tv Bloomberg Markets Americas Bloomberg September 28, 2017 2:00pm-3:30pm EDT
markets." scarlet: we are live and bloomberg world headquarters in new york. here are the top stories we are covering on the bloomberg and around the world. the clock is set for tax reform in the u.s. lawmakers unveiled their framework but the economic growth could be short-lived. falling for traffic in malls could be taking a tall on another industry. the ceo is telling us how he is investing in commercial real estate in the age of amazon. higher education commanding a higher price tag than ever. the president of cornell university tells us how tuition affects diversity across the nation. u.s. markets close in about two hours. let us look on how stocks are trading. bank of mexico is holding
steady at 7% as expected. they have seen a lot of the inflation pressures ease in the eeks of september. a lot of economists do not expect to raise rates next year. they're holding with their interest rates at 7%. let us look at dollar peso. dollarooking at a weaker story. that has been a trend since the beginning of this year. the bank of mexico holding in. let us circle back and look at the u.s. scarlet was talking about tax reform. the euphoria is here. all of this was right on the screen. we are finally seeing some of the euphoria come back into the get thiserhaps we will done. i'm sure there will be a lot of lobbying efforts. i will note that the dow is posting the biggest gains. up 0.2%.
highseaching record coming up 0.4%. a lot of this has to do with the strong gdp number we saw. the second revision was 3%, up atm the first front we saw 2%. when the economy does better, we are shipping goods all over. for fedex, i will give a shout out to my producer who pointed out a cool story on fedex. puerto rico is out of power. the atm's are not working. the u.s. is shipping cash to puerto rico. how do you ship it? maybe we will overnight it on fedex. overall, that is how we are looking. julia: thank you very much.
lawmakers are adjusting the full framework of president trump's plan today and some people think momentum is writes for a quick passage. >> you will see the first phase of tax reform start next week. if you have a question of if this will get done, you will find out next week. we will move the budget. ection vii of the constitution says it all starts in the house. we will move that bill out of the floor in congress this year. >> the entire text reform is designed to create incentives to encourage the expansion of the production capacity of the american people. [no audio] >> the budget is the golden key to unlock the tax reform.
[no audio] >> this is the way of not hurting the people that voted for you. the other side of that coin is talking to the liberal coastal states. california, new york, connecticut, new jersey. ifore coming on the air, added up the electoral college votes in that state. two thirds of the electoral college vote that hillary clinton got. whether it is intentional or not, it is languishing the votes -- the states that did not votes four president trump. julia: i'm sure that is intentional. who am i to say? >> it is shifting away from red states into blue states. >> there are some republicans
mobilizing against this. julia: there are enough republicans that this will hurt too. on this, they are talking about the end of the year. [no audio] julia: i'm going to say, kansas, and experiments. >> it was an experiment for tax cutting. julia: in 2013? >> it didn't go so well and they had to walk that the measures when they saw educational institutions were underfunded,
transportation projects were not adequately funded. --s was a great experience experiments in pursuing this. cutting taxes will get ofe growth, lots of promises jobs. similar to what we're hearing from the republicans here and they have reversed them. they were first the tax cut -- they reversed the tax cut. why? is if it willn work on the federal level. it is to be determined. if we can lower tax burdens, that is an economic positive but we cannot look at it in a vacuum. we have to remember interest rates declined dramatically. that paul volcker and alan greenspan.
