tv Bloomberg Markets Bloomberg August 29, 2016 12:00pm-2:01pm EDT
matt: it is noon in new york. >> welcome bloomberg markets. matt: good afternoon. i am matt miller. we are covering stories from washington to zurich to houston in this hour. here is what we are watching. stocks are in the green to start sinceg and stocks halting june. gains adding to investor confidence in the u.s. economy. we see a flurry of health care deals to close out the deal -- close out the year? suzy will be here to talk about what is on the horizon. >> what does donald trump really believe when it comes to immigration policy. we may get clarity this week.
matt: we are nearing the halfway point at the trading day. let's go to the markets were abigail doolittle has the latest. abigail: great to be here. good to see you in person. we do have a nice rally going on here for u.s. stocks, the dow s&p 500 and nasdaq are all nicely hired. we see the bullish activity accelerating for the day. nice exemplified the dow having its best day since august 5. we pull up a chart in the bloomberg, beautiful rally. this is where we started. we are now nicely higher on the best day for the dow since august 5. of the s&p 500, it is a bit a different story. we have the s&p 500 languishing to some degree in a range interestingly unchanged over the last 10 days despite some of the
choppiness in the range. individual movers, let's look at stocks moving on music news, starting with amazon and pandora. up nicely on the news out of a report from the financial times that the company could want a streaming music service very soon. perhaps as soon as next month. pandora is nearing a similar agreement but unlikely in september. when we throw serious into the mix, slightly higher and andorra has flipped into the red. both of these stocks are finding a little relief in the future, deals they had music before. lawsuits were not deals in place but it looks like deals finally made individually with record companies could be extended or we will see if they get the boost they had earlier. that is happening with individual movers. matt: music people or 1972, i am trying to
let the most important, black sabbath self-titled record? >> we are going led zeppelin. matt: good point here and i agree with you 100 sent. what about the bond market? what is the reaction like? >> we saw a big rally in rates on friday at your this each by fed chair janet yellen. quite some time but today we are seeing a boomerang, the 10 year yield having its worst drop in two weeks. investors are sorting through what janet yellen'speech mean for the markets. we look at a fabulous chart. we are looking at the probability of a fed hike by the end of 2016 and we go back to last year when the fed raised rates for the first time in seven years and we he the was very high and what is really interesting here, almost 0% ago it was
but now we are above 60%. in'd shifts in volatility what investors think will happen around rates. >> thanks so much, abigail. mark crumpton has more from our newsroom. to address millions of americans coping with mental own this. it is aimed at ensuring americans would no longer separate mental health and physical health in terms of access, care, and quality of treatment. secretary clinton presses agenda would focus on early diagnosis and intervention and create an initiative for suicide prevention. saysf her closest aides she is separating from her scandal plagued husband anthony weiner. he resigned from congress in 2011 after he was caught texting intimate pictures of himself to women. he has again exchanged sexually
charged messages with another woman. donald trump says he will deliver a detailed speech on illegal immigration in arizona. the announcement comes as he appears to have flip locks on a major order stone of his using his so-called deportation forced to kick 11 million people in the u.s. illegally out of the country. brazil's president has made an keep her appeal to job, urging senators to vote against her engagement. to hers it would amount death sentence and put brazil's democracy at risk are the final vote comes tomorrow. government spending without congressional approval, she denies wrongdoing. global news 24 hours a day powered by more than twice as hundred journalists and analysts in more than 120 countries where this is bloomberg. for me, it is kashmir. i did not realize they were both released in 1969,
zeppelin one and two. thank you. let's get back to the federal reserve right now. janet yellen has wall street divided. her hawkish comments were enough for goldman sachs to boost odds of a september rate hike. pimco did not think there was anything of note in this age. anna edwards asked mark what he thought. he was on earlier today from zurich. >> we think there will be one hike this year and there will probably be in december. i think the fed as a whole is taking the cue from what alan greenspan used to say, that if you think you understood what i said, you were not hearing me clearly. a situation where the u.s. it me is very strong but they are very focused on the global situation and they realized that too many hikes in the united states would likely drive the -- drive out the dollar and weaken the u.s.
economy. the dollarng with have to get for that to be a real worry for the fed? bit ands moved quite a the earnings have adjusted. i think we would be looking at not one hike in the dollar too strong, but if we saw two this year, i think the message that the fed has an sending would come into question and i think we would feel that in the dollar and also some uncertainty in markets. thatis the kind of thing could drive this very low volatility higher and start to hurt the equity markets. >> i was looking at an interesting chart on u.s. corporate profits and you are keen on u.s. stocks right now. dropping and been they have seen the longest slide since the end of the recession. give concerns about the growth fisher in the united states, the jobs engine still
intact, whether equities could go higher from here? >> on the contrary, this is a reason we like u.s. equities now despite the fact their pe's are above the historic norm. what we think is happening is you have got still feeding through lower earnings from the sorgies sector year-over-year, yes, corporate earnings are down about 2% that if you strip the energy component, unlikely to have a similar fall this year given how far energy prices have come down, earnings are up 2%. we see earnings improving quarter over quarter and we take for the year, earnings could be up about 3% and that should help overweight in u.s. equities. >> that was the ubs wealth management cio with anna edwards from zurich. we will have plenty more fed
talk tomorrow on bloomberg surveillance. tom keene hosts a conversation with stanley fischer in new york . 11:30 a.m. in london. it will be available across all platforms so you can see on bloomberg television, bloomberg.com, your bloomberg tv app, and surely there will be a podcast available on itunes. coming up, suzy wong, head of m&a is our guest in the deals report. are some major health care deals , more on the horizon? we will find out. this is bloomberg. ♪
it has in a quiet monday for deals as we wrap up the last week of summer. jeff joins us with a special guest. >> how is m&a looking this year? seems slower, a lot of big names but much slower. >> first, thank you for having me here. i've issued the invitation. slower.ower, 2016 is if you look at your today, 2016 is a little behind. the 10bout even with year average. it is too early to draw a conclusion about the year because a couple of big deals.
