tv Whatd You Miss Bloomberg October 31, 2016 3:30pm-5:01pm EDT
let's get you some other headlines. mark crumpton has those from the newsroom. mark: hillary clinton is challenging the fbi's new e-mail inquiry. she told a rally at kent state university in ohio she understands what concerns people have overuse of her personal e-mail server, for which she, once again, apologized. ms. clinton: now they apparently want to look at e-mails of one of my staffers, and by all means, they should look at them. reacham sure they will the same conclusion they did when they looked at my e-mails for the last year. there is no case here. said she would not be, in her words, knocked off course in the final days of the election. cnn said it is completely
uncomfortable to learn through question thatt a posed nearing a town hall last march in flint, michigan. cnn announced that it had accepted brazile's resignation two weeks ago. revealedial reportedly for least a second time brazile had communicated about questions of candidates might be asked on the air. islamic state claiming responsibility for a suicide car bombing at a popular baghdad market. at least 10 people were killed with dozens more wounded. the blast was one of several in the iraqi capital this weekend that left a total of 17 people dead. remarks call into question key assumptions about who will step
'swn after president xi reshuffle next year. saying retirement rules need to asflexible and revised circumstances require. global news 24 hours a day in over 120 countries. i'm mark crumpton, this is bloomberg. ♪ >> we are 30 minutes from the close of trading in the u.s.. scarlet: racing news crossing the bloomberg -- breaking news. more on this and how the stock is reacting, you only need to look inside the bloomberg to look at how the stock is doing.
this is according to people familiar with the matter. tumbling, still off by about 5% in trading. we're looking at the shares, they have been down for even longer. if i pull up your today on valeant, you can see it has been lower and today it moved lower, barely making a dent in the overall decline for valeant. all by 80% so far this year after news the former ceo and cfo are the focus of an investigation. this is the guy who was running things at a time when the company was under some real stress. shares started to seriously plummet and he had to do anything he could to bail it out, then there was the
revelations and eventually he was forced out of the company. scarlet: for more on the back story, let's reach out to christian, a reporter for the company and he helped break this news. understand, this has been an ongoing investigation for the last year or so. christian: it was disclosed about a year ago that it was under investigation by couple of different u.s. attorneys offices and then subsequently by the sec. prosecutors and investigators have been on this for quite a while. over the last year there's been a lot of talk about the business model of buying keystrokes, and hiking the prices. that has been controversial. then there's the specific separate accounting thing which is really the story that got into everyone's
attention over a year ago. what is the accounting structure here that is so controversial? a practiceit's been of using the specialty pharmaceutical companies to market their drugs. investigators in congress and elsewhere have said it is a way ordinary pricend controls by a's or benefits steering patients directly onto the brand of drug instead of a generic. there's a number of companies that have had relationships with specialty pharmacies or in the having their own specialty pharmacy they were doing that with. the claimant the time it was a specialty pharma owned and operated by valeant but it had the appearance of being an independent company. christian coleman initially it appeared to be its own independent company. it had its own separate the pharmacyt
thatny -- excuse me, client and the only eventually it was consolidated as part of the company. so if i was on a health care plan that asked doctors to prescribe the generic version is possible, or medicare, the doctor gives me a prescription for a job -- a drug that has a generic, i go to get it field and they give me the brand name version even though i asked for generic? question: my understanding is the allegation is that they would tell doctors offices and haitians that we will take care of all the paperwork and make angst easier for you, let us handle the filling of prescriptions for you. the doctor would write prescriptions and it would go to ,he pharmacy which would then
instead of checking the box for the generic, with check the box for the brand. scarlet: and they would get reimbursed more from the insurance company as a result. what is michael pearson's role now? if he still involved in any way? still an: he's consultant with the company and works from the valeant office, not the headquarters. the amount of work he is doing is not clear. a person close to the company said he is not making management decisions for the company why did these insurance companies put up with this? they get the order from the specialty pharmaceutical it still requires the insurance company to be willing to shell that out. they playing the role
of satan know, we are going to pay for the generic? i think the insurance companies did refuse to play a role once they found out about it. close it down until more became known about the relationship between those two companies because benefits managers would not do business with them after that. i certainly would not use the term kickbacks, but doesn't the insurance company get some money back from the specialty pharmacy after the prescription is filled? christian: that goes beyond my area. shares have gotten crushed already but another 7% on this news, i wonder what this does to bill ackman's phase in his investment in valeant? christian: the stock is already down 90% since this all started happening.
