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Speaker 1: This is Bloomberg Surveillance. A lot of policy makers are

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Speaker 1: maybe looking to the IMF for a bit of a

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Speaker 1: green light to move forward on fiscal policy. One of

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Speaker 1: the thing I think it's interesting in the commodity space

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Speaker 1: is this return and dispersion across the commodity market. There

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Speaker 1: are a lot of people, perhaps on the sidelines that

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Speaker 1: could come back in and compete for jobs, and compete

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Speaker 1: for wages and keep inflation down. Bloomberg Surveillance your link

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Speaker 1: to the world of economics, finance, and investment on Bloomberg Radio.

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Speaker 1: Good morning everyone, Good Friday Morning, Michael McKee and Tom

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Speaker 1: Keene Worldwide Doha on Sunday, on oil, the I m

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Speaker 1: F happening right now in Washington, International Economics and Oil.

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Speaker 1: Part of the theme of this hour. We need a

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Speaker 1: Forex brief. A churning forex market range bound is what

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Speaker 1: many pros say. The Forks Brief brought you by Interactive

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Speaker 1: Broker's Winner of FX Weeks two thousand fifteen, a war

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Speaker 1: I b k R dot com slash four x, Yen

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Speaker 1: can't make up its mind. We're almost back to a

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Speaker 1: one oh seven strong end one oh eight seventeen um,

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Speaker 1: just range bound sort of goes up, goes down range

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Speaker 1: bound one o eight seventeen um. Excuse me, one of

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Speaker 1: eight nineties six. I miss looked at the Bloomberg terminal.

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Speaker 1: That was my fault, not the Bloomberg terminal's fault. Let's

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Speaker 1: start over one nineties six on the end. Fracutionately weaker

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Speaker 1: this morning, the euro one seventy six, I got that

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Speaker 1: right the first time. And the dollar churning here on

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Speaker 1: a Friday, we're churning, which leads us to lean back

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Speaker 1: and look at the equity markets after an interesting week,

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Speaker 1: I mean, Dave Wilson. The basic idea here was um

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Speaker 1: JP Morrigan really taken positively by the street. Bank of

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Speaker 1: America was sort of a churn and it's set the

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Speaker 1: template for better other than good. But there was a

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Speaker 1: lot of butts out of Bank of America. And now

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Speaker 1: you have City Group as part of the mix as well,

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Speaker 1: and those numbers are being well received. Company shares up

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Speaker 1: about two and a half percent in early trading. It's

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Speaker 1: all about less bad, really, uh. First quarter earnings at

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Speaker 1: the bank fell less than analysts surveyed by Bloomberg were expecting.

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Speaker 1: City Group cut costs more than they anticipated, and the

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Speaker 1: drop and expenses offset a trading and dealmaking slump. Regions

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Speaker 1: Financial up four and a half percent, the banks first

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Speaker 1: quarter revenue being analyssessments by the widest margin in more

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Speaker 1: than five years. Earnings also exceeded projections. Uh Charles Schwab

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Speaker 1: had numbers out today as well, earnings and revenue pretty

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Speaker 1: much in line with analy assessments, and Schwab shares up

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Speaker 1: about one percent. At the moment, Fort Motor will be

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Speaker 1: a stock to watch, we are Chrysler chief executive Sergio

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Speaker 1: Marchioni said he sees the automaker as a prospective partner

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Speaker 1: after General Motors rebuffed his advance. Marconi also setting Twitter,

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Speaker 1: Motor and in Volkswagen as merger possibilities. Not much of

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Speaker 1: a moving forward so far, nonetheless, they stock to watch.

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Speaker 1: Ends Co the most active stock and early trading down

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Speaker 1: ten percent. The offshore oil and gas driller is raising

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Speaker 1: cash by selling fifty million shares equivalence to a seventeen

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Speaker 1: and a half percent steak. Key Banks said the sale

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Speaker 1: indicates that ends go sees, in its words, a prolonged

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Speaker 1: and severe industry downturn ahead. Uh, three D Systems, you've

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Speaker 1: got a back and forth on analysts calls here. Uh,

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Speaker 1: the maker of three dimensional printers down to three percent.