the last three or four weeks, >> we had the motivation with pfizer and you had a bunch of deals in the health care space. how is health care overall looking? >> it is always busy and that is why it is such an interesting market. over time, there are always deals going on. you look at the pattern and we had several cycles of consolidation. large companies merging. deals.find is you know what it takes. biotech is becoming a more mature industry. you have many more companies now
than you had 10 or 15 years ago that have d risked assets. the market and acquirers can look at the companies and say yes, i see that big running big and having a big impact on me. classic couple of years ago, hepatitis see. it now seems we are in the era of cancer drugs. what do you think comes next? what is the next area that the biotech companies will go after? it in have to look at terms of, they look for big market profits. they first went after cardiovascular and cholesterol and then it was hepatitis d and now it is oncology. i think it is key to remember that oncology is a big market and there are a lot of indications, types of cancer, and i think we are at the tip of the ice and we will go on for a while. there are still a lot of
countries out there. thereed earlier about being a more mature biotech company, but one important point is in the search for growth, if you looked at the biotech market five years ago and the acquisitions that took place, pharma companies look at companies close to launching a drug. a lot of deals got done in the last five years as well as commercialization. he will willing to take some risk. what is next, oncology will go on for a while. the other area is small diseases. small populations. less competition in terms of r&d but you also have more pricing flexibility and you can show clinical impact and things like that. further out, several years out, i think demographics would point me toward things like alzheimer's, parkinson's,
degenerative diseases. jeff: as the generation thesis. it will becoming more popular drug as well. hard though. compared to other diseases people are trying to treat, we do not know what the causes are. it will be longer and more expensive to research something like that. >> companies in the u.s. buying into asia or europe or the u.s., has brexit been a big impact like we thought? has there been a slowdown on m&a? onit has had some impact inking. i do not think it will impact a company that really has a strategic imperative to invest in a or product or who really needs growth. temporarily, people are trying to orient themselves toward what do we happens next, but i think it is company specific. you have to look at the
individual, and he. multinationals in a lot of places. it does not necessarily determine what is the impact of brexit. after that, as you see there may be a slowdown in people investing into the u.k. for some time, but people are investing in europe and deals are going on so i think it is hard to say there has in a big impact so far during >> is mostly the push into the u.s., europe in companies are asian companies that want to get into the gdp? we complain but it is still the biggest economy in the world. >> it is all relative. there is still a big push into the u.s. both because the relative growth is higher because in dollar terms, it is a big absolute mark. inflow thanot more outflow but there has also been a lot more inflow into europe. behindis only about 15%
the u.s. in terms of inflow and m&a. that is an important market and it does not have some of the issues. >> there are not a lot of women in that kind of a position. it feel? what kind of feedback have you gotten from clients or other women in the banking space? wall street has struggled with diversity and putting people into those kinds of roles. >> i know wall street is visible for that. i was overwhelmed with the response i got. i get it is so important.
>> did you regret going into finance and m&a and did not think is the right history for a woman? >> i did not. i got the job coming out of dartmouth college. i have worked here for 28 years and i frankly think i just picked right and i've always loved it and learn from it and it has given me a lot of opportunity and i have a lot of mentor ship and authorship. worked out well for me but if you think i should have a tv career, let me know. >> back to you, matt. matt: thank you very much. want to know anything more on m&a, a great unction you can look out on bloomberg. myave got it here on bloomberg and i have tapped on the tab so i can see volume and deal town, the deal count being the green line and the blue bars volume.the
it matt, you have got breaking news. matt: i do. the fact that apple is holding on september 7 is one market has been reporting for weeks out of san francisco but now it's seems apple has sent ,ut the invites so confirming the iphone saget -- iphone seven -- it will not be terribly different from the currently -- of the current iphone so maybe it will not get its own special new number. it is more heavily weighted on the nasdaq, about 4% of the index that any move makes a difference. still ahead, hillary clinton is trying to operate donald trump from other republicans but her comments are actually making democrats angry. some of them. we will explain why next. this is bloomberg. ♪
matt: this is bloomberg markets. i am matt miller. trump had a flurry of confusion on his stance on immigration, a centerpiece of his campaign. top aides say little has changed in his stance. let's bring in a bloomberg politics reporter who wrote about the topic today. -- onlythere has only been a meaningful change when he talks about mass deportation. >> that is correct, it is the only policy area where he seems to have clearly shifted between last weekend this week there it he said multiple times in the primary he would do a mass deportation program as president and roundup and expel legally potentially under two years.
