 1: more and continues to communicate they'd like to do more. Ultimately, 5 00:00:16,200 --> 00:00:18,520 Speaker 1: are only able to deliver one more rate high this year. 6 00:00:18,720 --> 00:00:21,439 Speaker 1: Market's discount the future when interest rates are very very low, 7 00:00:21,640 --> 00:00:24,759 Speaker 1: You're effectively discounting further out into the future at a 8 00:00:24,800 --> 00:00:27,240 Speaker 1: time when it's harder to see what's out The Bloomberg 9 00:00:27,320 --> 00:00:31,080 Speaker 1: Surveillance your link to the world of economics, finance, and 10 00:00:31,200 --> 00:00:34,800 Speaker 1: investment on Bloomberg Radio. Good morning everyone, Michael McKee and 11 00:00:34,800 --> 00:00:37,919 Speaker 1: Tom Kine. Bloomberg Surveillance is Tuesday. Good morning in Florida, 12 00:00:38,000 --> 00:00:41,640 Speaker 1: Good morning in Ohio, and seriously next time Channel one nineteen, 13 00:00:41,920 --> 00:00:44,920 Speaker 1: Good morning in Washington, where they'll be watching the results 14 00:00:44,920 --> 00:00:49,680 Speaker 1: tonight to a fair the well FM Washington and Baltimore, 15 00:00:49,760 --> 00:00:53,159 Speaker 1: Bloomberg twelve, Boston, Bloomberg Eleven's Rio. You know, sort of 16 00:00:53,159 --> 00:00:56,560 Speaker 1: a cloudy gray New York and the gorgiosity of San 17 00:00:56,600 --> 00:01:01,200 Speaker 1: Francisco Bay Area. We say good morning across this great 18 00:01:01,440 --> 00:01:04,160 Speaker 1: nation as we discuss a little bit of politics, but 19 00:01:04,680 --> 00:01:08,240 Speaker 1: a lot of economics, financial investment. Alan Ruskin will join 20 00:01:08,319 --> 00:01:10,640 Speaker 1: us on the dollar here in a moment and other 21 00:01:11,319 --> 00:01:16,440 Speaker 1: efforts of his economics Deutsche Bank Bloomberg Surveillance. We brought 22 00:01:16,480 --> 00:01:21,480 Speaker 1: you by kone Resnec Accounting Tax Advisory. During times of growth, crisis, 23 00:01:21,480 --> 00:01:26,240 Speaker 1: are economic uncertainty, your business needs the cone Resneck Advisory 24 00:01:26,319 --> 00:01:29,479 Speaker 1: Group for the strategies to move forward. Find out more 25 00:01:30,120 --> 00:01:33,480 Speaker 1: at kne Resnick dot com, O h N R e 26 00:01:33,600 --> 00:01:37,240 Speaker 1: z N I C K cone Resnick dot com and 27 00:01:37,920 --> 00:01:41,080 Speaker 1: shout out to con Resnick for their continued support of 28 00:01:41,120 --> 00:01:43,640 Speaker 1: what we do. We try to bring in voices like 29 00:01:43,720 --> 00:01:46,440 Speaker 1: Alan Ruskin with Deutsche Bank and he joins us down Alan, 30 00:01:46,480 --> 00:01:53,240 Speaker 1: Good morning, Allen, good morning morning. There you are, um, Alan, 31 00:01:53,480 --> 00:01:55,880 Speaker 1: U dollar strength. I want to get right to your wheelhouse. 32 00:01:56,160 --> 00:02:02,160 Speaker 1: What is your call on the magnitude of dollars twelve months? Yeah, 33 00:02:02,200 --> 00:02:06,600 Speaker 1: we're actually shaving back some of the strength that we anticipated, 34 00:02:06,680 --> 00:02:09,880 Speaker 1: in part because of the market's response really to the ECB. 35 00:02:10,280 --> 00:02:13,840 Speaker 1: As you know, Tom, divergence has been the big story 36 00:02:13,919 --> 00:02:17,760 Speaker 1: for the last eighteen months to two years, and the 37 00:02:17,840 --> 00:02:20,960 Speaker 1: ECB has in many ways led the charge. Now I 38 00:02:20,960 --> 00:02:23,040 Speaker 1: think they to some extent. I wouldn't say, running out 39 00:02:23,040 --> 00:02:26,040 Speaker 1: of bullets, but their impact on the foreign exchange markets 40 00:02:26,120 --> 00:02:28,560 Speaker 1: much is likely to be more muted. It's really up 41 00:02:28,560 --> 00:02:30,520 Speaker 1: to the Fed, I think, to drive things forwards. So 42 00:02:30,560 --> 00:02:35,239 Speaker 1: we're scaming back our ur en forecast from zero point 43 00:02:35,320 --> 00:02:38,680 Speaker 1: nine five on euro dollar to parity um so you know, 44 00:02:38,720 --> 00:02:42,280 Speaker 1: still a stronger dollar, Directions still very much maintained in 45 00:02:42,320 --> 00:02:45,880 Speaker 1: favor of a stronger dollar, but the pace and magnitude 46 00:02:45,880 --> 00:02:48,480 Speaker 1: are are more contained. How do we get there? And 47 00:02:48,520 --> 00:02:52,400 Speaker 1: the reason I'm asking is the Bank of Japan stands pat, 48 00:02:52,800 --> 00:02:56,760 Speaker 1: the FADS expected to stand pat, and we're not seeing 49 00:02:56,800 --> 00:03:00,840 Speaker 1: any real movement in currencies other than a little jiggle 50 00:03:00,919 --> 00:03:04,200 Speaker 1: around the status quo lately. Yeah, I think, you know, 51 00:03:04,320 --> 00:03:06,880 Speaker 1: the the the emphasis has to be on what the 52 00:03:06,919 --> 00:03:09,520 Speaker 1: Federal Reserve does. So look, if the Feds are not 53 00:03:09,560 --> 00:03:12,000 Speaker 1: going to be in play this year, then we you know, 54 00:03:12,080 --> 00:03:14,960 Speaker 1: we'd likely have to scale back a tad further, but 55 00:03:15,000 --> 00:03:17,120 Speaker 1: not that much because I think the range has you 56 00:03:17,120 --> 00:03:19,240 Speaker 1: know that we've seen over the last twelve months of 57 00:03:19,240 --> 00:03:22,280 Speaker 1: one oh five to one fifteen on euro dollar is 58 00:03:22,320 --> 00:03:24,639 Speaker 1: you know, it's been solid enough anyway, and it doesn't 59 00:03:24,639 --> 00:03:26,280 Speaker 1: really even need the Fed to be in play. To 60 00:03:26,280 --> 00:03:28,440 Speaker 1: get us to one of one oh five. But the 61 00:03:28,480 --> 00:03:31,000 Speaker 1: FED is in play, as I would anticipate, and as 62 00:03:31,040 --> 00:03:33,720 Speaker 1: I think we'll see from uh you know Janet yelling 63 00:03:34,000 --> 00:03:36,840 Speaker 1: this week, then you know that will be the kicker, 64 00:03:36,920 --> 00:03:39,200 Speaker 1: I think, and and and just keep in mind, really 65 00:03:39,240 --> 00:03:42,280 Speaker 1: a ten percent move in the foreign exchange market is 66 00:03:42,320 --> 00:03:44,560 Speaker 1: not a huge move, certainly in terms of signaling the 67 00:03:44,600 --> 00:03:47,119 Speaker 1: low point for euro dollar this year. Well, what did 68 00:03:47,120 --> 00:03:52,120 Speaker 1: you make of coronison in the Bank of Japan today? Uh? 69 00:03:52,320 --> 00:03:56,400 Speaker 1: Do they are they still in play? I think there's 70 00:03:56,440 --> 00:03:58,240 Speaker 1: still laur in player. I think they're still coming to 71 00:03:58,320 --> 00:04:01,240 Speaker 1: grips with the whole idea air of negative rates, What 72 00:04:01,320 --> 00:04:05,600 Speaker 1: the implications are, what the mechanics of negative rates are? Um, 73 00:04:05,960 --> 00:04:09,080 Speaker 1: And you know, I don't think you're going to see 74 00:04:09,160 --> 00:04:11,520 Speaker 1: a whole lot more in terms of negative rates from 75 00:04:11,560 --> 00:04:14,160 Speaker 1: the Bank of Japan. I think you are likely to 76 00:04:14,240 --> 00:04:18,000 Speaker 1: see maybe they're sort of branching out towards buying riskier 77 00:04:18,000 --> 00:04:21,080 Speaker 1: assets or buying more risky acids going forward. So I 78 00:04:21,080 --> 00:04:23,839 Speaker 1: think the Bank of Japan is in play, but it's 79 00:04:24,080 --> 00:04:26,440 Speaker 1: in a sort of a more muted form than we've 80 00:04:26,440 --> 00:04:30,160 Speaker 1: see him previously. How does this adapt in the just 81 00:04:30,560 --> 00:04:33,760 Speaker 1: the Fed. Alan Roskin, I hate to tell you this, 82 00:04:33,839 --> 00:04:38,360 Speaker 1: but I'm misinformed on the dot plot. McKee is encyclopedic 83 00:04:38,960 --> 00:04:43,200 Speaker 1: on dot plot dynamics. When we bring up the dot plot, 84 00:04:43,839 --> 00:04:47,359 Speaker 1: there's the belief, the hope, whatever, and then there's the 85 00:04:47,440 --> 00:04:53,599 Speaker 1: market pricing and reality, which is right, um, somewhere in 86 00:04:53,600 --> 00:04:58,040 Speaker 1: between us you think, somewhere, and I think that's somewhere 87 00:04:58,040 --> 00:05:01,200 Speaker 1: in between. I think the Federal Service clearly sort of 88 00:05:01,240 --> 00:05:04,200 Speaker 1: looking at a fairly normal cycle. I mean, they've obviously 89 00:05:04,320 --> 00:05:08,880 Speaker 1: muted out the longer term equilibrium funds rate as well. 90 00:05:09,040 --> 00:05:12,920 Speaker 1: The market is taking a um, you know, a far 91 00:05:13,040 --> 00:05:16,000 Speaker 1: less sanguine view in terms of the real economy prospects 92 00:05:16,040 --> 00:05:18,520 Speaker 1: going forward. So I think, uh, you know, correct me 93 00:05:18,560 --> 00:05:20,120 Speaker 1: if I'm wrong your time. But I think the two 94 00:05:20,160 --> 00:05:24,920 Speaker 1: thousand and eight market view is uh, you know, less 95 00:05:24,960 --> 00:05:28,359 Speaker 1: hawkish effectively than uh, you know what we have for 96 00:05:28,400 --> 00:05:32,279 Speaker 1: two thousand and sixteen from you know, the federal reserves. Such. 97 00:05:32,360 --> 00:05:35,400 Speaker 1: So the market is obviously taking a very very very 98 00:05:35,520 --> 00:05:38,040 Speaker 1: duvish line going forward, but I think that could change 99 00:05:38,080 --> 00:05:40,800 Speaker 1: quite quickly. So you know, it's fair that actually does tighten, 100 00:05:40,880 --> 00:05:43,360 Speaker 1: for example, in June, then the market is going to 101 00:05:43,400 --> 00:05:45,800 Speaker 1: have to reconsider because there's really not much priced in 102 00:05:45,839 --> 00:05:48,160 Speaker 1: there for two thousand and sixteen and two thousand and 103 00:05:48,200 --> 00:05:50,880 Speaker 1: seventeen in particular, Well, isn't it Really what you want 104 00:05:50,880 --> 00:05:53,680 Speaker 1: to look at is inflation and what you think inflation 105 00:05:53,760 --> 00:05:56,440 Speaker 1: is going to be. That's going to drive the Fed's decisions, 106 00:05:56,440 --> 00:06:00,440 Speaker 1: so it should drive your investment decision to an extent. 