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Speaker 1: Broadcasting live to New York, Broomberg eleven, Rio to Washington,

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Speaker 1: d C, Bloomberg one to Boston, Bloomberg Well Huners to

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Speaker 1: San Francisco, Ruolberg ninety to the country at San Channel

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Speaker 1: one nine and around the globe the Bloomberg Radio Bust

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Speaker 1: and Bloomberg dot Com. This is Bloomberg Surveillance and good morning.

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Speaker 1: I'm John Tucker. Along with the Tom Keen. Have Michael

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Speaker 1: McKee the opening bell. He has been brought to you

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Speaker 1: by SEI. Recognized as a fintech pioneer, SEI continues its

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Speaker 1: legacy of innovation by helping asset managers to compete in

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Speaker 1: a changing world. Explore s E I S, next Jen

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Speaker 1: ideas at se i C dot com, slash I m

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Speaker 1: S and at the startup market Trading Right now regular trading,

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Speaker 1: we have stocks higher down johnes a Duster laverage up

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Speaker 1: for forty two points, a rise of two tenths percent.

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Speaker 1: SMP five at up four then as the Composite Index

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Speaker 1: eleven points higher. That's up two tenths of upper cent

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Speaker 1: stocks higher following a four day decline that sent the

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Speaker 1: SMP five hundred to a three week law. That's all,

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Speaker 1: of course, before the outcome of the Federals policy meeting

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Speaker 1: this afternoon, and among the stocks moving, Twitter among the

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Speaker 1: most active. That's a rising about two percent. Mark andres

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Speaker 1: and I venture capital firm, and reason Horwitz said companies

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Speaker 1: may consider social media firms for acquisition. Also while look

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Speaker 1: at Whole Foods losing over two percent, Regulators asked it

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Speaker 1: to resolve unsanitary conditions at a plant in Massachusetts, the

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Speaker 1: age where the agency found that listeria and other serious

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Speaker 1: food safety of violations. Once again, the Dow is up

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Speaker 1: thirty eight SMP five hundred, up about four points right now.

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Speaker 1: We checked the markets for you every ten minutes during

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Speaker 1: the trading day. Right here, Bloomberg Radio, Tom and Michael

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Speaker 1: John Tucker, thank you so much. We we would talk

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Speaker 1: to our next guest. Oh, I don't know block block

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Speaker 1: and a half. I think we can talk to him

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Speaker 1: for five blocks this morning. Charles Gabriel is a three

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Speaker 1: decade veteran of the Washington Wars. Mike, I've never seen

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Speaker 1: the last couple of weeks like it's been. I assume

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Speaker 1: Mr Gabriel is not not either with Capital Alpha Partners.

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Speaker 1: Chuck Gabriel, Good morning. Uh Ann Selzer is a hugely

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Speaker 1: respected person counting voters and in polling out of Des Moines,

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Speaker 1: she does bloom Bird Politics polls. And here's ther quote.

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Speaker 1: Secretary Clinton's supporters are more enthusiastic than Mr Trump's. I

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Speaker 1: was sort of surprised by that. Where's the level of

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Speaker 1: enthusiasm as you look at the Washington meter right now? Yeah,

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Speaker 1: that's a great point. Thanks thanks for having me Tom

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Speaker 1: the you know, the we were supposed to have a

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Speaker 1: motivation mismatch on behalf of Republicans with the cycle, and

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Speaker 1: you know, it's a there's an anger management issue that's

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Speaker 1: been forced in confronting both parties. Uh and and so

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Speaker 1: to the extent that Mrs Clinton is much more of

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Speaker 1: an establishment kennidate, you know, there was there was a

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Speaker 1: sense that there was going to be less enthusiasm for her,

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Speaker 1: but I think as things have going on, um, you know,

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Speaker 1: Mr Trump has had a unique reality TV in your face,

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Speaker 1: smash mouth way of of sort of creating, you know,

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Speaker 1: interest on the on the part of some of the

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Speaker 1: constituencies that have made up to the Obama coalition. And

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Speaker 1: it's it's certainly you know, that's now the playbook that

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Speaker 1: Hillary Clinton is advancing me while Republicans are defending the Senate.

