tv Whatd You Miss Bloomberg August 29, 2017 3:30pm-5:00pm EDT
the president said, we will congratulate each other when it is all finished. the secretary general of the condemningns is israeli settlement construction. he said the international community remains a solidly by the goal of palestinian independence. he said he remains committed to a two state solution. land, dream in the holy two states. a palestinian state and an israeli state, living together in peace and security and mutual forgnition, and allowing something not to be possible. the trip follows the secretary-general's meeting yesterday in jerusalem with israeli prime minister netanyahu. president trump warns all options are on the table when it comes to north korea.
the white house issued a statement after kim jong-un's regime fired a ballistic missile beforeew over japan landing in the pacific. the president said north korea has signaled its contempt for members of the united nations, and is increasing its own isolation. the european union president slammed the uk's brexit papers. he says he has read them all and none are satisfactory. the u.k. brexit negotiator says the eu must show more imagination. brexit talks resumed yesterday. global news, 24 hours a day, powered by more than 2700 journalists and analysts in over 120 countries. i am mark crumpton. this is bloomberg. julia: live from bloomberg's
world headquarters in new york, i am julia chatterley. scarlet: i'm scarlet fu. joe: i'm joe weisenthal. we are 30 minutes from the close of trading here in the u.s.. treasuries and gold remain higher. joe: but the question is, "what'd you miss?" president trump calls harvey a storm of unimaginable proportions," his response will be regarded as a model. porsche reveals a new version of its best-selling car, the porsche cayenne. , oliver to the ceo bloom, next hour. ♪ julia: for the latest on harvey's devastation, let's go to bloomberg's houston bureau chief. about efforts the emergency services people have
been making over the last hour. we are seeing president donald trump and the first lady leaving air force one, they are landing in austin, texas. they just flew over from corpus christi. they are showing solidarity and support with the people of texas. joe, what is the latest? : there are thousands of people standing on routes, or doorsteps, or standing waist deep in cold floodwaters, waiting for rescue, or trying to slog it out themselves and get to higher ground. is: we know the hurricane hitting farther north, toward louisiana. for houston, specifically, what is the outlook? in downtown houston come at the moment, it is not raining, but the skies full of clouds. we are at the back end of the storm as it moves in. it is moving up the .exas-louisiana border julia
give us some sense of the damage that has been done. we are still days away from the end of the storm, and the scale of this crisis is so bad it is hard to get a handle on it. we won't know for weeks, even if that quickly. it is going to take a long time for the water to receipt. it is 70 feet deep in some places. in houston, the flood is being aggregated -- being accurate aggravated because the water running out of the ship channel, is running into the ship channel. it is so full of water, that the water running out of the city and into all these bayous can't run anywhere. julia: i was talking to you
yesterday about the state's response and the government's response, and you said it was invisible. it is just emergency responders. the people you are speaking to, what do they make of the president traveling to texas. are they pleased that he has arrived and that he is in the state? honestly, i think everybody is in such a crisis mode, i don't see people panicking. but folks are worried about their families, their pets. , their possessions and their jobs. i have to be honest with you, and this is no slight at any of the politicians, but many of -- but none of these people are in front of their tv sets right now. they don't have the bandwidth right now to take a political temperature. what is the number, the estimated number of displaced people? how many people are in shelters? ofer katrina, the challenge housing so many people is well
known. any current estimates for that, right now? joe: no. the best i can tell you is, it is tens of thousands. at the convention center in downtown houston, there is already 9000, and they need to put more people in the. and all around the city, there are many, many other shelters or it if i give you a number, it would be outdated as soon as i spoke at. the keep opening more. i think the shelters are getting so full, that last night they started taking people down to galveston, which is 50 miles away, or so, and then airlifting them to dallas. scarlet: wow. incredible descriptions. joe carroll, thank you. stay safe. lawmakers return to washington on september 5, and they have a lot of their play. they have to hammer out a funding deal to keep the government up and running, and there is the debt ceiling. after that, you have relief funding for texas in the aftermath of party.