rate was near 60% down reagan'sthe end of term. a couple that, you had a decline in energy prices. all tax reform is helpful, you cannot look at it in a vacuum. what we're saying is reagan worked well. there are a lot of circumstances tailwind.a huge >> remember, it took five years. this was 1986 when we got the comprehensive tax reform. to get it done by next year at this time is a tall order. julia: a lot of people are saying to look at kansas and this experiments of tax reform. why is it different today? scarlet: that is a precedent that will sit uneasily with some republicans. we will see if it becomes an obstacle. what about deficits? to be anseen
obstacle. it looked like the freedom caucus signed off on it. >> there are rules. the deficit keep neutral outside of 10 years. they can louse as much money as they want to the next decade. i am a kansas girl and i thought of my parents at home. they lose a lot of money and do not get the growth they think they might get. investments are always rosy and then they do not can out. they will have to come up with something and they cannot rely on outside groups. they will have to rely on the committee on taxation. julia: they believed it would unlock growth and that would ultimately help pay for it and incidents. exactly. it will be fascinating. scarlet: this pumping into the air for kansas. kansas. dna --: bloombergs
flooding. officials say the evacuation order has been lifted. 10,000 people were ordered off the islands as maria turns offshore. union-negotiator union-negotiatore says it could take months -- [no audio] -- the u.k. desperately wants. steve scalise reported back to congress today. shotirst time since he was at a congressional baseball practice. the louisiana republican had a message. >> as we are fighting through
the issues of the day, let us keep in mind we rise above the challenges of the day and understand it is not just us and and our country that is counting on us on being successful. people all around the world who believe in freedom are counting on us as well and we will deliver. mark: the lease also thanked the capital --steve scalise also thanked the capital police officers who killed the gunman. global news 24 hours a day. powered by more than 2,700 journalists and analysts in more than 120 countries. i'm mark crumpton, this is bloomberg. scarlet? scarlet: thank you, mark. coming up, criticism on how the trump administration is handling it from puerto rico after hurricane maria swells. a critic says the white house failed to learn the lessons from katrina in 2005. this is bloomberg. ♪
"bloomberg is markets." scarlet: the cost of damage to $60to rico could reach billion to $7 billion. there is a growing chorus of criticism into how the trump administration is handling the ongoing crisis, including one katrinar to hurricane in 2005. with is christopher flo labell. the white house did a good job with harvey and that was something that helps give the president a boost and his approval rating. maria may bebe --
a different story. the army has to play in different role. only the department of defense has the manpower and it whitman -- equipment to get around the bottlenecks. he set his lesson from katrina is to do what it takes and do not wait to follow the rules. find a way around the impediments. in his view, they are not doing that yet. be an there cannot always army response in these cases and there has to be preparation behind the scenes ahead of the storm as we saw with hurricane irma.did he argue that point too? >> he said irma is the way to do it. there was a lot of repositioning inpeople and material florida. that could happen as much with maria. the counter will be you never
know how about the storm will be. order we go is an island, and it is hard to get -- rico is an islands and it is hard to get stouff there. julia: whose responsibility is it? government in puerto rico? >> the government of puerto rico can make requests to theme. the government will decide what to do and who runs it. the president can decide for himself that it is a d.o.t. mission. there is no strict playbook. every mission is different. we will not know for weeks how well this once. there is certainly a course of critics saying it is not going well. scarlet: that is a great question. given puerto rico is the territory makes it less clear than when the state of texas was asking for a. what this -- what is the
situation mean for the rest of the u.s.? >> the government said if it doesn't go well, millions perhaps could leave the island and moved to the mainland, which they are entitled to as citizens. i spoke to people who say the demand that would create an housing and jobs and social services could be huge, y willally because the concentrate in areas with a big puerto rican population. over weeks and months, that will be one of the best tests of the federal response. our people leaving the island in large numbers? -- are people leaving the island in large numbers? julia: i read 91% of satellite communication sites remain out of access. we talking about basic communications. surely that is a critical problem in court and 80
emergency efforts. >> they are hurting in every way. medications, roads, water. it is a hard situation. that will always be the counter. people will say you can only do so much of things are this bad, but the point people have made to me is his country has to be ready for more offense like this. we cannot keep saying that was bad but it will not happen again. we have to be ready as a country for three or four hurricanes every season. the country is not quite there yet. julia: there needs to be a program. speaker paul ryan speaking at the factory in pennsylvania. he says we are in a race to stop companies from leaving the united states over texas. he also says the hospital will continue to work on health care
welcome back. once again, facebook was deployed to boost a far right party at the polls. this time, it was in germany and it was an american firm behind it all. you can find the full story in the latest issue of "bloomberg businessweek." and aris media texas-based consulting firm that is a lot of work for conservative politicians around
the world. on the day before the election, i went and sat down in berlin with the guys from harris who were running the digital operation of this far right german party. they opened up to us about how they had done it. >> a lot of it involves search results advertising, which i think i knew about. tell us a little bit about what is and how we use it in the election. >> what is interesting as most users of facebook or google have a basic idea of what they are doing as part of an advertising business. one thing they did was paid google for the rights to use the term angela merkel, the little at that appears above the top search result. they had some trouble with getting the at approved at first but essentially what they did in the days leading up to the election was anyone who googled
her name, the first thing they saw was a link that led to an attack website they set up. it appears maybe it works. julia: they are calling for open breaker, saying how she allowed the refugees into the country and that was linked to terrorism. google pushed back. >> how their role became public in a way was when they tried to do the search results but , they got on youtube rejected by google for a couple different reasons. what they did was decided we do not need you anymore, google, if you will not let us play the way we want to play. we will take our money to facebook. they made a public thing about it in the german newspapers saying they were going to die for their advertising euros to facebook instead. julia: this was a fascinating
angle because they look at likes. liked posts and they tried to map them and find other potential supporters. describe this, because they got a lot of people here, didn't they? >> absolutely. what is interesting is the party already had a strong following. [no audio] they did some very basic moves on the facebook advertising interface to match the profiles. liked both a lot of the same things the party supporters like having clicked on the page were targeted.