400 really in 600 billion to do. it was never realistic but everything else in trump's policy proposals on immigration is the same. he still wants to build the wall and he still wants a tracking system and opposes any kind of legalization for any people here legally. very important. it is raising eyebrows and sparking a lot of confusion. reporters are confused by it. this has been a centerpiece of his identity. an issue that catapulted him in the republican primary and helped him win the nomination. any shift will raise eyebrows. >> politicians are hartline on issues for they get elected and they will soft and up they get in office.
two in the general election, and in his support -- can count on him. >> that is the theory on many republican strategist. of hispanics in 2012. a lot of republican strategist do not believe their party could win the presidency again and this is a gateway issue for many of them as to whether they would consider voting for a republican. that is one school of thought different,ategy is to maximize and supercharge the white vote. have a hard is to line and restrictive immigration policy and whether it works, it remains to be seen. it looks doubtful now. he is behind in the polls in
every swing state he needs to win and hillary clinton has the advantage. any benefit, it is hillary clinton's. supporters.pset tell us about it briefly. not son this case, it is much a matter of upsetting supporters as it is a disagreement that democrats have. her campaignon and decided to paint a bright line between trunk and the republican party are they want to cast him , someonech outlier they argue traffics in white supremacy sentences -- sentiments. they want to link every down ballot candidate to him. so much.you coming up, we will talk oil. this is bloomberg. ♪
bloomberg's world headquarters in midtown manhattan. i am not familiar -- matt miller. nejra: this is bloomberg markets. let's start with the headlines. mark crumpton has more from the newsroom. investigately will whether fraud had anything to do with the number of people killed in last week's earthquake. at least 290 people died. authorities want to know if buildingrs broke codes, making it more likely that buildings would collapse. the government also wants to make sure that organized crime does not get involved in the rebuilding effort. the death toll is rising in the car bombing in yemen. the attack killed at least 54 pro-government troops who had been prepared to travel to saudi arabia. the islamic state claimed responsibility for the attack. the fbi is reportedly warning election officials across the
country to improve security of their systems. yahoo! news reports that bureau discovered foreign hackers that breached to databases recently. jeh johnson has reportedly securingo assist with voting systems. a tropical depression that formed in the florida state's -- straits is moving into the gulf of mexico. tropicalsoon become a storm. meanwhile, another tropical depression that formed west of bermuda is moving towards the coast of north carolina. it is also expected to become a tropical storm overnight and threatens to bring wind and rain to the eastern part of the state. global news, 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. much fornk you very joining us. back to this breaking news. earlier this hour we confirmed that apple will be holding an
event on wednesday, september 7. i want to bring in with mark, who recently broke the news months ago. now we are receiving the invitation. how important is this for apple? >> this is a very significant event for apple. every time they launch a new flagship iphone model, the stock will soar. iphone is their cash cow. yes, this event is extraordinarily significant to apple. nejra: tell us more about what is expected to be unveiled in terms of next generation devices. to release planning september.els in the differentiator here will be about the camera on the larger model. it will have a dual camera system. pictures will be much sharper,
they will be able to interpret light much better, and you will be able to zoom in and out at a rate that is much better than current iphones. teachers will not be as blurry. matt: expectations really are not that high for ground breaking technology. how important is this to apple stock price? do we see swing up and down formally on days when tim cook or steve jobs would introduce new technology? to thene is very key overall revenues and profits all the time, every year. now, apple has forecasted another quarterly drop your after year in revenue, following two straight drops in revenue over the last two quarters. in the q1, the holiday
quarter, upcoming, that is apple's most important quarter. these iphones will be part of it. we will see how the sales really affect the quarter. even, the upcoming q4 because they will likely start selling it during part of q4. matt: will we get a new watch? >> apple is reportedly working on a new watch. it is to be seen when they announce it. the september of that will be focused heavily on the iphone. nejra: our competitors going to to this event, quaking in their boots, or not for much? >> samsung is taking a close look to see how their products matchup. i think next year will be at a good deal in terms of technology advancements. we reported that apple is planning a bigger iphone update with no home button. i think next year is one technology will advance.
this will hold apple over until then. matt: thank you so much. let's go now to a different ofic that is, i would say, equal importance, if not more for investors. oil. of press teachst economics weighed an earlier -- .n earlier >> stronger dollar expectations. this week, still some hawkish spillover as folks digest what make sure thatnd
physicians are short up before the holiday weekend. , i don't think the fed will do anything. labor will get a pop. meeting, that was very formally announced in a press release directory from the verysecretary, it is formal. that will happen between the 26 and the 28th of september. if nothing happens, we will see it move lower. we see it move lower too much before then, you could get some action. this time it is different. alix: why is it different? in april, these guys were like, they are producing at max capacity. why is this time different? >> this time you have a new saudi oil minister who was very
much involved in building bridges at the june opec building. you had an agreement on a new secretary general. was the new saudi minister campaign.y on a pr he really tried to move the opportunity forward in a way that we have not seen in some time. that is very different. we now see the opportunity for them to work together. this is political, more than anything else. does increase the probability that something happened. alix: you make a great point. if the iranians show up, that is situation thant
what we saw in april. is there a correlation? what kind is there from job owning to the informal meeting? >> i don't know if that is going to be what is really at play here, although, i would say a at of the opec members are pressure from a debt standpoint standpoint.ow that is why the shared review is .t least semi-annual defaults are expected to continue through the end of the year. and budgetaryes problems, that is something that all members are contending with. alix joins us now for a
closer look at oil. we heard their first about the dollar and about opec from the interview and other people you .ave been speaking to is that what the dollar does or all of these presumptions around opec? alix: it will be both. overall, it is about supply and demand and about whether we get that freeze. i loved how he broke down the definition of a freeze. just the fact that we are talking about a freeze means we are coming closer to balance in the market. we're not talking about cuts. ast talking about a freeze is good thing. committing to it, but the idea of the market coming into balance which is what the market expects for the end of this year. that is the longer-term driver. matt: talking about of fees of
the time when they are producing more oil than ever. i like to look at this once in a while to check it out. you can blow up number 11 and output production data. it continues to rise at an all-time high. you have a great chart -- actually my favorite chart of the day. nejra: this is about the output rising. more intry pumping december. the output has been increasing. and, crude below has been dropping. this is a really key chart to look at. be the firstuld decision. one more thing.