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Speaker 1: Three D cut to sell from Neutral City Group, A

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Speaker 1: day after Bank of America Merrill Lynch raised its rating

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Speaker 1: and sent the share of surging ten percent. C also

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Speaker 1: cut its rating on three D printer company Stratusis to

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Speaker 1: Neutral from buy in. That stock down about three percent.

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Speaker 1: A couple of deal related stories to talk about one

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Speaker 1: of the polycom it's up one percent. The provider of

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Speaker 1: video conferencing equipment accepted a takeover offer from Canada's my

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Speaker 1: TOEWN Networks. The cash and stock deal valued at about

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Speaker 1: two billion dollars and my tels shares down about six

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Speaker 1: percent in early trading. And then you have the drug

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Speaker 1: maker re Lipse down about eight percent. Relipsa no longer

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Speaker 1: has the investment bank. Centerview Partners as an advisor, coined

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Speaker 1: the financial website then zinga story citing an unnamed source

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Speaker 1: familiar the matter, where He's reported last week that center

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Speaker 1: View was helping relips the review offers from potential buyers.

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Speaker 1: David Wilson, thank you so much. What a great week

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Speaker 1: for bank perspective. Again, thank you so much. This is wonderful.

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Speaker 1: Paul Collier joins us Uh. The book is the Bottom Billion,

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Speaker 1: and it's about the poorest countries that are out there.

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Speaker 1: The backdrop is simple. He is out of St. Anthon.

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Speaker 1: He's Oxford, which was like the one college there that

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Speaker 1: wasn't invented in two It's a young college at Oxford

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Speaker 1: and truly expert on discussing and thinking about international relations.

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Speaker 1: Were thrilled to bringing professor Colly now from France. Paul,

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Speaker 1: welcome to the program. And I think the great insight

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Speaker 1: here for Americans particularly is the back and forth between

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Speaker 1: Jeff Sachs and William Easterly over what is the best

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Speaker 1: thing to do about the bottom billion? Where do you

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Speaker 1: stand in this great debate between AID more AID, more

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Speaker 1: money in creating legitimate incentives, what jump starts the bottom billion? Well,

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Speaker 1: I think AID is a bit of a side show.

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Speaker 1: I don't think it's the problem. Start. Don't agree with

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Speaker 1: sort of billy study there and started. I think it's

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Speaker 1: the solution. So regarding Jeff overstates the case thade and

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Speaker 1: the solution is difficult because these countries have fallen behind

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Speaker 1: badly behind um even during periods is you know, sort

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Speaker 1: of relatively prosperous world economy and so um. We can't

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Speaker 1: rely on any sort of automatic process that they'll catch up.

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Speaker 1: If they don't catch up, the spillovers from their continued poverty,

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Speaker 1: especially when some of them don't just fall behind but

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Speaker 1: fall apart post spillovers very bad. So trying to think

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Speaker 1: of intelligent ways of helping. That's the challenge. Aids part

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Speaker 1: of it, relatively minor part trade much more important. Things

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Speaker 1: we can do to help governance important, sometimes security important,

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Speaker 1: though clearly we've made a hash of security in a

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Speaker 1: lot of interventions so far. Let me ask you about

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Speaker 1: that trade idea. What we're finding is, of course that

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Speaker 1: as trade has opened up, billions of people have been

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Speaker 1: lifted out of poverty, and the living standards of most people,

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Speaker 1: a majority of whole around the world have gone up.

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Speaker 1: But here in the United States, living standards of a

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Speaker 1: certain group of people have gone down. How does the

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Speaker 1: world How do politicians manage that dichotomy so that you

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Speaker 1: can continue helping the bottom billion while the I don't

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Speaker 1: want to say the top billion, but a lot of

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Speaker 1: people in the upper or better off socio economic categories

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Speaker 1: actually lose out. You know, the bottom billion is no

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Speaker 1: threat to the top billion um. The if it ever

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Speaker 1: is a threat, it's going to be a threat through

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Speaker 1: state collapse and the spillovers from it, rather than through

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Speaker 1: the trade opportunities that the bottom billion take up. Yeah,

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Speaker 1: but you tell that to the politicians in the United

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Speaker 1: States who are running against the bottom billion. If the

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Speaker 1: if the poorest countries in the world managed to break

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Speaker 1: in two the bottom of pile industrialization, the sort of

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Speaker 1: very labor intensive T shirts and that sort of thing,

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Speaker 1: if they're managed to do that, the jobs veill threatened

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Speaker 1: are in China. And actually China is trying to get

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Speaker 1: rid of those jobs because China is now getting to

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Speaker 1: an absolute shortage of the young workers. The number of

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Speaker 1: young workers in China is actually falling now because of

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Speaker 1: their crazy one child policy, and so they're actually trying

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Speaker 1: to shift out of China the really labor intensive manufacturing.