they found groups that they were 'sle to push the party message to, which were anti-immigrant and anti-muslim names. you can find the story on news, online, and in the app store. imagine what happens in the italian elections. still ahead, the e-commerce boom. how the likes of amazon can affect marshall real estate. in new york, this is bloomberg. ♪ is this a phone?
movers. a down day for oil and related commodities, including gasoline and heating oil. falling just over 1%. the backdrop if there is concern oil may have rallied too much t oo soon. at these levels, the market needs to be fed said he, positive information. steady, positive information. track for its worst month since november last year. thank you so much. the real estate industry is feeling the effects of tech distraction, the rise of e-commerce. just how profound these changes will have on real estate like shopping centers and warehouses. joining us is bruce atkins. great to have you on.
at thek specifically messaging charts of debt in some of these transactions. you have a unique perspective of what is happening in the market. give us a birds eye view. what is it like given all the challenges? e: fundamentally, market conditions are healthy. it is a complex country with different markets, different property types. over all, the market conditions are benign. supply and demand are in balance. at this point we are seeing something very different than in the past. julia: i will pick up on 2007 back. you make interesting moves when you saw elements of the market you are concerned about. how do you predict how people are going to use space going n the changes? bruce: it is an enormous
challenge and a new challenge for most lenders. it is a challenge for owners also. the use of space is largely due to the changes in technology, which are happening faster than anyone ever anticipated. they are affecting the way used, hospitality, and residential, with regard to our. -- to offspace. you have no files and no secretaries. people are occupying half the amount of space they were in the last cycle. julia: with a not want to restrict themselves to longer-term money? does this short in the durations of the money you are lending? bruce: we're making a decision as a lender to shorten the duration because we cannot predict what shopping patterns
will be like and what the hospitality role will be like. what will happen with parking garages because of ridesharing? within the next few years, we will have driverless car is. julia: imagine trying to predict those days. talk about 2007. you said it is very different today from how it was in 2007. i know you guys decided to chop out -- you got rid of your loans and went to cash in 2007. how did you know? bruce: that is correct. beginning in 2006, we felt extremely uncomfortable about hree conditions we saw existing. unusually high leverage. the levels were rationing up very quickly. also, property values were moving up too quickly and leasing was not lining up with the rise in property values. the third was hyper securitization. julia: in terms of leverage, you
are saying it is a lot lower? in terms of securitization, that market has completely changed. the difference there is you cannot just give alone, securitize it, and get the risk off-balance-sheet. bruce: exactly. this created a much healthier environment. the capitalization of real estate is far more conservative than it was in 2007. julia: what about hedge funds? they were getting in on the action in 2007. bruce: exactly. it is when someone who is not in your business gets into your business like a day trader. that is a sign that it is probably time to look for an exit and that is what we did. julia: compare that to today. bruce: today is extremely different.
i do not see we have systemic risks because the lenders are under investing in real estate. levels are low in regard to construction loans. i think a lot of the funds that have come into the business are prudent, are conservative, and understand real estate fundamentals. julia: bring it to new york and what you are doing today. what are you looking at right now? is there a possibility of an infrastructure deal at some game?that changes the bruce: infrastructure would be wonderful if it ever happens. we have government agencies, particularly in new york,\ and we will not count on that. -- in new york, and we will not count on that. we have three round of deals in new york. all are intended to be condominiums. the way we structure our deals, dollar exposure on
behalf of our investors enables us -- if we took back the property -- to lease back those units and make it handsome return on our capital. why defensive and since when? since the new york property market escalated to unsustainable levels. there is a surplus of foreign capital and to have reached unsustainably low levels. we do not take equity risks. are notos we finance $10,000 a square foot like you see on 57th street. julia: what about pricing? are you losing deals? bruce: we are. i think we look at 100 deals before we sign one. julia: how has not changed from two or three years ago? bruce: we have only finance 250
properties since we launched the company. i am proud to say we never had a loss on any deal. we never had a principal loss. that has to do with the factory sold in 2007. we continue to do what we do and i think we adjust the cycle has they come. julia: are there any concerns you have out there given the friendliness that you are talking about -- the frothy in frothiness? bruce: we are seeing some sloppiness. i do not want to throw anyone under the bus. what helped bring down the market last time was granted rampantzation -- securitization. julia: what about your ors?stment are they having problems finding return also?