107 00:06:00,520 --> 00:06:03,400 Speaker 1: Although keep in mind inflation is a lagging indicators, so 108 00:06:03,600 --> 00:06:05,680 Speaker 1: the FED is you know, like I think a lot 109 00:06:05,680 --> 00:06:08,520 Speaker 1: of the market is hanging onto concepts that relate to 110 00:06:08,640 --> 00:06:13,000 Speaker 1: predicting inflation and output gap and spec capacity in the 111 00:06:13,120 --> 00:06:16,160 Speaker 1: labor market indicators in particular that you know, what they 112 00:06:16,279 --> 00:06:20,200 Speaker 1: tell us about spec capacity is absolutely crucial in that um. 113 00:06:20,279 --> 00:06:23,440 Speaker 1: And you know, obviously the the the interesting element you're 114 00:06:23,440 --> 00:06:25,640 Speaker 1: seeing in the market at the moment, there's this decoupling 115 00:06:25,680 --> 00:06:28,760 Speaker 1: between you know, the employment data and some of the 116 00:06:28,800 --> 00:06:31,920 Speaker 1: forward looking signals in terms of financial conditions, the yield 117 00:06:32,000 --> 00:06:34,760 Speaker 1: curve and maybe even GDP in facts. So you know 118 00:06:34,800 --> 00:06:36,760 Speaker 1: how long that will continue? I think that, you know, 119 00:06:36,880 --> 00:06:40,440 Speaker 1: probably the key question for the market. I look at 120 00:06:40,480 --> 00:06:44,840 Speaker 1: Ellen the key question here of back to back central banks. 121 00:06:44,880 --> 00:06:48,520 Speaker 1: I said, there's this morning to Francine look and no 122 00:06:48,560 --> 00:06:50,479 Speaker 1: one's looking at what Bank of England is going to do. 123 00:06:50,920 --> 00:06:54,000 Speaker 1: And to me it's maybe the most interesting meeting because 124 00:06:54,000 --> 00:06:56,760 Speaker 1: they have to play really play off what Mr Drag did. 125 00:06:57,000 --> 00:07:02,200 Speaker 1: Did Mr Drag adjust what Mr Kearney will say on Thursday. 126 00:07:03,360 --> 00:07:06,839 Speaker 1: I don't think materially, Tom, because you know, what the 127 00:07:06,920 --> 00:07:10,680 Speaker 1: UK is still facing is a large scale fiscal consolidation. 128 00:07:10,800 --> 00:07:12,920 Speaker 1: So let's see what the UK budget actually brings. But 129 00:07:12,920 --> 00:07:15,000 Speaker 1: I think that you know, the expectation is there as 130 00:07:15,000 --> 00:07:18,040 Speaker 1: you get some sort of contraction reinfluence there. The economy 131 00:07:18,080 --> 00:07:21,040 Speaker 1: seems to be slowing in any event, so the mix 132 00:07:21,200 --> 00:07:23,760 Speaker 1: is really meant that the Bank of England, I can 133 00:07:24,040 --> 00:07:26,960 Speaker 1: you can think, will hold tight really for the next 134 00:07:27,000 --> 00:07:29,720 Speaker 1: for pretty much this year. At this point, Um, you know, 135 00:07:29,720 --> 00:07:32,320 Speaker 1: it looked much more likely that the Bank of England 136 00:07:32,360 --> 00:07:35,120 Speaker 1: was going to tighten and be the only other G 137 00:07:35,200 --> 00:07:37,240 Speaker 1: ten central bank that would follow the fat in terms 138 00:07:37,240 --> 00:07:40,120 Speaker 1: of tightening this year. But of late, I think one's 139 00:07:40,120 --> 00:07:44,520 Speaker 1: had his scale back those expectations, asking with us with 140 00:07:44,600 --> 00:07:46,680 Speaker 1: Dutch Bank, we're going to come back on that. We 141 00:07:46,760 --> 00:07:50,800 Speaker 1: have to interrupt. It's important discussion on Mr Ruskin to 142 00:07:50,840 --> 00:07:55,520 Speaker 1: look at the implosion of Valiant two new loves. I 143 00:07:55,560 --> 00:07:57,520 Speaker 1: would have said, we don't have to do that right now, 144 00:07:57,720 --> 00:08:00,640 Speaker 1: we can save it for another day, but it has 145 00:08:00,720 --> 00:08:05,240 Speaker 1: not found a bid this morning. Is people digest non 146 00:08:05,280 --> 00:08:09,240 Speaker 1: gap and gap earnings and the mystery of this. I 147 00:08:09,280 --> 00:08:11,120 Speaker 1: don't pretend to be up to speed on it. We'll 148 00:08:11,120 --> 00:08:13,400 Speaker 1: get a guest on this as we go. But to 149 00:08:13,480 --> 00:08:17,200 Speaker 1: remind everybody, we've enjoyed moving from two dred and forty 150 00:08:17,240 --> 00:08:21,240 Speaker 1: three dollars a share down to sixty nine in a 151 00:08:21,320 --> 00:08:24,800 Speaker 1: low of sixty one, and right now, Mike, we've broken 152 00:08:24,880 --> 00:08:30,000 Speaker 1: through that March fourth low to fifty seven. We're down 153 00:08:30,160 --> 00:08:36,320 Speaker 1: sevent on this company, for those who haven't been following 154 00:08:36,320 --> 00:08:39,320 Speaker 1: the news, valued out this morning with a downgrade of 155 00:08:39,480 --> 00:08:44,520 Speaker 1: its forecast, a significant downgrade of its earnings forecast, and 156 00:08:44,600 --> 00:08:51,000 Speaker 1: that has obviously investors concerned. Valiant business model under attack, 157 00:08:51,200 --> 00:08:54,560 Speaker 1: and it had been defended by Mr Ackman and company 158 00:08:55,160 --> 00:08:59,960 Speaker 1: had investor. So, even if it's a relatively small company, 159 00:09:00,160 --> 00:09:02,560 Speaker 1: is has an outsized presence in the news and a 160 00:09:02,679 --> 00:09:06,280 Speaker 1: very different structure here Michael Pearson back from illness clearly, 161 00:09:06,720 --> 00:09:10,200 Speaker 1: but with three basically three chairman, which I don't pretend 162 00:09:10,200 --> 00:09:14,400 Speaker 1: to understand. Eric Abramson, Eric Kellen and Whittaker as well 163 00:09:14,400 --> 00:09:18,000 Speaker 1: out of Bridgewater, New Jersey, and uh this bears watching. 164 00:09:18,080 --> 00:09:20,080 Speaker 1: I I don't know why I say that, Mike, other 165 00:09:20,160 --> 00:09:24,319 Speaker 1: than stock price says a lot. And the way it's 166 00:09:24,440 --> 00:09:28,320 Speaker 1: acting off the news of I'm gonna say, forty five 167 00:09:28,360 --> 00:09:34,000 Speaker 1: minutes ago is unbecoming to the mysteries that are out there. 168 00:09:34,600 --> 00:09:38,800 Speaker 1: Hitting a low of fifty seven UM fifty six sixty 169 00:09:38,840 --> 00:09:43,240 Speaker 1: two eight oh two, six minutes ago as well. So 170 00:09:43,280 --> 00:09:46,120 Speaker 1: there's Valiant. I don't mean to interrupt Mr Ruskin on 171 00:09:46,440 --> 00:09:48,120 Speaker 1: but this is moving in real time. We'll try to 172 00:09:48,120 --> 00:09:51,760 Speaker 1: get some perspective on this, uh this morning as well. 173 00:09:51,880 --> 00:09:57,199 Speaker 1: Valiant Pharmaceuticals uh south and are really difficult. Ernie's might 174 00:09:57,240 --> 00:09:58,719 Speaker 1: help me with a data check here. The b o 175 00:09:58,840 --> 00:10:01,480 Speaker 1: J really didn't adjust that they did it and did 176 00:10:01,480 --> 00:10:03,640 Speaker 1: not well. I mean it did in the sense that 177 00:10:03,720 --> 00:10:08,280 Speaker 1: people were uh disappointed that they didn't get any more. 178 00:10:08,280 --> 00:10:11,600 Speaker 1: Easy K finished down by seven tents a hundred and 179 00:10:11,600 --> 00:10:13,800 Speaker 1: seven little points on the day, and that hangover has 180 00:10:13,840 --> 00:10:16,839 Speaker 1: spread to Europe and into the US markets ahead of 181 00:10:16,840 --> 00:10:19,640 Speaker 1: the fat A little wait stronger yeah, one twelve eighty three, 182 00:10:19,679 --> 00:10:23,160 Speaker 1: A full stick one eighty three stronger the euro one 183 00:10:23,240 --> 00:10:28,040 Speaker 1: eleven one ten. It'll earlier one eleven oh two on 184 00:10:28,160 --> 00:10:31,240 Speaker 1: the euro flat with some a little bit of dollar 185 00:10:31,320 --> 00:10:35,640 Speaker 1: strength this morning. Commodities really giving it up after a 186 00:10:35,760 --> 00:10:40,120 Speaker 1: great run. West Texas thirty six thirty six eighty two cents, 187 00:10:40,160 --> 00:10:44,160 Speaker 1: Brent thirty eight sixty one down ninety two cents oil 188 00:10:44,840 --> 00:10:48,840 Speaker 1: soft Gold down thirteen dollars twelve thirty one the ounce. 189 00:10:52,280 --> 00:10:54,120 Speaker 1: All right, let's check it with my car and get 190 00:10:54,160 --> 00:10:57,160 Speaker 1: the latest world and national headlines. Mike Tom, thank you 191 00:10:57,280 --> 00:11:00,720 Speaker 1: very much. Campaigns of Florida's Marco Ruby, oh and Ohio's 192 00:11:00,800 --> 00:11:04,040 Speaker 1: John Casey could hang the balance today. They need to 193 00:11:04,040 --> 00:11:06,280 Speaker 1: win their home states to have a chance at catching 194 00:11:06,320 --> 00:11:09,920 Speaker 1: Republican leader Donald Trump. Through other states sold primaries today. 