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Speaker 1: Possibly that would shift some of that would shift to Africa.

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Speaker 1: It's just starting to happen in Ethiopia. M that would

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Speaker 1: be a real big boom. It's hard to get industry

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Speaker 1: started in countries that basically don't have any because lodern

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Speaker 1: industry works through clusters. You know, you've got a cluster

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Speaker 1: of firms together and it lowers everybody's costs. Getting those clusters.

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Speaker 1: Start at his heart, because nobody wants to be the

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Speaker 1: first if you're just joining your source. Paul, care you

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Speaker 1: the Bottom Billion? One more question, professor, and will have

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Speaker 1: you back for our next section. Is well, you're talking

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Speaker 1: your book about and missing the boat? Who's missing the boat?

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Speaker 1: In two thousand sixteen, it's still about a billion people

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Speaker 1: in about fifty or sixty countries that have missed the boat.

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Speaker 1: They they've had the last decade has been kind to them,

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Speaker 1: but it's been kind in an unsustainable way. They've benefited

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Speaker 1: from the commodity booms because they were commodity exporters. That

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Speaker 1: game is over and so they've got to find a

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Speaker 1: more sustainable game. Let's come back, park. Are you with

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Speaker 1: us with the Oxford University? And of course this book

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Speaker 1: the Bottom Billion? Let me get the whole title up here,

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Speaker 1: Michael McKee, why the poorest countries are failing in what

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Speaker 1: we can be done about it? This really folds in nicely,

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Speaker 1: folks with an international relations in the Mike, Really the

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Speaker 1: timeless debate actor a ute of uh. If we could

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Speaker 1: just build another damn that would selve, that would solve

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Speaker 1: everything that was our youth as we don't into this.

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Speaker 1: Really not much has changed in the debate. We'll come

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Speaker 1: back with Paul Collier. St. Anthony's in uh actor. He

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Speaker 1: comes to us from France today future secutive three. It's

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Speaker 1: been one big churn on a Friday, and mis quoted

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Speaker 1: yet earlier. Let's try to do it right now. One

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Speaker 1: oh nine point zero three. That's a weaker yeah, and

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Speaker 1: I don't want to make too much of it. One

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Speaker 1: oh seven, one oh eight weaker yen from one twenty.

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Speaker 1: It's a very strong end from Mr Abe Euroe with

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Speaker 1: all in all, through the week, one big dollar churn

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Speaker 1: and of course the backdrop of this are the I

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Speaker 1: m F meetings UH in Washington forty thirty three cents

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Speaker 1: on oil, check in with Michael Barr and get the

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Speaker 1: latest world in National Mike Tom, thank you very much.

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Speaker 1: Bernie Sanders is in Rome today to WOS end they

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Speaker 1: can conference Sanders and Hillary Clinton. We're in a tense

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Speaker 1: Democratic presidential debate in New York. Last night's face off

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Speaker 1: in Brooklyn came just days before the New York primary.

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Speaker 1: At one point the debate moderators said no one could

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Speaker 1: hear the two of them if they continued screaming at

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Speaker 1: each other. President Obama will head to the UK next week.

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Speaker 1: The President will call for Britain to remain part of

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Speaker 1: the European Union. It is an embarrassing setback for North Korea.