bruce: over the past couple of years, we have been getting a on foreignund calls groups looking to get to commercial real estate credit -- looking to get commercial real estate credit. it is a strong your with the right sponsor. great to get your insight. great to get your insight. let us get a check on the first word news with mark crumpton. mark: pat toomey tells bloomberg a framework for the tax reform plan outlined yesterday by president trump creates sustainable growth and encourages businesses to spend more capital. directs not for us to the resources of a business. what we should do is create the ,ost rational sensible, competitive tax code and let the leaders decide how to allocate resources. mark: he helped draft tax overhaul legislation and said it will drive higher wages and a better standard of living. continues inus
bali. authorities say the number of volcano is more than 30,000. the amount of people who fled is more than double the estimated population. people further away are not taking chances and are leaving as well. -- number of muslims is now more than 500,000 according to the united nations, which says it could be up to 700,000. officials are scrambling to deliveriesaid to the refugees. court records show a woman charged with hacking u.s. agents she wasi frustrated with her job as a government contractor when she
tucked a classified report into as pantyhose and smuggled it a national security office. prosecutors are urging the court to keep her jailed until her trial. the transcript shows she confessed to fbi agents telling them "i screwed up." global news 24 hours a day. powered by more than 2,700 journalists and analysts in more than 120 countries. i'm a mark crumpton -- i'm mark crumpton. this is bloomberg. college with tuition on the rise, we discussed the price of education. from new york, this is bloomberg. ♪
markets." we're focusing on utilities stocks today. not a great day for the company. they are making a turnaround. we will get the data. we will look at what is happening in the space today. a little bit of weakness. what is interesting about the market is you have had on these days a group that is losing. rally.ever a clear today, utilities has done pretty solidly, despite having weakness through the past couple of weeks. largely, this is about the expectations for interest rates and the sector rotation's going through the market. -- rotations going through the market. on the downside, we were talking .bout scana
the company has come back a little bit. we have a few gainers. overall, there has been a mixed market for utilities. scana is down about 3.5% this morning but they have bounced back. let's jump into that going through the treasury yields and what it means for utilities. we will be looking at the 10-year yield versus utility. livenerally know these two inversely to each other but what is interesting is the surprise the market has changed -- staged some of the hawkishness by the bed. -- teh fed. scana is an interesting story today. julia: brilliance. what else on that? -- brilliant. that?lse on >> there a company with challenges right now legally speaking. they started building big, nuclear power plants and had to stop. ontalked about this
bloomberg businessweek. they have had great stories about getting nuclear power costsnow and the marginal of building plans is not building up as energy becomes cheap. on a is pushing back ruling by a commission in south carolina. they will debate the rate they will get back for building the plants. scana, this can be a huge hit to their bottom line. that is something we will watch. analysts cut ratings on the stock because of that. julia: great to get your insight. thank you. scarlet: inflation may need tema across the economy, but not when it comes to higher education. these rates increased about 6% annually. even with financial aid, american universities graduate are fewer students who grow up in lower income households,
worsening the inequality gap. joining us is the president of cornell university. to start with the state of higher ed. schools arenell's part of the state university of new york's system. we have seen a link between reduce public funding and student loans with higher tuition. do you see an end to this cycle? >> it is a great question. we know the problem comes from the fact that higher education is a labor-intensive industry. athink we have to have national discord, but we're trying to do two things. we're trying to reduce our cost wherever we can, with automation outside the classroom. we're we are trying to make
heavy use of an angel it -- fina ncial aid. i think people do not know how much financial aid drives down those costs. less today for a student to attend now then when you went to school. it is also the case -- there are a lot of things you get out of a collegeand it nation -- education. aboutege graduate makes $1 million more over the course of a lifetime than a student who did not go to college. i think it is important that lower income students here that message and come to our universities. scarlet: there is a cold for a discussion about whether a university degree is as relevant as it used to be. nevertheless, the point you make is there. when it comes to the metrics by which schools are ranked and measured, do you think we need better metrics? >> absolutely we do.
