tv Bloomberg Markets Bloomberg April 25, 2016 2:00pm-3:01pm EDT
lisa: welcome. david: here is what we are watching this hour. what are the key factors the fed will be looking at question mark our guest says the u.s. dollar and global growth are playing a much bigger role in the eyes of janet yellen. lisa: how is donald trump playing with congressional republicans? marshall is here to tell us if trump is making it harder for the gop to govern. will tomorrow be the first time apple reports a year-over-year decline in iphone reportincluding our's for the most malleable company by market cap? in two hours and stocks are lower. julie hyman has the latest. julie: a lot of big events are happening this week like the fed and the bank of japan.
we will hear from all of those folks. today, it is more micro driven. .e are seeing a drop in volume as we were reminded earlier, spring break for a lot of folks we see some people participating in the trading day. averages are up off the lows of the session. now only one third of 1%. at some of the earnings highlights and lowlifes as the case might be. estimates,elow because of data. since they declined reported results that beat estimates. still seeing struggling legacy business continue to lay on the numbers and taking the charges as a result. rising today after earnings estimates.
always a little bit good and a little bit back. potential deals are not happening to talk about today. bid for the unsolicited the company to create a larger newspaper company. $815 million unsolicited it, 1225 per share in cash. you do not see the l.a. times and the tribune -- then there is the long-standing >>. halliburton delaying its full earnings report until may 3 from april 25. a lot of analysts are speculating the merger might be off. both of those companies are declining today. >> facing a lot of scrutiny. you mentioned the fed meeting this week. there is no press congress and we do not expect a lot of data. he looks like inflation
expectations are working higher. if you look at the 10 year, the yield is higher for the sixth straight session. it is part of a move we see. also been watching inflation expectations. look at the five year breakeven, we have seen an increase. here is the increase we have been seeing. this is another gauge of inflation expectations on the part of market participants. even though we are not seeing any kind of probability being priced into the market, there will be a rate increase this week and there is an increasing that inflation will start to move higher. it will be interesting to hear what the fed has to say. lisa: especially because inflation has been for so many years. now it's check on the news this afternoon. mark crumpton has the news. mark: returning to united states after history to saudi arabia. earlier today, the president and
heads of state of france and italy and the united kingdom and germany discussed topics which reportedly included the fight against isil, syria'civil war, and uroplasty stress -- refugee crisis. john kasich is falling off two public events in indiana after his agreement to stand aside force -- from senator 10 crews. he announced a deal to give ted cruz a clear path for indiana's may 3 primary. he will still travel to indianapolis for a private fundraising event. a day of rallies at the n.c. state house again with a delivery of petitions signed by 180,000 people. they are seeking the appeal of a law that rolls back taxes for the lgbt community. about 200 people gathered on the grounds of the old capitol builder -- building in raleigh. they then got two dozen cardboard boxes and signatures
into the capital for delivery to the governor. at least 14 civilians were killed when a suicide car bomb was detonated in the commercial district of baghdad. the attack in the new baghdad neighborhood also wounded at least 38 others. no group has claimed responsibility for the attack. an attorney says the troubled former nfl quarterback is expected to be indicted on tuesday. accused of attacking his faces ariend in january misdemeanor assault charge that carries up to a year behind bars and was recently cut by the cleveland browns and dropped by two agents. news .4 hours a day powered by our 2400 journalists and one and 150 news bureaus around the world. i am mark crumpton. back to you. david: thank you. announces their decision on wednesday. investors, zero probability the
will hike rates and only a 10% chance of a move gathering in june. lisa: there is a probability that potentially they could cut rates. the next guest says the fed will look at global growth when assessing its next hike. joining us now is the head of global strategy at td securities. julie was just talking about inflation and she was looking at the five year for events. how big is the risk given nobody effects a hike? how big is the risk that the fed will overshoot and way too long to raise rates and that inflation will pick up much faster than they expect? >> i think particularly if you wage inflation, global growth. we are not seeing a lot of wage inflation. maybe wage inflation and cpi are not that correlated. and 3%,ally, between 1% they are not that correlated. know that the cpi is
the same. i find that a little bit odd. actually been rising for six months. his around 3%. i think the fed looking at global growth, there is a risk they will let cpi run a little bit higher. the fact that it has been undershooting for that long makes the fed -- inflation is notorious for actually bringing back down when you want. should the wage market start pricing in the five-year inflation expectations, they just started moving higher. i think there is a risk. eased,conditions have they might hike in june, i think the whole inflation issue goes away, but i do not think -- i changed the rhetoric.