195 00:11:09,960 --> 00:11:13,560 Speaker 1: Big wins today by Trump and Democrat Hillary Clinton could 196 00:11:13,600 --> 00:11:16,680 Speaker 1: pad their leads. There is more confirmation of the death 197 00:11:16,679 --> 00:11:19,760 Speaker 1: of the Islamic State group's top military commander in Syria. 198 00:11:20,280 --> 00:11:22,880 Speaker 1: Spokesman for the US led coalition battling in the RACK 199 00:11:22,960 --> 00:11:25,880 Speaker 1: says it has been able to determine that Omar al 200 00:11:26,040 --> 00:11:29,400 Speaker 1: Shashani is dead after being wounded last week in an 201 00:11:29,400 --> 00:11:33,160 Speaker 1: air strike. Russian officials say it's military forces have started 202 00:11:33,240 --> 00:11:37,000 Speaker 1: leaving Syria. The surprise move by Russian President of Vladimir 203 00:11:37,040 --> 00:11:40,240 Speaker 1: Putin puts pressure on the regime of Syrian President Assad 204 00:11:40,640 --> 00:11:43,200 Speaker 1: and opposition groups to reach a peace deal at talks 205 00:11:43,240 --> 00:11:46,160 Speaker 1: in Geneva. Global News twenty four hours a day, powered 206 00:11:46,200 --> 00:11:49,400 Speaker 1: by our two hundred journalists more than a hundred fifty 207 00:11:49,400 --> 00:11:52,679 Speaker 1: news bureaus from around the world. Not Michael bar to Michael, 208 00:11:52,720 --> 00:11:55,600 Speaker 1: thanks so much, Worldwide Economics financial Investor. We are with 209 00:11:55,720 --> 00:11:59,080 Speaker 1: Alan Ruskin of Deutsche Bank as you look at three 210 00:11:59,360 --> 00:12:07,400 Speaker 1: Central Bank meetings. This is Bloomberg Surveillance. The news update 211 00:12:07,440 --> 00:12:09,480 Speaker 1: brought to you by Mercedes Benz. This month, your Mercedes 212 00:12:09,480 --> 00:12:11,920 Speaker 1: bens Tri State dealers Welcome Spring with limited time offers 213 00:12:11,920 --> 00:12:13,880 Speaker 1: on select models like the Sporty c L A and 214 00:12:14,000 --> 00:12:16,400 Speaker 1: Versatile g l A, each engineered and price to move. 215 00:12:16,840 --> 00:12:23,280 Speaker 1: Was at m b USA dot com. Today tws Global 216 00:12:23,320 --> 00:12:26,760 Speaker 1: Business News twenty four hours a day at Bloomberg dot com, 217 00:12:27,000 --> 00:12:29,720 Speaker 1: the Radio plus mobile app and on your radio. This 218 00:12:30,200 --> 00:12:33,720 Speaker 1: is a Bloomberg Business Flash and I'm Karen Moscow. U 219 00:12:33,800 --> 00:12:36,520 Speaker 1: S Dock Index futures are lower this morning. Let's go 220 00:12:36,559 --> 00:12:39,160 Speaker 1: to the First Word Breaking news desk for today's morning call, 221 00:12:39,280 --> 00:12:42,520 Speaker 1: and here's Bill Maloney. Good morning, Bill, Good morning Karen. 222 00:12:42,559 --> 00:12:45,800 Speaker 1: That's right, US, you just remain under pressure today. Down 223 00:12:45,840 --> 00:12:48,160 Speaker 1: features currently lower by seventy one point, says to be 224 00:12:48,320 --> 00:12:51,280 Speaker 1: dropped ten and as a future is lower by thirteen. 225 00:12:51,679 --> 00:12:54,520 Speaker 1: The US ten yel at one point nine three percent 226 00:12:54,880 --> 00:12:57,000 Speaker 1: and up of markets are also lower, led by greater 227 00:12:57,080 --> 00:13:00,559 Speaker 1: than one percent declines in Spain and Italy. On the 228 00:13:00,600 --> 00:13:04,240 Speaker 1: US economic Frinday thirty retail sales pp I and Empire 229 00:13:04,280 --> 00:13:09,160 Speaker 1: Manufacturing and at ten o'clock Housing Market Index and business inventories. 230 00:13:09,559 --> 00:13:13,319 Speaker 1: Regarding earnings this morning, HD supply beat and Valiant lower 231 00:13:14,200 --> 00:13:18,200 Speaker 1: forecast shares her down sixteen percent pre market and other news. 232 00:13:18,240 --> 00:13:22,040 Speaker 1: Morgan Stanley says Apple March quarter iPhone demand tracking well 233 00:13:22,720 --> 00:13:25,880 Speaker 1: and me Johnson rises six percent pre market amid report. 234 00:13:25,920 --> 00:13:29,120 Speaker 1: Company is said to be working with Lazard. Finally some 235 00:13:29,160 --> 00:13:32,079 Speaker 1: of your early Wallstreet upgrades and downgrades. Tiffany cut the 236 00:13:32,120 --> 00:13:34,599 Speaker 1: neutral over at City Group at Goldman Sachs Hi with 237 00:13:34,679 --> 00:13:37,840 Speaker 1: Sports and Sanderson Farms both cut to sell at JPE. 238 00:13:37,880 --> 00:13:41,160 Speaker 1: Morgan three D Systems cut to underweight and Wirlpool raised 239 00:13:41,200 --> 00:13:45,040 Speaker 1: to overweight. Also, Reticenter raised to strung by over at 240 00:13:45,160 --> 00:13:48,000 Speaker 1: Raymond James live from the first breaking news desk Im 241 00:13:48,080 --> 00:13:50,800 Speaker 1: Bill Maloney, Karen, all right, thanks Melan to her live 242 00:13:50,840 --> 00:13:53,720 Speaker 1: breaking news over your Bloomberg type squawk go and your terminal, 243 00:13:53,800 --> 00:13:56,599 Speaker 1: that's s do you, that's squ a w K go 244 00:13:56,800 --> 00:13:59,400 Speaker 1: and that's a Bloomberg business flash, Tom and Mike turn 245 00:13:59,679 --> 00:14:01,599 Speaker 1: thanks so much. In the middle of three days of 246 00:14:01,720 --> 00:14:06,800 Speaker 1: central bank meetings, Bloomberg Surveillance brought you by Investco. Looking 247 00:14:06,800 --> 00:14:10,480 Speaker 1: for investment views, experienced experts are just to click away. 248 00:14:10,600 --> 00:14:14,680 Speaker 1: Go to investco dot com, slash us to subscribe to 249 00:14:14,800 --> 00:14:20,640 Speaker 1: the investco blog and follow at investo us on Twitter. 250 00:14:20,800 --> 00:14:24,160 Speaker 1: Thank you Investco for your support this morning. Mike, it's 251 00:14:24,160 --> 00:14:27,000 Speaker 1: just does this ever happen before? Back to back to 252 00:14:27,080 --> 00:14:30,160 Speaker 1: back central bank means It's enough to make Alan Ruskin 253 00:14:30,680 --> 00:14:32,880 Speaker 1: set up straight and smile. Well, it's not just the 254 00:14:33,120 --> 00:14:37,920 Speaker 1: Big Three. The minutes of the Bank of Australia meeting 255 00:14:38,080 --> 00:14:43,400 Speaker 1: just out, uh, the the Norwegian Central Bank is meeting 256 00:14:43,400 --> 00:14:46,040 Speaker 1: this week, the South African Central Bank. Awful lot going 257 00:14:46,080 --> 00:14:49,800 Speaker 1: on and for the most part, central banks continuing with 258 00:14:50,000 --> 00:14:53,280 Speaker 1: a stimulus. One of the questions that comes up, though, Alan, 259 00:14:53,440 --> 00:14:57,200 Speaker 1: is uh, what effect it has? Bank of Japan went 260 00:14:57,240 --> 00:14:59,840 Speaker 1: to negative interest rates and saw the end strengthen in 261 00:15:00,000 --> 00:15:03,240 Speaker 1: instead of weekend. We note the story on the Bloomberg 262 00:15:03,280 --> 00:15:09,040 Speaker 1: this morning that bank lending has gained less than bank 263 00:15:09,120 --> 00:15:13,440 Speaker 1: deposits in Japan, completely opposite of what the bank UH 264 00:15:13,880 --> 00:15:19,400 Speaker 1: is UH trying for. UH does it work anymore? Well? 265 00:15:19,440 --> 00:15:25,200 Speaker 1: The bank lending program that that UH senior dragging introduced 266 00:15:25,640 --> 00:15:30,000 Speaker 1: um actually work in Europe? Well, I think you know 267 00:15:30,000 --> 00:15:32,680 Speaker 1: there are lots of different elements in UH that the 268 00:15:32,720 --> 00:15:35,720 Speaker 1: e CBS trying in terms of this large reserve additions 269 00:15:35,760 --> 00:15:37,720 Speaker 1: to the through the l t r o s and 270 00:15:37,760 --> 00:15:41,800 Speaker 1: the corporate bond purchases. Um. Look at the end of 271 00:15:41,800 --> 00:15:43,880 Speaker 1: the day, I mean you you asked me earlier about 272 00:15:43,920 --> 00:15:46,440 Speaker 1: what would drive the euro and what would drive euro 273 00:15:46,520 --> 00:15:50,680 Speaker 1: dollar down? And I think what the central banks are 274 00:15:50,760 --> 00:15:53,760 Speaker 1: facing is that they don't want to admit it, but 275 00:15:53,840 --> 00:15:56,760 Speaker 1: the exchange right channel is a powerful channel and they 276 00:15:56,840 --> 00:16:02,040 Speaker 1: need it. Um and UM. It's harder and harder to 277 00:16:02,240 --> 00:16:06,400 Speaker 1: manipulate exchange rates lower in part because you know, some 278 00:16:06,440 --> 00:16:09,400 Speaker 1: of the adjustment has already occurred. So, for example, in 279 00:16:09,480 --> 00:16:12,880 Speaker 1: terms of negative rates in Europe, moving to more negative 280 00:16:12,960 --> 00:16:16,840 Speaker 1: rates doesn't have quite the same exchange rate effect because um, 281 00:16:16,880 --> 00:16:19,160 Speaker 1: you know a lot of the accounts that would have 282 00:16:19,160 --> 00:16:21,760 Speaker 1: already sold euros in the back of negative rates would 283 00:16:21,760 --> 00:16:24,720 Speaker 1: have done so a euros also go so um. You 284 00:16:24,760 --> 00:16:26,800 Speaker 1: know what you're seeing the world over, I think is 285 00:16:26,880 --> 00:16:30,520 Speaker 1: unorthodox policies can be used. Now q E one works 286 00:16:31,080 --> 00:16:33,360 Speaker 1: more than QV two, which works more than QV three. 