i will tell you one of the with theroblems ranking, which ties back to what we're talking about. of that ranking is based on expenditures for students. if you try to do the right thing and try down your cost, you get penalized for it. we need to be looking at outcomes, quality of life, diversity, of that ranking is bn expenditures for students. if you at those things that influence the experience students have. scarlet: speaking of diversity in general, universities saw a huge bump when millennial came of age. i think that coincided with the rise of emerging markets and in influx of students from laces like china and brazil. course? burst run its across whatt varies industry you are in. at cornell, we see an enormous increase year after year from international and domestic students. we do not see the bubble bursting yet. scarlet: it will continue to be
competitive at cornell. i know you expressed the importance of free speech. on campuses across the nation, against an argument tolerance for speech that is not uncomfortable -- that is not comfortable. what have you been doing to speech? >> i told our students why i support free speech but i supported not just because it is the only way to get truth but because i actually care about social justice. history shows us when you suppress speech, it marginalizes people who you might be trying to protect. ist said, i do not think it because the students are snowflakes, it is because they see certain groups targeted more. we need to give them all a voice. >> thank you so much for joining us. up, we areng
listening to gary cohn speaking at the press briefing. let us hear what he has to say. children that has been a standard protector. a tax cut ofct about $1000. that is where we are headed and that is where we will continue to be. with that, i will open it up to questions and see what is on your mind. is to give aism but whene rich, criticism seems to be relevant to connecticut. there are certain people who will suffer double taxation. izers.are item is that a hard and fast redline for you? >> our planet is based on lowering rates -- our plan is b ased on lowering rat and
base.ding the ba we have designed a plan will you will pay a lower rate. that is the basic low premise of our plan and we're committed to and sticking with it. >> there were some people in the isdle income where this supposed to be beneficial because they itemize. >> to remind everyone in here, 25% of american families and mice. -- itemize. 70 5% don't. when you talk about this you are talking about 25%. we have many things we're doing in the tax plan to help out american families. we are going tax rates, we're going from seven rates to three rates. the first $24,000 of income,
they will pay zero dollars on. we are lowering the 50% rate down to 12%. we are things to help that family. we're expanding the parameters for childcare. we will move the upper bound tell who is eligible for child care of 28 higher income levels of family may be -- for incomere to a higher level. do not look at any one piece. look at tax reform in its entirety. there are people who think if you dissuade people from itemizing you will suppress the real estate market. people will not be interested in buying homes because they will not be able to use itemized deduction. >> we are protecting this deduction. the homeowner came out in favor of our tax plan.
the number one reason why people buy homes if they are excited and optimistic about the economy. today.ve a jobthe number one ry they feel accomplished that they will have a job tomorrow. their kids will get a job and their spouse has a job. they feel like there is upward wage pressure and mobility and they feel good about the economy. that is why people buy homes. we have not been in this situation for the last decade. we have to get america back to a place where they feel excited and exuberant about the economy. economy. when i happens, they will go out and spend money and buy homes. again, 75% of families do not use itemized deductions. >> how will you ensure the wealthier people do not abuse this? >> great question. we spent a lot of time on the anti-abuse -- the last thing we want to see is movehy groups or families
their tax rate down from the 35% rate to the 25% rate. we are spending time on that. the house writers -- the tax writers in the house and senate are aware of this issue. you will be seeing language when we deliver more details. we are acutely aware of that. bes like myself should not allowed to put their assets into a partnership to reduce our tax liability by 10%. >> what do you said this morning no you could not guarantee taxpayers would actually pay more taxes under the plan. that is a real possibility. some of the calculations are -- four theedline president that all taxpayers stick to the plan? the president said this tax-cut
would not help him and he said it would be bad for him. , he saveshat we know $2.5 million. he would say a lot not paying his state tax. how can you think this is not going to help him? >> i think with the american people are concerned about is their financial position. they are concerned about when they go to work every week how much they get to keep. how much goes in their pocket versus how much goes to the government? how much do they get to spend versus how much do they send to the government? how much do they send to the government? if we allow a family to save another $1000, what does that mean? they can buy a new car, they can take a family vacation. that is what the tax plan does.
it is aimed to return more income back to hard-working americans. speaking of the president saying the tax plan will not benefit him, do you think it will be a good idea for the president to prove that by releasing his tax returns? >> what we are to do here is to -- thee a lifestyle lifestyle of american citizens. our hard-working citizens to get up every morning and work as hard as anybody in the world to keep more of their hard-earned income. our tax plan is to try to get the economy and the growth rate back to a normalized rate above 3%. we just had a quarter of .1% gdp. people do not think we could get to 3.1%. this week $3 trillion. than $3means more trillion.
of this contradict the central promise of the plan to help all middle-class americans? >> our tax plan is aimed to make sure we give middle-class americans a tax cut. we are going to give middle-class americans a tax cuts. that is what we're spending all our time on doing. we have lots of tools at our disposal and that is what we're going to do. as i said this morning, and i i can read myain, statement from this morning. i liked it so much i can say it again. i cannot guarantee that. you can find me someone in the country that their taxes may not go down. remember, we have 50 states, we have counties, cities, long-term capital gain, short-term capital gain. i guarantee you you could find someone in this country, maybe whoserson who's taxes -- taxes may not go down. >> will confidence do you have
that given what has happened so far this year on e hill -- on capitol hill they will get this done? >> i am very confident the house in the senate are working as quickly as they can. brady andk at german what he -- at chairman brady, he came in on sunday to start working and he continues to work every day. he says they will work through the tax plan as quickly as they can. throughhope it will get the house in october, the senate in november, and the build on by this year. why am i here? i am here for this reason. think about what i am involved in with president trump trying to rewrite the tax code. something hasn't been done for 31 years th.
