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tv   Bloomberg Markets  Bloomberg  September 18, 2015 2:00pm-3:01pm EDT

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board. looming government shutdown. will congressional readers like mitch mcconnell and john boehner demand that funding this trip -- be stripped for planned parenthood. another $3rs wants billion in extra taxes from the go: company. -- coca-cola company. mark: that is a lot of coca-cola. i am mark crumpton, with matt miller. matt: let's get a look at the markets. they are red across the board. the s&p 500 down 1.5%. 19.59 the number. nearly 300ing points. mark: it gives one pause, because what are the market
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saying yesterday and today about the federal reserve's decision not to raise interest rates? mark: some could say they are concerned janet yellen doesn't have the ability to raise interest rates, are we going to be stuck here forever? is the u.s. japan? treasuries, you can see in -- investors are running for treasuries. matt: the to your is the usually -- two year is the most sensitive. the 30 year is down at 2.94%. and into the 10 year as well, the yield down five basis points at 2.14%. oil, oil has at been interesting to watch today, dropping amid a broader selloff. the fed was to global risk and it's really the lack of inflation that is the problem for janet yellen. that's what we see in the oil markets as well.
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i'll bring it up myself. let's take a look at oil. here's a one-day look at oil. can we pull up my terminal? one-day look at oil, coming down 4.4%. they dropped their to $44.91 a barrel. 44% fromn more than the closing peak in june. let's take a look at the top stories. as we mentioned, coca-cola facing a big tax bill, $3.3 billion. the internal revenue service has not demanded any penalties on the soft drink maker, and they say the assessment is without merit. the bill cover 2007 2009. it centers on the licensing of its properties to foreign entities. the disagree on how much of that activity should be reported as taxable income here in the united states. matt: next for the irs is the search for irs -- offshore tax cheats.
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that indications is that the rss next americans are using those accounts to dodge tactics -- dodge taxes. liabilityral motors over faulty ignition switches is far from over. the automaker faces hundreds of personal injury and wrongful death claims over the deadly defect. the company also faces litigation by car owners seeking as much as $10 billion for the lost value of the vehicles. gm agreed to pay out 900 million dollars to resolve the federal criminal investigation, and $575 million to settle a civil lawsuit. jamie dimon says the u.s. banking system is safer now than it has been in years. jpmorgan ceo spoke this morning and conference. he says banks have more capital and are more diversified than that used to be. he's concerned about what
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happens when the economy worsens. jamie dimon: i worry about what happens when you have a really bad environment. we don't have a bad environment now. banks will be much more restricted in their ability to stand against the tide. a lot of that will be made up for with other banks. it remains to be seen. matt: he says his concerns involve treasury. some traders have never been an environment where interest rates are rising. mark: exxon mobil looking for shale bargains in west texas. exxon is meeting with small oil producers in the permian basin about takeovers and joint ventures. the collapse in oil prices is forced many drillers to either shut down rigs or partner with a company that has deep pockets like exxon. a touching moment during the atlanta braves toronto blue jays game. former president jimmy carter scored a kiss from his wife of nearly 70 years. thesmooch was caught on
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braves kiss cam. the 90-year-old carter recently announced the cancer has spread to his brain. he says he's not a good life. mark: he was very optimistic about it. he spoke about it in very religious terms. he has led a very full life. they are devoted atlanta braves fans. at most of the games, they are sitting on the braves dugout. matt: there's the top stories we are following this hour. mark: the federal reserve decision to delay raising interest rates keeps the debate about timing alive as u.s. stocks attempt to hold on to earlier games this week. of thearon klein bipartisan policy center thinks the fed should not raise rates this year, he joins us from the washington newsroom. i appreciate your time. i wonder if the fed could justify a raise rate. there is no inflation, and even though unemployment is low, it
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hasn't led to any increase or real increase in wages. substantial increase in wages. there's still a lot of slack in the labor market, right? >> there is a lot lack in the labor market. the fed released its quarterly economic projections at lowered its long-run projection for the sustainable unemployment rate to below 5%. this is the first time to my knowledge and fed history they have said that the economy can sustain unemployment below 5% without causing inflation. mark: without causing inflation. this is having a lot of our guest have been talking about. i spoke to michelle meyer about it within the last hour. try as they might, policymakers to't seem to get in place in rise from where it is, 1.2, 1.3%. what are they to do? do with the decline of the price of oil. the fed consistently has gotten it wrong. the fed thinks this is transitory and a lot of evidence indicates it's more permanent. economist and economic models
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are having a hard time making sense of what's going on in the oil market. in part because they are not necessarily economic principles in play. if oil doesn't have -- the fed keeps saying oil is what about backup. what doesn't, inflation keeps undershooting the feds target. matt: doesn't the fed look at a target without oil? don't they consider fuel prices transitory? aaron: there's a little bit inflation, introduced under the nixon and administration. it's useful to since it -- statistic for those who don't drive cars or eat food. for the rest of society, food and energy costs matter. it trickled in. matt: i love the ben bernanke quote, you can't eat your ipad. at my take a look bloomberg terminal, we have the rule out, i wonder what you think about what this says.
