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tv   Bloomberg Markets European Close  Bloomberg  May 30, 2016 11:00am-12:01pm EDT

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>> let's get straight to the bloomberg first world news. ten-year future contracts fell by the nose -- most in over two weeks after janet yellen said on friday that an interest rate increase is likely in the coming months. emerging-market currencies are heading for their worst month since august. treasury bills, notes and bonds are closed worldwide today. german consumer prices unexpectedly halted their decline in may. the inflation rate rose to zero. news to ecbers good policymakers struggling to revive price wrote that growth
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in the euro area. sales by jaguar land rover in europe and china helped them triple products ahead of analyst estimates. a rose to $771 million in the latest forecast. unit grewthe luxury sales by 19%. of euro insurance has died. he left the company as part of a reshuffle left december. he is reported to have taken his own life on friday. he was 59 years old. global news 24 hours a day powered by our 2400 journalists in more than 150 news bureaus around the world. markets are closed in the u.s. and the u.k. for the memorial day and spring bank holiday respectively. let's check in on the markets now open. the dax holding its gains, same
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for the tech 40. --cac 40. the senate has reported it may put forward an improved offer as early as this week for months and so. monsanto rejected the $122 a share bid last week. the sunday times reporting the next offer can be of two $130 a share. fallinggaining and post on news that those two companies failed to agree on terms for a merger. let's move on to the currency markets. a day of dollar strength after janet yellen's comments. euro strength after better-than-expected data from the eurozone, sterling flat and eight we getting yen on reports of the sales tax hike delayed in japan. if a look at what's happening in bond markets, we are seeing deals with higher after treasury yields rose following janet yellen's comments. treasury markets closed today
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and in the commodity markets, gold down for the night day. the longest losing streak this year -- or in a year i should say. branch rebounding. we'll bring you the highlights from bloomberg best. ♪
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week in business around the world. >> i have rarely seen a rejection for the target company. david: does deutsche bank deserve more credit for its comeback efforts? >> it's offering results have been in decline the past couple of quarters. david: has greece turned the corner in its debt debacle? >> we still have to work that out. david: high-profile leaders share high-level insights in the week's best interviews. >> i have confidence that the regulators want this to be a level playing field. >> all these changes are not going to happen without bumps. >> we can expect turbulence in the financial markets. david: preparations for shanghai disneyland. ♪ it is all straight ahead on "bloomberg best." ♪ david: hello and welcome, i am david gura. this is "bloomberg best," your weekly review of the most important analysis of business news and interviews from around the world. as the week began a proposal to , merge two chemical companies took over the headlines. shery: bayer is proposing a blockbuster deal that would create the largest supply of farm chemicals and genetically modified seed. bayer wants to buy monsanto for $62 billion in cash. that represents a 20% premium. it would be the biggest takeover ever by a german company. francine: if monsanto actually
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rejects your offer, are you ready or do you have a capacity to increase the offer? werner: we are totally convinced about the attractiveness of our offer. it is a 37% premium over and above the uneffective share price as of may 9. that is a strong testimony as to the value proposition of monsanto shareholders. it is also in line with the transactions and attempted transactions we have seen in the past. we are fully convinced that it is a highly effective offer for monsanto's board. also, for their shareholders to consider. francine: is it your best offer? or just your first? werner: the best and strong offer. we are waiting for the offer from the shareholders of monsanto. mark: $106 is the monsanto share price. that tells us investors are not convinced? aaron: they are not. there is a lot of concern that investors will come back and say they are not convinced. david: the current offer of $122 a share is inadequate. there is a statement out today
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that says the current proposal significantly undervalues our company and does not adequately address and provide reassurance for some of the potential financing and regulation risks related to this. francine: do we intimate they are prepared to pay a price? aaron: i have rarely seen such a friendly rejection from the target company. on the one hand, it says it undervalued, there are risks, bayer andally respect sees the rationale for the deal. so it has very obviously invited to them with a higher price. obviously bayer has to ask itself if we are going to stretch the balance sheet, do we want to raise more equity, sell assets? i think, if i had to guess, bayer does not table the first offer first, so i think that there is room to bump. scarlet: the dow up more than 200 points, u.s. stocks close near the best level of the session, joining a rally we saw in european markets. if you break the s&p 500 into 24 industry groups, everyone