i think they want to see global growth pick up. certainlyflation can rise. >> situates us. we have a meeting this week, mario draghi at the ecb saying essentially that central bank will wait and see what they will yield. how difficult is that make things for the fed charting fast-forward here? >> in general, if you look at monitor policy, different from the inflation rate, they don't know how negative they can go, the problem is, we were looking at growth, we need fiscal stimulus, we kind of are getting neither with the fed has hikingd this if they are in the global context of everyone else easing, we're talking about a few hikes down the road, it has a response. think about december. they hiked in december. that happenextent
in the first quarter. it is aamongst banks, greater realization that pushing on the currency front, when all you have is monitor policy, which we have been using for the last years, he may be running out of steam. back.take -- take a step until you are not forced into action, to not necessarily act to aggressively. they other central bank, global backdrop means everyone else has to, effectively. >> on the fed talks about global risk and you say the fed is looking more at global risk than other data, what exactly is the risk they are most worried about? where in the world is janet yellen looking? >> conspiracy theorists will tell you she us looking at any,
but i think is bigger than that. the fed of the first quarter, they hiked once and talked about a very gradual state. financial conditions to the point where we believe the market action is pricing in a pretty high session. nothing is suggesting a of howon, but the extent much oil prices sell, commodity so and the equity markets sell, i think the fed has realized if they're the only one hiking in the rest of the world, global growth, i say the one market indicator is the dollar. it is hard to say the dog is not as inflationary. longe commodity side, as as the dollar stays within a fairly narrow range, between 94 and 96, any strengthening beyond you a generaling range, but any significant strengthening will hurt growth and inflation. david: the way the fed has
communicated, there has been no shortage of those speaking. the fair data dependent and they will wait and see. how do you rate so far? >> i think there are transparent. the struggle the market has is to essentially the different officials. i would say the core of the committee, janet yellen, and i think a few others, by taking the stance. the other things i started noticing is a bunch of them are a lot of funds rate. why, if youhind only have to hike up to 2%, mutual funds rate, maybe you do not have to go that far. effectiveey have been in the sense they tell us what they're thinking. knownt mandate, we do not the rates between unemployment and the global factor rates are.
it is an uncertain world. i think they're doing the best they can but it will be uncertain. david: thank you so much. news abouteaking charter. with the two julie hyman at the market desk for more. -- shares of both coming out. they were already expected to advance with a vote in a report to the federal communications commission. set to submits the vote by his fellow commissioners and it looks like up here. gotten that advancing with certain conditions. the u.s. is said to speak in
online video conditions as part of the settlement. we will get you details on what exactly those conditions to the deal and tail. we are seeing that a huge percentage gain, but you saw on the charts in big movement upward have on the headlines coming out. we will keep you posted once we get more details on what the deal entails. moore is coming up here after the break. ♪
to say the least here the republican party seemingly more divided than ever be or. how is congress doing with the turmoil? joining us now is the vice chair of the house committee on energy. nice to have you here. let me start with the news of the day. ted cruz and john kasich essentially saying they will clear a path for each other to what you make of the strategy when it seems it is straying a little bit p will not outright tell people not to vote. quite that is right. it is difficult when you look at trying to do those alliances. usually, things like this do not end with the effect people would like for them to end with p or for those of us in elected office, we have to be mindful of listening to the voters. lisa: i think the fact the alliance was formed underscores the -- the tension.