thank you so much. christian help to break the news the focus ofd investigation at the doj. we have about 21 minutes left to go. unchanged basically right now. the s&p 500 up by almost two points. there are plenty of movers. nasdaq andto the check in with abigail doolittle. abigail: the nasdaq basically unchanged. perhaps investors trading water ahead of the fed meeting that starts tomorrow, but beneath the surface we do have lots of movers. as far leaders on the day, amazon is one of the hot points on the nasdaq today. drop, one-day drop
since february on a disappointing third-quarter result. another tech wehner, check point software. the firms are -- shares are nicely higher. they may $1.08 in adjusted earnings, beating estimates by about 6%. the expectations were somewhat low. some investors viewed it as a safety cushion. areyst on the street neutral on the shares of checkpoint. biotech index down more than 1% on the month. it's down more than 10% with its worst monthly performance since january. are of the biotech giants
-- some of it could be genders into the election. amgen put up a third order that pricingting power is declining for one of the key drugs, so this could have investors nervous as well. scarlet: biotech is down more than 10% this month. what does that mean for the nasdaq overall? ,> would go into the bloomberg this is a more than one year inrt of the biotech index blue and the nasdaq and white. the biotech index is back near year to date lows. the biotech index is down about 36% from its peak. the nasdaq is still high. there has been a strong correlation ahead of this divergence. care and the biotech
sector are very gamy. an area of congestion last year that broke to the downside is an area of congestion again right now over the last couple of months. unless the biotech sector starts to recover, it's hard to see that breaking to the upside. nasdaq andest the the broader markets could enter into a corrective phase. coming up, the major players in the deal that would combine the oil and gas businesses of ge and baker hughes. we will hear from the baker hughes ceo. this is bloomberg. ♪
ge is combining its oil and gas business with a hughes. andill contribute its oil gas business and $7.4 billion through a special dividend for baker hughes shares. looking at the shares trading right now, both are down, but baker hughes is all 6%. earlier today alix steel interviewed the chairman and ceo. she asked why the $400 million in revenue opportunity was not more. >> we think that's a pretty modest projection. again, if you're able to play in a much broader array of the oil and gas sector and you couple upstream, our domain with ge path more midstream domain, then you can go to the customer community and have a
conversation about reducing the dollars per barrel and improving the recovery factors in optimizing production profiles. alix: can you expand on that $400 million? where you see getting to? i don't want to put a limit on it. the $400 million is a very modest number. pricell me what the oil will be two years now and what our customers spending patterns will be, the number could go well north based on what the spin pattern is and where the spending is occurring. we have a little bit of a pickup in the middle east but the offshore arena is still facing some headwinds. but again, whatever the global economy looks like, that will drive the synergy number. the $400 million is a modest projection at this stage.
the oil prices relatively conservative. what was today the right time to do this deal? as you looking giving value to our customers and to our investors, this is the right time. we've modeled this transaction even in a downsize case oil maintains its current levels. this is still attractive from an investor respective. when you look at the complementary nature but also what we are able to differentiate ourselves with the customers by bringing in the ge store, and also the cost synergies. we have a modest profile of 4.5%. you get that through the product cost out initiatives, the takerint, the ability to manufacturing excellence into
the baker hughes footprint, and we see this as being the right time in each of the segments. the cost per barrel is what we are going after. alix: we talked a lot about the industry. when do you see pricing power coming back for the l services company? -- the oil services company? that's a great question. it's going to come back and pockets geographically and within the respective portfolios. , we see a slow grind up in north america. we believe our customer community need something around between 55 and 64 some durable. some durable time, so they have the confidence to deploy capital in a meaningful way. happens, you will get
price traction pretty quickly. as i said on the call last week, some of our high-end directional drilling services are pretty much sold out. some of the areas around pressure pumping and fracking could be a little bit slower to get pricing. international, certainly the middle east is already picking up and some of the offshore markets will be a little slower to recover. our combination, helping customers get the cost per barrel down, should bring this whole activity curve forward a little bit. matt: that was the ge oil and gas president and baker hughes ceo martin craighead. brocade communications is in advanced talks to sell itself, according to people familiar with the matter. the company is in final stages of the sales process.