the wildcard here could be iraq. alix: they want to increase exports by, i think, 5%. they want to get into 100%, the market share backup. until they do that, the likelihood is that they agree to a freeze. if they show up, which they did not do in april, is a good thing. if they are talking, they were not talking before over the last year and a half. that is a good thing going forward. my chart -- can you pull it up for me? matt: yes, i pulled it up. permian rigs the count. it is the one you want to pay attention to. , 198are being added there rigs. producers there continue to add. they are drilling. that is where you will see
reverberating through markets. mark b.: the race is on. bmw is falling behind mercedes. what they are doing to the flagship seven series to catch up. take,: in today's quick south africans are losing faith congress.ional many doubt they will ever be able to deliver on promises. almost unthinkable. just two months ago, the prospect of a rate increase next month is back on the table in the united states janet yellen said on friday in jackson hole that the case for an increase is getting stronger, while the vice chair suggested that a tightening is possible at the next roo review. >> rates are simply going to
normalize. septembertes go up in or december, it does not particularly bother me. the bond yield, equity markets are very bifurcated at the moment. mark b.: manufacturing confidence fell this month to the lowest level since early .ast year bmw is trying to put its flagship seven series back into the luxury car race. the auto might make her -- automaker is coming up with the two door sportier version of the series. the s class from her now outsells the bmw seven series.
next year, audi will, with an updated version of its a8 flagship. prauct turnaround for da. it is said the company will return to growth in sales and earnings helped by cost-cutting and online expansion in asia. time now for the bloomberg quick take where we provide context and background .n issues of interest power inndela came to 1994. today, a quarter of the workforce remains unemployed. 22% of the population still does not get enough to eat. while the anz is holding onto power nationally, party
support has fallen nationally. here is the situation. on august 3, elections were held here he the party lost support in four of the major centers. voters expressed anger over a stagnating economy and scandals .round jason zuma he was replaced by a little-known lawmaker in december 2015. zuma backtracked and reappointed the person who served as finance minister between 2009 and 2014. british immigrants settled mostly on coastal areas while dutch colonists settled in london -- in land. colonists adopted a
concert to ship that disenfranchised blacks. south africa endured decades of economic sanctions and arms struggled by the anz before it was agreed to release nelson mandela from prison in 1990. the anz has won every election since. successes,int to reducing poverty, get, the south african economy was reported to have grown just 1.8% last year. many are losing patience. the party is nervous. you can read more about south africa and all of our quick takes on the bloomberg. that is the bloomberg business report. head to bloomberg.com for more stories to . ♪
today, lower prices at the bond means more americans hitting the road. that is good news for airstream, makers of the iconic rv. thank you for coming to new york here. let's talk about this. let's get straight how important low gas prices are. this is such a high-priced product, i find it hard to believe that a 10% or a 30% change at the pump makes a difference. >> you are absolutely right. lower prices help but it does not drive the market one way or another. of inwhat about the sort style aspect of airstream trailers specifically? has that helped? i know the design fascination that millennials have had, along with baby boomers who are able to finally use this project, has
sales?elped with >> it has. the bloomberg thing, that is the meat of our market. don't forget about the gen xers. and the millennials are coming right behind. what are the different products you are working on to appeal to the different generations? >> besides the court travel trailers that we work on today iconic airstream shell -- we have some new products coming out in the next eight months. it does not look anything like airstream, it is lighter, less intimidating, easier to use. we are coming out with a much home tomotor allow campers to take more stuff and sleep comfortably.
and, a product in the spring as well. nejra: you also had factory $6ansion worth almost million. has that allowed you to increase output to meet demand? matt: in the great state of ohio. >> exactly right. a great place to do business. yearse the last three trying to catch up with demand. we are there now. we have capacity where it ought to be. we are happily meeting demand. matt: i have been looking to try to rent an airstream lately. i was looking on social media sites, airbnb, and i noticed there is one company whose whole business model is renting out their streams and three or four locations across the country. buy one afford to myself to use once or twice a year. is that business model interesting to you as a company? .> yeah, it is
we have been watching it very closely. the former president of the company is having great success with customers like yourself. matt: maybe they will be owners after they rent an airstream once or twice. >> we certainly hope so. he is right now meeting the needs of those people and doing it very well. stay what about places to as soon as you get your trailer? a place youving -- can stay once you get the airstream, or do you go off to where no one else is? >> there is a whole range of camping options. some are pretty down and dirty. there are also high and luxury resorts with restaurants, golf courses, and clubs.