here is lumber business week columnist josh green, he is also bargain," of "devil's about president trump and his former divisor, steve bannon. i just want to start with president trump being in texas. the governor gave the federal government and a plus grading n a plus grade for its handling. to have president trump come out and say the right things, the script, and show up at the site, which george w bush failed to do in katrina. he has made clear the message most people want to hear, that we are going to provide disaster relief. as long as you can follow
congressn that when returns, that is the only place i think where he might get tripped up. joe: obviously, you have gone to the key question. is an extraordinary legislative calendar coming up. its going to be even more complex and the need to pass a bill to appropriate for this. this is considerably different than during the health care fight, obviously, steve bannon .eing the biggest difference you think the white house will take a different approach your? >> ethic the white house is going to be the problem here. i think the congress is going to be the big problem. there are two potential hurdles that i see. both would involve getting through legislation to help hurricane victims. number one is that conservatives have traditionally insisted on offsetting the funding with cuts elsewhere in the budget, and democrats are not going to go for those kind of cuts. i imagine a lot of moderate
republicans won't, either. the second hurdle is how you actually pass this funding. one thing that is being considered is that you attach it to a build that got past, anyway. and the obvious bill would become of the bill funding the government. the problem there, is, if that bill also includes funding for a border wall, then you run into a problem in congress were you can't get the legislation through. so where president trump has at excelled at the performative side of handling the hurricane, the legislative side will be different. why should we be doing it when there is a republican in the white house? he is still reiterating the line that the conservatives have always taken. rejoinder tos that question is, since you are the republican party and you're control -- you're in control of
all three branches of government, it shouldn't be too hard to pass that. scarlet: you think a picture of the challenges. is this an instance where president trump and moderate republicans and democrats are aligned? think it actually is. that is a good point. it has been very rare that president trump's desires and the democrats' desires a line. but i think there is. traditionallyra want to help areas that are andcted by disaster, republicans in more moderate areas, and those in texas that have been hit. but as we saw in funding battles with hurricane sandy, conservative republicans in the house are often loath to spend additional money, and insist on looking for cuts elsewhere in the budget. joe: if all the challenges and september are going to come out of the congress, and you have
shown these interesting divisions, how might the white house change with all the personnel changes we have seen? trump's ability to get along and persuade, rather than bully republican s, is going to come into play. to say, you may want cuts, but given the scale of the disaster, and the importance of the budget, swallow hard and pass the budget and want you to pass. so far, trump has not shown a lot of ability to get things like that done. when advisor said donald trump was isolated. interesting. josh, thank you. josh green for business week. on a quick note, the american red cross is asking for your help with the disaster in texas.
the organization already has dozens of shelters up and running but it expects the crisis to grow exponentially. thousands of texans will end up relying on the red cross for food, for water, and for a place to stay. your donations can help. donations red cross.org. all donations are tax-deductible. julia: from new york, this is bloomberg. ♪
according to the wall street journal, ideal could come by the weekend. united technologies makes a variety of aircraft parts, including engines. groceries, earlier today ford announced a partnership with dominoes. the service will have an engineer at the wheel. says,a chief executive' running uber is the chance of a lifetime. and that is your bloomberg business flash. .carlet ar julia: let's get more from dara.
he has commented on that job offer, but has not yet indicated he accepted it. >> he called it the opportunity and he'stime, interested in going to uber, so i think it is pretty clear that is the plant. they're hammering out these final details. barry diller said yesterday, it looked like dara intended to accept. that he was going to be the ceo got out way earlier than uber expected. you have a lot of lawyers that have to figure out the final details of that, and how to communicate it officially. i think there is very loved doubt come at this point, that he is going to be the ceo of uber. assuming he does take the job, and as you put it, it does not seem like there is much ambiguity at this point, what is
the first thing he has to do when he gets in their? >> many firsts that he should do. theink, figure out executive team, at least get an interim chief financial officer. he's a former chief financial officer, he should understand the importance of that. the company needs an independent board chair. and, figuring out what his relationship is with the company's cofounder is going to be key. joe: eric, as the uber business doing well right now -- is the uber business doing well right now? they lost 640 family and dollars in the second quarter of 2015. on $1.75 billion in revenue. it is a growing business but the losses remain historic. bigger than amazon, at its worst. the.com booe dot com
boom. there was a wrestling match going on between travis and benchmark. cashthis remain a startup, burn, don't worry about profits, address it mature into something? and profits mature into a grown-up style company. i believe this is the way benchmark wants to see this company go. is that why they brought this guy in? >> investors like him. he listens to them, at least. he cares about striking a balance between short-term, near-term performance, and a long-term vision. he is willing to change strategies when that makes sense. and he is offering expedia as a
public, new company. certainly, investors would like time, that happen at some for uber, an ipo. in the interim, we have this big soft thing, and the question of whether there is going to be a .assive, secondary offering if he decides to go that route, it would presumably give uber even more time for an ipo. but, nothing is inked and there are definitely people who think uber has the leverage now, and why give softbank this big stake in uber, at a time when it might get an opportunistic price. hasa: it sounds like he those management one-on-one skills, that you talk to. eric, thank you. scarlet: -- the biotech company
develops therapies for her logic -- for neuraological problems. >> a big drop today. corda, i think we have a stock of their chart over the last three months. on thisisen 80% experimental drug, and so it nobody had really been expecting the fda to say, we are not interested. joe: i'm looking at a five-year chart, and there is a really sharp move. biotech, i think it is kind of like gambling, isn't it? >> there has been lots of ups and downs, because so much of a does rely on getting approval for drugs. if you take a look at my terminal. i think this is interesting.