no deal has been reached and talks may still fall apart. and acquisition of brocade could be announced as soon as this week. the two biggest daily fantasy sports companies are close to joining forces under the leadership of the draft kings cofounder. robbins is expected to serve as ceo of the combined firm which is as yet unnamed. --estors hope the countries companies could unify against other challengers. it u.s. armyce at contract to build the next phase of a combat data system. a federal judge ruled that the army violate bidding rules, effectively shutting out a silicon valley firm. they were barred from awarding the contract. the story we've been talking about this hour, u.s. prosecutors are focusing on former ceo and cfo as
they build a fraud case against the company that could result in charges within week, according to people familiar with the matter. they had hidden ties with a pharmacy company. in a statement valeant says it is cooperating with authorities. that is your business flash update. next, a coffee craze. millennials are becoming java junkies at an early age, driving up global demand. this is bloomberg. ♪
lastnormalized it since friday, so we are talking about the last five trading days. the white line is the s&p 500. during thebout 2% past five days. the vix has surged 34%. to 17.ne from 13 certainly a big move but compared to the 10 year historical average for the vix, we are really not talking about any elevated anxiety here. people call it the anxiety gauge but it is a measurement of how much people are willing to pay for protection against losses in the s&p 500. joe: very interesting, signs of
bubbling discontent underneath the surface. i'm looking at something very important, and that is coffee. this chart shows worldwide demand for coffee. it is absolutely exploding. it just keeps growing. people are drinking more and more coffee, particularly millennials. i drink a lot of coffee so i can certainly understand why people are drinking it like crazy. people are betting a lot on of the same -- seemingly unending demand for it. matt: how many cups would you go through a day? joe: six or seven. that's a lot of caffeine, but you will not be a depressed person. hilary clark out in london sent out a chart of about the british
miners. -- colin hamilton is the source of that, he's the head of commodities at mccrory. he said this time last your hours talking about a commodities this is financial crisis. i wonder if the same is true about u.s. markets. into 6800 up the s&p different industry groups. year to date you can see metals and mining here, also the best performing group of all of them. andof 68 groups, metals mining is doing the best, up 41% year to date. scarlet: and by a long shot. matt: also in the face of a strong dollar.
decline. matt: i want to welcome our viewers who are tuning in live on twitter. you can watch our closing bell coverage on twitter every weekday from 4:00 p.m. until 5:00 p.m., and more and more people are doing that. joe: it's the future of tv. scarlet: we begin with our market minute. unchanged, basically the nasdaq little changed as well. if you look at the volume here, it is pretty much in line with the 20 day and 30 day average. it's not like there's a big election influx or bunch of central bank decisions. nothing going on. matt: there have been some real
fluctuations, so we were up and then down. utilities the big gainers but consumer staples of. the cautious investors are bidding of those assets. ,ealth care a loser today energy the biggest loser, down more than 1%. the market wants to go with oil today. biggest loser the as far as point decliners on the s&p. it's only down 1.4 percent, but it is a gigantic company. loews corp. of big riser and then level three, due to the acquisition. exxon and the oil stocks really holding the market today. scarlet: who broke the news earlier that the the oj is
investigating the x ceo and cfo of valeant pharmaceuticals. this companies lost more than 80% of its market value so far this year, all according to people familiar with the matter. are building an accounting fraud case against the company. joe: a quick look at government bond markets around the world. u.s.,yields in the falling also on friday on some of the selling. inflation data out of germany was roughly in line so we continue to be in positive nd.ritory from the bu there was a lot of volatility in the rant lately, but some -- in the rand lately. the finance minister will not be
charged with any crimes. scarlet: breaking news over the last 90 minutes, this is the british pound. it was high already but getting higher as the bank of england governor, mark carney, said he will remain in the role until 2019. he had previously committed only to a five-year term, so now he is extending that. he is also saying that he will not stay for a full term. this is interesting. joe points out he will get through the important parts, negotiations,exit but then he will go to wall street and make some real money. go tot: maybe he will canada. we will continue to watch that one. there is another central-bank meeting, the boj is meeting.