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Speaker 1: Uh and really are you really are apoplectic about losing

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Speaker 1: the opportunity to retake the White House with the Trump bids. So,

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Speaker 1: you know, the mixture of the burlock sack full of

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Speaker 1: kittens that is the Republican Party at this stage and

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Speaker 1: the Democrats, you know, really very excited about the way

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Speaker 1: uh that you know that Trump is energizing their constituency

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Speaker 1: has led to exactly what you're talking about. Kittens. I

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Speaker 1: don't know, kittens are cute. You might need a different

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Speaker 1: animal analogy there. Uh, the bluebird pole Tom's referencing has

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Speaker 1: Hillary Clinton up twelve points over Donald Trump. And what

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Speaker 1: I thought was interesting in it is that Hillary Clinton

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Speaker 1: is up twelve points. And this poll was taken over

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Speaker 1: the you know uh to a certain extent, over the

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Speaker 1: time period of the Orlando attack. And the theory had

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Speaker 1: been that if you had a terrorist attack, and it

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Speaker 1: still hasn't been proven to really have any connection to uh,

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Speaker 1: to radical Islam, as Donald Trump would say, but um,

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Speaker 1: if you had a terrorist attack, then it would benefit him.

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Speaker 1: It did not, right, And this is first poll that

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Speaker 1: that overlaps the Orlando you know attacks, so it is.

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Speaker 1: It is quite interesting. It certainly doesn't match up with

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Speaker 1: a lot of the other polls. So I'm not I'm

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Speaker 1: not suggesting it's a uh, it's an outlier. Will have

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Speaker 1: to see and and you know, certainly a part of

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Speaker 1: it would also have to reflect a bit of a

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Speaker 1: honeymoon bounce, if you will. After Mrs Clinton, you know,

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Speaker 1: was names the historical presumptive nominee. Uh. This this, this

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Speaker 1: looked like it might be uh convey a tremendous snap

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Speaker 1: back advantage to Trump because it disrupted that that narrative

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Speaker 1: about the Mrs Clinton's seizing of the nomination, you know, nineties,

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Speaker 1: six years after women were given the right to vote.

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Speaker 1: And it should be an issue that really would help

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Speaker 1: Trump because he's made such a big, a big deal

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Speaker 1: about the administration or the president not even being able

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Speaker 1: to say radical Islam, you know, the things he's saying,

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Speaker 1: uh certainly resonate with what we would call fo planned.

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Speaker 1: But he doesn't seem to have gotten anywhere near the

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Speaker 1: kind of bounce that he got after San Bernardino and Paris.

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Speaker 1: That seems to have moved on and she actually she

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Speaker 1: actually pulls better on the issue of who has seen

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Speaker 1: best handling a crisis. So it's interesting that actually has

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Speaker 1: played more to her strength based on where Trump has

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Speaker 1: painted himself into a corner. Your pull your note rather

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Speaker 1: is away from falls is a wonderful set of ideas

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Speaker 1: on policy and linking it into our electoral process. Do

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Speaker 1: you have any confidence that we can create policy however

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Speaker 1: November happens. Yeah? Well, I think you know, our our

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Speaker 1: group really thinks that the Senate could be really the

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Speaker 1: unremarked important issue here. Uh. And I think our frankly,

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Speaker 1: our next note that will go out our electional s repport,

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Speaker 1: I think we're going to title it it's the Senate Stupid,

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Speaker 1: because you know, there are number of things that point

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Speaker 1: to the notion that Donald Trump could lose. It might

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Speaker 1: will be a much closer race than people think. But

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Speaker 1: the Republicans you might surprise folks by actually holding onto

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Speaker 1: the Senate, you know, particularly if they're able to hold

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Speaker 1: on to uh, you know, key seats like in Ohio

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Speaker 1: with Rob portmund in New Hampshire with Kelly at very

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Speaker 1: very important Pat Toomey in Pennsylvania. All of those candidates

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Speaker 1: have been either even or just ahead of their competitors.