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climbed. the worst performer was energy. that still gained .5%. alix: it feels like a risk-on day. we had the home sales that were killer, but oliver pointed out before we got to air it started overnight. it is hard to find a specific catalyst. oliver: definitely helps when you open the day with european indexes across the board, on the other side of the pond, trading at standard deions two times as high as they normally close. so a huge risk on day does help. and you had some company-specific news. a good day from apple again. nice to see that back in the mix. overall, great day for biggest day in three months. >> and new home sales -- killer. really amazing new home sales. the concern is whether it will be paid back down the road. but that helps with risk on momentum. matt: greece's creditors have reached an agreement that will allow the release of 10.3 billion euros of aid. they have also committed to taking steps to relieve the
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nation's 321 billion euro debt. after an 11 hour meeting of european finance ministers, the international monetary fund softened its stance. what will be the political impact of this? ian: there were three main headlines really last night. there was the deal on the payout of 10.3 billion euros to greece. there was also an agreement to look at debt relief in the future. details are still to come. we have to work that out. and also, the imf gave a commitment it would continue to participate in the greek rescue. that is important for germany, particularly going into the federal elections next year. so the political impact will be some respit for alexis tsipras, the prime minister of greece. in germany, some certainty for angela merkel going into those elections. but more than anything, some sense of calm, sense of debt relief has been pushed until 2018. guy: i'm looking for details and
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struggling to find them. this feels all too reminiscent of where we have been before. ian: it does. what is particularly reminiscent of all we have seen in the greek saga the last five or six years or so is this in principle agreement to keep everybody happy, but in the end, nobody is happy and it all blows up again? so yes. there are options on debt relief after 2018. that is when the bailout program finishes. but there are no concrete measures. guy: brent crude back above $50 a barrel for the first time in more than six months. a drop in u.s. stockpiles spurring the latest rise. along with domestic options in oil-producing nations -- canada, nigeria, etc. talk about the exact reason it is above $50 a barrel and why it could go higher. tracy: the catalyst the stockpile data from the u.s. showing a much higher than expected cut in stockpiles, something like 4 million barrels.
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as well as you point out we have production outages in venezuela, nigerian turmoil, and lingering effects from wildfires in canada. all of those one-offs seemed to be combining to give oil a bit of a spur at the moment. you have to wonder how much further that rally can go ahead of the opec meeting next week. in fact, bloomberg is reporting today that in the pre-opec meeting, there was no discussion from opec officials of a possible production cut. at least from the gulf side, we are seeing a continuation of the strategy of maintaining market share. david: now we want to go to japan, where world leaders tangled over how to push the global economy toward growth. there was some language in the communique saying we need to get growth going, but they did not go as far as prime minister abe wanted them to go. is he satisfied with this result? yvonne: he says no. he will still continue to talk about this lehman crisis even after the fact that the g7
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didn't buy it. he could not get that language into the communique. instead, we heard leaders declare in this document that they have strengthened their resilience is in their economies to avoid falling into a crisis. we did see the g7 try to fix this coordination, but trying to get that recipe on boosting growth, that remains tangled over geopolitical tensions. david: they did not get the language of crisis in, but in the 11th hour, they added the language about the u.k.'s referendum about leaving the european union. what happened with that? there was an earlier draft that language. yvonne: that is right, and prime minister david cameron really got the last effort to get that line into that communique. they added a line that says brexit is a serious risk to the global economy. it was a good weekend for the prime minister. he was able to get support from the g7 when it came to china's steel overcapacity issues.
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the g7 this excess, which has been fueled bgovernment subsidies and support. not singling out china, but the references seemed to point to it. jonathan: as the data drops in the united states, gdp annualized quarter on quarter, the previous 0.5 revised to 0.8. the survey was looking for something firmer. but an upward provision nonetheless. carl: this is important news which lowers the hurdle for what is required for the next couple of quarters to hit the fed's full-year growth target of 2.2%. now we need to average 2.7% for the remaining quarters of the year. that makes it a little easier to hit that mark and at the margin helps them stay on track for major activity, but i doubt at the june meeting. david: what will janet yellen and the fed be looking at in june? is it consumer spending?