here with cnion iskening into the meeting how well the boj proceed next? target? it meet the new questions that we may or may not get the answer to. the rand is the best performer against the dollar. front,m a commodities oil down over 4% on news that opec has not been to get the details together for the production freeze they got a lot of hype. west texasn intermediate crude. 2.6% onrising almost the leaf that demand is coming in stronger than expected out of china. so gdp numbers holding up
think is doing very well. scarlet: let's take a deep dive into the bloomberg. matt, you're going to kick it off. oil: i'm want to talk about , because obviously the opec news, every day we get a new opec member that doesn't want to play with saudi arabia's group to cap or cut production. so that is not good for oil prices. maybe the technicals will save it here. i have a chart showing oil, i like to look at brent because it is the global benchmark, even though texas oil counts the most here in the u.s.. here you can see that we are getting closer and closer, or today hitting the 50 day and 100 day moving averages here in monday's trade. the other thing to look at is rsi.
we're getting closer to an oversold level. it doesn't necessarily mean that is oversold but that is what technical analyst look at. joe: all kinds of lines touching other lines. i'm looking at an interesting chart ahead of the election, something i've been watching. the blue line is the trump -clinton spread. the polls have been better for donald trump lately. the white line means the biotech has been underperforming when clinton has been doing better, which kind of makes sense because she would theoretically be more inclined to implement price controls.
but the lines have disconnected and donald trump is doing better but biotech is quite weak relative to the s&p. so maybe a bit of divergence, something to keep an eye on. the future of biotech as a growth story may be at stake here. weaking of the election, know we've been stuck in a range, individual companies tend to move in lockstep with each other during this range bound trading. thetop panel shows correlation with the s&p 500 and you can see that has moved up after the recent low. the bottom panel is a hearty day we -- realized correlation. it's come down 34% since 2015.
there is a lot of cash sitting on the sidelines. let's bring in oliver. we've talked about the $50 trillion plus that is sitting on the sidelines in cash. matt: if that is true, $50 trillion in cash, that is more than there is in cash, so it's only theoretical cash. there is a loosening in correlations, that could potentially be good news. compiling anished small but useful allocation table and basically what it looks that is where people are suggesting to put money right now. it's been flat in terms of equities. there is still a lot of hesitation in terms of where to
put your money. what's interesting about the story about the correlations is that it does signal a time in which if you are a portfolio manager to be able to distinguish yourself from the rest of the market, that's a good thing when you look at those correlations getting lower. that has been trending for a little bit now. this quarter, it's been difficult and money managers have done poorly at outperforming. we did get one bit of positive news. joe: structurally as more money goes into etf's, would we expect correlations to rise over time? oliver: that's a good question. the logical answer would be yes.
that's the strongest case for would attribute late pull correlations to that, up the chart again. this, it'su look at a cool chart just the way it is put together. white is the s&p index, the blue part of the line is the government 10 year. >> i would put in the zero line because it sort of ties the whole thing together, if you will. i'm going to make it read, obviously. look at what you can see here.
five months of correlations has only happened once in the last two years. it happen once in 2014 and before that it was 2009, the last time we saw that. it's somewhat of a flawed to talk about how they move inversely to each other. this is a fairly recent thing in the last decade. but within that trend, for the past five months, you have seen stocks and bonds moving together very closely. you want to know if that correlation is going to unwind and everything breaks down. day you recently did a nice to dive to look at what indices are most sensitive to changes in the election. biotech earlier, looks like there may be something there. i have a chart where you break down a bunch of different
categories and look at how they relate to these polls. what did you discover here? oliver: we have a story coming out about this tomorrow morning. we are trying to figure out what has been moving with the election, trying to speculate on what each administration will look like and who will benefit. which companies and sectors have their most with likelihood? this is a sector dive which is maybe not quite as useful but what we are finding is that financials at the heart of it are correlated to both candidates. they do well when donald trump does better, but at the same time, they do poorly when hillary clinton does better. you could have more people coming into the pool so they don't have to be inversely
related to one and positive or -- related to the other one. health care is positively correlated with clinton but not with donald trump. we have a lot more of that tomorrow, definitely check it out. thanks so much, oliver. some breaking news, corporate changes over at viacom. five, has named robert begich -- bakishhas named robert as acting president and ceo. afterl succeed tom dooley he was pushed out by sherry redstone who controls viacom and cbs. this comes as viacom explores a merger with cbs.