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Speaker 1: US and South Korean officials say a missile launched by

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Speaker 1: the North that was meant to celebrate its founder's birthday

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Speaker 1: has failed. Global News twenty four hours a day, powered

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Speaker 1: by our twenty four hundred journalists and more than a

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Speaker 1: hundred fifty news bureaus from around the world. I'm Michael bar,

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Speaker 1: tomcau Bar, thanks so much. A dollar Canada again, hydrocarbon

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Speaker 1: currencies having a better bout of it recently, Ruble uh dollar,

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Speaker 1: ruble sixty six whole was that distant from eighty eight

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Speaker 1: to sixty six within the will recovery. This is Bloomberg's surveillance.

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Speaker 1: Visit m b usa dot com for details. Today, global

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Speaker 1: business news twenty four hours a day at Bloomberg dot com,

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Speaker 1: the Radio plus Mobile Act and on your radio. This

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Speaker 1: is a Bloomberg Business Flash and I'm Karen moscown the

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Speaker 1: Bloomberg Futures Report, brought to you by Interactive Brokers and

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Speaker 1: c m E Group. And there's breaking economic news crossing

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Speaker 1: the Bloomberg. We go to Vinidelle Judas with the latest

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Speaker 1: Vinnie Karen week. Disappointing data from the Federal Reserve Industrial

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Speaker 1: production and marched down point six percent, more than forecast.

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Speaker 1: Manufacturing alone down point three percent. Economists had been looking

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Speaker 1: for a gain in that category. Again, the Fed reporting

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Speaker 1: industrial production March down point six percent, weaker than forecast.

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Speaker 1: At the Bloomberg First Word Desk, I'm vany doubts you,

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Speaker 1: Cameron back to you. Thanks. Many futures remained lower following

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Speaker 1: that report, with SNP eveny futures down three and a

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Speaker 1: half points now eveny futures down twenty and nasdack e

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Speaker 1: many futures down eleven dacks in Germany's down four tenths percent.

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Speaker 1: Ten year treasury up six thirty seconds. The yelled one

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Speaker 1: point seven six percent. Now I max screwed oil down

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Speaker 1: to and a half percent, or a dollar five to

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Speaker 1: forty dollars forty four cents of barrel go makes gold

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Speaker 1: up four tenths percent or four dollars eighty cents to

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Speaker 1: twelve thirty one forty announced the euro a dollar twelve

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Speaker 1: eighty four. The end one oh eight point nine two.

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Speaker 1: That's a Blutenberg business flash, Tom and Mike. Sure, thanks

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Speaker 1: so much. Michael McKee. We have to pause for that

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Speaker 1: production number. I just did a three six and twelve

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Speaker 1: months study of it, and it's getting moldy. We're not

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Speaker 1: back to oh one recession moldy, but it is it

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Speaker 1: gives pause to see the concave trends of spreeing six

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Speaker 1: and twelve months industrial production. Wells. The question is is

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Speaker 1: that what was? Because you get to these UM I

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Speaker 1: s M like indicators that's against things maybe getting better

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Speaker 1: going forward. Well there it is um most interesting to

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Speaker 1: say at least we are speaking on maybe a voice

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Speaker 1: that is less heard in Washington at the I m

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Speaker 1: F meetings. That is the bottom billion. Paul Callier, for

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Speaker 1: years working at Oxford on international relations, has really tried

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Speaker 1: to think about what do we do? Paul. The old

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Speaker 1: answer used to be build a damn We're all weaned

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Speaker 1: on Nasser in Egypt. That worked out. What's the new theory?

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Speaker 1: What drives the World Bank? Particularly World Bank, but the

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Speaker 1: I m F, what's the new theory they're using when

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Speaker 1: they help. I think we've got to get back to basics.

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Speaker 1: And the last decade with the nine decade for for

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Speaker 1: the poorest countries, but it was an unsustainable decade. It

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Speaker 1: started with debt relief, then you had a commodity boom.