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carl: three indicators. jobs, jobs, and jobs. david: still ahead on "bloomberg best," investors involved in turkey, puerto rico, and saudi arabia. up next, some of their weeks most important company stories, including a report of a new suitor for yahoo! ♪ ♪
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♪ david: this is "bloomberg best," am davidura. let's continue our global tour of the week's top is news stories. deutsche bank has been ensuring investors it is in the midst of a turnaround. tuesday, that journey took an unexpected turn. david: moody's downgraded deutsche bank, and it has ceo john cryan speaking his mind this morning. mr. cryan came out fairly emphatically after this downgrade, matt. matt: john cryan saying he thought it was ridiculous for moody's to downgrade their debt just two steps above junk because, in his words, they have enough capital to pay their debt four times over. >> does mr. cryan have a point? the bank has never had as much capital. they could easily repay their debt many times over. is that a valid argument? peter: the rating action was about the increased headwinds the bank is facing in terms of operating environment, and its operating results have been in decline for the past couple of
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quarters. so that is what drove our rating change. mark: what is the biggest challenge, then, for deutsche bank in achieving this big turnaround? peter: the turnaround has many elements to it. it has been a very disciplined execution by the new management team. what they are trying to do is to change the balance of the earnings mix of the bank. they are trying to strengthen the balance sheet. they are trying to revitalize the technology platform. they are trying to do all of these things, and all of these things, if they were achieved, we thi would actually be credit positive. but they are challenging to achieve them all. shery: yahoo! having its award space since early january, falling 5%. telecom giant at&t is said to be interested in buying the company's internet business. why did at&t come back into the
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game? we had heard earlier it was dropping its bid. alex: we don't know if we were fed misinformation or if at&t has sort of changed its mind about yahoo! look, at&t and verizon are both at the point where there is only so much they can do, at least u.s.-wise, from an m&a standpoints. they cannot buy another wireless network. regulators will not allow them to. they cannot buy another cable network. regulators will not allow them to. so the digital aspects like yahoo!, it is probably somewhat appealing. you can make a small bet and develop something down the road that is appealing to your wireless customers. francine: let's go to vietnam, where boeing has won an order for 100 planes from vietjet, the country's only private airline. the deal is worth $3 billion. vietjet is an airbus customer. it had multibillion options to buy single aisles. what incentives were offered for you to switch?
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dinesh: it's not a switch. they are looking at the value of our new airplane, called the max 200, which is 370 max. this was launched by ryanair, and clearly that airplane has 197 seats. they saw the economic stuff that airplanes, and they realized this is the best economic any airplane can have in the world. thereby they have growth profitability. with that particular importance, and they are kind of a low carrier in vietnam right now, and they have ambition to go into other parts of asia. they want to do a major order, and that is why they order 100 airplanes. >> toyota is investing in uber to explore a ridesharing partnership. toyota financial services corporation and mirai creation investment limited are joining together to make a strategic
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investment in the company. it will include toyota leasing special fleet vehicles to uber. >> the auto industry is being assaulted by all kinds of technological change. maybe the least of those is this concept of ridesharing, but it has really taken off. it has changed the way rental cars operate, the way taxis operate. it is a big part of the global fleet. it may change the way people choose to drive or choose one to own a car or not to. nobody wants to get left out. toyota has a lot of money. it is very easy for them to make an investment, kind of get thier toe in the water and see what is there for them to learn. guy: the unicredit ceo federico ghizzoni has agreed to step down after only six years at the helm of the bank after losing the support of investors and share price capital as well. do they have to raise money? jonathan: they certainly need more capital. one of the issues it faces is when you are trading at four times global growth, it is