joe: it's the last week of campaigning for hillary clinton finalnald trump, in the days leading up to the election, how our markets positioning themselves and what is the effect of the election on the economy and the public mood? looks at how changes in confidence impact are investing decisions. it is an extraordinary election
season, nobody can remember anything like it. when you look at the public mood, do you see a feedback loop where it feeds back into investor and consumer behavior? actually i'm seeing investor and consumer confidence impacting how we interpret those events. you see a landslide enthusiasm towards hillary clinton right before the donald trump news breaks, and then the video hits the screen, and it is a bombshell to the side of the ship. and everybody runs for the exits. so it's a combination of mood leading events and the reactions of those events. scarlet: how to swings in confidence ever from what we've seen in the past? peter: what is unique in this election is that neither clinton nor trump is an especially good
fit with where we are right now. we are in this no man's land between high and low confidence. clinton correlates extraordinarily well to extremely high confidence. very on the other hand to low confidence. what we are seeing in this election is small changes in confidence having a major impact in the popularity of one candidate versus the other. matt: what about the fact that the market didn't seem to react very much at all on friday after the james comey bombshell which was like the biggest story since 9/11 for political reporters? but for the markets, it barely moved the needle. peter: the same would be true for consumer confidence. gallup does a daily poll and it has stayed very steady through this, which success -- suggests to me that confidence is rising slightly and investors and consumers are shaking it off. it's not having the impact that
the political walks were expecting. of: there is a high degree negativity toward both candidates but also high degrees of polarization. few voterseemingly that are up for grabs this year. most people seem locked into one or the other. they are just fighting over the scraps and trying to motivate es to go out. what happens after the election? would you expect to see the mood of the losing side collapsed or medically? dramatically? peter: what you seen so far is actually a larger base of undecided then you have polarized. the truly polarized camp's are small relative to the middle
ground. i think what you're seeing in terms of folks coming to the polls is voting in an environment where my enemy's enemy is my friend. are not exactly as polarized as you would expect. what i do think is going to happen is that no matter who wins, the losing side is going to take this very badly. stronginitely have very views on the far right and the far left that i think have to be paid attention to. the chronic under confidence on both sides is something that policymakers really need to pay attention to. scarlet: you reference the far left and far right. populismoned that matters more than partisanship. which party do you think is making more headway in supporting populist causes? peter: there's no question that the democrats are making hay on
that. i think that elizabeth warren has been an extraordinary focal point for the democratic party. if you were to just look at her ofplay during the testimony wells fargo, sheep, tim up one side and down the other. they have definitely taken advantage of it. at the same time, the bipartisan beating that he took suggests that after november, populism isn't going to go away, no matter who is elected. voters are still angry, and i think you are really beginning to see that in the health care space now. matt: maybe we can see that as well in our neckties. you mentioned in a note that j.crew is beginning to widen its ties by about a quarter inch. joe goes with the thinner ties.
peter, explain to us what this means. what does it say about joe, that his ties are thinner? peter: joe is a very confident guy. you saw the same thing in the late 1920's. as confidence falls, ties widen out. at one time there were chips -- neckerchiefs. scarlet: i don't think of ever seen joe in a wide tie. thank you very much, peter. i appreciate the endorsement of my confidence. the federals reserve take into account financial market stability when deciding its rate that? maybe not, and we will show you
scarlet: we know it's a big week for central banks. we will find out what they discussed in three weeks time. the past minutes of fed meetings appeare they do not overly worried about financial stability because there are no mention of those terms at the meetings. in september, no mention whatsoever. in april, they mentioned it 14 times following the turbulence in january and february. there were no mentions of the term financial instability in 2015 and 2016 which is a
disconnect with market sentiment overall. people are very worried about the fed rate hike and what it will do to financial stability. matt: it is fascinating to see the big spike in april when there was all that volatility. i think it spiked around then. i'm looking at the global bonds selloff and the keyword is global. you see the yields rising. this is where we currently are on the 10 year treasury up at the top and white. uk 18 yearle, the yield, rising across the board over the last several weeks. it's really interesting, one thing that struck me with the 10
year treasury yield, when we got the news on friday about the fbi and the e-mails, stocks really fell off. fell off. there was a little bit of a decline in 10 year yields. people wondered if dollar trump would put upward pressure on yields due to fiscal spending in tax cuts. i have a chart from david doyle that initially looks at a good thing. in terms ofes here construction workers and manufacturing workers rising, especially construction workers shooting up there. however, he's worried that this could lead to a bit of an overheating and then to more aggressive fed policy and possibly the end of this long bull market. stay with us. this is bloomberg. ♪
mar let's get to first word newsk: -- donald trump is seizing of the ongoing flak over hillary's private e-mail server, claiming that the american people are the victims. speaking in michigan, he said she broke the law over and over. he did have positive things to say about james comey. >> i have to give the fbi credit, that was so bad what happened originally and it took comey todirector make the movie made in light of the opposition he had, where they are trying to protect her from criminal prosecution. you know that. mark: clinton has not been charged with any wrongdoing. the fbi declined to recommend charges this summer over her use of a private e-mail server while she was secretary of state.