which view of trump is the most divisive a month republicans? representative blackburn: we have to look of the year. this is an outsider year. i said all along, we were going to have an outsider nominee and going back into the primary, it was the outsider always leading. for those of us in elected office, what we need to be doing is not saying, what position is divisive, we need to say, where theailing expectations of american people? what do they want to see action on? i am delighted that millions have come into the process to vote the cycle that have never voted before. they love their country enough to get mad about this. and to show up and vote. they're wanting to see action on the issue of national security, jobs in the economy, retirement
security, and we hear that. in poll after poll. rather than an issue or a policy aretion, probably what they most angry with is the lack of action of getting things done, and address coming out of washington or taking place in washington. david: are you backing donald trump? not blackburn: no, i have endorsed anybody. i have said all along to look at the outsiders. they have lead going into the primary. carly fiorina or ben carson. it has been individuals not that involved in the process. ted cruz and rubio were outsider candidates coming to the senate. trump, who has never run for anything. people identify with that kind of energy coming into the process. for those of us, listen and
learn. the american people want to see things accomplished. david: i do not know if they were rhetorical questions, but what people want, seeing those people come out for the first time in many change, has it made you rethink? it made me more committed than ever to say, look, people are sick of the 19 troy dollars worth of debt. we need to get behind it and have a game plan. hold some votes and sent some things to the president's. if you veto it, come back and let's work on it again. obamacare, we hear about the impact, the affordable care act. you all hear about that and reported. it affects small business owners . it has affected individual insurance marketplace. see thingso accomplished, like my legislation that handles across stateline purchase of health insurance. >> over the weekend, there was news the koch brothers might support hillary clinton rather
than republican nominees. what do you make of that? had not heard: i that. it is always interesting to see where alliances are formed. interesting is more than who may or may not endorse, this year, experience matters less and endorsements matter .ess than ever before there is a level of civic engagement i do not think we have seen in many years. would go back to reagan'campaign in 1980, i do not recall having seen this level of engagement. john boehner, paul ryan steps in. have things improved under his leadership? i know it is a big litmus test for him. what has changed? >> i think speaker ryan is doing a terrific job here at he is listening. he comes to the floor. we are able to have good
conversations and talking about things we think would be helpful out of the house and often house floor. supportive of so many of those concepts. he is feeling with the issue of trying to arrive at numbers on the budget. i know chairman prices working with him on that. puerto rico, finding some develop would put them into a situation where they are accountable and there is a lot of transparency around it and they do not get a bailout. i think all of us are not in favor of a bailout. representative, thank you for joining us today. still ahead, saudi arabia's prince mohammed outlined sweeping economic reform plans. how will they impact the oil markets, next. ♪
david: let's check on some company movers. julie: my theme is activists. shareholder changes to the companies we are talking about. square, that hedge fund announcing a 5.99% stake, it is a stake in the company. shares are up 2.5%. we can to look at these together, twitter is lower. this is that the top holders for various companies. the seventh largest shareholder of the company, largest is kcb be, here at tiger global. pretty high percentage of hedge ,und ownership of the company around the same time it took its stake.
saw what looks like a unit of sequoia, as well as dan's -- the earnings by the way from the company, on may 5. starboard, including info blocks, manufactures a device that allows users to create and manage dynamic computer networks, a technology company. and analyst says there is perhaps room for info block to improve margins for editors. well,g at that stock as saying purchasing square capital management has decided not to exercise the option to renew the term of its representative on the board, william doyle, two the 2017 annual shareholders meeting.
firing back trump in an attempt to unify the anti-trump vote. some of the remaining presidential primaries. he told me a camp -- in a campaign in rhode island that ted cruz and john kasich are colluding in a way that would be illegal in many industries. agreed in some primaries to avoid splitting the anti-trump vote. .2 aed cross is -- eight, town under siege in central syria. it includes 35 trucks carrying food delivery kits for pregnant shampoo. anti-life the deliveries being carried out in a partnership with united states death the united nations -- california, tweeting about a trial that could cost jurors. jurors aboutg some
$1500 for posing social messages on media. they should also be fined for restricting cases on google. supporters of the bill say it would give keep to test teeth to current bands by jurors. when patriots quarterback tom brady must serve a four-game imposedate suspension by the national football league. the decision overturns a lower or judges warning that ruling. the ruling can be appealed to a full second circuit court or to the u.s. supreme court but will likely be a steep and time-consuming climb even if the courts took an unusual step. global move -- global news 24 hours a day powered by our 24 hundred journalists in more than 150 news bureaus around the world. lisa and david, back to you. >> breaking news. a federal judge has agreed to case in brooklyn
involving a drug dealer. we heard on friday, the justice department gained access to the phone. they did not reveal who the person is who gained access to the phone. the jugular passes iphone is just one of more than 1000 they cannot break into. anotherseems like example of how they want to go after these companies with lawsuits and yet they find alternative means yet again, raising the russian of how secure these phones are. accordingly, the government no longer needs apple passes assistance and withdraws. similar where the 11th hour, the government was able to get access to that phone as well. commodity markets in new york. let's look at some of the biggest movers starting with gold. pre-session today after home sales unexpectedly declined.
growing expectations the fed would be slow to raise rates. five oil retreating from a -- five rate hike. investors are assessing reports today that they plan to expand a major field though iran increases output to an already saturated market. the highest prices and 10 weeks today. southntense heat in the east in that limited demand. lisa: plagued by massive high inventories. one of the ways energy is dealing with the reality is to be one of the first companies to export liquefied natural gas. alix steel sat down with the interim ceo who helped start morgan stanley's commodity business 30 years ago. lnge asked him how u.s. explores can transform the global market. take a listen. >> it is a market really in transition.