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diluted. there was a lot of things they can do, spin off assets, relieve some of the capital pressure. unicredit is second to only santander as the lowest capital big bank across the eurozone. it has 40 billion of our -- un-provision performing loans. it is the biggest. emily: hp enterprise shares are surging in extended trading. this is half of the old hewlett-packard still run by ceo meg whitman and focuses on servers and storage for corporate customers. the company announced it is spinning off its troubled corporate services business and merging with computer sciences corp. was this expected? anand: no, but it makes sense. to focus -- have one part of the entity focus on hardware, predominantly networking, storage, and servers, and then finding a way to exit the services business to a company that focuses on exactly that
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portion of the business. it is a good strategy. it refocuses the company into a smaller piece of the pie. again, the risk here is that you have an extremely small pie you are focusing on, one that is on hardware, predominately selling to corporate i.t. systems. so, will that be the long-term revenue growth area for hpe? that remains to be seen. but in the near term, the deal makes sense. shery: microsoft is making as many as 1,850 job cuts while taking a $950 million impairment and restructuring charge. give us a sense of where these cuts are coming from, and what this tells us about the new strategy. cory: one of the things it tells us is that the $9.5 billion acquisition of nokia by steve ballmer, one of the last big deals, was a disaster. they took on a write-down last year, another $1 billion down
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now. it shows that decision at the time, which was controversial, was a mistake. a very expensive one. it shows you the company is focused on the things they do differently and focused on the things they do well, and focusing very much on offering software on the cloud, where they have their powerful franchises, both on the operating side and microsoft office. thinking about the cloud, thinking about bringing micro users to the office 365 platform and the microsoft azure platform, which they think will be the future of this business. >> shares in alibaba close more than 6% lower in new york after the company revealed the sec is looking into its accounting practices. that information was disclosed in its annual report filing. alibaba is being investigated -- for what? rosalind: the sec is looking into consolidation policies. it has asked alibaba about more information on its delivery network, and has also asked for
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information of about operating data for a single day. single day is a shopping extravaganza. once a year. it was in november last year. it brought in something like $40 billion. oppenheimer co. says the single day issue could be related to some confusion over alibaba's definition of gmv -- growth merchandising volume. there was this total transaction. it is possible that it doesn't remove some transactions which later turned out to be fake. it is possible 20% or 30% of transactions could be inflated as sellers buy their own products to boost their own sales rankings, essentially. but sec does not think it is too much of an issue, it thinks alibaba is trying to become more transparent. alibaba is cooperating. and the sec says just because it requests information does not mean anything is wrong. ♪
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♪ david: you are watching "bloomberg best," i am david gura. earnings season is winding down, but there were still a number of major companies reporting. a roundup begins with a u.s. builder many see as a bellwether for the luxury housing market. scarlet: toll brothers ceo doug
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yearley has been frustrated by the decline in his stock price. today, the stock is having its best day since 2013 after earnings beat estimates. let's see what the numbers on the luxury builder show in the numbers don't lie. first, we discuss stocks. even with the bounceback, toll brothers is down 12% in 2016. over the past year, it trailed the broader market and its peers. today's results lessened some investor concerns, saying the luxury market remains a strong and conjunction labor costs are easing. tolls revenue had plunged during the u.s. housing crisis. it slowed again after bouncing back from the housing crisis. revenue this quarter increased 31%. analysts estimate toll's revenue may regain 30% for the full year. california is a key market for toll. it represents 12% of its revenue the last quarter. its purchase of chapelle homes provided instant scale in that state. the northeast corridor, historically the center of
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toll's business, but the land has fewer opportunities and ranks fourth overall. toll has diversified beyond the single-family home. it now makes up two thirds of all offshore closings versus 91% in the year 2000. the strategy is paying off today with stocks gaining 8%. angie: sony is enjoying another positive session, the stock rising the most in a month -- 5.84% higher. that follows an overnight jump on wall street as investors shrug off weak profit outlook and take the long term view. why are investors ignoring this really dreadful profit forecast? yvonne: it seems like the earthquake impact forecast for sony is a hiccup. that is the view of analysts out there. if you look at the restructuring sony has undergone with its tv and handset business, a lot of them say, hey, they are already over the hump.