287 00:16:33,440 --> 00:16:38,240 Speaker 1: There's definitely diminishing returns to unorthodox policies. Well, what's your 288 00:16:38,320 --> 00:16:43,800 Speaker 1: bet with the ECB and the bank lending program? But 289 00:16:43,880 --> 00:16:48,120 Speaker 1: I think we will get some adjustment. You know, the 290 00:16:48,280 --> 00:16:52,960 Speaker 1: benchmarks in terms of the amount of lending that's needed 291 00:16:53,040 --> 00:17:00,200 Speaker 1: to trigger very low or negative borrowing from banks is 292 00:17:00,120 --> 00:17:02,200 Speaker 1: is not you know that that that benchmark is not 293 00:17:02,320 --> 00:17:06,320 Speaker 1: very high really, so there's plenty of incentive to go 294 00:17:06,480 --> 00:17:09,120 Speaker 1: borrow at negative rates. And you know, I think from 295 00:17:09,119 --> 00:17:13,320 Speaker 1: a funding standpoint, from a point of view of supporting 296 00:17:13,359 --> 00:17:18,080 Speaker 1: the banking system, the actions are you know, considerable. Whether 297 00:17:18,160 --> 00:17:21,800 Speaker 1: the credit channel itself is particularly powerful is another exactly 298 00:17:21,880 --> 00:17:23,879 Speaker 1: all together? Yeah, that's right where I wanted to go. 299 00:17:24,160 --> 00:17:26,480 Speaker 1: Is this you know the word I'm hearing now, Ellen 300 00:17:26,640 --> 00:17:30,040 Speaker 1: is transmission or diffusement, which I used to hear a 301 00:17:30,040 --> 00:17:33,520 Speaker 1: lot from Mr trichet. The idea that you can diffuse 302 00:17:33,640 --> 00:17:38,560 Speaker 1: well intentioned economic theory through a system is really open 303 00:17:38,600 --> 00:17:41,920 Speaker 1: to questions, isn't it. Yes. I mean I think of 304 00:17:42,000 --> 00:17:44,320 Speaker 1: in a particularly in terms of the credit channel. You've 305 00:17:44,320 --> 00:17:46,280 Speaker 1: got obviously got a demand side and you've got a 306 00:17:46,320 --> 00:17:49,960 Speaker 1: supply side, so you're facilitating supply. Um, you know, are 307 00:17:50,000 --> 00:17:54,359 Speaker 1: you necessary driving demands? You know, traditionally supply does not 308 00:17:54,520 --> 00:17:57,240 Speaker 1: create its own demand really, so you know, that's one 309 00:17:57,240 --> 00:17:59,720 Speaker 1: of the problems I think you're faced, or one face 310 00:17:59,840 --> 00:18:02,640 Speaker 1: is it's a credit channels. As I mentioned earlier time, 311 00:18:02,680 --> 00:18:05,840 Speaker 1: I think the channel we know tends to work is 312 00:18:05,920 --> 00:18:09,040 Speaker 1: the exchange rate channel. But of course that tends to 313 00:18:09,080 --> 00:18:11,680 Speaker 1: get into begg of our neighbor type policies, and everyone 314 00:18:11,760 --> 00:18:14,280 Speaker 1: can followed the same policy, which is part of the problem. 315 00:18:14,440 --> 00:18:16,120 Speaker 1: And I think one of the problems we face from 316 00:18:16,119 --> 00:18:18,879 Speaker 1: the global economy standpoint is the FED has been the 317 00:18:18,880 --> 00:18:21,720 Speaker 1: only guys on the other side willing to tolerate a 318 00:18:21,760 --> 00:18:25,479 Speaker 1: stronger currency. But the stronger dollar has become disruptive as well, 319 00:18:26,160 --> 00:18:30,320 Speaker 1: you know, through weakening the equity markets, weakening commodity prices. 320 00:18:30,400 --> 00:18:34,880 Speaker 1: So you know, there's there's no simple gain here from 321 00:18:34,920 --> 00:18:39,200 Speaker 1: a global macro standpoint. Ellen Ruskin, thank you so much. 322 00:18:39,760 --> 00:18:43,360 Speaker 1: Just really really interesting conversation, folks, given the swirling mike. 323 00:18:43,400 --> 00:18:46,320 Speaker 1: To me, it goes back to orphans and the tool box. 324 00:18:47,080 --> 00:18:49,960 Speaker 1: We're using things in the tool box. They we didn't 325 00:18:49,960 --> 00:18:52,800 Speaker 1: know they were there. They were like down below you 326 00:18:52,840 --> 00:18:55,520 Speaker 1: know where you have the hacks are used from one 327 00:18:55,560 --> 00:18:59,680 Speaker 1: project eight years ago. While they're rooting around. Um, they're 328 00:18:59,720 --> 00:19:03,200 Speaker 1: getting getting close to the the end of what they 329 00:19:03,280 --> 00:19:05,520 Speaker 1: have as tools. But the question is to the tools 330 00:19:05,560 --> 00:19:10,240 Speaker 1: that even we're getting to now work. Uh, As I said, 331 00:19:10,320 --> 00:19:13,200 Speaker 1: interesting story on the Bloomer today about how bank lending, 332 00:19:13,200 --> 00:19:15,440 Speaker 1: which is what the Bank of Japan wants to stimulate, 333 00:19:15,880 --> 00:19:19,760 Speaker 1: it's up a little bit. But bank deposits, the banks 334 00:19:19,760 --> 00:19:23,480 Speaker 1: there are paying one thousandths of one percent, they're paying 335 00:19:23,760 --> 00:19:26,359 Speaker 1: let's they're paying a tenth of a basis point, and 336 00:19:26,440 --> 00:19:29,560 Speaker 1: people are rushing to put money into bank accounts. Uh, 337 00:19:29,560 --> 00:19:31,760 Speaker 1: and the banks can't lend it out fast enough. And 338 00:19:31,920 --> 00:19:34,560 Speaker 1: it is UH completely working the opposite of what the 339 00:19:34,560 --> 00:19:38,640 Speaker 1: Bank of Japan exactly and with great respect for the 340 00:19:38,640 --> 00:19:42,080 Speaker 1: theory out there, none of this is in the textbooks. 341 00:19:42,480 --> 00:19:44,960 Speaker 1: Well that's why its theory, and it hasn't been tried. 342 00:19:46,040 --> 00:19:48,119 Speaker 1: We will know a lot more. I think somehow to 343 00:19:48,240 --> 00:19:51,160 Speaker 1: keep us unemployed through two thousand sixteen. That's a good thing. 344 00:19:51,280 --> 00:19:56,800 Speaker 1: Futures negative eleven down, futures negative seventy six, important economic data, 345 00:19:56,880 --> 00:20:00,280 Speaker 1: the pulse of the American consumer. We will do that next. 346 00:20:00,880 --> 00:20:07,280 Speaker 1: This is Bloomberg Surveillance coming up there, with all due respect, highlight, 347 00:20:07,280 --> 00:20:08,880 Speaker 1: brought you by land Rover. If it's in your nature 348 00:20:08,880 --> 00:20:10,399 Speaker 1: to cast off the every day and seek adventure, the 349 00:20:10,440 --> 00:20:12,600 Speaker 1: Discovery's Court was built to help your search. Visit land 350 00:20:12,600 --> 00:20:14,760 Speaker 1: Over tri State dot com for special offers during the 351 00:20:14,760 --> 00:20:25,119 Speaker 1: only Adventure Sales event. Landrover Above and beyond broadcasting live 352 00:20:25,200 --> 00:20:28,560 Speaker 1: to New York, Cloomberg eleventh, Riyo to Washington, d C, 353 00:20:28,760 --> 00:20:34,040 Speaker 1: Bloomberg to Boston, Bloomberg twelve hundreds to San Francisco, Bloomberg 354 00:20:34,119 --> 00:20:37,719 Speaker 1: nine six to the Country Series Exam Channel one nineteen 355 00:20:37,880 --> 00:20:41,320 Speaker 1: and around the globe the Bloomberg Radio Plus Appen Bloomberg 356 00:20:41,400 --> 00:20:45,520 Speaker 1: dot Com. This is Bloomberg Surveillance. Welcome back and say 357 00:20:45,560 --> 00:20:48,760 Speaker 1: thirty on Wall Street. I Michael McKee, along with Tom Keene, 358 00:20:49,080 --> 00:20:51,560 Speaker 1: and our economic indicators are brought to you by Commonwealth 359 00:20:51,560 --> 00:20:54,159 Speaker 1: Financial Network when it's time to change the conversation, talk 360 00:20:54,240 --> 00:20:56,480 Speaker 1: with a broker dealer r I A that is ready 361 00:20:56,520 --> 00:20:58,920 Speaker 1: to listen. Call eight six or six two three six 362 00:20:58,960 --> 00:21:02,120 Speaker 1: three eight or visit Commonwealth dot com to learn more. 363 00:21:02,440 --> 00:21:06,280 Speaker 1: Here's Vine l Judais with the retail sales figures. Michael, 364 00:21:06,320 --> 00:21:09,320 Speaker 1: we have a decline down point one percent in February 365 00:21:09,359 --> 00:21:13,119 Speaker 1: retail sales nationwide. Economists had been looking for a point 366 00:21:13,160 --> 00:21:17,680 Speaker 1: two percent decline excluding autos. Also a decline excluding autos 367 00:21:17,680 --> 00:21:21,399 Speaker 1: and gasoline up the retail sales control group of inflation. 