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Speaker 1: They're they're dancing a little bit because they're being you know,

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Speaker 1: hit with the Democratic attacks that they haven't embraced the

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Speaker 1: Fine steam bill that would suggest anybody who's being uh

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Speaker 1: surveilled or investigated as a potential terrorists shouldn't be able

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Speaker 1: to buy guns. Amazingly, Republicans have had to resist that

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Speaker 1: because they don't think that gives a due process. But

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Speaker 1: you know, we would, we would sort of suggest that

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Speaker 1: the odds of Mrs Clinton winning, perhaps not surprisingly are rising,

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Speaker 1: even though it might still be close, but the Republicans

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Speaker 1: holding go onto the Senate are are also potentially doing

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Speaker 1: better than expected. In that scenario where she wins and

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Speaker 1: you get a Republicans retained narrow Republican Senate and House

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Speaker 1: is actually very very good for the markets and actually

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Speaker 1: very very good if you want legislation. Let's come back

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Speaker 1: with Chuck Avriel, Capital Alpha Partners as we lincn UM

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Speaker 1: less economics, finance and investment, more policy and what we'll

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Speaker 1: see coming forward. Like it's there's such a such a

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Speaker 1: not desire but almost need to keep up with the

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Speaker 1: tick by tick news of the two candidates. I mean

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Speaker 1: it's just social media. You look at the Internet. You go, okay,

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Speaker 1: what what Which of these two has given us the

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Speaker 1: latest fix of silliness? So well, I don't think there's

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Speaker 1: there any question about which one if you're talking about silliness. Um,

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Speaker 1: but it's been a remarkable period and it is interesting

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Speaker 1: that the public is not responding as we thought they might. Yeah,

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Speaker 1: I mean there there it is. Where are we greed

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Speaker 1: on the screen? Futures up thirty The VIX comes in

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Speaker 1: from at twenty two level into twenty point to nine

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Speaker 1: in a modest point to one point sort of a

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Speaker 1: fed day field fed day field. Uh to the market.

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Speaker 1: It is at nine on Wall Street. And this hour

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Speaker 1: of surveillance is brought to you by Volvo Cars, White Planes.

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Speaker 1: Visit Volvo Cars, White Planes dot com. Here's Mickael bar

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Speaker 1: with news headlines. Mind Tom, thank you very much. The

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Speaker 1: House Oversight and Government Reform Committee plans to vote today

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Speaker 1: on whether to sense your inter Internal Revenue Service Commissioner

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Speaker 1: John Coskinen. Republicans claimed coscon In obstructed an investigation into

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Speaker 1: whether his agency to target a conservative groups seeking tax

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Speaker 1: exempt status. It comes before a planned hearing next week

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Speaker 1: by the House Judiciary Committee about a resolution to impeach Koskinen.

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Speaker 1: The city of Orlando, Florida, is opening a family assistance

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Speaker 1: center for the friends and relatives the victims who were

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Speaker 1: killed or wounded in Sunday's mass shooting. May Every Buddy

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Speaker 1: Dyer says that will be offering an array of services

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Speaker 1: at Camping World Stadium, Child and Family services. We have counseling, grief, counseling, crime,

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Speaker 1: victims services, lodging, funeral services, ground transportation. Tomorrow, President Obama

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Speaker 1: will head to Orlando to pay his respects to the

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Speaker 1: victims who were killed and fifty three others that were wounded.

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Speaker 1: The latest Bloomberg poll shows Democrat Hillary Clinton with a

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Speaker 1: twelve point lead over Republican arrival Donald Trump. Global News

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Speaker 1: twenty four hours a day, powered by our twenty four

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Speaker 1: hundred journalists more than a hundred fifty news bureaus around

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Speaker 1: the world. I'm Michael Barr time, Michael, thanks so much.

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Speaker 1: Gold five ounce make their twelve eighties six a oouns

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Speaker 1: flat for the day, But what a run Gold has

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Speaker 1: had almost level. Don't forget our Friend Day coverage one

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Speaker 1: PM this afternoon with Scarlet Food. This is Bloomberg's surveillance.

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Speaker 1: mobile app, and on your radio. This is a Bloomberg

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Speaker 1: Business Flash. Hen good morning. I'm John Tucker. This is

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Speaker 1: a Bloomberg Business Flash being brought to by American Arbitration Association.