and, everything in between. you mentioned, there are national wilderness areas -- you can really go out and boondock , cap by yourself. nejra: what is the market like outside of the u.s. for the luxury trailers? in manyve a footprint countries around the world. there is a strong caravan ing industry in europe. nejra: which i knew as a child. >> the currency issue has been a bit of headwind for our export. we built everything here in the u.s.. export has been a bit of a challenge. matt: the falling pound does not help. thank you for joining us. really appreciate it. learn more about pursuits, the dissipation for finest things -- the finest things in life. ♪
"markets." ♪ matt: from bloomberg world headquarters in new york, good afternoon. i am matt miller. here is what we are watching. part of: was there a key the speech from janet yellen overlooked? >> taking the stand trying to convince lawmakers to keep her in office. removalwork or is the already a foregone conclusion? >> the great race among automakers to become the most tech savvy. will hear from sergio marchionne on why a potential partnership with samsung may be in the works. we are halfway to the trading
day and stocks are hovering around session highs. heading to the markets desk were abigail doolittle has more. we have a very nice rally here. s&p 500 and nasdaq all three near session highs. a bounceback from the weekly declines we saw in the equity index last week that perhaps investors are reconsidering the theng of a rate hike after speech by janet yellen in jackson hole. same,ory is really the complacency and a lack of volatility. when we go to the bloomberg and look at the #311, we see what everyone has been talking about. day 36 of the s&p not having a greater than 1% move. here is the orange line. this is called a broadband formation because it does broaden.
nine times out of 10 this is considered to be a bearish pattern. calmps this really is the before the storm that some strategists are thinking could happen. as for one stock trading higher, apple. shares had been hire earlier, but around new the stock spiked higher on news that the company had said out invites to a september event. it is at the bill graham civic auditorium. i am guest you may -- guessing you may like bill graham. launched many careers. nejra: we are also seeing quite a rally in sao paulo, right? we certainly are. we see a beautiful rally, up 1.5%. the best day since august 11 as investors that the president will be removed.
this will lend legitimacy to the new administration and could help finances and growth. we take a look at the brazil stock market. up 39% here to date, having the best year since 2009. the biggest waiting to the helping ink market the recovery. the classic rock very important to american viewers. not as important to british viewers. they made all of the classic rock and now they do not listen to it as much as we do. listening to mark crumpton with the first word news. donald trump's campaign is planning the biggest ad buy to date. the ads will appear as soon as today in nine things -- swing states including ohio, pennsylvania, and florida. outspent so far been
by hillary clinton. hillary clinton has spent more 77 million dollars on tv and radio advertisements. aides said clinton's she is separating from her scandal-playing husband. there is now report he exchanged sexually chargedthere is now red sexually with another woman. orlando's major theme parks are now offering residues bug repelt viruscerns free about zika mount in florida. disney, universal in seaworld orlando began offering the bug spray free of charge at their parks. case hasransmitted been found in central florida. john kerry says the united states and bangladesh are work more closely together to fight extremist after a series of including one that
killed 22 people raised fears the islamic state is spreading its network inside the country. secretary kerry said it is clear the military group is gaining in south asia. local news 24 hours a day powered by more than 2600 journalists and analysts and more than 120 countries. crumpton. this is bloomberg. nejra: speaking at the fed jackson hole symposium, janet yellen made it clear a rate hike is so a possibility dated this year. and what itat wrp, shows is a fed fund rates indicate a hike in september. they have risen to 61% by the end of the year. one thing is certain, that will turn to august job data friday for the next indication for indication of a rate hike. marx.g us now is dan
great to have you. everyone does seem to be focused on the fact that september is life. are they missing the point? were -- is not a lot of difference between an interest rate increase in september or december. in term of how -- in terms of positioned at a market, it can vary greatly. the sentence after it reads, of course the decision always depends the degree to which incoming data continues to confirm the committee's outlook. in other words, the data does it out of thet park. it does not have to be a spectacular jobs report. it just needs to confirm the way they are already thinking. >> i want to bring up a chart that was struck out.