wasuse for so many years it focused on crude index, the transition will take place and it takes time to do that. we are beginning to see other has developed. in europe, we have and the peak, asia is lying again to establish index contracts. that will probably be a local-based contract between the u.s. and europe. coast and the european destination. classes is what we line of same you havestress come brent, select, is that what you envision the market to look like? >> yes, you will have a variety of local executives, not that many in a number of them, too many saturate the market, and it is really the transportation
that at the end of the day will make the difference. how big the spread is what change over time for natural gas and lng. link, like it will be linked to henry hub, for example? will develop a local futures market, which would require the ability to deliver lng and have different lng to domestic asked markets. >> right. creating a stock market where they have not had one before. >> we are enabling the spotlight -- spot market to be created, similar to how brent traded in change and various cargoes were traded over and over again. you will see like that happening.
>> a short-term import, 28% of 50% of all trade. what do you think that will look like in 10 to 15 or 20 years? cautious on that. if you ask me five years ago, i would have told you today the market have been probably bigger than it is. the natural tendency is we will see a certain percentage of the marketremember ,ill not turn into a 100% spot because a significant amount of users are companies either owned by government or directed by government. they are buying lng because it is producing something very basic in their economy such as power. they can never be put in a position where they do not have enough to satisfy the marketplace. always need a certain percent of contracts are in
place for the long-term to supply lng to the community or country or whatever it is. what you will find is they will be more comfortable buying a but i do nottage think you'll ever see long-term contracts go away. >> many of you look at oversupply by 2020. when you think they slipped into a scenario? >> we think it happens around 2020. i am slightly more optimistic than that. i cannot get overly bullish on the global economy and i say china's growth rate on a national basis is still very strong. the developing markets in asia are still moving forward. this inot representing volume but when you start adding it up in aggregate, those are health -- helpful for the marketplace. it really is slowing down,
that will really put the combustion on the demand in the longer term. >> largest visitant, lng is a break between traditional fossil fuel and the renewables. increase.me will we have it at 4.8% between 2015 and 2030. lisa: long-term? you are a commodities guy, come on. >> i'm not in the business of making flat price commodities positions. >> $10? we will see it again? [laughter] david: coming up, one of the new trends in the fitness world, endurance fitness. events like ironman triathlon.
for the $55 billion deal. they have been waiting on antitrust approval to also in the process of buying bright house networks, another smaller cable provider for 10 the dollars. both deals are making the second-largest provider in the united states. charter shares are up by 2% and shares of time warner cable also spiked on the deal. when the deal is all said and they will have gained 13 in 24 millioners customers in 41 states. as part of the deal with the justice department, china cannot strike agreements with programs that make it more to for streaming services like netflix to obtain content. we talked about, conditions but on the field. oft appears to be the crux the condition, that they have to allow competition from ice cream -- online streaming services so there will not be a blockage,
time warner shares up by nearly 3%. privately held so we cannot see how the shares are performing at this point. >> charter is such a big story in the debt markets. it is more than 1% of $1.4 trillion u.s. high yield bond market. cable have almost 65 billion dollars debt. it will be interesting to see how they finance the acquisition, whether it makes them less credit worthy. as youof the advantages get the money coming in every month. thank you very much. fitness is a major market mystically and globally. people are spending more time and money than ever before to get in shape. lisa: wrote a book all about the rise for mind, body, and big money.
china's now is the capital managing partner and founder who bought and sold the iron man franchise. how much bigger can the industry get? have we peaked? >> i do not think we are anywhere close to a peak. the market is getting more etiquette -- more educated. people five years ago who-up with an event might happen -- maybe have it with heavy rock bands on the course as novel. the consumer is getting very .ducated it is not enough to stage a good event that has interesting entertainment value. you have to have a real course and you have to tap into something that you are not easy to do. we are quite early. see there is ao megatrend. smoking -- ite is is probably not going to happen.
when it comes down to is, what modality will people choose for their exercise? running seems to be something that is lasting. we will see on the margins what phase in and out. >> do they take off really quickly right from the get-go? >> they can take off pretty fast people see each other doing things and they jump in. >> we have to jump -- differentiate between entertainment and business dimon is not an entertainment event. it is a true lifestyle choice. >> it can be all they talk about. >> it is true. they deeply internalized the need to do this and it is not entertainment. mud runs, these are in direct
competition for those dollars, movies and other running events. we have to differentiate those things. they grew up quickly. the ones i'm interested in have a longer ramp-up in lifecycle. >> that is one of the interesting things we talked about a lot, the shift from activity to lifestyle. it really becomes not just what you do but who you are. if area, which, when he is training, he takes what he wears and what he is, all of those different things. takes over your life. it really shifts discretionary income, which is usually a lot. 10,000. >> letter the elements of a successful life tile regiment? a general fitness plan? withwill answer that adherence versus any sort of ergonomic movement.