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the company showing more resilience than we know. but keep in mind, it was a pretty ugly annual forecast. it basically ruins the hopes sony was going to have its most profitable year in nearly two decades. net income expected to fall 46% to $727 million. that is nearly two thirds what analysts were expecting, and operating profit was also a miss. if you take a look at the quake impact and do the math, it seems like this could cost sony $1 billion when it comes to damages, repairs, as well as sales lost from the time they had to shut down their facilities. >> ryanair has forecast earnings growth will slow this year even as profits jump. europe's largest discount airlines expected to rise 40% after a 43% surge in march. that is as airlines cut ticket prices to entice people wary
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after recent terror attacks to fly. you are guiding the market lower, so how weak is pricing going to be as we go through 2017? >> the primary key driver of the next 12 months will be lower oil. we just reported $1.2 billion in profit when we were hedged at $90 a barrel. oil prices are falling. the overriding theme is weaker pricing. we are seeing the first half of the year, up to september, we expect prices to fall by about 7%. that is a combination of three things. ryanair's own strong growth across europe, opening new bases, new markets. you have the impact of competitors, responding with the benefit of lower oil prices. and then the terrorist activities. the events in brussels, paris, and the egyptair incident this weekend. and then you have the repeated
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air traffic control strikes in mainly france, which is causing a lot of cancellation of high-yielding passengers we cannot replace. x she gave the turnaround a lot of credibility. she said we're going to cut a billion dollars in costs. that's been part of this turnaround. they cut costs, sold off foreign divisions. now it is a matter of sales again. alix: in terms of growth, it was a store within a store concept, like the samsung store in a best buy, that was going to be one of their growth drivers going forward. where are they in the actual growth turnaround plans? >> it has been tough, because they have done a lot of stuff to make the store better. they have the samsung stores, the apple store within the
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stores. but the product cycle has gone against him for about two years now. >> marks and spencer reported results, the u.k. ceo also unveiled a new plan to boost clothing and home business by reducing price provisions and refreshing styles more often. i was drawn to one of the lines about the need to focus on older returns. what does that mean for shareholders in the context of what you have done previously, buybacks and the like? >> what we announced is we are continuing the program of shareholder returns. we announced last year we are moving to an ongoing program of return that is continuing with the announcement of special dividends at 75 million pounds for the first half of the year. we are a strong regenerative business. we will invest in growth, as we said, but our growth is likely to be 40 million pounds next year, which will generate
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surface capital, and we are committed to sharing that with shareholders. >> shares at hp are climbing this morning after reporting 11% decline in second-quarter revenue. the company, which focuses on the consumer market, which was spun off from hewlett-packard enterprises in november. declining sales, but they did beat estimates, which is why the stock may be up. >> there was a hint in the restructuring going on since 2001, but we are reaching an end. they actually started the new company with restructuring programs. it is crazy restructuring, so they are giving non-gap numbers, they beat that non-gap number with a gap number. they are 11% year-over-year. they have always been tied to printing and pc's. pc's are a disaster right now, but the printing is unfolding right now. this is a bad sign, because that has been the bread and butter for hewlett-packard for over a decade. david: coming up, the week's most interesting interviews on bloomberg television. fed policy, chinese growth,
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brexit, and more. some crucial topics on the table when we continue. you are watching "bloomberg best." ♪ >> let's get to the first word
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news. contracts bell by the most two weeks. janet yellen said ofriday that interest rates increase alike in the coming months. emerging market currencies are having their worst month since august. treasury bills are closed worldwide today. german consumer prices halted their decline in may. in zero.tion rate came the data office offer some good news for policymakers. meeting ahead of the this thursday. noble group ceo has quit. it has accepted his rising nation. 60% inhares have plunged the past year with questions
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about his accounting practices. zurichmer ceo of insurance has died. he left the company last december. he is reported to have taken his own life in switzerland on friday. global news 24 hours a day 2400 journalists in more than 150 news bureaus around the world are in it -- world. in europe, the markets are just closing up. let's take a look. eurozone stocks are unchanged. dig in for a little more detail with what's been happening in european trading. stoxx 600 carmakers have been the best performers today.
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movers haveiggest been be post. this is belgium's main mail carrier. it was in talk to take over. we heard from the company they failed to agree to terms. let's switch up the board. let's take a look at commodities. the dollar yen has been the story. the yen is weaker. the sales tax hike might be delayed. course, gold is down for a night day after those comments from yellen. do stay with us. we will bring you the highlights from bloomberg tv in bloomberg best. it's been a pleasure giving you the news today. do keep watching.