368 00:21:21,680 --> 00:21:24,880 Speaker 1: The Producer Price Index down point two percent in February 369 00:21:24,920 --> 00:21:30,240 Speaker 1: as forecast cores excluding food and energy unchanged. Empire State 370 00:21:30,320 --> 00:21:35,720 Speaker 1: Manufacturing Index meantime, registering barely a positive reading point six too. 371 00:21:36,119 --> 00:21:40,040 Speaker 1: In March again, retail sales down, the producer price index down, 372 00:21:40,280 --> 00:21:44,800 Speaker 1: the Empire State Manufacturing Index just barely positive. At the 373 00:21:44,800 --> 00:21:47,440 Speaker 1: Bloombark First World Desk, Comfy del juice, let's go back 374 00:21:47,440 --> 00:21:50,720 Speaker 1: to New York. Vinnie, Thank you very much, well trying 375 00:21:50,760 --> 00:21:53,080 Speaker 1: to make sense. I'm looking at the numbers here kind 376 00:21:53,080 --> 00:21:55,160 Speaker 1: of makes sense of the retail sales figures and why 377 00:21:55,200 --> 00:21:59,680 Speaker 1: the decline. It looks like major decline in gasoline prices 378 00:22:00,000 --> 00:22:03,560 Speaker 1: pushed down gas station sales four point four percent UH 379 00:22:03,640 --> 00:22:06,399 Speaker 1: and three point three percent the prior month, which is 380 00:22:06,440 --> 00:22:08,960 Speaker 1: maybe part of the reason we saw the big revision there, 381 00:22:09,040 --> 00:22:13,000 Speaker 1: but a lot of declines across the whole the whole 382 00:22:13,080 --> 00:22:15,479 Speaker 1: number of categories. We try to give you more than 383 00:22:15,520 --> 00:22:18,000 Speaker 1: the headline data, and the markets move on this. We're 384 00:22:18,000 --> 00:22:21,040 Speaker 1: in four basis points on the tenure. We have just 385 00:22:21,040 --> 00:22:24,480 Speaker 1: just moved away from the two percent dash one point 386 00:22:24,600 --> 00:22:28,520 Speaker 1: nine percent the two year yield in two basis points 387 00:22:28,560 --> 00:22:32,440 Speaker 1: point nine, three five eight. Futures have a weight to them. 388 00:22:32,480 --> 00:22:35,960 Speaker 1: I won't say they've deteriorated. And Mike, what I see 389 00:22:36,280 --> 00:22:40,359 Speaker 1: are the revisions. I think the revisions just is a 390 00:22:40,400 --> 00:22:44,760 Speaker 1: gross moving from a positive set to a negative set 391 00:22:44,840 --> 00:22:47,920 Speaker 1: as a general statement, and you add them together at 392 00:22:47,960 --> 00:22:52,080 Speaker 1: sixty days of just to wait to the market, I 393 00:22:52,080 --> 00:22:56,119 Speaker 1: think Howard developments to say we're in the crapper. That 394 00:22:56,160 --> 00:22:58,720 Speaker 1: would be his economic and we gotta bring Howard out 395 00:22:58,800 --> 00:23:01,560 Speaker 1: for thirty seconds every time I get a retail report 396 00:23:01,960 --> 00:23:04,960 Speaker 1: to give us a one word answer like that. Uh, 397 00:23:05,080 --> 00:23:08,560 Speaker 1: Kyle Tannenbaum, he doesn't talk like that, No, he doesn't. 398 00:23:09,200 --> 00:23:12,320 Speaker 1: He will give us some very interesting analysis of this 399 00:23:12,640 --> 00:23:14,199 Speaker 1: and what's going on in the economy and how it 400 00:23:14,240 --> 00:23:16,600 Speaker 1: all relates to the FED. He is chief economists at 401 00:23:16,600 --> 00:23:20,280 Speaker 1: Northern Trust, former official at the Chicago Federal Reserve Bank. 402 00:23:20,320 --> 00:23:24,360 Speaker 1: Good morning to you, Carl, Good morning mite. Um. If 403 00:23:24,400 --> 00:23:26,520 Speaker 1: you had to pick one word, and you don't have to, 404 00:23:26,800 --> 00:23:30,280 Speaker 1: you know, do go all hourd on us. What would 405 00:23:30,320 --> 00:23:33,760 Speaker 1: you say about the numbers that we're seeing here? Well, 406 00:23:33,800 --> 00:23:36,600 Speaker 1: I do like to use phrasing that's appropriate for polite companies, 407 00:23:36,600 --> 00:23:39,280 Speaker 1: so I would say modest. I think you know you've 408 00:23:39,320 --> 00:23:42,800 Speaker 1: gotten a lot of swings, as you've highlighted in energy prices. Also, 409 00:23:42,880 --> 00:23:45,240 Speaker 1: auto sales seem to have hit a little bit of 410 00:23:45,280 --> 00:23:47,800 Speaker 1: a rough spot. Some concern about the financing side of 411 00:23:47,840 --> 00:23:49,680 Speaker 1: that business have taken some of the steam out of 412 00:23:49,720 --> 00:23:53,280 Speaker 1: it in recent months, but I think the overall the 413 00:23:53,280 --> 00:23:56,000 Speaker 1: consumer fundamentals are still awfully good. I just note for 414 00:23:56,000 --> 00:23:58,920 Speaker 1: our listeners that while retail sales is an important number, 415 00:23:58,960 --> 00:24:00,960 Speaker 1: it excludes a lot of things that we spend a 416 00:24:00,960 --> 00:24:03,920 Speaker 1: lot of money on, including rent and healthcare. And that's 417 00:24:03,920 --> 00:24:06,120 Speaker 1: why the personal consumption numbers I think are a bit 418 00:24:06,119 --> 00:24:09,160 Speaker 1: more comprehensive. In those obviously have been showing some pretty 419 00:24:09,200 --> 00:24:12,920 Speaker 1: nice year over year games. Wages are growing modestly, I 420 00:24:12,920 --> 00:24:15,119 Speaker 1: would say, but we're still creating a lot of jobs 421 00:24:15,119 --> 00:24:17,720 Speaker 1: and those who are going from not having incomes to 422 00:24:17,840 --> 00:24:22,040 Speaker 1: having you know, reasonable restoration of income. I would say, Mike, 423 00:24:22,280 --> 00:24:26,080 Speaker 1: is that is are being really powering the spending going forward. 424 00:24:26,400 --> 00:24:28,399 Speaker 1: We've also tried to find out where all of the 425 00:24:28,640 --> 00:24:32,439 Speaker 1: energy dividend, uh, you know, spending is going. And you know, 426 00:24:32,480 --> 00:24:34,159 Speaker 1: we've been able to tease out a little bit in 427 00:24:34,240 --> 00:24:36,760 Speaker 1: restaurant sales, which would show up in in resale and 428 00:24:36,800 --> 00:24:39,040 Speaker 1: there's a bit of vacation and going on. But again, 429 00:24:39,119 --> 00:24:42,320 Speaker 1: the other sign is, you know, people are renting much 430 00:24:42,320 --> 00:24:44,600 Speaker 1: more often in rents are rising. You don't capture that 431 00:24:44,640 --> 00:24:48,320 Speaker 1: in this morning's numbers. Well, the one discretionary service related 432 00:24:48,760 --> 00:24:51,359 Speaker 1: category in the retail sales report is eating and drinking 433 00:24:51,440 --> 00:24:56,159 Speaker 1: establishments and that was up one. And that is really 434 00:24:56,480 --> 00:25:00,000 Speaker 1: somewhat discretionary. If you're feeling bad about where the account 435 00:25:00,000 --> 00:25:01,760 Speaker 1: of me's going, that's when are you're going to cut 436 00:25:01,760 --> 00:25:05,639 Speaker 1: back relatively quickly. Yes, that's been rising really for the 437 00:25:05,720 --> 00:25:09,400 Speaker 1: last seven or eight months. You know, again teasing out 438 00:25:09,440 --> 00:25:11,120 Speaker 1: the and you have to look at the sub level 439 00:25:11,240 --> 00:25:13,399 Speaker 1: data the two of you know, in order to find 440 00:25:13,440 --> 00:25:16,120 Speaker 1: these signs, but you do see people driving more so 441 00:25:16,359 --> 00:25:19,400 Speaker 1: the d hotel stays hotel because he's very, very high 442 00:25:19,480 --> 00:25:23,880 Speaker 1: right now. So with that additional discussionary income from gasolene savings, 443 00:25:23,880 --> 00:25:25,920 Speaker 1: people do seem to be getting away just a little 444 00:25:25,920 --> 00:25:28,560 Speaker 1: bit more and having an evening out. Girl. I love 445 00:25:28,560 --> 00:25:30,320 Speaker 1: how you put a balance to this, and we all 446 00:25:30,320 --> 00:25:32,680 Speaker 1: agree there's some real positives out there, like the hotel 447 00:25:33,080 --> 00:25:35,760 Speaker 1: angle you mentioned. I just took three months, six months, 448 00:25:35,760 --> 00:25:40,080 Speaker 1: twelve months moving averages on the control group, and the 449 00:25:40,119 --> 00:25:44,000 Speaker 1: bottom line is there is a roll over in those 450 00:25:44,320 --> 00:25:48,120 Speaker 1: sort of curves, if you will, from August of last year. 451 00:25:48,680 --> 00:25:53,399 Speaker 1: What is your confidence that March or April are different 452 00:25:53,440 --> 00:25:59,240 Speaker 1: than December, January, February. Well, it's it's it's challenging to 453 00:25:59,440 --> 00:26:02,320 Speaker 1: predict month to month. I think, you know, we typically 454 00:26:02,359 --> 00:26:04,399 Speaker 1: look at things over a longer period of time to 455 00:26:04,520 --> 00:26:07,280 Speaker 1: year over year. Number I think is particularly important, which 456 00:26:07,280 --> 00:26:10,480 Speaker 1: is okay, which is which is fine? And I think 457 00:26:10,520 --> 00:26:12,960 Speaker 1: you know again, what I'm getting a sense of though, 458 00:26:13,000 --> 00:26:14,760 Speaker 1: is that you know, there we had a little bit 459 00:26:14,800 --> 00:26:17,439 Speaker 1: of a concern of funk that we came into the 460 00:26:17,480 --> 00:26:20,360 Speaker 1: beginning of the year with we had a big correction 461 00:26:20,400 --> 00:26:23,040 Speaker 1: in the equity markets. There was concerned that there might 462 00:26:23,040 --> 00:26:25,840 Speaker 1: be a negative wealth effect, to be honest with you, Tom, 463 00:26:25,880 --> 00:26:28,440 Speaker 1: and we just don't see much evidence of it. Um 464 00:26:28,560 --> 00:26:30,879 Speaker 1: And frankly, there hasn't been a lot of evidence that 465 00:26:30,960 --> 00:26:33,399 Speaker 1: we had a massive wealth effect from the stock market 466 00:26:33,840 --> 00:26:36,120 Speaker 1: gain that we had from two thousand and nine through 467 00:26:36,160 --> 00:26:39,359 Speaker 1: the beginning of two thousand and fifteen. So um, I 468 00:26:39,359 --> 00:26:41,639 Speaker 1: don't think we're at much risk. We seem to be 469 00:26:41,680 --> 00:26:44,960 Speaker 1: creating spending power the organic and traditional way, which is 470 00:26:45,080 --> 00:26:47,840 Speaker 1: which is pretty impressive. Carl Channebaum where us on the 471 00:26:47,920 --> 00:26:52,480 Speaker 1: negative wealth of sect Mike, we call that children us 472 00:26:52,560 --> 00:26:57,359 Speaker 1: discussion with Carl. With Carl ches with the Northern the 473 00:26:57,400 --> 00:27:02,639 Speaker 1: Northern Trust Company, Chicago, Illinois, Okay, over there, Uh definitely. 