theimpact we can have on u.s. economy, this is a once-in-a-lifetime opportunity that i would never miss. that mean when you're done with tax reform you will no longer be at the white house? >> there are many more once-in-a-lifetime opportunities at the white house. >> i would love to hear what would make you stay. can you give us any kind of the goalon as to what for refundable's will be? >> i think we said yesterday, the existing childcare credit is refundable and will stay refundable. the additional money we put into the credit will be nonrefundable. we want to encourage people to work and to have people have taxable income to take the credit against. we are still working out some of it. we have a range and mind. -- in
mind. we are looking to deliver a large middle income tax-cut. the plan 12 $.2 trillion to the deficit. is that wrong? >> we think that is wrong because the way they score. let us not argue with they are right or wrong. we firmly believe that this tax plan will have a dramatic >> we believe this tax plan will have a dramatic -- that $3a change in gdp trillion back. if we are right, we will only pay. $800 billion of the deficit. >> history would show that companies don't always use those assets to invest in
>> when i just be candid about that. think -- american taxpayers care about what they take him and what they have to spend. >> he is saying he will not benefit. it appears as though the way it is put together, he actually will. about thesere wealthy americans. sarah will you let me. i'm taking too long here. that being a great benefit. the two great drivers that would repeal the tax, the farm bureau. small businesses and farms. those are the two organizations
has been the most time wobbling around the death tax. it has the biggest effect on them. they can use trust and all types of things that are legal within the tax code to makes -- to make sure they do not pay the death tax. get into deep to calculations, but at a broad brush level, when you do the amt, once you get rid of it, deductions of state and local taxes, that is the biggest ad back at amt. amt becomes irrelevant once you get rid of deductions and local taxes. you are not looking at the planets in its entirety. they don't make sense once you redo the plan. >> gary. question, inlow-up the ultimate appearance of this
room -- yousaid that, i cited see the worry of groups such as jim martin and 60 plus seniors association that you will drag tax.he repeal of the death is that final? immediateg to be an -- off the books? >> in our outline, it is immediate. >> five-year expense. >> speaking of small businesses, let's start negotiating. yesterday, senator schumer said democrats may be willing to work with sometimes small business tax relief into whatever cuts out of all of this. when you start negotiating, what offer to you make?
>> our open offer and final officer -- offer on the table. we are happy to the lower. there is the opening offer. if you want to counter something oh -- lower, we are negotiable -- negotiable. >> the white house press briefing. just to give you a sense of what they are talking about there. homebuying -- confidences not by tax reduction. he was tackled once again. who will benefit overall with the tax cuts. finally taxes done by the house in october and the senate in november. a 20% is notax in negotiable with the democrats
and they want to the lower. let's bring in mike mckee to break down what we just heard. something you just said, the symbol of all of this, not negotiable with democrats, it will be negotiable with republicans. it is an extraordinarily complex issue and it will break down on republican and democrat lines, who is the business that funds your campaign that you take campaign donations from? what method -- what matters to state and locality, there are republicans in big cities that will be in big trouble. this is very early. the language to up suit -- up to kate -- you cannot tell who the winners will be. the analysts who looked at it say it is almost impossible to say at this point.
>> it is ok to not go on about the deficit for now. one thing he did get more specific on is the repeal of the death tax and how that is driven by small businesses. you are giving me context in terms of how many farms would benefit. >> it is another silly argument a lot of people are making for a long time. what has happened over the years is congress has raised the exemption level. you have $5.5 million as a single taxpayer or more than $11 million to even start thinking about paying it. very few people do. the tax policy center has put together figures for 2017 and they say total of 50, 50 farms, would be subject to the estate tax. they would pay an average tax rate of about 6%.
it is not really at issue and certainly will not raise revenue. >> mike, great to chat with you. thank you for the wisdom. let's get a check of the first word news with mark crumpton. mark: thank you. the acting homeland security secretary says 90% of order rico is now accessible. an update on eight efforts with homeland security tom -- advisor tom. >> everything has been prioritized. we are now on gas stations. is a conscious effort to make sure we do not have a loss of life. mark: duke says the most difficult challenge is they'd across the commonwealth. the storm knocked out power and water on the island.