mrs. clinton is challenging the fbi's new e-mail inquiry, saying there is no case. she says she is not making excuses for her use of a private e-mail address and personal internet server at the state department. she says the fbi wants to investigate e-mails one of her closest aides, and they should look at them, but says she is sure the fbi will reach the same conclusion they did earlier this year when the bureau decided against prosecution. in north new jersey, jurors in the george washington bridge lane closing trial are deliberating. two former allies of chris christie are on trial after they created traffic jams informally for punishing the mayor. christie denies any knowledge of the plan. there are reports that 13 miners have been killed and 20 others trapped after a gas explosion in china. china has announced plans to
close more than 1000 outdated lines. -- mines. global news, 24 hours a day, powered by over 2600 journalists and analysts in more than 120 countries. i'm mark crumpton. this is bloomberg. scarlet: thank you so much. let's get a recap of today's market action. not a whole lot when you look at the major indexes, although the dow jones industrial average dick fuld 19 points. s&p and nasdaq were little changed. energy was the big loser as oil prices declined. utilities and real estate investment trusts to better. joe: ultimately, a very quiet start to a pretty huge week. also we want to reiterate the breaking story on valeant. bloomberg news has written their former ceo is under criminal investigation for accounting fraud. the department of justice is looking into whether or not he
committed accounting fraud, although we have so far no comment from valeant. shares falling 12.3%. news came out just before the close in the shares tanked. the stock is lowest since june, 2010. it has been a rough year. matt: pretty rough. "what'd you miss?" the strong relationship between the viz and invested. anxiety index -- investopedia anxiety index. take a look at this chart, the anxiety index. it's usually a few steps ahead of the vix. the correlation was tested and we are joined from london. thank you for joining us. attempt toically an look at what people are searching for, to see if you can
measure rising anxiety among investors before it shows up in traditional metrics. explain to me the research you did and the data you looked at. >> thanks for having me. trying tocribed, it's measure investor anxiety, and it does that by looking at certain internet keywords. one related to, say, shortselling. the idea that people want to put on trade and research it before and. the research i did was to look at the anxiety index and try to understand how a related to vix. see, on i also tried to given that there is a strong relationship between these two indices, to use it to create trading. scarlet: part of this is that the vix has been an incomplete. measurement.