we talked a lot about this. what it really shows, it is , but very clearly shows rates will not drop below zero. >> this is the challenge with this. it was introduced during the time of forward guidance. the fed has made remarkable steps toward transparency. is past of interest rates all things being equal. the problem is, that tends to get lost in the discussion. , theed says it will be to fed says it will be three, but really it is the best guess of individual committee members at a given point in time. james leeward, a frequent guest on bloomberg tv has said he is stopped submitting them. att: i will focus on this for
second, even though i know it is to minute, but where do we have to see work before there is a wasce of an increase? i thinking to myself in the shower this morning, even at 60% of the world interest rate probability screen, it does not seem like that is the deadlock we will get in an interest rate increase. >> nothing is a deadlock. there could be an effort seen between now and september. in the term of the way chair yellen positioned herself and the fed, she is not had a public appearance in months. the case has strengthened for an interest rate increase. and fed speak, that is pretty clear. it is going to happen, whether that is september or december, i am not sure. this is now firmly part of the discussion. what parts of the discussion did larry summers find it interesting and what did
he not? >> he did appear to take some heart from the idea that the concept of a lower neutral interest rate was discussed, and the chair to avoid -- devotes at least two paragraphs to that. the idea the neutral rate of interest has come down from past cycles and still coming down, right now it is 3% and could be lower. the chair acknowledges the i think larry summers took some heart from that. nejra: i went to look at what else you got out of jackson hole in terms of other bankers, including bank of japan. we also heard from yellen that negative interest rates are not on the table. what did we hear from other central bankers? one of the big discussions was
how big balance sheets are getting. >> negative interest rates were not discussed at all. kuroda was interesting. the last monetary policy meeting the bank of japan, many market participants condemned their decision is not going far enough. kuroda announced there would be a big review of where monetary policy was going. .e're approaching that now there had been some narrative at the time that the bank of japan back and let fiscal policy do more. there is zero indication from the remarks that that is actually going to happen. it is entirely possible they could come out in september and say we reviewed it, here is my conclusion. i pulled up an old chart hillary made back in the day. 21.89 in the library.
i think it is violent -- look at theto balance sheet. balance sheets per person. getting crazy.is i was wonder, does it make a difference? even without inflation, people seem relatively happy. if you look at the balance sheet per capita, it is pretty nuts. does japan have a real serious problem here? bank of japan has been at qe far longer than any other developed central bank. secondly, recognition is shrinking. those things will come into play as well. think japan officials have said .here is no impediment we can keep buying more.
they are also buying etf's in rates. -- and reits. matt: and becoming the biggest shareholder in the market. >> and yet interest rates in japan is very low. it is a saving society. a population that is shrinking. they are great sabers. there will be an appetite as long as they are issued. print as much as they like and people still subscribe a certain amount of value to yen. i think it is a fascinating story. dan moss, thank you for coming on. tomorrow, tom keene will host a conversation with the fed vice .hairman stanley fischer don't miss it. you can see it anywhere on tv, on the internet. nejra: coming up, sergio marker -- sergio marchionne
>> we have a very good relationship with samsung, both as a supplier and potential strategic partner. i happen to have a good relationship with jamie. we share membership on the board exxon. what i did say yesterday is an opportunity has been looked at by a variety of other people. interest. i think it has strategic value to us. i said it was an important element strategically going forward. whatever happens with the business going forward, it will not happen overnight. nejra: sergio marchionne bloomberg.th one thing i find interesting is
it is exposed more to changes in the auto market because of the small size compares to the likes of chrysler -- compared to gm. matt: they are smaller for sure. that is something sergio was trying to change i'm making acquisitions. they have not really been able to pick up in size to become one of the top three or four auto sellers. another thing he is trying to overcome is another place where they live the rest of the market, and that is valuations. i have a chart showing the p/e ratio. it is an white, 4.5 times earnings. what he is trying to do is position the company as a technology company. he is made deals with apple, google. that is the samsung pe valuation. --has tried to spin off
ferrari he has spun off. now it is trading at 20 times earnings. he wants to do the same with maserati. a boy hey interesting will be a will to expand valuations with that. really interesting chart. square making a massive push to hook and more business by partnering with a startup. will this give greater exposure? this will give greater exposure next. this is bloomberg. ♪
manhattan on this monday morning. i am matt miller. square is partnering with vend bistro to look into more business. giving additional services. spoke with the ceo. towe do welcome on everyone bloomberg advantage radio. selina wang joins us. working and to hook businesses. they are point of sale startups. the interesting thing, they are kind of competitive. they are able to hook and on the businesses and able to offer other services. andents and other actions data and software services. this is a way to keep low
customer acquisition costs and gain a ton more businesses. >> this is maybe an opportunity to offer up loans. whole otherble -- a audience. >> exactly. a way to get businesses they were not able to get before. they have built their whole prophecies around the point of sale system. they can offer loans, which is a much higher urgent business and also, so a lot of other services . it is not just a simple integration. make moves like this because jack dorsey has been talking to investors and making promises about more growth. is this how they deliver it? >> when i talk to people on wall street, they think this is a very smart strategy. as always, what is the total addressable market?