474 00:27:03,200 --> 00:27:05,679 Speaker 1: I was just thinking about this. There must be a 475 00:27:05,720 --> 00:27:08,320 Speaker 1: Southern Trust company somewhere. It's like the fifth third bank 476 00:27:08,720 --> 00:27:12,560 Speaker 1: in Cincinnati. What is it? You know, what is the 477 00:27:12,600 --> 00:27:17,520 Speaker 1: fourth third bank company? A long time, long time? I 478 00:27:17,560 --> 00:27:21,119 Speaker 1: think the answer Louisiana purchases there. We have some other 479 00:27:21,200 --> 00:27:22,879 Speaker 1: numbers out there, of course, is and he mentioned the 480 00:27:22,920 --> 00:27:27,120 Speaker 1: p P. I will ask Carl about that. Basically, flat 481 00:27:27,200 --> 00:27:33,640 Speaker 1: and then Empire Manufacturing up. Carl tannaboum futures at negative thirteen. 482 00:27:37,600 --> 00:27:39,080 Speaker 1: Time now to check in with Michael mar and get 483 00:27:39,119 --> 00:27:41,560 Speaker 1: the latest world in national headlines. Mike Tom, thank you 484 00:27:41,640 --> 00:27:44,480 Speaker 1: very much. It is make or break day as voters 485 00:27:44,520 --> 00:27:47,920 Speaker 1: had to the polls in five states for primaries. Ohio 486 00:27:48,000 --> 00:27:50,560 Speaker 1: Governor John Kasi says he's confident he will win his 487 00:27:50,600 --> 00:27:54,520 Speaker 1: state despite being tied with Donald Trump and the polls kick. 488 00:27:54,560 --> 00:27:57,840 Speaker 1: When asked by ABC News Today about the atmosphere at 489 00:27:57,840 --> 00:28:00,719 Speaker 1: Trump rally, says, that's not how we're mary Cans behave. 490 00:28:01,119 --> 00:28:02,880 Speaker 1: And when I look at the things that I saw 491 00:28:02,880 --> 00:28:05,360 Speaker 1: at that rally, and I see in rallies and the rhetoric, 492 00:28:05,800 --> 00:28:09,000 Speaker 1: it's disgraceful. Frankly. I mean, we're not a country that 493 00:28:09,080 --> 00:28:12,320 Speaker 1: spends his time slugging each other in the aisles. The 494 00:28:12,359 --> 00:28:15,399 Speaker 1: Obama administration is set to scale back plans to a 495 00:28:15,440 --> 00:28:18,520 Speaker 1: new generation of oil and gas drilling in the Atlantic. 496 00:28:18,840 --> 00:28:21,399 Speaker 1: That's according to an Interior Department official who does not 497 00:28:21,480 --> 00:28:25,119 Speaker 1: want to be named. Environmentalists and U S coastal communities 498 00:28:25,119 --> 00:28:28,919 Speaker 1: say the activity threatened fishing and tourism along the East Coast. 499 00:28:29,160 --> 00:28:31,640 Speaker 1: A suspected bombing off in Berlin today, killing a man 500 00:28:31,680 --> 00:28:34,760 Speaker 1: who was driving through the German capital. Police believe that 501 00:28:34,800 --> 00:28:37,720 Speaker 1: the device was either in or on the car. North 502 00:28:37,800 --> 00:28:39,960 Speaker 1: Korean leader Kim John Un says he will detonate a 503 00:28:40,040 --> 00:28:44,040 Speaker 1: nuclear warhead and test launch a ballistic missile capable of 504 00:28:44,160 --> 00:28:47,800 Speaker 1: carrying one in a short time. Global News twenty four 505 00:28:47,840 --> 00:28:51,040 Speaker 1: hours a day, powered by our twenty four hundred journalists 506 00:28:51,240 --> 00:28:53,920 Speaker 1: and more than one fifty news bureaus from around the world. 507 00:28:54,200 --> 00:28:58,560 Speaker 1: I am Michael bar Mike Tom Time now for the 508 00:28:58,640 --> 00:29:03,200 Speaker 1: Rancotina Auto Group. Bloomberg bes he sports update with good 509 00:29:03,200 --> 00:29:05,000 Speaker 1: Morning Mike and Tom. Both the n I T and 510 00:29:05,160 --> 00:29:08,040 Speaker 1: n C A tournaments get underway today, and locally, Fairleigh 511 00:29:08,080 --> 00:29:10,400 Speaker 1: Dickinson has given us a reason to cheer. The Nights 512 00:29:10,400 --> 00:29:12,960 Speaker 1: are peaking at the right time. They're just eighteen and fourteen, 513 00:29:12,960 --> 00:29:14,960 Speaker 1: but did earn their way into the Big Dance and 514 00:29:14,960 --> 00:29:17,400 Speaker 1: a trip to Dayton tonight, where they'll meet Florida Gulf 515 00:29:17,440 --> 00:29:20,080 Speaker 1: Coast at six forty to officially kick off the n 516 00:29:20,080 --> 00:29:22,240 Speaker 1: C two Attorney as part of the East Region. That's 517 00:29:22,240 --> 00:29:24,200 Speaker 1: followed by a pair of eleven seeds doing battle when 518 00:29:24,200 --> 00:29:28,120 Speaker 1: Wichita State meets Vanderbilt to the NHL. The Islanders had 519 00:29:28,160 --> 00:29:29,840 Speaker 1: to come back for the ages. They were being shut 520 00:29:29,840 --> 00:29:32,000 Speaker 1: out at home to nothing by Florida, only to score 521 00:29:32,080 --> 00:29:34,960 Speaker 1: three times and just under six minutes Kal Clutterbuck with 522 00:29:35,080 --> 00:29:37,520 Speaker 1: the game winner. The wind pulls the Aisles to within 523 00:29:37,600 --> 00:29:40,880 Speaker 1: a point of the Rangers for second in the Metro Division. 524 00:29:41,000 --> 00:29:43,960 Speaker 1: Kyle Okposo on the meeting, Just take one glass at 525 00:29:43,960 --> 00:29:45,640 Speaker 1: the standings. We've got a couple of games in hand, 526 00:29:46,240 --> 00:29:48,880 Speaker 1: you know, slowly we're gonna make up those games. And um, 527 00:29:49,160 --> 00:29:50,840 Speaker 1: those games are only good if you win the ends. 528 00:29:50,840 --> 00:29:55,200 Speaker 1: So every two points is hug. The Islanders will drop 529 00:29:55,200 --> 00:29:57,960 Speaker 1: the puck in Pittsburgh tonight. The West Coast has been 530 00:29:58,040 --> 00:30:01,120 Speaker 1: unkind to the Devil's trounced seven to one in Anahi, 531 00:30:01,200 --> 00:30:04,440 Speaker 1: thanks for the first career hat trick by Jacob Silverberg 532 00:30:04,520 --> 00:30:06,880 Speaker 1: and Great Fruit League. The match felt of the Tigers 533 00:30:06,920 --> 00:30:09,360 Speaker 1: nine to two. But the story is welcome back David Wright. 534 00:30:10,320 --> 00:30:12,480 Speaker 1: As far as timing and stuff, and now will do 535 00:30:12,640 --> 00:30:15,440 Speaker 1: the secondary to you know, going out there as simulatings 536 00:30:15,440 --> 00:30:18,560 Speaker 1: in that bat, you know, in game Mike situation, Uh, 537 00:30:18,920 --> 00:30:21,280 Speaker 1: thinking some swains trying to you know, run the first 538 00:30:21,320 --> 00:30:25,360 Speaker 1: babe from bass A little bit went great, right, went 539 00:30:25,480 --> 00:30:28,880 Speaker 1: one for five in a minor league interest squad game. 540 00:30:29,200 --> 00:30:31,280 Speaker 1: Yankees had the day off. Heart to believe, guys, just 541 00:30:31,320 --> 00:30:34,520 Speaker 1: twenty days until opening day. And that is your NBC 542 00:30:34,560 --> 00:30:38,440 Speaker 1: Bloomberg Sports update, Mike Tom, thanks so much, greatly appreciate it. 543 00:30:38,680 --> 00:30:42,800 Speaker 1: Valiant is in a call right now. The stock just 544 00:30:43,120 --> 00:30:47,640 Speaker 1: moments ago got a modest bid and the headline is 545 00:30:47,720 --> 00:30:55,200 Speaker 1: simple Valiant and confidential talks with parties on non core divestitures. 546 00:30:55,240 --> 00:30:58,600 Speaker 1: The stock is down seventeen percent this morning, and the 547 00:30:58,600 --> 00:31:01,080 Speaker 1: whole string of headlines. We'll go into this a little 548 00:31:01,080 --> 00:31:05,480 Speaker 1: bit later, but uh, Valiant has become really almost interesting 549 00:31:06,400 --> 00:31:11,280 Speaker 1: Wall Street story on their accounting and on their future. Uh. 550 00:31:11,320 --> 00:31:15,840 Speaker 1: We're with Carl Tannaba, Northern Trust. This is Bloomberg Surveillance. 551 00:31:21,160 --> 00:31:23,200 Speaker 1: This portionport was brought to you by Katina Auto Group. 552 00:31:23,280 --> 00:31:25,920 Speaker 1: Let Rakatin and show you the way to affordable luxury driving. 553 00:31:26,000 --> 00:31:28,720 Speaker 1: Visit any one of their sixteen beautiful show rooms in 554 00:31:28,760 --> 00:31:31,240 Speaker 1: New Jersey and New York to call one eight D 555 00:31:31,440 --> 00:31:37,640 Speaker 1: New Auto or go to Rakotino dot com for special offers. 556 00:31:37,640 --> 00:31:41,000 Speaker 1: Global Business news twenty four hours a day. If Bloomberg 557 00:31:41,080 --> 00:31:44,160 Speaker 1: dot com the radio plus mobil and on your radio. 558 00:31:44,440 --> 00:31:48,200 Speaker 1: This is a Bloomberg Business flash and I'm Karin Moscow. 559 00:31:48,280 --> 00:31:51,400 Speaker 1: This updates brought to you by National Realty. Returns on 560 00:31:51,520 --> 00:31:53,760 Speaker 1: cash and rented real estate find them at n r 561 00:31:53,840 --> 00:31:57,320 Speaker 1: I a dot net u S Stock Index futures extending 562 00:31:57,360 --> 00:32:00,240 Speaker 1: the clients amid retail sales data that for kin old 563 00:32:00,240 --> 00:32:03,240 Speaker 1: concern that the world's largest economy isn't immune to slowing 564 00:32:03,280 --> 00:32:06,520 Speaker 1: growth overseas. And we checked the markets every fifteen minutes 565 00:32:06,560 --> 00:32:10,040 Speaker 1: throughout the trading day on Bloomberg SNP eveny futures down 566 00:32:10,040 --> 00:32:13,200 Speaker 1: eleven points and now eveny futures down eighty four NASDAC 567 00:32:13,280 --> 00:32:16,000 Speaker 1: eveny futures down sixteen and the decks in Germany's down 568 00:32:16,000 --> 00:32:19,120 Speaker 1: eight tenths per cent ten Your treasury up eleven thirty seconds, 569 00:32:19,120 --> 00:32:21,240 Speaker 1: the yield one point nine two percent yield on a 570 00:32:21,320 --> 00:32:24,400 Speaker 1: two year point nine three percent nimax screwed oil down 571 00:32:24,480 --> 00:32:26,960 Speaker 1: two point seven percent or dollar one to thirty six 572 00:32:26,960 --> 00:32:29,960 Speaker 1: sixteen A barrel comaxs goal there is down seven tenths 573 00:32:29,960 --> 00:32:32,200 Speaker 1: per cent or nine dollars ten cents to twelve thirty 574 00:32:32,240 --> 00:32:35,040 Speaker 1: six and ounce the euro at dollar eleven nineteen the 575 00:32:35,160 --> 00:32:38,560 Speaker 1: N one twelve point seven one that reports showed US 576 00:32:38,640 --> 00:32:41,280 Speaker 1: retail sales dropped a tenth of upper cent in February 577 00:32:41,360 --> 00:32:43,960 Speaker 1: and the prior months gain was revised to a decline. 