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Speaker 1: Where's things Stocks higher in the early going after declines

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Speaker 1: to the last four sessions. Investors positioning ahead of the

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Speaker 1: FED decision this afternoon. Doesn't seem like anything that's gonna

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Speaker 1: happen at that meeting, which actually could be taken as

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Speaker 1: a positive. People also keeping an eye on bregsit decision

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Speaker 1: that is scheduled for next week. I had the economic

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Speaker 1: data apps today, data showing the producer price index gained

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Speaker 1: four tents of a percent. That was more than Fourecast,

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Speaker 1: but a factory production that felt more than projected. For

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Speaker 1: the month of May, we have the down Jones and

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Speaker 1: Dustrial average of forty five points that's up three tents

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Speaker 1: p percent at seventeen thousand, seven hundred and twenty. The

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Speaker 1: SMB five hundred six points higher, that's up three tents

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Speaker 1: at two thousand eighty one. Has the Composite index four

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Speaker 1: team points higher. That's up three tents at forty eight

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Speaker 1: of fifty seven Who checked the markets for you every

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Speaker 1: fifteen minutes during the trading day right here on Bloomberg Radio,

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Speaker 1: and Michael and Tom Jen Tucker, thank you so much.

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Speaker 1: Appreciate that. Michael, you want to my greatest factor, Mr

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Speaker 1: Gambriel when you want Yeah, well he's a uh you

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Speaker 1: got check Abriel Courser in the political covernce for Capital

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Speaker 1: Alpha Partners didn't doing this for thirty two years, still

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Speaker 1: doing it and maybe you need time off. Maybe he

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Speaker 1: had he had to stay around for this election. Ye.

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Speaker 1: There are some headlines crossing here that bring us back

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Speaker 1: to what you were talking about earlier and in the

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Speaker 1: issue about the Senate. Harry Reid is on the Senate

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Speaker 1: floor now saying Democrats are gonna push gun control at

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Speaker 1: every opportunity. Is there any chance they can make an

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Speaker 1: and trying to get anything through both houses of Congress.

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Speaker 1: But can it become a political issue in the fall? Uh?

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Speaker 1: You know, doubtfully that would work to the advantage Mike

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Speaker 1: of of the Democrats, because again, the polls in the

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Speaker 1: in the public, you know, still support gun control. It's

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Speaker 1: made to seem kind of silly that that Republicans is

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Speaker 1: being supportive of uh, you know, of gun rights, just

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Speaker 1: refused to take any losses. So um. And but they

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Speaker 1: do still control the Senate. They still you know, the

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Speaker 1: rules of the Senate are are are such that Harry

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Speaker 1: Reid and the Democratic Minority. Uh, they can you know,

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Speaker 1: try to either disrupt debate. They can they can try

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Speaker 1: to add amendments to appropriations bills that the Senate sort

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Speaker 1: of working its way through, but aren't must pass bills

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Speaker 1: because ultimately we're gonna fund the government with a continuing resolution. Uh,

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Speaker 1: they're just kind of buying time. But but you know,

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Speaker 1: as we talked about earlier, doing a fairly good job

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Speaker 1: of finessing this issue. While Mrs Clinton, you know, frankly

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Speaker 1: at least initially has seemed to almost turn it to

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Speaker 1: the inactivity in Congress along for the ride with whatever

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Speaker 1: happens in the presidential race. Well, it's funny, you know,

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Speaker 1: Republicans make this very strong point that when Harry Reid

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Speaker 1: was Majority leader in two thousand, two thousand fourteen, UH,

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Speaker 1: they were only offered allow to offer a very small

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Speaker 1: number of amendments because he's so ruthlessly controlled the debate.

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Speaker 1: He didn't want his in cycle vulnerable incumbents to have

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Speaker 1: to take difficult votes Republicans, you know, to the extent

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Speaker 1: that you know, Democrats can make some issues, for instance,

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Speaker 1: out of this Orlando issue. It's it's because Republicans now

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Speaker 1: have UH and Mitch McConnell really have had a more

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Speaker 1: open process. But but frankly, there's not a lot of

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Speaker 1: real live issues that are are capturing you know, voters

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Speaker 1: attention right now that are on the Senate floor. Tell

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Speaker 1: us the agenda for Speaker Ryan as he staggers to

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Speaker 1: the convention, I mean within the work of the House,

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Speaker 1: and I guess his future prospects, what would you suggest,

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Speaker 1: Speaker Ryan will say and critically not say as he

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Speaker 1: tries to get to Cleveland one piece. Yeah, it's amazing.