getsows you where accorda its revenue, from. .evenue, is the green row multiple sclerosis, is basically where acorda gets all their money from. today,d a drug rejected so they are really struggling when you compare acorda with other companies. julia: berkshire hathaway chairman and ceo warren buffett talks to us yesterday. don't miss it. from new york, this is bloomberg. ♪
the worst performers best buy. declined -- the scott -- the stock the client today to its worst level in two years. here, is also critical. best buy has posted comparable sales growth in nine of the last 12 quarters. that is a good sign. and investors have rewarded that performance. panel here shows the stock on a quarterly basis, and you can see that, even with today's stock, overall you are looking at a stock that has been trading at a record high. a climbed as much as 46% this year, through yesterday. , second quarter comparable sales are not the new normal. but as we talked about, perhaps this is just making sure expectations aren't too high. yes, managing those
expectations. it is such an uncertain time, in this industry. we have been talking about challenges congress faces when they come back to washington next week. they have the debt ceiling, the budget, hurricane harvey, and there have been signs of caution in the t-bill market. look at the white line here, it shows the rate of two bills due on october the 12th. the blue line is t-bills due on december 14. you have seen that kind of premium being charged over concerns about what happens when they have to get this bill and the debt ceiling raised by the 29th of september. today's table option, incredibly important. the debt will mature on september the 28th, just a day before that deadline. the we actually saw was high rate coming in at 96 base points, below what i'm showing you here. i think that suggests markets are pretty language, at this
stage. joe: does going to be a lot watch in september. we have a jobs report this friday. i'm previewing it with a little labor data there it morning we got consumer confidence numbers from that confidence board. one of the questions they asked was, do you perceive jobs hard to get, or easy to get. that is this white line. more people say jobs are easier to get, then they have in years. and if you match it up with this blue line, that is the rate of quits. more confident people are about finding a job, the more confident they are going to be about quitting, and finding another job. their feeling good about job prospects, that is bad news for employers. maybe they will quit, and those of labor shortages we have heard tout from ceo's, are going boost. adding 57he dow,
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over japan. joe: if you are tuning in on twitter, we want to welcome you to our closing bell coverage every weekday from 4:00 to 5:00 p.m. eastern. scarlet: is again with our market minutes. u.s. stocks pretty amazing come back here. it has been a steady climb higher through the afternoon with stocks closing just off their session highs after asian stocks tumbled and european stocks took the baton and decline quite a bit. joe: we definitely saw a risk off move in the wake of the north korean missile launch last night, but it dissipated obviously by the time u.s. trading had come around. scarlet: pretty remarkable how resilient equities are. let's focus on a couple of individual names i want to point to. best buy, we just talked about how it came out with the quarter numbers but it is not the new normal, the ceo warns.
a drop of tour percent the biggest -- 12%, the biggest drop since january. the finish line cut its .ull-year forecast -- fo nike and under armour down by about 2% as well. some companies getting a boost, of course, on the storm because of expectations that eventually we will start to see the spending on rebuilding. you are looking at united rentals gaining. of course, united technologies, there is a report out there from the "wall street journal" that it may buy rock wall for $20 billion. boost.n getting a that is because of the north korean missile launch over japan. a quick mention here because this new just came out in the last 30 minutes or so. you're looking at expedia.
the last two days, it has fallen. comments,s made some his first public comments since he was offered the job at uber. he says it is something he is looking forward to. a lot of lawyers working on a lot of things. joe: never good to see your stock fall if you are going -- good to see the stock fall if you are going to leave. it means they like you. to year yield down 1.32. 10 year yield at one point had been below 2.1% very early in the morning. on the day, 2.13%. german ten-year yield down to 0 .34%. japan 10 year yield back at zero essentially. here is the one year look at the 10 year yield. ofreally space to the degree which many of the postelection moves have really been stated.
we are not quite back to pre-election levels on ten-year rates. such a big move on november 9 and november 10, but we are back at november 9 or 10 levels on the tenure. julia: despite some of the softness we saw in yields, actually, the dollar has staged relatively unchanged today. above the 1.20 figure earlier in the session. it has come down this morning in the u.s. session. at the highest level since january of 2015. right now, 1.1967. here witht to quality a we have seen from the north koreans. swiss overall pushing higher in the session.