the extremelyin short supply. passengers at airports around this mine some delays because of a software glitch that caused a problem with check. the spain-based company, which , airports,ftware airlines, and the tourism industry, confirmed that the network industry caused disruption to systems and services. more than 130 airlines worldwide used to passenger service system. president vladimir putin is in -- on for talks with developments with iraq and syria and turkey's's decision to purchase a russian-made missile to set -- missile-defense system. president putin's decision comes as they are strengthening ties and the turnaround for the two signss, have data posing in syria and relations were strained over turkey downing of inushing -- russian plane 2015. nevada and secretary of state
cause -- called for greater dialogue of the roman catholic church. after a small group of traditionalists accused pope francis of spreading heresy. the group is criticizing the pope for his opening to divorced and remarried catholics. it was said today that those who do not agree with the pope are free to express themselves but on these things, one must reason and find ways to understand one another. 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: thank you. coming up, lin joins less after beating back fraud charges. we will ask her what is next for her firm now that the case have in -- case has been dismissed. this is bloomberg. ♪
>> founder and ceo lynn tilton has -- been backed exchange commission. they have rolled in favor of tilton throwing out fcc allegations that she and her firm -- the decision comes after a three-week trial last year. let's handed over to david gura. david: you had complaints about how these judges are appointed in the context of fcc. he forget your complaints about everything else or are you upset about the way transpired or the outcome overall? >> their purposes --
they don't serve the due process needs for career and reputation. process protections offered by article three quarts. i had no depositions and no discovery. after it was lifted by the court, i had six weeks to get ready and i needed to move and pay for an army. most people would not have had the resources to do that. i do not think the courts are billed for these types of cases. i'm grateful to the judge for following the evidence but i do think these types of cases do not belong in administrative courts. >> in the middle of this, you -- ged why did you make the change and how did the jurist prudence, the way you are being represented, change as a result? >> most lawyers do not want to go into the administrative courts. there is over a 90% win rate for
the fcc in the courts. there is no due process in terms of discovery and deposition. they really thought the fight against administrative court system was the way to go. i had very little time to get ready. randy -- m and susan, who has been with me since the beginning of time, since early when i started. she and my partner have always represented me and they were willing to get in there and fight. i felt like i needed a complete and honor vindication so my companies and my people would not have to live under that shadow. >> i looked at the decision yesterday, and this is complicated stuff. i read it five times to try and get a sense of it. how many people do you think understand what you are doing? how unique was the one -- was
the work you are doing? on a patentedse model i have. these are different than other indentures. the investors certainly knew what was going on with these funds. they were all institutional investors, all tanks and investment banks. major hedge funds but in later on but no mom-and-pop investors. the documents spoke for themselves and make if me complete discretion, as a judge said. they gave me control over the funds and there were no omissions. everything was there for people to see. for the press, there is nothing to look against, it might have been difficult to understand. >> on that point, there is a criticism that you could have been more detailed on your financial statements. why weren't you?
>> i had the same accounting firm for 17 years who went through and design my financial statements and went through my financial statements every month. i'm not an accountant by background. direction as it seemed to be. they had trustee reports that one across of it. they investor witnesses brought to trial, not of them have looked at financial statements. the trustee reports, hundreds of pages, were actually were everybody was able to see things. we thought we were doing everything we were supposed to do with financial statements. the end, she found that there were no omissions, but, there was nothing that was being hidden. it was just how they were formulated and how we followed them. >> i think you'll want to respond to a line from this decision. a hands-on managing portfolio company. turnaround.ful
you can read between the lines there. part.tter >> well look, every company i bought over the last two decades , we restructured and bought over 240 companies. they were all left for dead. there were -- they were days from liquidation. not everyone will turn around and be successful and if someone told you they would, they would not be truthful. for me to end up with highly successful companies to me is a victory. the hundreds of thousands of people we put to work is a victory. for me, it has always been about giving the dignity of work to years, i have 20 talked about saving american manufacturing and bringing manufacturing back to america. that has always been the motivation beyond what i did. >> how do you attribute the situation yesterday to the changes in washington.