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if you put the neutral real rate 5%,o -- at 2%, and nehru at it looks like we should have raise rates sometime in 2011. we had another bout of qe after that. do you think the fed has missed the boat i a lot but -- by a lot? aaron: i drop your estimate of nehru. they had 4.9%. i think you are somewhere around 4.5 or 4.7. the fed lowered their increase of economic growth down to 2%. it had been 2.5 a little while ago. that's reducing the output gap. the fed is making up the output gap by saying the economy can grow as fast. the should concern policymakers of all sorts because long-run economic growth is the best solution to most of our problems. matt: where you put a new scroll real rate? -- a neutral real rate?
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no matter what variables you plug-in, you still get more than zero. aaron: it's a very useful concept. themember the size of recovery is proportional to the size of the recession. we can throw that one out after the financial crisis. benchmarks,portant but you can't be slavish to any of them. the art of monetary policy is figuring out as you go. you have to be concerned about the u.s. economy, which seems to be on island of growth in a sea of sluggishness. you should be concerned about the value of the dollar, which rule in the taylor phenomenon. when the fed survey talk about raising rates, the dollar took off. that has a major impact. mark: do you share the concerns voiced by some about a decline in market liquidity? aaron: i think it's an issue we have to look at. the problems in august
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and september played into the fed's decision now. there may be other problems and factors in december. there's been noted urine liquidity problems at the end of the year in the last several years. it's been a reason to be concerned about the federal reserve rate increase at the end of the year as well. mark: thanks for that. with the bipartisan policy center in washington. mark: still ahead on the "bloomberg market day," the next fight in washington is the looming government shutdown. matt: will congressional leaders demand that funding be stripped from planned parenthood? ♪
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mark: welcome back to the "bloomberg market day," i am mark crumpton with matt miller.
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senior markets correspondent julie hyman joins us with the latest on today's market action. julie: looks like the first day after reaction to a fed announcement that we've had since last july. the selloff is only deepening as the day progresses here. it seems to be the interpretation of the fed declining to raise rates at this time. are concerned about the well-being of the global economy. as a core function on the bloomberg terminal, if you bring up this excel chart of the f one c. plot versus what the market expectations are. the three lines you see here are the past several meetings. the darkest line is yesterday's. the trajectory of interest rates increases, which as the fed has assured us, will be a gentle upward sloping curve. reflects the market
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expectations for rates to go up. you can see is lower than the fed. plot. it looks like mark participants at least as reflected by the swaps market don't have a lot of confidence that the fed is going to be as aggressive as raising rates as the fed members themselves predict. that's not very aggressive to begin with. it's an interesting divergence we're seeing here between what the fed is telling market participants, and what they are trading on. you type in fomc. plot. julie: it launches the spreadsheet. matt: you are going for the auto fill. it's actually a different command. it's actually ask opp asked out. -- xlpp. that view is important for the moves we're seeing. julie: across the board.