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Speaker 1: He it's it's you know, it's just it's such a

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Speaker 1: metaphor for this tough position he's inherited because he should

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Speaker 1: be doing, frankly, a bit of a victor lab because

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Speaker 1: he was able to navigate to Puerto Rico debt release

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Speaker 1: bill through last week, uh, and not even have to

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Speaker 1: you know, do so with the minority of Republican voters.

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Speaker 1: So that was frankly a huge triumph. That bill will

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Speaker 1: pass in the Senate, you know, by July one, and

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Speaker 1: we'll move on. He has a lot of Muslim minority

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Speaker 1: voters up in the Upper Midwest, up in Wisconsin, in

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Speaker 1: his states, so he has to be very careful on

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Speaker 1: this issue and be very judicious. So he's definitely tap

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Speaker 1: dancing to try to help his his you know, his party,

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Speaker 1: his his caucus you know, have the ability to distance

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Speaker 1: themselves somewhat from Trump without you know, disavowing Trump as

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Speaker 1: the candidate. So it's he's he's done a good job

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Speaker 1: so far, but it's you know the fact that with

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Speaker 1: each one of these episodes where an advantage is to

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Speaker 1: his turn to sort of a mixed if not disadvantaged

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Speaker 1: by Trump. You know, the bloom has come off the

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Speaker 1: rose and the party is really you wonder, Mike, how

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Speaker 1: many more episodes? I don't have any anything to add.

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Speaker 1: I wonder, Chuck, is it likely that we get you know,

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Speaker 1: presuming this continues, and we have no reason to think

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Speaker 1: it won't that the Republicans get to a point where

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Speaker 1: they are better off ditching Trump. Well, I I think

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Speaker 1: we might just sort of have a new equilibrium emerge,

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Speaker 1: you know, going into and out of the convention where

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Speaker 1: and this is this could be an incredible freak show convention.

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Speaker 1: So this will be one of the more interesting ones

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Speaker 1: that we've seen. And of course it's in Ohio, which

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Speaker 1: is very key because if if because I was as

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Speaker 1: I was saying earlier, it could be that all the

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Speaker 1: money on the conservative side, including in the corporate community,

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Speaker 1: really does flow not the Donald Trump and the presidential campaign,

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Speaker 1: which often sucks the oxygen, the financial oxygen out of

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Speaker 1: the battlefield. Instead it could go to keeping Republicans Senate.

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Speaker 1: That could actually be helpful. If Hillary Clinton looks like

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Speaker 1: she's going to win big, that could actually be helpful

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Speaker 1: because you know, you don't have as much turnout as

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Speaker 1: as you think. So there are a number of things

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Speaker 1: that could help Republicans Senate and and one of the

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Speaker 1: most important races is in Ohio with with Rob Portman.

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Speaker 1: So but but I but I think that you know,

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Speaker 1: the randomness of Donald Trump, the fact that he's winning

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Speaker 1: it is going to lead increasingly, I think to a

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Speaker 1: focus on a fallback strategy of focusing resources and energy

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Speaker 1: on keeping the Senate and and and you know, and

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Speaker 1: holding losses in the House to a minimum. And we'll

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Speaker 1: see how that goes. It's been very difficult in the

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Speaker 1: past for candidates to uh distance themselves from a you know,

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Speaker 1: from a presidential ticket that's that's going down. But it's

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Speaker 1: going to be we we still think it's going to

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Speaker 1: be closer than people expect, just because Mrs Clinton still

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Speaker 1: has their issues and this we still have several months

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Speaker 1: ago obviously told November Mike, I just want to point

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Speaker 1: out fractionally the German tenure yields move negatively and I

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Speaker 1: don't want to overdo that, but we had a higher

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Speaker 1: yield on it, and that's reverse itself. You're fractually, Chuck,