a new president and chairman of the fcc. did that work in your favor? >> i think it is a profile encourage for the judge or the most senior people at the fcc sat in the front row for three weeks pressuring her. she followed the facts and did what was right. i would like to think a change in administration has taken some pressure off but i would like to believe the evidence spoke for and that she is a woman of integrity. i am grateful. >> you are looking at the second and the 10th circuit. there was the prophet -- prospect of going to the supreme court. he tried to do that. how much of the fire did i -- die down? >> i have no reason to go to the appellant courts. i am out of the game. i think he the administrative
core issue will be decided by supreme court's since we have split appellate courts. i think they will that up and i hope this case will be motivation for the fcc for real reform. there are uses for the administrative courts that really make sense. these types of cases do not belong in the administrative courts and i hope they will self reform because of it. hope isith the fcc i over and i can go back to billing value in taking companies to greatness. >> on that note, where do things stand procedurally in terms of what you're looking at legally? what are you looking ahead to now? >> i am hoping with this off my back and the indo and knows that it casts, that it will help refinance my companies and so companies without losing value now. legal actions are mostly piggybacked cases off of this. i hope this will help me remove
that from my profile as well. i love leading people and teaching them that the impossible is possible. >> great to see you. >> thanks to david for the interview. to puertof damage rico by her cambria can reach an estimated 60-70,000,000,000 dollars according to -- now criticism into how the trump administration is handling the ongoing crisis. including the general who came in to clean up recovery efforts after the 2005 hurricane katrina . the trump administration's is a hit on white house decision-making. response to that critique as well as updates, deputy administrator daniel can he scheme from fema headquarters. .reat to have you thank you for joining us.
i appreciate that you are incredibly busy. i just want your response to whatyou heard there about was said. he said it was amateur hour. your response? >> i can simply say that whether it is the leaders here at fema, or those seated behind me or nearly the 10,000 federal responders on the islands of puerto rico and virgin islands right now would be humanly disagree with that. we are working tirelessly to a virgin islands and puerto rico to sustain operations for the long-term. we are in this for the long haul. we have got to make sure everyone is taken care of, from commodities to power restoration to communication, to hospitals, you name it. we are on it. are on it but at the same time, the issue for puerto rico is not that there is not aid, or physical it in the form of food
and water being sent to puerto rico. it is sitting on the ports, cargo that cannot be moved because the roads are not passable. what is being done on that front? we had a major hurricane, the worst to hit the area in nearly 100 years. roads are going to be impassable and these are areas we cannot get to except by helicopter. your point about the commodities sitting there is the case in point that commodities are getting there, despite the 1500 miles between right here in the islands. it is either ship or plane, that is the only way to get commodities there. given that the air traffic control system has been barely operating since the storm hit, we have been pushing commodities and it is all showing up. it is good it is there. we have evidence that we have pushed as hard and fast as we can and quite frankly, it has been like pushing a bowling ball through a straw with air traffic control system being down. one airport to get all of those supplies and now that it is
opening, we are getting much more at the ports. your point is, how do we get the last mile direct -- delivery. it is a challenge for the reasons you just said. to rate -- debris being in the roads and areas seeing inaccessible. we are doing everything in our power together with our partners at the department of defense, and a three-star general arriving this afternoon will command a much larger sustainment that has begun to arrive and i think you will see a visible presence. it has taken a while but given the challenges, given that there is an ocean between the mainland and the island, and given that municipal governments were completely wiped out and not able to help us distribute the items, we're taking on the challenge and we will meet the challenge. >> can i ask you about preparation that fema did in the case?
in the days leading up to hurricane maria when we clearly knew this would be a problem for the territory, what a system -- assistance did fema and other agencies provide in preparation? >> we were there before the storm, before hurricane irma. this is the second strike to hit puerto rico. there were thousands of federal personnel on the island when the hurricane struck. >> you do not feel like you were underprepared? >> no. we knew this would be bad. but there is only so much you can put on the island before the storm. we have thousands of personnel and many tons of commodities were there and immediately excess of the. the challenge is of course logistics, to get the rest. we cannot sustain the operation with pre-existing items. >> can you give us a sense of the dollar value of the assistance provided pre-the hurricane hitting? >> i cannot give you an exact dollar amount but it was tons of
assets and thousands of federal personnel. the cost ofell you the disaster in the immediate response in the lead up to now, the federalbe government disaster relief -- >> thanks to daniel joining us from fema headquarters in washington dc on the challenges of getting aid to those in puerto rico after hurricane maria. still ahead, everything from tax reform to bitcoin. president and founder joins us for a full hour on what did you miss. this is bloomberg. ♪
feels to be back to work. he was wounded at a shooting at a baseball practice three months ago. todayurned to the capitol for cheers and a standing ovation and he thanked crystal and david, the two police officers who, despite being wanted, shot and killed the gunman. when i was laying there, i could hear a different caliber weapon. that told me they immediately engaged the shipper. shot, bothbeing continue to engage the shooter and ultimately got him down, which not only saved my life that saved the lives of a lot of other people in the chamber today. crystal could not be with us with us. david is you are my hero and you saved my life. >> speaker paul ryan welcomed him with the word, our