578 00:32:44,320 --> 00:32:46,840 Speaker 1: Now calls into question and narrative that bigger gains and 579 00:32:46,960 --> 00:32:50,200 Speaker 1: consumer spending with propelled economic growth at the start of 580 00:32:50,280 --> 00:32:53,440 Speaker 1: the year. Separated data showed wholesale prices in the US 581 00:32:53,560 --> 00:32:56,080 Speaker 1: felt two tons percent in February, held down by lower 582 00:32:56,120 --> 00:32:59,400 Speaker 1: fuel costs that have kept inflation languishing below the federal 583 00:32:59,480 --> 00:33:02,440 Speaker 1: reserves goal. And that's a Bloomberg Business flash, Tom and Mike, 584 00:33:04,720 --> 00:33:10,800 Speaker 1: Karen Mushkove, thank you very much. Some other numbers, Oh 585 00:33:11,560 --> 00:33:16,320 Speaker 1: Wall Street. The following is from Bloomberg View. Opinions and 586 00:33:16,360 --> 00:33:20,280 Speaker 1: commentary from Bloomberg columnists. I'm Justin Fox, a columnist for 587 00:33:20,280 --> 00:33:23,440 Speaker 1: Bloomberg View. The past decade and a half have been 588 00:33:23,480 --> 00:33:27,160 Speaker 1: tough for American workers. The median household brings in less 589 00:33:27,160 --> 00:33:30,320 Speaker 1: money than it did in two thousand, adjusted for inflation. 590 00:33:30,840 --> 00:33:35,080 Speaker 1: The percentage of adults without jobs has risen. Recent economics 591 00:33:35,080 --> 00:33:39,120 Speaker 1: research gives trade with China some of the blame. Politicians 592 00:33:39,160 --> 00:33:42,640 Speaker 1: and voters have taken notice. Raising trade barriers is a 593 00:33:42,680 --> 00:33:46,840 Speaker 1: major theme of the surprisingly successful presidential campaigns of Donald 594 00:33:46,880 --> 00:33:50,760 Speaker 1: Trump and Bernie Sanders. That got me wondering, there are 595 00:33:50,800 --> 00:33:53,479 Speaker 1: other wealthy countries where the average worker seems to have 596 00:33:53,520 --> 00:33:56,640 Speaker 1: fared better since two thousand than in the US. Can 597 00:33:56,640 --> 00:33:59,880 Speaker 1: that be chalked up to higher trade barriers? It does 598 00:34:00,160 --> 00:34:02,360 Speaker 1: look like it. To get a sense of where things 599 00:34:02,440 --> 00:34:05,040 Speaker 1: might be going better for workers, they used the United 600 00:34:05,120 --> 00:34:09,680 Speaker 1: Nations Inequality Adjusted Human Development Index, which combines income measures 601 00:34:09,680 --> 00:34:12,880 Speaker 1: with health and education indicators. Then I looked at the 602 00:34:12,920 --> 00:34:17,040 Speaker 1: International Chamber of Commerce's Open Markets Index, which measures a 603 00:34:17,080 --> 00:34:20,520 Speaker 1: country's openness to trade. Of the twenty six countries that 604 00:34:20,600 --> 00:34:23,280 Speaker 1: score higher than the US on the Human Development Index, 605 00:34:23,560 --> 00:34:26,680 Speaker 1: all but three also score higher on the trade openness ranking. 606 00:34:27,120 --> 00:34:31,280 Speaker 1: Free trade and widely shared prosperity are clearly not incompatible. 607 00:34:31,840 --> 00:34:34,880 Speaker 1: I'm justin Fox, a columnist for Bloomberg View. For more 608 00:34:34,920 --> 00:34:38,239 Speaker 1: Bloomberg opinion and commentary, please go to Bloomberg View dot 609 00:34:38,239 --> 00:34:41,279 Speaker 1: com or view go on the Bloomberg terminal. This has 610 00:34:41,320 --> 00:34:45,240 Speaker 1: been Bloomberg View. Bloomberg View commentaries can be heard hourly 611 00:34:45,400 --> 00:34:50,880 Speaker 1: weekdays on Bloomberg Radio. Tag Tom You're it, Yeah, Carltonobob 612 00:34:50,960 --> 00:34:53,680 Speaker 1: with this as we look at the American economy and uh, 613 00:34:53,840 --> 00:34:58,000 Speaker 1: the backdrop here is a sharp revision negative to retail 614 00:34:58,040 --> 00:35:01,359 Speaker 1: sales markets move on the new is and good. Mr 615 00:35:01,400 --> 00:35:04,000 Speaker 1: Tannemb I'm Dr Tannemb, I'm pushes against it and says 616 00:35:05,120 --> 00:35:07,880 Speaker 1: there's some glimmers of optimism out there as well. Carl, 617 00:35:07,920 --> 00:35:10,799 Speaker 1: I just made up a chart, which I'm hesitant to 618 00:35:10,840 --> 00:35:12,759 Speaker 1: say in March will be my chart of the year. 619 00:35:13,480 --> 00:35:15,320 Speaker 1: It's a thirty year look at real g d P, 620 00:35:15,480 --> 00:35:19,320 Speaker 1: which is migrated on a regression from under four percent 621 00:35:19,440 --> 00:35:22,600 Speaker 1: to under two percent. How do we turn that around? 622 00:35:23,160 --> 00:35:26,959 Speaker 1: It's the politic politics of the moment, it's the economics 623 00:35:27,080 --> 00:35:30,239 Speaker 1: of the moment. Retail sales consumer is not going to 624 00:35:30,360 --> 00:35:34,680 Speaker 1: do that. How do you turn around real GDP? Wow, 625 00:35:35,120 --> 00:35:38,719 Speaker 1: that's a weighty question for early morning. But I think 626 00:35:38,719 --> 00:35:41,400 Speaker 1: the long term issues that we've got are really to 627 00:35:41,400 --> 00:35:44,880 Speaker 1: to see what we can do to improve our potential 628 00:35:45,000 --> 00:35:47,759 Speaker 1: rate of economic growth. Tom. The chart that you may 629 00:35:47,800 --> 00:35:49,520 Speaker 1: be looking at a similar to others that I've seen 630 00:35:49,520 --> 00:35:51,560 Speaker 1: that take a look at a tenure moving average over 631 00:35:51,640 --> 00:35:54,520 Speaker 1: let's say forty or fifty years that show the decline, 632 00:35:54,520 --> 00:35:56,440 Speaker 1: and of course the economists would tell you that you 633 00:35:56,480 --> 00:35:59,000 Speaker 1: build up to that with two quantities. One is the 634 00:35:59,200 --> 00:36:03,680 Speaker 1: population or labor force growth and productivity growth. Obviously, we've 635 00:36:03,680 --> 00:36:07,040 Speaker 1: got baby boomers retiring and deservedly so, but we'll need 636 00:36:07,120 --> 00:36:11,280 Speaker 1: to renew the labor force in numbers and also skills. 637 00:36:12,080 --> 00:36:15,880 Speaker 1: The discussions really centers on in that realm around immigration, 638 00:36:15,920 --> 00:36:18,400 Speaker 1: which is a huge issue so far on the campaign trail, 639 00:36:18,480 --> 00:36:22,160 Speaker 1: but from a numbers perspective, typically immigration is very beneficial 640 00:36:22,200 --> 00:36:24,920 Speaker 1: to those countries that assimilate well. And then on the 641 00:36:24,920 --> 00:36:27,640 Speaker 1: productivity side, we've got a lot of thesis out there 642 00:36:27,640 --> 00:36:31,120 Speaker 1: as to what we might do or or or not do, frankly, 643 00:36:31,160 --> 00:36:33,800 Speaker 1: to to increase that level. A lot of the public 644 00:36:33,840 --> 00:36:36,440 Speaker 1: spending on infrastructure that we need in order to remain 645 00:36:36,800 --> 00:36:41,680 Speaker 1: economically fluid has been stunted by the fiscal austerity that's 646 00:36:41,680 --> 00:36:43,600 Speaker 1: be needed. Not even so much at the national level, 647 00:36:43,640 --> 00:36:45,200 Speaker 1: but as you know, a lot of this is handled 648 00:36:45,480 --> 00:36:47,759 Speaker 1: at the state and local level, where finances in many 649 00:36:47,760 --> 00:36:50,600 Speaker 1: places are a lot more tenuous. And then also I 650 00:36:50,640 --> 00:36:53,080 Speaker 1: think that there's an opportunity for whomever is sitting in 651 00:36:53,120 --> 00:36:56,520 Speaker 1: whatever seats next January to find those in near term 652 00:36:56,560 --> 00:36:59,400 Speaker 1: incentives to get a little bit more investment in R 653 00:36:59,480 --> 00:37:02,560 Speaker 1: and D and APEX going so that if we can 654 00:37:02,719 --> 00:37:07,120 Speaker 1: make the investments today, we'll reap the returns tomorrow and 655 00:37:07,160 --> 00:37:10,400 Speaker 1: the dire predictions of economists like Bob Gordon or Larry 656 00:37:10,440 --> 00:37:15,400 Speaker 1: Summers will not come true. Um. My name is Carl 657 00:37:15,400 --> 00:37:18,400 Speaker 1: Tannerbaum and I'm running for president. Have you endorsed that 658 00:37:19,520 --> 00:37:22,920 Speaker 1: I was a little taken about? I mean, Bob Gordon 659 00:37:23,000 --> 00:37:25,920 Speaker 1: is is not really dire making dire predictions. He's just 660 00:37:25,920 --> 00:37:29,080 Speaker 1: saying productivity won't be as high as it was. Well, 661 00:37:29,600 --> 00:37:32,239 Speaker 1: Mike's last paper