what we have seen over the last five trading days is the vix surging 32%, even as the s&p 500 on which it has base has not done a whole lot. vix insufficient as a measurement of anxiety? >> one thing is that the vix is once reflective of what's happening in the market. it's based upon the volatility of the s&p 500. but it's potentially not going to read into what people are thinking about doing in the future. that's one thing you can pick up from search patterns. even before someone puts up a trade, they can pick up something from that. whatever you want to put on the trade, that might end up taking you want to the web and searching. and people are searching for things like short shortselling, and they are anxious about what's happening in the market. matt: you mentioned that they
are roughly similar, what people are searching for in the vix. tell us what you found in terms of the trading strategy. did you implement a successful trading strategy based on anticipating market movements of the searches, and how far back did you look, and what does the data show you? >> sure. i looked at a data set going biggest2012, the history you have for the anxiety index. i tried to look at a case for stocks, trying to filter using vix, and filter it using the anxiety index. what you tend to find is that they typically have lower drawdowns on lawn stocks -- long stocks. joe: i would think this is a great way to pursue short
strategies, right? you can make money when people are freaking out and searching investopedia. >> that's true. there is some research i did, that's not on here. having a long strategy most of the time, but when you have a lot of anxiety, going short. it's true you can use it are going short as well. it as a long only benchmark, but you can use the index to go short as well. joe: so you follow the -- you are deep in the weeds. sites openingore this data to license out -- it's interesting that it works out in theory, but are there more places opening up where traders are looking at twitter, google
search words, other things to create rules based on real-time sentiment and other indicators? >> i would say there is a big increase in the area alternative data, whether it is using twitter and social media more broadly, using web data as well. also using other source signals to look at what fed communications are saying and doing natural language processing, may trying the movement of mobile phones as well. there are many different areas of alternative data and i think macros a big push in funds to try and understand how you can use alternative data to get an idea of what's going to happen. it's a big focus of what i do. joe: i thought it was interesting around brexit when everyone started paying attention to lab growth.
after they were proven so wrong, someone said, maybe there is a hedge fund then needed to get out of its position, so they went and placed a small bet and were easily able to influence the betting. how big is alternative data? in other words, would it be easy to gain the system? could you use a network of computers to game the system? matt: a robot farm in russia to search shortselling? joe: exactly. >> whenever you use alternative data, the strategy is not to use a single trading role. typically want to use a number of different roles. if one thing doesn't work, then hopefully you will have more diverse a vacation. i don't think anyone would have one specific role working by itself. when you combine these data sources together, maybe one of
them doesn't show anything interesting and all the others - - but don't use one signal in isolation. joe: all right, great stuff. very interesting research. thank you very much for joining us. coming up, it was an october surprise that could be a game changer for the 2016 election. how the renewed fbi review of hillary clinton's e-mails is impacting voters. this is bloomberg. ♪
unmoved. in a new poll done after the news of the fbi probe, clinton is still edging out trump. so can hillary clinton keeper league in the final days of the race? let's ask our bloombergpolitics reporter, joining us now from washington. enoughly, this news was to push republicans who are maybe on the fence to finally pull the lever for trump; not enough to sway democrats deeply entrenched with hillary clinton. >> that's right. i think what we saw earlier was in the last week, we have seen a trend of republicans moving in the direction of trump. it was always likely that many of these voters would come home at the end. they're united by dislike of hillary clinton, and this news gets them further toward trump. that evidence we have is there is no clear sign of democrats moving off hillary clinton. 13oll over the weekend in
battleground states found that only 5% of democrats were less likely to vote for hillary clinton. six.olls today show her up a morning poll shows her up three. there are warning signs. she has to handle this issue,shb ut so far i think there is no sign she is losing. matt: obviously a member of analysts have come out trying to estimate how much this is going to change the game in the final several days of the race. nothing like this has ever happened before. isn't the only honest answer that we have no idea? >> that's true. that is always the only honest answer. the only one that matters is the one on election day. democrats are seeing early voting advantages. republicans do tend to turn out
in bigger numbers in a number of states like north carolina and georgia on election day. here's one way to look at this. right now in "the washington post"/abc tracker, the latest one we had, showed that donald trump was leading among independents by 19 points, and down two. that's how many more democrats there are then republicans, and that same poll showed that both were doing about as well with their respective party bases. there's no clear gap. the only way hillary clinton loses is if he pulls these democratic voters or they stay home. scarlet: ok. that's a pretty tall order. instant polling after the news broke on friday, the news that he is pulling ahead. assuming he can win florida, what other states must he win to get to 270? >> he stood florida, ohio, nevada, and iowa. those are the four, along with