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that it's notn going to raise rates for quite some time is also reflected in bonds. if you look at bond yields today, we are seeing significant decline, especially in the 10 year. the two-year, most of the decline came yesterday. it's unchanged at the moment. the 10 year continues to be lower, 2.14%. i wanted to point out that energy stocks of the worst-performing group by a long shot. companiesme of the doing the worst on the percentage basis, and oil is declining again on this concern over the global economy. because of that global weakness, copper is down, gold as you they perceive a safety one of the few things its trading up although the dollar has gotten a late a rebound as well. matt: i'm going to show you a cool function. r, and clicke in mip
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on the world map button at the top -- take my terminal. click on the world map button and you can see throughout time what the stock market is pricing is far as the expectation of will rates rise or lower on a world map. i'm looking at one year right expect rates to lower in canada rise in the u.s., and rise in russia. if you change that to three years, we expect canadian rates to rise and russian rates to fall. it's quite cool. mark: that's going to be the #. matt: i just wanted to share that. you can get rid of my terminal. mark: they're are only 13 days left in the fiscal year. ,ongress has had it again threatening to shut down the government if lawmakers can agree on a funding plan. -- can't agree on a funding plan. matt: joining us is phil mattingly. let's talk about the feud. it's different than last year. it's all about -- planned
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parenthood. all about planned parenthood an abortion. there have been 10 undercover videos release detailing and parenthood employees talking about the selling of fetal tissue from aborted children. that's illegal to be paid for that. planned parenthood has disputed this. but even democrats have acknowledged that the videos in the language used in those videos is disturbing. force been the driving behind a conservative bloc of republicans in both the house and the senate saying no funding bill should move forward that continues funding for planned parenthood. planned parenthood gets about $500 million worth of government funding. republicans of said that has to be stripped for them to be willing to consider a vote from the government past september 30. as of now, with democrats in the senate and the democratic president and the white house, it is simply impossible for them to a college that. republican leaders don't have the votes, and they don't have
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another pathway forward. we are walking right up to that line, five legislative days left to try and figure out a solution. mark: five days to figure out a solution. is there one? is there room for compromise? what is the white house saying? phil: the white house is more than happy to have this fight whatever they want to. democrats will always back planned parenthood, not just because they are huge supporters of abortion. case. not the they believe reproductive services that they always support and push to support for women's health. the big issue you have to look at right now is the presidential campaign is really collocated in this dynamic. when i talk to campaign fundraisers from 2014 during the shutdown that happened during the election cycle, they were talking about millions and millions of dollars lost in their fundraising because of the shutdown. you look right now, you have four senate republicans running for candidate -- for president
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right now. it changes the debate on the strategy side. ted cruz is releasing this -- leading this push in the senate. he's causing major headaches. matt: i feel like almost all the candidates were saying during republicanon the side, obviously, because there's not much of a debate among the want to tryhat they and find a different way to defund planned parenthood. and they do not want to shut down the government again. phil: i think what you hear from --ublicans who get it everybody knows when you talk to them behind the scenes how this is going to happen. a clean funding bill will be the only process that can move forward. the idea is how you figure out how to address the concerns of conservatives through another method legislatively? the house passed a one-year ban on funding for planned parenthood. you see the senate considering 20 week abortion bill going forward. the problem is conservatives don't believe that's enough.
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they believe you need to force the fight and force the senate democrats to vote down the spending bill. you need to force the president to veto a spending bill. that is showing the fight great right now, republican leaders have some ideas, but no firm plan forward. mark: phil mattingly from bloomberg politics joining us from washington. thank you. matt: coming up on the "bloomberg market day," it's been one year since alibaba pulled off the largest initial international public offering ever. what went wrong? we take a look after the break. ♪
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the: the one year --mark: one-year anniversary of alibaba's ipo and things have changed after record public debut. shares of fallen tremendously, leaving analysts to question what's next. matt: up until last month, luria was up- gil
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on the stock. now he is neutral. thanks for joining us. what you think about the prospects going forward? is it down to a neutral because of the drop in the share price, or do you think they are on shaky ground is first of profitability outlook? gil: the reduction in rating was more a function of how i see the growth going forward. time they were going 40%, 50% with good visibility. that justified a higher multiple level, a very high growth multiple. they may have slowed down from that. their margins are contracting. now we are looking at at best 20% earnings growth. that's a different year of growth. we took down -- tier of growth. we took down the multiple, and that took down the price target and the rating on alibaba. goodill think alibaba is a investment and growth for the chinese consumer, they are by far the market leader.