we can talk about some level of resilience in terms of what we are seeing for emerging markets. people want to point at the losses we are seeing for dollar sorry loss of the ruble in light of the news that the russia will bail out the bank. there will be some bailing of creditors here as well. expect a bit of softness in the ruble concerning around the bank. joe: finally in the commodities market around the world dipping again. west texas intermediate down to $46.38. gold a little bit lower on the day. stories, thehe big treasury move, the come back and gold this year. a slight bit of a breather. the industrial medals. a lot of the industrial metals
nearly another 2% today. scarlet: "what'd you miss?" u.s. stocks hit a ceiling. if you look at the s&p 500, it is down this month to happen big changes. let's bring in mark. mark is usually based in singapore. he has the following the global asia, europe.he asia the idea that despite these geopolitical concerns, north korea firing missiles over japan, it remains buy the dip. mark: very little risk aversion today. the reaction was quite negative, but it is amazing how quickly that turns. in the initial reaction what was interesting was how much was dollar-based risk aversion. we saw the dollar fall. when i came in this morning, i
was surprised to see the dollar traditionally as one of the more sensitive currencies to risk aversion. u.s. centered risk aversion. joe: what does that tell you? we saw buying in the swiss franc and the yen. what does that tell you about how people are positioned? mark: i think one is that u.s. equities are probably some of the most compared to the global equity markets. a lot of people think generally global equities are stretch but the u.s. is the most stressed. plus, the risks are measure centric. you have the debt ceiling and the fed balance sheet reduction and the hotel is the turmoil that is never going away. all of those issues mean it is likely the cause of with the version will come from the u.s. next. joe: at the beginning of the year, we talked and you were optimistic about a lot of things. your point to good news and the rebound in europe, which has
clearly come to fruition. have seen this lately were a lot those postelection terms have faded like the dollar, but u.s. equities holding just fine. what now? what is for the rest of the year? mark: the easy gains have been made. the real theme this year was returning global growth. combined with excess liquidity. excess liquidity is not quite there anymore. we saw stocks with these and earnings were not being rewarded. that is the first time we have seen that since 2007, almost a decade. on top of that, we see credit markets seem to base out. there is not this excess capital to buy the debt. it might be lucky going forward. forward.going i still think there is access
liquidity, but i am worried of a material correction in u.s. equity, which will spill over to other assets. the debt ceiling will be a big issue. the technology reduction, there are risks. we are picking up volatility. julia: i agree with everything you said, and i look at europe. earlier.theg at his dax is down just under 7.5% as they rallied to losses today. the french markets are down. the italians have been relatively resilient. consciousness out there about the strength of the euro. equity investors, we go into europe because it is relatively undervalued. mark: a letter that is the committee trade. for example, the smp is down in terms of euro terms. this is very much euro-dollar trade. the euro-dollar is dominating some of the earnings for some investors in europe.
with the rising euro, they see an opportunity to go abroad. more and emerging markets. for a period, they were looking at the s&p. scarlet: all the points. is that the most crowded trades out there to be long on the euro? tosk because, what is likely catch offsides? mark: i do not think it is the most crowded. the euro-dollar was structurally underweight. real money investors were getting out for a long period of time. getting out of bond allocations. for six years, we were playing this crisis trade in europe. overt is likely seal it is . no breakup of the eurozone. short-term might be crowded. julia: we talked about a possible risk factors from the downside to the upside.
was the prospect of gary cohn and steve mnuchin following through and the markets go wo ohoo? mark: i am not sure exactly what the probability is, but it is priced at pretty much zero in the market. if it happens because it is priced solo, it will be a reinstallation again. julia: absolute imperfection here. i like it. joe: i want to talk a little bit more about september because the debt ceiling is the one thing that clearly could have the potential if they do not a solution there. there have been other times over the years where people saw political calendar is very risky now. expect higher volatility. european elections, brexit, the u.s. election, and usually it is not quite work out as planned. what is in your view the way people are proper positioning for september? mark: that is a good point.
one of the things is structurally volatility is much lower than going into some of those events. over the thing is equity markets are signifying there is this lack of appetite to buy the dip we have seen the last couple of years because the recent earnings season did not see stocks performing. there are three things saying that is a chance of a bit of a larger correction here. i do not think that negates the fundamental point. there is still excess capital in the world. they are still printing money. only thing is there is more reason for the dip be a little lower if there is a catalyst. julia: what is the catalyst? what is the catalyst for correction here? it has to be coming from monetary policy and a mistake there. just is not likely going to make that kind of a mistake. mark: i do not think the major correction is in treasury
markets. i think both the debt ceiling and balance sheet reduction could be a big issue. for me, the balance sheet reduction is large and an ly underestimated. julia: what about credit? we have had so many analysts come out and say it is not on a fundamental basis. what would be the catalyst there? mark: are think credit markets need it in isolation. -- i don't think markets need it in isolation. scarlet: mark, great conversation. thank you so much. julia: coming up, we are heading to germany. we cannot wait for this. from new york, this is bloomberg. ♪
mark: it is time now for first word news. a senior national guard officer says the military's role in the aftermath of hurricane harvey has been limited by weather and flooding but could soon expand by tenfold or more. air force major general james told reporters there are currently about 3500 national guard troops involved, including about 3000 from the texas national guard. >> we are looking at posturing just on the national guard side an additional 20000 and 30,000 soldiers and airmen that if requested could be brought in and that includes engineering capabilities, high-profile vehicles, additional rotary wing assets, but those will be in the recovery phase.