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david: this is "bloomberg best," i am david gura. time to replay some of the week's best interviews on bloomberg television. we start with erik schatzker sitting down with janice capital's bill gross. he made it clear what he expects. bill: i think the move in june. i think that because of the second quarter is looking decent. it is a 2% to 3% type of quarter. it is a come back from the first quarter, and jobs will probably be adequate in terms of growth. the dollar has gone down instead of up. the stock market is close to its peak. for all of those reasons, this is their time, if ever, to move. i think janet yellen is more dovish than some of the governors and presidents, but there are presidents and governors, edwin, williams, who i think are beginning to understand what we just talked about in terms of effective low
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interest rates on the savings pool. erik: and kaplan as well from the dallas fed, arguing the same thing. that the fed, sooner than later -- bill: right. erik: has to make a move. those are the arguments in favor of a hike in june. what, if any, arguments do you find persuasive against a hike in june? bill: it is the question of trying to answer what the appropriate neutral interest rate is. so some would argue that where we are now, close to zero, and where central banks are, in many cases negative, is the appropriate rate. in a situation where aggregate demand and global demand is insufficient, which has been a condition for 10, 15, 20 years.
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erik: and that holds some water with you? bill: oh, it does. ♪ david: where do you think rates should be at this juncture? alan: if we lived in an abstract environment where we did not have to worry about the past, i would say at this juncture, we would like to see interest rates 2.5%, 3% -- in the abstract. but there is a past history. we are starting this tightening cycle, if you want to call it that, by the fed from 15 basis points, or something like that. and the last thing we americans would want our central-bank to do, and unfortunately the last thing the central bank wants to do, is bang the economy over the head with a huge amount of monetary tightening. it is not going to do that. it will go really slowly. francine: what will it take for investors to rewrite european banking stocks? [laughter]
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jes: i think a view that we now have credibility and how regulators will deal with bangs going forward, that is probably the most important thing. we need to believe we are at least at the beginning of the end of the regulatory environment for european banks going forward. we need to believe we are at the beginning of the end of the conduct issues, whether it is rmbs in the united states, ppi in the u.k., there needs to be a sense that we have a vision to some predictability around the bottom line results of banks. rinsing: on the regulation, do you think it is a level playing field between u.s. banks and yourselves? jes: i think the regulators have an enormously difficult task of re-regulating this complex banking industry. i know they have a goal, try to make it a level playing field between home countries and host countries in u.s. banks and european banks and asian banks.
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it will not be perfect, it is not perfect today. but i have confidence the regulators want this to be a level playing field, and they will make the course corrections as we go to allow that to happen. francine: we are a month away from the brexit, the u.k. referendum. do you feel the discounts on barclays, because you are in the whirlwinds of possible brexit concerns? jes: i think for sure, the markets are being impacted by the uncertainty of this vote. it is a historic vote, for sure. as our chairman, john mcfarlane, has said, the best thing for customers and clients in the u.k., if they vote to stay, part of the european union. but as we get closer to that date, for sure the uncertainty will impact financial markets. james: the chinese economy is a $10 trillion economy. it is the second-largest economy in the world. it is growing apparently larger at 6.9%, whether that is right or not.
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it is certainly growing at a rate demonstrably faster than the rest of the world. the third largest economy in the world, japan, has negative growth. fourth-largest is germany at 1%. and the u.s., the largest, is 2%. percentagewise, yes, it is slowing. china accounts for 35% of global growth. >> how about the unvarnished view on china? former fitch ratings analysts had an interview out on bloomberg, saying the debt problem at the banks is far worse than anyone is reporting. upwards of 22% of outstanding credit in the chinese banking system will go npl, nonperforming, by the end of the year. needing trillions of dollars in bailout. james: they are big numbers they are throwing around. clearly, npl's are likely to rise from where they are. but the chinese economy is a complex, enormously complicated
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set of things going on, moving from an export led economy to a domestic demand economy, moving from a savings economy, consumer savings, to consumption. all of these changes are not going to happen without some bumps. sure, npl's are going up in the bank, no question about that. but the four big chinese banks are earnings engines at the same time. >> as a regulator, are the european banks prepared in case of a leave vote? vitor: we think so. banks are aware of the risks that exist. many have edged as much as they can against those risks. and judging by the mounds of exposure that we identified out there, yes, banks will be resilient to such a hypothesis. if it happens. nevertheless, we will have for a while negative impact.