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they've executed very well over the years. it's just that the growth trajectory is lower both in terms of what they perform, and the outlook for the chinese economy and the chinese consumer. mark: how uncomfortable or alibaba's investors right now? gil: very uncomfortable. over the last couple of quarters, expectations of come down to her three times in a row. just last week, a were at an investors complex, and that's not something investors want. a want good visibility into the outlook. like device isel going to be upwards. for the last three quarters and intra-quarter expectations have had to come down. do, going can alibaba forward, to spur more growth? or do they need to? is this a just a maturing company? gil: it's a maturing sector, and it's become more competitive. all alibaba can do is to
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continue to do with a are doing. which is execute for a well is the market leader in e-commerce. at the end of the day, growth will depend on the chinese consumer and their ability to ward off the competitors. specifically competitors like jd , are basically amazoning them. they started being a first party commerce operator and are expanding into alibaba's marketplace. they are utilizing things like same-day delivery to do that. for alibaba to remain competitive, especially for those competitors, the need to be more competitive and aggressive in creating the media availability of products. especially in big cities. matt: what about here? do you think they're going to be able to -- do they need to worry will they be able to push and u.s. business? gil: only longer-term. if you are saying the chinese e-commerce business maturing, it's still probably growing 30% a year. for them to go into the market such as ours, which is growing
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more than 10% or 15% year wouldn't necessarily be the highest opportunity. their biggest opportunities are places like russia or brazil that are still very fast-growing e-commerce markets that aren't as consolidated in terms of shares. and the bigger opportunity there. eventually they come to the u.s. as they become a global e-commerce provider. they are planting the seeds now, i expect to see them within three to five years. gil luria joins us from los angeles. enjoy your weekend. matt: are you out of your? -- out of here? mark: that's why is that enjoy your weekend. matt: coming up on the "bloomberg market day," what bill gross things about janet yellen. ♪ sure, tv has evolved over the years.
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for all binge watchers. movie geeks. sports freaks. x1 from xfinity will change the way you experience tv. matt: welcome back to the bloomberg market day. i want to get you straight to the stories we are following for you at this hour. u.s. and russian military officials will soon begin direct
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talks over russia's buildup in syria. russia has to stepped up its military support for syrian president assad in the country's civil war. military talks between u.s. and russia were stopped after russia annexed crimea. donald trump may have some explaining to do today. at a rally in new hampshire, he did not challenge an audience member who said president obama was not american. >> a problem in this country, it's called muslims. we know our current president is one part of you know he is not even american. camps brewingng where they want to kill us. that is my question. when do we get rid of them? at a lotl be looking of things to a lot of people are saying that and saying that bad things are happening out there. we will be looking at that and plenty of other things. matt: the washington post asked trump about his comment.
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he said the bigger issue is that obama is waging war against christians. the vatican is not happy with the white house guest list for pope francis is welcome ceremony. the white house has invited transgender activists come a gay up as cavalli and bishop -- but this could billion bishop -- the obama administration is using were economic sanctions on cuba. the companies offering telecom services can establish a presence in cuba or do so connect borders -- so can exporters and religious organizations as well. bill gross is taking janet yellen's side. the longtime bond fund manager was talking with tom keene and
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mike mckee. bill: when they did the wrong thing, they went below 2% in terms of the short-term. they did not have to go to zero. now, getting back up there will recap a con asset markets -- recap act on asset markets. asset prices plunge and we have a problem. tom: it is the 10th anniversary of your acclaimed article in the financial analyst journal. thatwas a classic article all of our listeners and viewers are living. when does the great distortion and? it did not end yesterday. it will not end for years. can you tell me when retirees get a fair shake? bill: i can't.
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such thatuld indicate seven years, if we had 25 years of expanding debt, perhaps we will have to pay the price for at least another five or 10 years. debt, thetalize financial sector and corporate sector is doing well. 0% problem being, savers at are really getting the short end of the stick. ultimately, there has to be a rebalance. tom: are we at the point where we are addicted to accommodation? we are addicted to the point of the alcoholic punch bowl too
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full? bill: that is a mild understatement. every asset price i can observe is artificially elevated. some more than others. when you see negative interest rates in germany after five years, when you see the zero bound in the night states, you know -- in the united states, you know that all asset prices are basically hinging on that rate. those rates are artificially low, they will at some point have to be higher. the investor must be very careful in terms of buying something at an artificial price. mike: when do we get real prices? what is the fed's reaction function? how are you going to know what they're going to do after yesterday? growthhe fed wants real
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and a semblance of inflation. 2% inflation, 2% growth, 4% nominal gdp, which is not historically normal but close enough such that profits can still increase, such that capital structures can be justified and interest can be paid. up until this point, five or six years after lehman brothers, we had real growth of two and nominal 3.5. states, theunited only country that has been able to produce it. policy banks in monetary is exhausted in terms of producing real growth and even inflation. governments should begin to policy isthat fiscal the second piece of the leg that has to take place in order to get us back to where we want to go. matt: that was bill gross
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talking with tom keene this morning. coming up, why does the irs one another $3.3 billion in extra taxes from coca-cola? ♪
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welcome back to the bloomberg market day. i want to see how commodity prices and settled in new york trading. i will bring in my commodities expert. alix steel joins me here. commodity exchange traded funds and notes all down for the year except for one.