mark: the rainfall and flooding exceeded what those in texas could have foreseen. estimates for total damages caused by harvey continue to rise. of economic losses of $42 billion. that is up $12 billion from monday. others project a cost over $100 billion, potentially surpassing hurricane katrina in 2005. less than 30% of harvey's losses likely to be covered by insurance. vice president pence is warning the people of southeast texas that life-threatening flooding will continue. he is also urging residents to listen to state and local officials. pence spoke today on san antonio and corpus christi radio stations. he says he will visit the region this week along with his wife karen. louisiana's governor john bel edwards says the state's offering to shelter storm victims from texas. that is as louisiana conduct rescues of its own residents
from harvey's floodwaters. about 500 people were evacuated last night and early today in southwest louisiana. edwards says he expects texas officials to decide within 48 hours whether to accept the offer and transport flood victims to louisiana shelters. global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. i'm mark crumpton. this is bloomberg. julia: "what'd you miss?" reveals a new version of its car, the cayenne. it is caught in the latest emissions scandal, too. a model recall in july for exceeding illusion limits. -- pollution limits. matt, take it away. all of her bloom, the porsche ceo. you just introduced this new
cayenne, the third-generation. so successful for porsche even though at that time it was introduced, no unexpected it to be a viable option. how important is the cayenne to the porch business? oliver: we are very happy to be here tonight. present theo third-generation. think a very special topic of the cayenne is it is a real sports car in the suv segment. a perfect combination between 91 1 and now the cayenne. matt: here in germany, is that the diesel version of the cayenne have been the best seller because of the extreme torque, the diesel loader was capable of generating. now with this scandal, the crisis around diesel, will you be offering this car?
oliver: a very big importance in europe. beern diesel engine will very good for the automotive industry. for porsche, we are 15% diesel. porsche does not develop an does not produce diesel engines. designed fore cars a diesel engine, but we have not decided yet. matt: the base model will come out with the gasoline engine, the v-6. another model with a powerful v-6. are we going to see a hybrid move more quickly to hybrid, alternative powertrains? oliver: we have a lot of options. we will follow after this first six-cylinder engine with 340 horsepower and 440 horsepower. then you can think about very
successful engines. we will bring with the new cayenne a plug-in hybrid. with a 50in hybrid kilometer range, full electric. matt: you do have still diesel engines being sold, of course, model, the german car bible for gearheads has it on the cover. is diesel still an important part of the german auto industry's goals? oliver: of course it is. we have around about 70% of diesel in europe. for the whole automotive industry, it is very important because we are an engine
producer in the future and electric car designers. matt: let's talk about what you want to do as porsche. you're not going to tell me if this comes out in a diesel. i am guessing after the political hubbub dies down, you probably will because it makes sense, but what do you expect as far as the growth numbers? with you expect for growth of porsche the general? oliver: in the last year, we had the growth coming from the mcconnel model. we have a growth of 7% from 2016. we have a very big issue in the double digits range. i think with the new cayenne, it will give a new push to porsche for the future. matt: what is ahead by the way for porsche? you have the boxer, the cayman, the 911, like 20 different 911's. what else can you do?
is there anything else porsche needs to make? oliver: first of all, the core of our brand is the 911. very important. yeah. the core of porsche is the 911. it is very important to transfer a live technology from the 911 two all the other ranges. for example, the new cayenne, we have the new steering. 911.e using from the one we look to a new segment, we look very clear what our customers need and what do they ask us. for example, before we talked about the gt3 and the new version has a hand menu. that was important for us. always listen to our customers. matt: we were talking about the gt3 before we came on camera.