the group of people, the community it creates, no one can tackle the whole thing, very few people. for several hundred people, we have a lot and they are all over the world. because of that community and reinforcement, and the modest everyone has to display, no knows how to do all of those things, it appearance and that is the reason why, along with the fact that running and cycling and swimming happen to be a great mix of things to do to stay young and fit, that is the key to the exercise. it is why i do not see the same kind of adherence, and i look that -- look at that a lot as an investor. >> is a huge community aspect to this. my a runner and i see it in running group once you start running with other people, there is an expectation you will show up and you're more likely to go out on the weekend if you know people are waiting for you and they will give you a hard time the next time if you do not show
up. >> social pressure is powerful. >> let's take a marathon as an example. for a while, it used to be something enjoyed by few. it strikes me there is something about the marathon now that anybody can do it if they put their mind to it. thatere a danger there people go down the path who might not be ready to work with to do them? does that deal with the rate you're talking about? >> from the perspective of trying and i man without really being ready, they are just testers just so much involved, it usually gets people off. a half marathon is the fastest-growing category of andts in the u.s. for sure, probably the world. we see generally a mainstreaming , a great thing for ironman and certain kinds of marathon events. comes next.what
there is a limit but the activities that require a lot of technical skill and practice are the ones that will thrive in the longer term. >> as you say, so many more people are doing marathons. has becomemarathon so much more demand because people who run marathons have seen folks that they may work with or see at the grocery store a marathon anded i need to differentiate myself from these folks. lisa: what is the biggest area within the industry? >> the fitness center of industry? i would say probably two. the first would be out of gym fitness to we have seen city,on-based in new york covering all matters of different workouts. now andhuge boom right we will see how many of those businesses will last. the other one is events.
almost the same number based on yoga have popped up. really that is a wonderful area. >> this is the one i'm here he a lot more about, the idea of taking care of your mind. we live in the anxiety age and people are look for all different ways to destress. they see a lot of benefit in exercise. meditation, technology driven, there is a at -- a nap or you can have bite-size vacations as you are walking on the street. there is something for everyone. much, jesse.so the book is on shelves today. coming up, apple earnings come
as we mentioned earlier, the federal government is dropping its appeal seeking apple's help in breaking into the iphone. they say they no longer need the apple's assistance to get into .he iphone apple reports earnings after the bell on tomorrow. investors will be looking to see if customers are upgrading their iphones more frequently. >> this is something the investment community has been talking about for a long time. emily: right now, expectations
could be a good thing for the stock. we have been bracing for this to not be a great quarter for a long time. the quarter is typically where you see a slowdown after the cycle where they released a new to pickd they expect us up again in september where they are expected to announce a new iphone for the iphone seven. that is where analysts are expecting. it is a big difference. global smart phone sales expected to slow 7%. a broader factor something going on worldwide. there is a question to be asked. have iphone sales heat?
phase? the next the iphone makes up 68% of the .usiness i slept in we expect to see coming out of earnings? have we found that enough to determine whether it has been a failure or a success? there are a lot of skeptics out there. people called it a complete flop. analysts are saying, look, probably about 12 million. apple does not say exactly how many and that is part of the problem. it, over theabout last year, they sold 6 million iphones. it is a completely different era. let's say they sold 12 money watches. $500 a pop. in terms of revenue, is three times the size of fitbit's
business and the entire business is predicated on a wearable wrist device. >> looking to the future, will we get any signs for the apple cart to appear? >> likely to get zero signs of that. i think tim cook said he thinks there interesting. that is probably the extent anyone will go. david: do not miss emily later today at 6:00 p.m., 3:00 p.m. in san francisco right here on bloomberg television. ramsey tells us he is still sour on the markets coming up. ♪
david: welcome to bloomberg market. ♪ good afternoon. federal open market committee meets tomorrow morning. her economic growth outlook changed. plan unveiled the on oil. we will speak about what it means for the economy. some forecasting iphone sales to drop. julie hyman has the latest. down one third of 1% across the board. investorsing a lot of waiting for the fed to come