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Speaker 1: The commodity boom triggered a wave of resource discoveries, and

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Speaker 1: then the well became a wash with liquidity, and so

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Speaker 1: people were willing to lend sovereign willing to buy sovereign

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Speaker 1: bonds from very poor countries. All that's over. We now

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Speaker 1: need a new game. And the new game will be

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Speaker 1: back to the fundamentals of productivity. And that's both fundamentals

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Speaker 1: I think energy and connectivity. So in part it is

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Speaker 1: back to dams. You know, there's one country in Africa

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Speaker 1: that's really building dams. That's Ethiopia. It's pretty sensible. Um,

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Speaker 1: they've got a lot of water on high grounds, they

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Speaker 1: can generate a lot of cheap electricity, and that can

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Speaker 1: be the basis for helping to get industrialization going. So

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Speaker 1: dams are not stupid. They've been very unfashionable for the

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Speaker 1: last thirty years, but they're not stupid. Well, it's not

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Speaker 1: so much the damns, I think is the idea that

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Speaker 1: you you just build infrastructure. Uh and and the Chinese

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Speaker 1: get accused of this, build infrastructure that may not be

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Speaker 1: needed just to keep people employed. No sure, so that

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Speaker 1: the Chinese have satury tod their economy in excessive infrastructure.

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Speaker 1: Africa is the opposite extreme. It's desperately short of basics,

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Speaker 1: it's desperately short of road networks, it's desperately short of electricity.

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Speaker 1: You know, you go to an African city and the

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Speaker 1: lights keep going off. So just just get those fundamentals provided,

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Speaker 1: and that's pretty expensive. Is not going to be financed

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Speaker 1: through aid, and so African countries need access to private

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Speaker 1: capital markets. It probably won't come through so we need

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Speaker 1: to get project finance port about so that the risk

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Speaker 1: structure is much more manageable. With a new study by

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Speaker 1: mood Is showing that actually African infrastructure is pretty well

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Speaker 1: indistinguishable from ABCD infrastructure and its risk properties. It's not

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Speaker 1: that it's perceived as very risky. We mentioned Jeff Sax

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Speaker 1: before in the concept of the aid and money helped

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Speaker 1: me with a William Easterly world which is front and

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Speaker 1: center building constructive incentives, which institution builds incentives for development

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Speaker 1: for the bottom billion. Of course, incentives are important, so

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Speaker 1: basic property rights are important. And a really really good

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Speaker 1: starting point is is urban land rights. You know, Africa

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Speaker 1: in the next decade, you've got to urbanize fast. At

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Speaker 1: the moment, it's cities are a mess. And a key

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Speaker 1: reason why they're a mess is that the basic rights

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Speaker 1: to urban land haven't been sorted out. They're confused. And

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Speaker 1: some countries, for example Rwanda, Ruanda has now registered all

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Speaker 1: urban land ownership and so it's clear and it was

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Speaker 1: done very fast. If Ruanda can do it, anybody can

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Speaker 1: do it. But most African cities, the land ownership is disputed,

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Speaker 1: and so of course nobody's going to got to build

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Speaker 1: on it. And so the very basics of getting a

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Speaker 1: city built with decent density with good transport connections. That

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Speaker 1: that's you know, that's what means New York prosperers. But

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Speaker 1: you go to you go to the big cities in

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Speaker 1: Africa and there their single throat cities, first cities, the shacks,

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Speaker 1: and then you can't move. They're just massive traffic because

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Speaker 1: they're on enough roads and there isn't any transport. Interesting.

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Speaker 1: I was reading on the Huffington Post a terrific article

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Speaker 1: in the Philippines this weekend on Manila's traffic jam. Paul,

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Speaker 1: how you think is so much congratulations on the bottom billion?

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Speaker 1: Why the poorest countries are failing? And what can be

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Speaker 1: done about it? Michael, you're over there where you have Yeah,

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Speaker 1: I get some news here. Um. The Bank of England

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Speaker 1: has a new Monetary Policy Committee member city groups Western Europe.

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Speaker 1: Chief economist Michael Saunders is going to join the MPC.

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Speaker 1: This according to the Chancellor of the Exchequer George Osborne,

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Speaker 1: making that announcement in Washington at the I m F meetings. Uh,

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Speaker 1: he'll replace Martin Whale. So Michael Saunders goes from city

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Speaker 1: to city. It's interesting to the good gray lady. I

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Speaker 1: looked at the six month industrial production. If you take

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Speaker 1: out recessions, it's back to nine nine. That gives pause

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Speaker 1: a little bit of a rollover. Well, then let's take

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Speaker 1: a pause in the nations, ie Pe, We'll take a pause.

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Speaker 1: Come back Bloomberg's surveillance. Stay with us. We're counting down

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