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it is coco. who would have thought? etn has returned 13% more than the bloomberg commodity index. that is crazy. matt: what do you type in? .lix: choc a different story of supply and demand. other commodity has the opposite problem. demand is supposed to rise by 1.7% this year to a record where production is going to fall about 5% in the season that ends in a couple of weeks. pure supply and demand. matt: they cannot make enough. alix: bam. there is also the el niño factor. matt: the same is true of turkey.
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there are people protesting jersey mike's because they don't have enough turkey. alix: remember the avian flu rose your egg prices? prices for frozen turkey up 7%. fresh turkey breast prices gained 41%. avian flu killing birds. you wind up having birds in a contained environment, the flu can spread really quickly. those birds affected are the ones we use for breast meat. these are smaller turkeys. 8 million turkeys have gotten the flu this year. production at a 15 year low. it only takes four-five months to raise turkey for us to eat it but there are not enough baby birds to make turkey. this will be a longer-term issue. matt: turkey season is just around the corner. alix: they will not have the flu. while turkey roaming free, those
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bigger pens, the less likely you will contract avian flu. matt: i hope they don't. alix: who would have thought? turkey and chocolate. one of my favorite subjects to talk about, bitcoin is a commodity. alix: commodity is something you mine or find and use it to do stuff. except for gold. everything else does stuff. matt: that is exactly bitcoin. by computer geeks around the world. and then you do stuff with it. you can buy beer. there's a supermarket in brooklyn. greenpoint. alix: this is the same point people make about gold. it is a currency. it has no intrinsic value except for what you are willing to pay for it. same thing as gold. debate, is it a
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currency or commodity? can't it be both? i thought video games with bitcoin. alix: the cftc will be regulating the coin. a fascinating development. matt: the price not doing so well. i made my last major bitcoin purchase for about $600. i've got the price on my screen right now. looking at 23281. i have taken a decent loss. alix: you know what else is ugly? oil prices. matt: you and i were on john oliver last night. -- last week tonight. alix: we have to take a look at the oil price today. .t dipped below $45.08
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it picked up steam to the downside. i did not see any bearish news that would signal the kind of fall that we have seen today. we got the baker hughes rig account number. it was a pretty bullish number. -- a total of six rigs. u.s. crude is down by 500,000 barrels a day. these are relatively bullish or stabilizing factors. i have to wonder what kind of financial speculation is going on. be expectations for dollar moves. i have the chart up here. it has been down below the 50 day moving average pretty much for all of september. alix: it went below it again today. it had a bit of a rally.
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that explains a lot of what's going on in the stock market. something else that is happening is the build that could lift the export ban is going to the full house for a vote at some point. it got to the committee yesterday and is now going to the house. you have democrats saying they need an extra environmental and consumer protection before they vote for it. matt: i don't understand why. oil come i cannot sell it to whoever i want? alix: that is the rule. matt: you mess with the whole market dynamic and refiners get a cheaper. this butcould go into this is a whole other debate. matt: we will at 3:00. right now, i will read the top stories. petco is holding merger talks
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with petsmart according to reuters. talks in the preliminary stages. petsmart passed on a deal last year. the company was worried about anditrust issues disclosing confidential information. there is no such thing as a merger, only acquisitions. one company will buy the other. job cuts on the way at johnson control. johnson will cut 3000 jobs in the next two years. a little less than 3%. the company hopes to save $250 million a year. , estate government announced its hiring 400 low-level office workers who run errands and make tea. 2 million people actually apply for the job. hundreds of candidates have advanced degrees, even of the jobs only require a fifth-grade education. this reflects the high rate of unemployment.