how big can it get? through partnerships like this, fragmented payment point-of-sale space, if they can pick and choose, they kid home in on businesses. >> what i was wondering about square, they do loans, inventory tool, what is the most profitable part? >> what they are looking at mostly is the software and data line. they are looking at growth in that line item, all of the ancillary services. that would be like square capital. that is where they are looking for growth. >> how quickly do these deals actually contribute to squares bottom line that go it is not clear. countrystro is in three
-- are in many countries. -- touchbistro. means more payment transaction volume, more money for square, and potentially bigger loans. >> more customers -- that was carol massar and selina wang. you can continue listening on bloomberg radio. this.always talk about there are serious. i listen on the bloomberg radio app. now looking at the biggest stories in the news right now. warren buffett considering resuming dividends. the payments have been suspended for 15 years. the 2009 housing
crash. it will use proceeds from the sale of the distribution business to pay down debt and return cash to shareholders. >> the new york yankees want to take advantage of the record low interest rates we are saying. to lower the borrowing costs by refinancing $1 billion. earlier this month, the owner of the nba brooklyn nets and barclays center refinanced almost half a billion at the arena debt, saving $90 million. nejra: apple holding a products event. invitation sent out today. potentially on the agenda, oppressor -- a sensor touch and paid to -- touch to pay feature to paper on the new york subway. ascendant --
we are going to learn the results on tuesday. so there is a tax case the eu and reportedlyut apple will decide against tuesday. rt's it is 130 pages long, and apple could face aliens of fines in the tax case. earlier news on apple because ony sense out invitations the iphone presentation. we do not know what it will be called. this headline may be more important. nejra: we have seen a little bit of a pullback. the shares were up earlier. now pretty much flat, up one --
up .1%. tot: apple has declined comment, the government of ireland as well. is key.er of billions i am looking at the essay function, the financial analysis function that tells you so much information. if you look at the current it is $23 billion, then it is a bigger deal. nejra: absolutely. people always question the apple cash pile. you do not want to draw down your cash pile because of something like this. in on the headlines on
the bloomberg first word news. going to the newsroom with mark crumpton. mark: donald trump will go to detroit next weekend to make his -- beforearance for predominantly black audience. making a weeks he is bid for african-american voters but in front of mostly white crowds. polls show he has little support among the black electorate. hillary clinton is rolling out a comprehensive plan to day to address millions of americans coping with mental illness. it is aimed at assuring americans would no longer separate mental health from physical health as terms of access of care and physical treatment. it would focus on early diagnosis and internet -- intervention. sandy hook elementary school reopened today four years after a shooting rampage that killed 20 students and six educators. students returned to a 50
million dollar replacement of the old school on the same property in newtown, connecticut. i and issuing an alert after the largest ibaka novel was written by the biggest tremors since 1977. -- ireland. that was followed by at least 10 more tremors at the volcano that rises more than 4700 feet into the air on the north atlantic southern coast. the volcano last erupted 1955 and 1999. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. now turning to brazil where the impeachment trial is entering the final stages. she said she did not commit any crime she was accused of. nowr remarks, the right
rose the most against the u.s. dollar. joining us from sao paulo is bloomberg business chief julia g. relief andng of brazilian markets and stocks as well. what is driving that jacob >? >> what we are seeing is a continuation of the rally over the past year month. currenciesds, and have been doing well in hope of a new government that can get brazil out of the recession. she did not say anything different in the speech than what she is been saying when she defended herself to the media and to the public. the currency and the stocks are continuing with the rally. nejra: what was the speed -- speech like? did she talk about resigning at all? >> she mentioned that.
she said it is not within me to fight -- to give up. she said she is fighting for democracy and justice and reiterated she is innocent of the crimes she is eating accused of. accused of. is a coldnder if it throw issue because it seems dramatic to say this is a death sentence. she is not being serious that it would be a death sentence, or is that the case? >> not necessarily. we do have an impeached president now a senator. not necessarily a political death sentence, but this is the final chance to appeal and the first chance she has been in congress twos the to everyone at the same time and make a public statement of how serious this is. we have seen quite a few
heated moments. is today any different? .> today was much call mark there was around of applause and the session was interrupted because the supreme court minister presiding over the andion said no applause, what cut the microphones and he did. it has been much more civil than what we saw last week with name-calling and shouting matches. for coveringou that. we will continue to cover that story from brazil. a lot more going on. surroundingt we see her. the economic side and for investors is maybe more exciting. absolutely. the finances of brazilian companies are. in. the most impressive returns and
emerging-market. if you look at the corporate yields, you can see how that is coming down. rating from bbs to bb plus. look -- outlook on the ratings. that is the highest rate in a decade. on our handingse back a better return. securities are almost twice the emerging markets average. on the investment. that is pretty amazing. what is this about? there is a real disconnect between the behavior of the bond
indexes and the fundamental credit analysis. i have another interesting chart on the bloomberg. at the globalg diversified software and spread, basically showing the emerging-market yield premium over u.s. treasuries coming down. i just thought it was interesting, because showing a little bit less risk, a little bit less perceived risk. that is fascinating. almost five .5%. probably whatat has less to do with brazil and more to do with the olympics. chart from bloomberg 3108. the blue line shows gdp forecast. gdp forecast continued to climb.
the white line climbing up a little bit, to. that is a forecast for interest rates in brazil. this goes back to the beginning of march. havethe month of economist lower the forecast for brazilian rates because they thought the central bank would continue cutting at a pretty aggressive pace. now they continue to grow pulling the rate forecast up, thinking the central bank will not cut as quickly. we are talking about a pretty massive growth. 12.5%.inking pretty impressive. an 8.5up, plans for billion dollars liquefied natural gas lan in canada gaining support from who you would least expect. we had to toronto next.