he was sorry that i was able to try out a stick shift version anytime and like. thank you for that. really appreciate it. congratulations on the new cayenne. oliver: thank you very much for coming. matt: back to you in the studio. scarlet: matt miller has a lot to look forward to speaking with the porsche ceo. coming up, damages from tropical storm harvey likely leading to tens if not hundreds of billions of dollars. what kind of an effect will it have on jobs? will take a look at the history of job listings in natural disasters. this is bloomberg. ♪
screen. ever indicator, which is weekly jobless claims. it is a high-frequency data point that shows very clear trends. it is a pretty straightforward train share. the number of people filing front of the benefits held steady in the mid to thousands -- 2000's. since then, claims on a steady 7.5 year decline. two distant disruptions. the blue circle is hurricane katrina. the yellow circle is hurricane sandy. jobless claims 10 to spike in the weeks after severe weather. look for a big spike in the coming weeks. joe: houston's massive population, the fourth-largest city in the country. there are going to be a lot of people displaced uncertain about their job prospects over the coming weeks. this is going to be the first place it shows up. as you point out, it tends to fall very quickly back to print. still something to keep an eye on. julia: the energy components of the areas we are talking about, particularly the path of what
the storm is going to be, the border between texas and louisiana as well. we will have a quarter of u.s. refineries perhaps taken out of action here or at least impacted to some degree. joe: very interesting to compare this with katrina. that was a very different energy environment. much tighter oil. these days, we have shale, super oil. very instructive to see what a silly and different in the aftermath. ruggedt: oil has sh this off. week.parate storms in one the initial making landfall earlier this week and looking for a to come back again to the texas-louisiana border. julia: coming up, what is next for north korea and other issues for donald trump to focus on? tensions mounted as yesterday's launch over japan. all options are on the table. ♪
mark: it is time now for first word news. president trump told residents of flood ravaged corpus christi, texas, "we are going to get you back and operating immediately." the president addressed crowds gathered outside of the firehouse. the president traveled with first lady melania trump and cabinet secretaries will play key roles in the recovery. u.s. ambassador to the united nations nikki haley says it is time to take serious action on north korea. ambassador haley spoke to reporters ahead of an emergency security council meeting today. >> no country should have missiles flying over them likely the 130 million people in japan. it is an acceptable. they have violated every single
un security council resolution that we have had. i think something serious has to happen. mark: yesterday, north korea fired a ballistic missile designed to carry a nuclear payload. it flew over japan. haley says she is hoping for assistance from china and russia on the matter. the u.s. attorney general jeff sessions says drug overdoses are "the top lethal issue in the u.s." he spoke today at the conference of the national alliance for drug endangered children. sessions as for luminary data shows nearly 16,000 overdose deaths in the u.s. last year, the highest number ever. german chancellor angela merkel said today she did the right thing by allowing large numbers of migrants into her country two years ago and that europe has not done enough to develop long-term solutions to the migration crisis since then. recent polls suggest the chancellor's popularity has returned to levels from before 2015 when refugee crisis reached
its peak. global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. i'm mark crumpton. this is bloomberg. scarlet: let's get a recap of today's market action. we thought stocks were going to tumble. they did initially, look at that. they made a steady recovery through the day and certainly by the end of it, the dow up 57 points, the s&p 500 gaining 1/10 of 1% shrugging off all concerns of the north korean missile. julia: "what'd you miss?" tensions between the u.s. and north korea continue to fly. yesterday a missile over japan comes with after donald trump promised to respond to any threat with "fire and fury." he called out china for not intervening. he tweeted they talk, just talk. china could easily solve this problem.
joining us now for more is christopher, bloomberg's new columnist and associate professor at the university. great to have you on. serious action we heard nikki haley say about what the u.s. or the international community needs to do about north korea here. if you believe "the new york times," they believe this white house is giving up to some preemptive literally strike. do you think, hypothetically, the united states will change their mind if china says, do not do this? christopher: the u.s. is in a tough position to begin with because if they were to take some type of a strong preemptive right, that would essentially spell doom for millions of people in seoul. that is the reality of the situation. we cannot get around that. it is very difficult to see what kind of preemptive action outside of the diplomatic realm that trump can take. scarlet: sounds like steve bannon was right. joe: exactly.
speaking of that, we were just talking in the break about the lack of market anxiety over this. on the one hand, this story has been playing out in slow motion for a long time, decades arguably. on the other hand, people are saying that last night was different. the fact that it went over japan. is this a different stage of the crisis that is more heightened than it had been, or more of the same? christopher: it is safe to say the fight over japan was a little bit of a game changer. i think it will be very interesting to see the reactions going forward because as you said, this has been going on for really 20 plus years and we are still at the same point. how much that really changes facts on the ground, mathis has that really indicated he is more reluctant to engage in some type of a preamp to strike because of the risks involved. scarlet: donald trump and shinzo oblique spoke on the phone for 40 minutes after the launch. they talk about how they need to step up the pressure on north korea. as far as we know, the president
did not spring with china is usin. what can turn a do at this point? christopher: there is the debate about how much china can influence it. how is that everything that china can stop this immediately and there are others that say they really do not have the control. i personally think the reality is much more nuanced in that they are not actively necessarily aiding, but if you read the u.n. reports, which make for great bedtime reading, all of their money, all of these materials go to china in some way. i just sigh report before coming on that a german company was buying north korean coal unknowingly that was shipped out of china. ok? this is still ongoing. it belies logic that china is unaware of these activities. that does not mean that they can just pick up the phone and tell north korea what to do. scarlet: why not? christopher: basically, they
really do not have the influence. a lot of what is going on is operations, front companies, things like that. it is different between having control over a country like a puppet state and being able to cut off the flow of materials. julia: does diplomacy work here? because it diplomacy, you have to assume somebody on the other side is rational, they will behave rationally. when i talk to you at the beginning, you set any form of preemptive strike would flatten seoul. just because somebody takes out military inflations in north korea is not necessary precipitate a leader flattening the korean capital. in order for diplomacy to work here, do we and can we assume this man is rational, and what difference does that make? christopher: a difference what you mean by rational. if we look at north korea, the primary objective is staying in power. if there is some type of sustained conflict, that is going to probably put them out of power, ok?