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one of the other top stories is coca-cola. that company received a notice from the irs that it owes an extra $3.3 million in taxes. the two sides disagreeing over how much of that activity should be reported as taxable income in the u.s. with us is craig jia mota. is it just for two or three years? period.three-year coat disputes this saying we've been doing it this way for 30 years. nothing has changed. coke is not expecting to pay this money. they are irs has said willing to pass this to their
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biggest litigators. : the issue is caught the attention of folks in washington. microsoft is involved. the big tech companies stash a lot of money abroad. they say there is no reason for us to bring it back. they keep the money abroad -- matt: you would, too. craig: why would we ever bring this money back? it is on the radar. the irs coming out strong saying we will fight this. matt: i know they are auditing coke. is this a sign that other companies will have to watch out or get ready with lawyers on retainer? craig: there's already hundreds of these cases in the works. microsoft, amazon. every company looking -- particularly the ones doing is a
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broad. just doing a lot of business abroad. they get tax cuts in brazil and switzerland. maybe this is a sign that other companies, the irs will look at this. matt: coke's reply is we are in the right, we will litigate this issue if necessary and we will not change anything. craig: they are saying we have plenty of tax reserves. we do our tax reserves. coke is saying we been doing it this way for 30 years and we don't expect -- we expect to win matt:. thank you so much for joining us. coming up, antibiotic use is on the rise. it is causing an epidemic superbugs. the biotech company working to combat the problem, next. ♪
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matt: the overuse of antibiotics has led to a dramatic rise in drug resistance. a new report has found the problem is more widespread than most people think. joining us now is someone who has been working to combat this, the ceo of curaza. armstrongus is drew who covered this stuff for a living. he will be more focused than i am. k to mfirst about how big this problem is. we've all heard that using too many enemy out of dish to many antibiotics can cause superbugs. ryan: it is pretty bad. this a top five
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global health care threat. it is a growing problem. we don't see it getting better. andrew: we have not had a lot of success. -- whate recent stuff are you guys trying to do differently to find new ways to fight bacteria? ryan: it's a great time to be talking about it because this month is the anniversary of the penicillin. lived in a time of antibiotics but part of the problem is the majority of the drugs developed over the past several decades have been derivatives or analogs of the old antibiotics. like penicillin. antibiotics -- the bacteria have developed a resistance to these drugs. the biggest problems that nobody has been paying attention to is the biofilm.
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it can be confusing. 99% of all bacteria form together into these communities. when they do it, takes great sticky stuff -- excrete sticky stuff. they are protected from any of the drugs. it is weird. what we have designed is the trojan horse drug. antibiotics cannot penetrate them. they kill the bacteria as they come out of the biofilm. .hey are still in there our drug forces a dispersion. we blow up the biofilm and and kill the bacteria. >> biofilms are one of the leading causes of antibiotic tuberculosis, cystic fibrosis, lyme disease and other
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diseases states. matt: are they the way that they become drug-resistant? they create stronger or more impenetrable biofilms? >> is not the only way but it is a big factor. -- bacteria,ature once they have no more nutrients , they will disperse. they will come out and re-feed and form a new biofilm. once they are out with antibiotics are effective. it's when they go back in that they are not effective. the bacteria are hit by an biotic and go back in. now, you have a mutated gene. >> where are you guys in the development process? potentially advancing these things through the pipeline. ryan: we are in the preclinical stage right now. we hope to be finished with phase one by this time next year. there's three phases in the fda process.
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we are moving relatively quickly. we are hopeful that with one of our league candidates -- lead suredates, we are not which of those will be pushed through first, but 2-3 years we hope. , hopefullyculosis not a lot of people are getting tuberculosis. whereas lyme disease, everybody in the northeast will get it. how big is the market for the drugs you are working on? >> the tuberculosis market is massive. -- million people a year die it is less of a problem here in the u.s. because of the advancements in medicine. it is a global problem. tb is on the rise in the u.s. it is something we are paying attention to. lyme disease is a huge deal. thoughtis saying they
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there were 30,000 new cases year. it's 320,000 new cases year. it starts in the northeast. it is one of the fastest-growing viral diseases in the country. it is spreading throughout the u.s. we are having a lot of new cases in the midwest and west coast and canada. there is no cure, no treatment. matt: i got it when i was nine. i go on vacation outside in connecticut. it is a big deal. >> it is the biofilm causing that chronic. matt: i hope you can find a cure. thank you for joining us. we will take a quick break and be right back. ♪
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alix: this is the bloomberg market day.
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matt: good afternoon. alix: we have to get a look at these markets because we are off on the dow by about 240 pounds. matt: we are around the lows. we were down 300 earlier. aboutand the s&p 500 down 25. the question is why? matt: because. alix: stocks have been relatively flat. matt: i thought that was weird too. but janet yellen came out and said the global economy is still weak and terrifying and we cannot get off the zero balance. we do have some rebalancing going on within the s&p 500. some estimates are $41 billion of shares need to be changed.

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