we wrote, the book, I think, was 662 00:37:32,400 --> 00:37:34,480 Speaker 1: entitled the End of American Growth. So I don't know 663 00:37:34,520 --> 00:37:37,239 Speaker 1: how much darker you can get on that front. Well, 664 00:37:37,280 --> 00:37:40,000 Speaker 1: perhaps he stole a page from the tabloid newspapers and 665 00:37:40,120 --> 00:37:45,360 Speaker 1: exaggerate the headline to copies of the paper. Uh, here's 666 00:37:45,400 --> 00:37:49,160 Speaker 1: my question for you, Carl. We're talking earlier with our 667 00:37:49,200 --> 00:37:52,920 Speaker 1: political ale and c. J. Dione and Chuck Todd, who 668 00:37:53,000 --> 00:37:56,200 Speaker 1: suggests that given the nature of the campaign we've had, 669 00:37:56,600 --> 00:37:59,239 Speaker 1: it's gonna be very difficult for anybody to govern next year. 670 00:37:59,480 --> 00:38:02,879 Speaker 1: So what happens You're you're suggesting that there are things 671 00:38:02,880 --> 00:38:05,560 Speaker 1: they could do to get productivity going in the economy, 672 00:38:05,560 --> 00:38:09,839 Speaker 1: going what happens, If nothing happens, what happens to the economy, Mike, 673 00:38:09,880 --> 00:38:13,000 Speaker 1: would be hard to imagine an environment where governance is 674 00:38:13,040 --> 00:38:15,080 Speaker 1: harder than it is today. I'll just say that at 675 00:38:15,120 --> 00:38:16,480 Speaker 1: the outset it so, I'm not sure that we're going 676 00:38:16,520 --> 00:38:20,000 Speaker 1: to see such a paradigm change as we deal with 677 00:38:20,040 --> 00:38:22,560 Speaker 1: a new administration. I will say though, that there's a 678 00:38:22,560 --> 00:38:25,799 Speaker 1: body of work in economics that finds that that uncertainty 679 00:38:25,880 --> 00:38:30,080 Speaker 1: policy uncertainty is the enemy really of business progress and 680 00:38:30,160 --> 00:38:34,680 Speaker 1: market progress, and we're certainly getting tested on that front today. 681 00:38:34,719 --> 00:38:37,840 Speaker 1: I think gridlock the status quo is not good fiscally 682 00:38:37,960 --> 00:38:41,360 Speaker 1: because of the hill of healthcare costs and social security 683 00:38:41,360 --> 00:38:43,399 Speaker 1: costs and pension costs we have at the local level 684 00:38:43,440 --> 00:38:45,799 Speaker 1: that we're facing. We do need to face those as 685 00:38:45,840 --> 00:38:48,400 Speaker 1: soon as as possible, because kicking the can down the 686 00:38:48,440 --> 00:38:50,799 Speaker 1: curb is going to run into a wall in the 687 00:38:50,840 --> 00:38:55,000 Speaker 1: not too distant future. When you look, Carl at the 688 00:38:55,080 --> 00:38:57,360 Speaker 1: makeup here, and this has been the arts debate, and 689 00:38:57,440 --> 00:39:00,680 Speaker 1: it can go either way, optimist or pessimists. Do you 690 00:39:00,719 --> 00:39:04,359 Speaker 1: look at the all in economy? Are things so distorted? 691 00:39:04,960 --> 00:39:08,320 Speaker 1: X out trades and even energy dynamics right now, which 692 00:39:08,360 --> 00:39:11,520 Speaker 1: is it. I think you have to be very careful, 693 00:39:11,560 --> 00:39:15,319 Speaker 1: including the energy dynamics, because it's challenging to understand where 694 00:39:15,360 --> 00:39:17,880 Speaker 1: energy will settle in and what the American component of 695 00:39:17,920 --> 00:39:20,440 Speaker 1: that will look like. Our own view is that over 696 00:39:20,480 --> 00:39:22,960 Speaker 1: the long term, you know, energy demand globally is going 697 00:39:23,000 --> 00:39:25,360 Speaker 1: to be strong, and the supply but that we have 698 00:39:25,480 --> 00:39:28,080 Speaker 1: now will eventually dissipate. That should be good for our 699 00:39:28,120 --> 00:39:31,799 Speaker 1: producers and bring that back to being an important contributor 700 00:39:31,840 --> 00:39:35,240 Speaker 1: to our economy. But the fundamentals that we talked about earlier, 701 00:39:35,280 --> 00:39:37,440 Speaker 1: which are you know, what is our potential for growing, 702 00:39:37,640 --> 00:39:39,360 Speaker 1: are the ones that are going to be much more lasting, 703 00:39:39,360 --> 00:39:41,960 Speaker 1: and I think those need to be the focus of policy. 704 00:39:42,080 --> 00:39:43,359 Speaker 1: Before we let you go here, we have to ask 705 00:39:43,400 --> 00:39:45,440 Speaker 1: about the other numbers out today. Do you pay a 706 00:39:45,440 --> 00:39:48,239 Speaker 1: who lot of attention to pp I Essentially pp I 707 00:39:48,320 --> 00:39:52,960 Speaker 1: file demand flat and then um the New York I 708 00:39:53,239 --> 00:39:56,520 Speaker 1: s M numbers, So the pp I mike. We've had 709 00:39:56,640 --> 00:39:59,440 Speaker 1: kind of a quiet recovery and energy and commodity prices 710 00:39:59,440 --> 00:40:01,839 Speaker 1: over the last several weeks of taking the edge off 711 00:40:01,880 --> 00:40:05,239 Speaker 1: of that on inflation, and that certainly will feed into 712 00:40:05,280 --> 00:40:08,080 Speaker 1: the conversation that begins with the FED today, where I 713 00:40:08,080 --> 00:40:09,920 Speaker 1: think the numbers are better than they thought they'd be 714 00:40:09,960 --> 00:40:13,080 Speaker 1: a month ago. It'll be very interesting at the discussions. Carl, 715 00:40:13,120 --> 00:40:17,839 Speaker 1: Thank you so much. Carl Table the Northern Company surveillance correction. Here, 716 00:40:17,880 --> 00:40:20,400 Speaker 1: I said, New York I s M. They're not the 717 00:40:20,440 --> 00:40:23,120 Speaker 1: I s M. They don't come from the purchasing managers. 718 00:40:23,120 --> 00:40:25,360 Speaker 1: They come from survey by the New York Federal Reserve. 719 00:40:25,440 --> 00:40:29,880 Speaker 1: Empire Manufacturing it was up to positive zero point six 720 00:40:29,920 --> 00:40:34,319 Speaker 1: to from sixteen point six four. So a big change there. Well, 721 00:40:34,320 --> 00:40:36,279 Speaker 1: I'm glad to bring it up and that folks were 722 00:40:36,400 --> 00:40:40,880 Speaker 1: buried by tertiary economic data. And what I find interesting 723 00:40:40,920 --> 00:40:44,680 Speaker 1: is some of it, like the Dallas inflation statistic, has 724 00:40:44,760 --> 00:40:47,480 Speaker 1: real merit. Mike, what do you think of all these 725 00:40:47,520 --> 00:40:52,440 Speaker 1: you know, sub sub sub industries like Empire Manufacturing. Well, 726 00:40:52,480 --> 00:40:54,160 Speaker 1: they don't tell you much about what's going on in 727 00:40:54,160 --> 00:40:57,120 Speaker 1: the in the national economy, and there's no relationship between 728 00:40:57,120 --> 00:40:59,520 Speaker 1: the Empire number and the national I s M number. 729 00:40:59,560 --> 00:41:01,480 Speaker 1: But if you at them all together, it gives you 730 00:41:01,480 --> 00:41:04,360 Speaker 1: sort of a region by region picture of how things 731 00:41:04,400 --> 00:41:08,400 Speaker 1: are going. And uh, we have seen a deterioration across 732 00:41:08,440 --> 00:41:11,560 Speaker 1: the country. And now if this one's leading us back 733 00:41:11,680 --> 00:41:15,040 Speaker 1: up again, that would be good news. Yeah, it's just fascinating, folks. 734 00:41:15,080 --> 00:41:18,719 Speaker 1: All of our interviews on radio, out at iTunes, out 735 00:41:18,719 --> 00:41:21,399 Speaker 1: on podcast, we are thrilled to reofer that to your 736 00:41:21,440 --> 00:41:24,160 Speaker 1: team is doing a great job of getting those out. 737 00:41:24,160 --> 00:41:28,400 Speaker 1: Going to iTunes, search Bloomberg's Surveillance and you will find 738 00:41:28,920 --> 00:41:33,040 Speaker 1: any number of good interviews, including Richard Hass yesterday with 739 00:41:33,120 --> 00:41:36,880 Speaker 1: a consul and Form Relations, and Dr Tannebaum and Alan 740 00:41:36,960 --> 00:41:41,000 Speaker 1: Ruskin h and others. Are futures negative eleven, DOB futures 741 00:41:41,000 --> 00:41:44,000 Speaker 1: negative eighty three. I'm gonna call it a two week 742 00:41:44,120 --> 00:41:48,640 Speaker 1: churn to the market. With a better equity framework, we 743 00:41:48,760 --> 00:41:53,800 Speaker 1: forgot the doubt closing seventeen thousand two nine, the vix 744 00:41:54,520 --> 00:41:59,399 Speaker 1: not at mass complacency, but nevertheless very good sixteen point 745 00:41:59,480 --> 00:42:03,840 Speaker 1: nine two, way below the twenty long term average. Yields 746 00:42:03,840 --> 00:42:06,879 Speaker 1: come into the risk off off the retail data they 747 00:42:06,880 --> 00:42:09,120 Speaker 1: were in earlier, and come in more ever more in 748 00:42:09,840 --> 00:42:15,239 Speaker 1: one but still a churn to the market. And you 749 00:42:15,280 --> 00:42:17,759 Speaker 1: know the press conference tomorrow. What what does she not 750 00:42:18,040 --> 00:42:23,200 Speaker 1: say at the press conference? What does she not say? 751 00:42:23,600 --> 00:42:28,800 Speaker 1: She doesn't give it, and she doesn't talk about dates. 752 00:42:28,960 --> 00:42:37,440 Speaker 1: Were times data dependent? Yeah, actual progress Green Shoots. Remember 753 00:42:37,480 --> 00:42:41,879 Speaker 1: Green Shoots, We were younger. Green Shoots was a few 754 00:42:41,960 --> 00:42:45,439 Speaker 1: years ago. Futures negative eleven, del futures negative eighty four. 755 00:42:45,760 --> 00:42:47,960 Speaker 1: Another hour of Bloomberg surveillance.