they hold nuclear weapons. they are going to be able to stay in power as long as they continue this ongoing conflict that keeps dragging out. joe: i want to ask you about the state of the chinese economy right now. fairly quiet. there has not been a ton of big headlines about the economy in one direction or the other for most of the year. there is this view with the people's congress coming up that they will do anything to keep it stable. does that imply that when that passed, we could see the return of economic and market volatility in china later this year and into next year? christopher: the reason we have seen that quieting of chinese headlines is the economy in real terms is probably working very well. we have seen a rise in output, real estate construction is a. up. we have all of these indicators say things are doing well. this is credit driven. in the second half of 2016 and the first quarter of 2017, that
does not mean the real activity is not real. the other thing to members that a lot of people forget, this is essentially like 2016 for china. this is an election year. they are going to do everything they can to keep it going and going very well. going forward, we are going to see weakness because especially a lot of the profit drivers we have seen like coal and steel, they have triple digit price increases. as that moves forward, unless they experience another triple digit price increase, you are going to see things go down. julia: the reaction function of north korea as well. scarlet: absolutely. julia: it is 2016 for china. scarlet: i love that. thank you so much. christopher is a bloomberg columnist. usually based in china, but thank you for joining us in new york. coming up, john kline yunker has brexit the u.k.'s position papers, saying none of them are satisfactory. more details on today's brexit talks just ahead.
julia: "what'd you miss?" raising negotiations in brussels got a little more tends to say. john kline yunker called out the u.k. for not being adequately prepared for the talks. i have read all of the position papers produced by her majesty's government, and none of them are satisfactory. there is still an enormous amount of issues that remain to be settled. julia: for more, let's bring in our guest. great to have you on the show. thmore flexibility and imagination needed. who is right here?
are the underprepared on the u.k. side? is that the bottom line? >> the talks are certainly not going to well. what the u.k. has added past few weeks is outlined more of its position because it was coming under a lot of criticism that they actually did not know what they wanted. if you take a very holistic view of how the eu sees this, they are saying, well, actually, you have not come to us with anything new because all you are saying is you want all of the benefits of the eu membership but you do not want to pay any of the cost. they are saying for example they want a transition areaary perio. another item that is not in those position papers is how the u.k. thinks it will calculate one of the very controversial issues in the divorce and that is the brexit bill. they are tussling over these issues. people think that perhaps indeed well, not much is expected. to me about this
rumor because i loved this suggestion that the u.k. can take 10 billion pounds or euros a year for the next three years during that transitionp e period, and it was a suggestion proposed by the french. that would facilitate sooner trade negotiations as a sort of offset here. it, but inpoo-poo'ed my mind, that looks like a decent strategy. what are we hearing about that rumor? nina: absolutelynina:. basically, the u.k. has excepted it will have to pay something. what has not been decided is how much it will pay and how it will pay it. i think that the eu understands that makes it a lot more politically viable for the u.k. if they are able to sell it as part of the cost of the transitional agreement rather than one upfront huge sum. extraordinary that it was quite so quick to squash that rumor and we have been feeling other rumors as well that france sayingmany have been
they should hold the line and not allow the conversation to proceed to those future trade talks. perhaps the commission is seen as an inflexible is because of the position they have taken that they will talk about the divorce first and then only about the future trade agreement was basically the position that was decided by the eu summit. what i am hearing is berlin and paris are adamantly sticking to that. joe: obviously, the clock is ticking.there is a deadline to get a deal before theyen without anythingd anything.d without is there any urgency on the eu side? if the u.k. cannot come up with something appealing, let it fall into disarray? nina: several things to say to that. the first comment i would make is that the eu and u.k., everyone in general wants to have a deal.