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>> how negative do you expect that to be? vitor: very difficult. it depends on many unpredictable reactions of economic actors in markets. certainly, one can expect turbulence in financial markets during that period of time. >> even more turbulence than we have seen the last six months? vitor: well, that turbulence that was quite -- in the beginning of the year, it has abated now. so it we will see. very difficult to really predict the degree of the effect that will be produced by such an event. certainly something i hope will not continue. rishaad: it is next month that sees the june 23 referendum in britain on whether to stay in the european union. which way would you like that to go, and why?
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richard: we have tens of thousands of employees in britain. i would be devastated if we were to pull out -- pull out of europe. it has been wonderful, i think, for europe to have britain part of europe. it would be wonderful for britain to be a part of europe. i am old enough to remember the days before we were a part of europe. if i wanted to export my products to europe, i had to pay a 35% tax. if i wanted to import products from europe, i had to pay a 35% tax. and the bureaucracy of all these things going on, we could not take employees from europe. we could not go work in europe, we could not live in europe. all of these barriers have been taken away. so i just hope that sense prevails. and when push comes to shove,
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people will realize it will be enormously damaging, i think both to europe and great britain, if britain was to walk away. ♪ ♪
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david: you are watching "bloomberg best," i am david gura. government actions moved markets this week. legislation to address address puerto rico's debt, cabinet reorganization in turkey, and the megadeal in saudi arabia all had implications for investors. let's look back at the top stories with politics. mark: breaking news out of turkey. mehmet simsek has retained his post as a deputy prime minister. simin demokan, give us the details, why is this so important? simin: the prime minister binali yildirim just announced his new cabinet. as you said, investors were waiting to see if the deputy prime minister of economy was in or out? we just learned he is in. he has been named the deputy prime minister. he is extremely liked by investors and the markets. he used to be an economy
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minister and the finance minister. this is welcome news. markets in turkey have had havoc over the past months. the lira has strengthened and the stock market is up. >> turkish assets maybe. but i have been looking at turkish lira and the vault, and dollar-lira is ticking higher. and the uncertainty, the source is politics. where do we go from here? does the president, erdogan, continue to try to consolidate power away from the prime minister's power to the president? simin: 100%. that is the prime minister's now main mission. and he has been saying this. he is saying he will change the constitution to a presidential system. this is exactly what the president wants. and loyalists to the president are saying this is his number one mission. they will be following this through 100% and trying to change the constitution so that the president's grip on power
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becomes tighter. shery: congress took a big step, striking a deal with the white house to help rescue puerto rico from its $70 billion debt crisis. this is a major hurdle as congressional leaders work out the details and disagreements. david: july 1, the big deadline on the horizon. what is the likelihood a bill will get to the president's desk before then? rob: it will be tight. it is possible to do it, but the significant issue is if we can have this bill passed through the house, maybe through the senate or close to being passed the senate, it would give the market an understanding of what will happen. we can take some of that accordingly. david: how does this bill respect the priority of the claims of the bond market? what specifically in this bill will do that? rob: the goal of having this oversight board is to make sure we bring financial order to the island, so everyone gets paid back, whether they are obligation bonds or tax bonds or the pension.
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we are not picking winners and losers. everyone has to be made whole. this is the path to it. but there has to be an orderly process, and this creates a federally processed accomplishment. it will work, but we have to do it as quickly as possible. alix: general electric will take part in a $3 billion investment in saudi arabia that has nothing to do with oil. it is all about of the saudi plan to diversify the economy. ge will invest in water, digital, and other projects. by 2020, the company will double its saudi workforce to 4000 people. john: let me say how important it is for governments like saudi arabia to be clear with their vision for 2030. like in china, you have a series of five-year plans. we are now in the 13th one. it gives companies like ours and investors an agenda they can focus on.
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the saudis have done the same thing. we think it is fit for purpose for us. they are talking about diversifying the economy. they are talking about expanding their health-care capabilities. we can help to there. and human capital development. creating higher skilled labor force that can do different things. this is all in our sweet spot. >> now let's stop in shanghai, which disney hopes will be the happiest place in mainland china. the disneyland theme park opens its gates on june 16, and right now, the company's training to people that will translate the magic to customers. tom mackenzie gives us the inside look. tom: niu tianlong is one of about 1000 performers being put through their paces before disney throws open the doors on its most ambitious venture to date.