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Speaker 1: what do you tell your investors, the investors who are

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Speaker 1: your clients? Um to do at this point? I mean,

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Speaker 1: what's your advice? Well? What near term? We've just warned that, um,

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Speaker 1: you know, risks to you know of a Trump victory

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Speaker 1: or you know, a sharp diversion from what we think

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Speaker 1: is the conventional wisdom of conventional forecast is that Clinton

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Speaker 1: will win, probably take along a Democratic Senate. You know,

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Speaker 1: when when Trump seemed to be doing fairly well a

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Speaker 1: month ago and Poles had him either up slightly or

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Speaker 1: down a couple of points, we thought the risk of

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Speaker 1: the forecast might be instead of a wipeout, that instead

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Speaker 1: that you know, Trump could actually win, or republics that

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Speaker 1: keep the Senate. Now I think they're concerns about a

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Speaker 1: wipeout again. So uh, and just the randomness of miss

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Speaker 1: Trump's comments, and now the re emergence of terrorism, you know,

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Speaker 1: with a with a Washington debate in full flower, you

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Speaker 1: know this this this will add perhaps another brick and

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Speaker 1: a wall of worry that seems to have emerged here

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Speaker 1: in June over the Brexit, you know, over the Fed

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Speaker 1: the dot plot numbers that will we may see by tomorrow.

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Speaker 1: So that's what we've been warning that in your term

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Speaker 1: that you know, Washington's uh, you know, maybe we'll add

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Speaker 1: to that. We don't think it will drive that because

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Speaker 1: we think people assume that Clinton will win. That that's

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Speaker 1: that's shown in the polls, uh, and that we assume

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Speaker 1: that even if Trump were to win, you know, he

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Speaker 1: would moderate. But then beyond that, we just have a

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Speaker 1: number of analyzes about red stocks and blue stocks, and

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Speaker 1: that's been fairly lopsided for a long time because the

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Speaker 1: Democratic Redttoria and Charles Gabriel is with Capital Alpha Partners.

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Speaker 1: Thank you so much. A little long there, folks, but

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Speaker 1: the political discourse is such somehow, I think, Mike, I'm

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Speaker 1: not sure how much we'll do with this. I really

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Speaker 1: can't say how much we'll do with this, but it

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Speaker 1: has been amazing. Was interesting to talk to Megan Murphy,

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Speaker 1: particularly when I pronounced their name rectly this morning. She

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Speaker 1: would like that, yeah, about um Mr Trump banning the

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Speaker 1: Washington Post, that was that was for those of you worldwide.

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Speaker 1: That was a bit of an uproar among media. Well,

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Speaker 1: you know, I would just say that it is It

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Speaker 1: is our desire, given our show, to get to what

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Speaker 1: Mr Gabriel was talking about, the red stocks in the

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Speaker 1: blue stocks, who's going to benefit? What you should do,

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Speaker 1: what you should think about. But there's so much noise

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Speaker 1: between and you can't you can't figure it out. And

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Speaker 1: I think you're your phrase and what to think about

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Speaker 1: is important. It's not only in this world we live

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Speaker 1: in now what to think about it, but it's what

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Speaker 1: to push aside. And so when we talked to Chuck

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Speaker 1: Gabriel and Greg Villier and Megan Murphy and others, maybe

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Speaker 1: they help us say I don't have to read that

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Speaker 1: or I don't have to think about that versus what matters.

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Speaker 1: And you know again, I think the path is speaker

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Speaker 1: Ryan here. In the coming days will be interesting for

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Speaker 1: not only supporters of to trumpet supporters of Mrs Clinton

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Speaker 1: to think about today the fact are you going to

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Speaker 1: get a nap in before one year? I've got some

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Speaker 1: more broadcasting to Yeah. I think the surveillance nap is

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Speaker 1: out the door today, very good cause and that causes

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Speaker 1: scarlet food, which is a good thing. One pm this afternoon,

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Speaker 1: we will be with Scarlet Food with Ellen Zetner, Alan Blinder,

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Speaker 1: Richard Clarida and the cast of Worthies. This is Bloomberg's

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Speaker 1: surveillance