that therepoint is is so much going on in the eu right now. they have different priorities. in germany, the general election and another election coming up .n italy and austria there is the issue of the eurozone reform and the migration crisis so the idea that brexit is the number one priority of the year 27 is not eu case -- the mind of the 27 is not the case. scarlet: how has the u.k.'s priorities shifted or evolved since the general election? because the election was meant to solidify theresa may's standing in parliament and give her room to negotiate more during the brexit negotiations. nina: i think we can all agree that the general election was a big disaster for the party. scarlet: shirt. -- sure. nina: and terms of their priorities, there is a lot of focus at home trying to keep the
shift together. interesting that this weekend they were came out with his brexit position because so far its policy has been even more obscure than anything the conservatives might be accused of peddling. what they said is that they want a transitionary period where they continue to have the things like the jurisdiction of the european court, they will continue to accept free movement, and those are all redlines for the conservatives. in terms of priorities, the number one priority for this government is trying to make a success of brexit, but there is a lot of wiggle room on the home front as well because domestic politics is so unstable right now. who knows if we will have another general election? theresa may will not be prime minister going into the next general election. a lot can change going into the u.k. as well. julia: so much to discuss here. macron has given his falling ratings as well. we will come back to that.
has been speaking in texas. let's listen in to what he has been saying. president trump: pretty horrific. it has never been seen like this to this extent. it is maybe someday going to disappear. we keep waiting. we have four of our great congressmen right here. we appreciate you. we will be working on helping out the state of texas. it will be a costly proposition because, again, probably ted cruz is here. senator, thank you very much. we will be working with these characters over here. i think we will come through with the right solution. probably there hasn't been anything so special during our country's history. there has never been anything so historic in terms of damage in terms of atrocity as what we witnessed with harvey. -- ferocity as what we witnessed
with harvey. i want to thank my people. ben carson is here. linda mcmahon from small business. i say this is not small business. this is big business. when you add it all up, you will be giving away many millions of dollars to help people out. tom price, as you know, you have your people in the field. in fact, you may say a couple of words. i will ask linda and ben. >> sure. thanks mr. president. this is a historic proportions storm and flood. the challenge we have obviously is getting the resources to the individuals that are stranded right now. make certain evacuees have a place to go. our an hhs standpoint, responsible is our medical and mortuary. the challenge we have is long-term the people that suffer
from not being able to get the medical care they need after ou. whes pharmacies staffed, make sure folks get electricity to their homes, oxygen concentrator and the like, and just chronic disease. making sure they can get to their doctor when they are in their hometown and get the treatment they need. we are staffed up, ready to go. four medical stations. two are up and running. two on the way. another four or five that are stationed after that. president trump: thank you very much. thank you, tom. linda? the disaster relief office is in the dallas-fort worth area. 900 people there permanently. 600 people available. they are already coming in. i did get a note on the plane
that we have made the first home loan approval from this disaster. i am glad we are already up and running. we will be making home loans, business loans. we will be making loans for those folks who have lost income. also, the opportunity to replace plant, crop, property, equipment, and inventory. julia: you have been listening to the harvey briefing, the hurricane harvey briefing in texas. the president praising the efforts of the coordination of the emergency services. beautiful to watch. aid will be a costly proposition of course. that is probably the about to come with congress. just trying to finance what increase funding we will need. estimates ranging between $30 million and $100 billion. scarlet: it is still evolving because the storm is not over yet. no longer raining in houston this afternoon, but the storm is
expected to go back north and to the east. we are looking at texas and louisiana perhaps coming under rain again. joe: from specifically praising the according nation, as you mentioned, beautiful to watch. he is really driving it home that this is not between all over again, at least from the federal government response. people talked so much about how poorly that went for bush. he is going out of his way to make it clear that it is a very different story under his watch. julia: and he is actually there. he may be going back to texas on saturday. he may be in houston. corpus christi this morning and austin, texas. scarlet: in the meantime, let's get you to the bloomberg business flash from a look at the biggest business stories in the news right now. the hard rock hotel and casino las vegas is, for sale according to people familiar with the matter -- is for sale, according to people familiar with the matter. buyers whollows many
purchase resorts after the 2008 real estate collapse and are looking to sell. content global planning an initial public offering close to $1 billion in london. the company generates power through traditional sources as large renewable unit which uses wind, solar, and hydropower. it'll be the first london i feel from a large power company in a decade. jetblue founder is launching a private jet commuter service. it has been registered under the tentative name. asfar, two just have as few 16 feet. that is your business flash update. joe: coming up, what you need to know for tomorrow's trading day. this is bloomberg. ♪
>> i'm emma chandra in new york, and you are watching "bloomberg technology." let's start with a check of your first word news. president trump is in texas to witness the devastation from harvey and the ongoing recovery efforts. andrrived in austin today corpus christi where harvey made landfall. trump hopes his administration's
response to the hurricane demonstration will be regarded as a model for the future. governor greg abbott called the white house response so far very effective. monday, he said he graded the +.sponse an a vice president mike pence is warning that the flooding will continue. people visit the region this week along with his wife karen. estimates to total damages caused by hurricane harvey continue to rise. research now projects losses of $42 billion, up $12 billion from monday.other analyst estimates are at $100 billion, potentially more than hurricane katrina. louisiana governor john bel edwards said his state's offering to shelter storm victims from texas after the state conducts