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shanghai disneyland. niu tianlong: i feel proud and honored when i tell people i work for disney. tom: the action sequences come naturally to tianlong. he trained in martial arts. it is playing to the crowd that daunts him. niu tianlong: the challenge's about the interaction with the audience and how to make people happy. that is the most difficult thing. tom: pirates are something of a theme in shanghai disney, and that swashbuckling can be physically demanding. yu liang: we have a lot of performances every day. we need strength to keep us going. we need at least 30 minutes of training a day to keep up with physical fitness. tom: yu liang plays a hapless love interest in a "pirates of the caribbean" spin off, and she has no plans to leave any time soon. yu liang: from the very first day i joined disney, i have been very ambitious. i want to work at least 10 years or maybe 20 years or even longer. tom: across the park, they are getting ready for another
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curtain raiser. ♪ tom: we are on stage at "the lion king" in shanghai. the highest grossing musical of all time. they are counting down the first ever fully mandarin version to an audience of 1200 people. li weiling is already a celebrity in china after appearing in tv singing competitions. she plays nala, simba's long time friend and wife to be. she is the female lead. how do you feel about playing such a role in such a huge production? li weiling: this is my first time taking part in such a big production and to be a lead actress in a really important role. so i feel really proud, but at the same time, it is a big challenge. i never thought i would be able to be a part of disney and perform as nala in "the lion king." and not only that, i got to perform it in chinese.
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tom: some have doubts about whether disney will be able to get these performers up to scratch. many of the actors had only a hazy idea of the company's films. but if these guys are anything to go by, they have a good stab at getting it right. ♪ ♪
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>> tell us what sort of tools you are using to assess the situation in brazil. >> we want to take a dive into the crp function. crp . this function is calculating a country risk premium on the countries you see listed. it is comparing the perspective term on the equity market and then comparing that with 10-year yield on government bonds. it is coming up with this risk premium. >> there have been 30,000 functions on the bloomberg, and we really enjoy showing you our favorites on bloomberg television. here is a function you will find useful. this is quic , which will get you to fast intakes on timely topics. here is a quick one from this week. >> it is the year 2000, and vladimir putin has become the president of russia. after a decade of post soviet humiliation, he starts reasserting his country on the world stage.
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the timing is convenient. oil prices are soaring. that is boosting living standards across the country. it years later, putin has to leave the presidency because of term limits and does an interim stint as prime minister. by 2012, putin becomes president again. now, following international sanctions provoked by russia's intervention in ukraine and the collapse of oil, living standards are falling, and that is putting his appeal to the test. this is the situation. putin is all about strength, and it's his strongman image that has helped maintain his leadership. you can get it in his vast publicity stunts, whether it is competing in martial arts, riding horseback, or having his pet labrador sniff angela merkel, who is not one of the biggest fan of dogs, as you can tell. in fact, the only time he really showed softness was at his presidential victory rally in 2012.
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here comes the argument. putin is being tested by an economy that is tanking. russia's facing its longest recession in two decades with real gdp falling by 3.7% in 2015. meanwhile, he is holding onto the former kgb tough man image at home. but abroad, he has tried playing the role of a diplomat. after starting a bombing campaign in syria to support his ally, president basshar al-assad, he is now working with the u.s. to reach a settlement there. he is also pulling back the military there. the question is how will he be remembered? for his diplomatic flexibility or the unyielding ruler whose military adventurism hurt russia when its economy could least afford it? david: that was one of the many quick takes you can find on the bloomberg. you can also find them at, along with the latest business news and analysis 24 hours a day. that will be all for "bloomberg best" this week. i am david gura. thank you for watching bloomberg television. ♪
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>> from our studios in new york city, this is "charlie rose." charlie: we begin this evening with politics. a report delivered to congress yesterday, the state department's inspector general criticized hillary clinton's e-mails, saying clinton violated government policies in using a private e-mail account as secretary of state. the next are asking why she did not seek permission to use it and why she refused to cooperate with the inspector general's investigation. clinton has refused to respond. at a rally yesterday, donald trump capitalized on the news. mr. trump: she is as crooked as


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