north carolina, they got in 2012. but even those states want to get him over the top. as soon as he sweeps all those he will still be five short. he needs pennsylvania, colorado, or virginia, which have been pretty consistently shifting to hillary clinton. in other words he needs to do something that he has not done in the entirety of the cycle. people have been raising their eyebrows at the way the clinton campaign reacted to the news, which was pretty aggressive, giving a bunch of people to come out and slammed him as though he has done something completely reckless and beyond the pale, even though no one outside the fbi knows what's in those e-mails or what prompted him to do this. what is the thinking there? why the aggressive approach as a prose to, he has to do that, but there is nothing in it? >> i think this news jolted the
campaign, and they decided they can't go passive, because that would create an the impression that something was wrong. they decided to take the unprecedented step of attacking the fbi. i don't think we have had a candidate who has done things that have been under fbi investigation this close to an election. this is uncharted territory throughout. the campaign decided they have to extinguish this quickly, and they decided to use it as a base mobilizer. what has gotten a lot of attention since last night is harry reid put out an extremely scathing, very aggressive letter accusing james comey of intentionally trying to sway the election by leaking this news -- by putting this letter out there and accusing him of taking sides . he even accused him of violating the law, which is quite a stretch. but his reaction has gotten a
lot more attention. scarlet: and your question is interesting, joe, because you were talking about how in 2003 there was something similar. 2003, october 8,an they discovered that the fbi planted an electronic bugging device of the philadelphia mayor's office, and he went on to win the election decisively. it made me think about that. maybe the appearance of an investigation could backfire -- theot backfire, but be to benefit of the person under investigation. this is a random example of the money oral election -- of a mayoral election. matt: i would add to that, if this news came out later, if the election came out later that the fbi was looking into this, and they could have been damaging,
if that came out after the votes have been tabulated, there would be an explosion of criticism, and it would fuel her critics who argue that her election was not legitimate. arguably, yes, she should be thankful, and it puts to rest this notion that voters would have judged it if they knew at the time. joe: the mayor won reelection, too. maybe the more serious the crime -- i wonder, do you think democratic voters don't care, or they don't believe that she committed a crime? >> i think this issue is priced in. we have been talking about her for a year and a half, largely through her own fault. she gets defensive, she does half-truths, she has always been forthcoming. that's why this issue has lingered. but it has lingered for so long that every democrat knows about
it. it's why her untrustworthy ratings are high. they have priced this in. they know the election is a binary choice. there's very little more they can learn about the e-mails, short of there being an indictment or conclusion by the fbi that will change the perception. joe: thanks very much. a massivelynext, grow global central bank. boje the said and are expected to hold steady. this is bloomberg. ♪
economics professor if we will see anything new in terms of an economic outlook for major central banks. >> they seem very inclined to go above the rate hike in december. i think they will try to clearly signal that in their statement this week. they did something similar a year ago, in a statement where they said we will be considering a rate hike seriously. they'll use similar language this year, and i think markets will understand that a rate hike is probably coming, barring overseen circumstances. >> that said, none of the three meeting their inflation targets. somfrom somehow far targets they are. we'll have to get action on the using side for the boj and ecb,
at least messaging or signaling. >> right. i think this is a story where the u.s. has been running pretty well over the past year, payroll growth has been pretty strong. modest signs been of u.s. inflation starting to head upward a bit. the federal reserve has a 2% target. the measures of core pce inflation, which is the measure they focus on, is now running at about 1.7%, just a tad below the target, but not dramatically. a key question for fed officials is that, will that slow trend continue? china could be a factor. ed the other hand, if the f hikes while other central banks ease, that puts upward pressure on the dollar, with 10 to push down inflation. it's a complex environment the
indexes back down. scarlet: even though the s&p 500 did nothing and has been doing nothing, the vix has been moving higher. joe: delly really want to keep your eye on the rising fear gauge. scarlet: in terms of what's coming up, tonight, the bank of japan comes out with its interest-rate decision. a the question is will the boj stay in terms of its new target, what does it mean for qe. am looking at british petroleum and shell. big oil producers report before the bell tomorrow. joe: and i will be looking at u.s. isn manufacturing tonight and tomorrow. we have chicago, so we'll see if it's corroborated with that manufacturing report. scarlet: thanks so much for watching. matt: we will see you back your tomorrow. joe:. have a great evening this is bloomberg. ♪
mark: i'm mark halperin. john: and i'm john heilemann. and "with all due respect october, you better hold on to chicken treat." treat.rick and ♪ john: happy halloweener, sports fans. hillary clinton hits a sour patch, donald trump flickers, and the fbi throws out a fireball. agents in aederal whatchamacallit. fbi agents now have a wa