nejra: this isnejra: bloomberg i am matt matt: miller. a look at the move in equities. stock in terms of ups and downs. they sent the invitation to the big iphone meeting september 7. i am sure you will be following closely to see if you need to upgrade or not. then we heard they will be aliens of dollars in a
tax case decided tomorrow. u.s. stocks trading at a near record. the dow jones of 5.7%. the nasdaq by .5%. gains partly these because we have the consumer data spending report underscoring the u.s. economy. we are seeing a little bit of u.s. dollar strength against the yen. i guess we don't see the u.s. dollar yen. we do see the british pound yen. more interesting for you than for me. then we see the euro pound. there.a cable rate that is interesting. weakness in euro weakness against the dollar. taking a look at the euro
businesses to message more than one billion users. facebook wants to monetize the messaging system anyway it can. looking to expand. they want to buy moscow controlling stake in a smaller producer for $5 billion. russia could earn another $11 billion by selling 19.5 state. that would generate a $16 billion windfall and produce the widest deficit and more than six years. lenderhe italian considering a debt for ratio offering. that is reporting to person familiar with the plan who declined to be identified. the swap is only one possible option. the rights issue is part of a announced last month on the same day the stress test showed the capital would be
wiped out in the wake of a severe economic crisis. that is the bloomberg flash. getting welcome news from aboriginal groups in british columbia. pamela ritchie joins us from project andut the canada project in perspective. how far away are they from having the first lng ready? >> it has been interrupted by all kinds of environmental concerns, opposition. a few steps forward and back. is other backdrop for now the world is awash in cheap energy options, so that has not helped. really years behind in the lng thecontracts for
united states has signed. not to mention middle east producers as well. and the aboriginal group on the west coast has shown movement from itsrhaps negotiating stance letting things move forward on one of the projects, saying they do not like the proposed light but are proposing to others. it is at least a step. matt: do the aboriginal groups own a substantial part of british columbia because we do not hear it much about that down it is disputed in many cases and there are land land claimshave -- cases that have gone on many years. a big boys at the table certainly. the lead on the consortium is
petro gas, a malaysian company. the other people in the group are japan's petroleum group, -- thispetroleum group whole group has stepped back and delayed final investment decisions for a number of different decisions. there is about to be an environmental assessment. much hinges on that. it is expected in the next month or so. you get the sense that this aboriginal group is moving closer to the assessment. the group looking very carefully for what is said. then maybe there will be more clarity on whether the lng industry will be growing up in canada. the prime minister heading for his first official visit to china.
what can we expect from that? >> that is right. he is on the plane right now and will be there for 10 days. lots of meetings with well-known people, jack ma of alibaba. husky. he will meet with political leaders. it is also thought to be something to help relations that were stuck a bit under stephen predecessor. there are discussions of the free trade deal swirling. nothing has been confirmed at this point. officials have said nothing -- definitely nothing before the general elections. there are discussions around a free-trade deal at some point. matt: thank you, pamela ritchie. nejra: coming up, more details on the breaking news that apple is set to face billions in the
matt: let's get back to breaking news this hour. apple may face billions of dollars in the case of arrears with ireland. the outcome of the case could be released as soon as tomorrow. so far apple and irish ministry have the climb comment. alex webb joins us to talk about how serious this is. billions of dollars are important to any company, but this is a company that has 231 billion in cash. how serious is this for apple? >> and implies this is perhaps worse than the original story suggested. ofy were saying a couple
hundred million. the worst-case $19 billion -- $19 million. this sort of reporting that my colleague has put out just now suggest in the billions, perhaps in the upper level. matt: what is the crux of the issue? what is the problem the european commission has with apple's irish tax arrangements? >> the claim is there is a quid pro quo arrangement. apple brings jobs to ireland and they get a lower tax rate than they may otherwise the expected to pay. that is what the european back in 2014.und the ramifications of that are now the ones we will learn in the coming days. that sounds like the arrangement all companies have with countries and big business? they must have something on them
in order to bus them for that. >> this has not been in ireland-'s pacific phenomenon. there have been other cases in the belgium's another lens with companies such as starbucks, anheuser-busch and bp. thisnd is not alone in sort of negotiation. nejra: we obviously got this news on the same day we got the an announcement of an event. what will be more important for investors out of these two stories? >> the stock is very little to change today as you can see. the september 7 events, pretty much everything likely to be announced has been reported we think. so the actual announcement today of the event is confirming what has artie been anticipated. we've reported there would be an event on september 7.
the extent of the billions they -- they havehave to pay has ramifications on the stump. has 230ay, apple billion. so they still have plenty of reserves to sit back on. matt: are we going to see more cases like this coming from the european commission so many governments have quid pro quo arrangements set up. cannot be theand only ones up to it. >> i cannot possibly speculate on it. there is speculation they are being be example. apple is the wealthiest publicly traded company in the world. making an example of apple suggests there may be a trickle
down and a warning shot across the bow. there are companies that are in dublin, so they are probably going to be watching this case with great attention and trying to establish its relevance. matt: alex webb from san francisco. nejra: coming up, we speak with at 4:00 eastern. tomorrow, tom keene hosts a conversation with fed up vice-chairman stanley fischer a.m. in new6:30 york. definitely one to watch. this is bloomberg. ♪ . .
david: we are live from bloomberg world headquarters in new york covering stories out of san francisco, brazil, washington and milan. pushing -- after a strong raid on consumer spending. presidentazil's taking the stand at her own impeachment trial, issuing a personal appeal to lawmakers, saying her ouster what about to a political death sentence. david: donald trump has been seemingly sending mixed messages on issues like race and immigration. can he win over voters? a look at the latest polls, coming up. the markets close in about two hours. let's look at the major u.s. indexes. the dow jones up and the s&p 500