tv Bloomberg Markets Americas Bloomberg October 4, 2017 12:00pm-1:00pm EDT
have given him a final list of people they are recommending as candidates to lead the federal reserve. they have ended the search according to seven people familiar. stanley fischer speaks in an exclusive interview on the search to replace fed chair janet yellen. on capitol hill, we are awaiting a key press conference of senate intelligence committee leaders. the latest on the inquiry into russian interference in the 2016 elections. john fx network ceo landgraf sits down for an exclusive interview on why networks are losing the battle against the likes of netflix, amazon, and many more. first, julie hyman is with us and we are halfway into the trading day. julie: i was just glancing at the bloomberg to see if there had been any reaction to the fed headline you mentioned in the bond market and it does not look like as of yet. we are talking about the story
that the trump administration getting close to that final list . as we are looking at the major averages, we have seen them tick up a little bit in the past hour or so. we had been seeing a mixed picture and now all three major averages are at records. seeing fairly tight ranges in terms of the trading ranges for them, so a pretty typical playbook. andumer discretionary staple stocks are leading gains in the s&p 500. on the downside we have the solid waste management companies. analyst michael hoffman downgrading his rating on the sector. he says there are headwinds from and plummeting prices for recycled paper, so that is weighing on the companies in the sector. waste management and advanced disposal services are examples. the best performer on the s&p 500 is mylan, shares are soaring
after the company got fda approval for the first generic copies of the best selling multiple sclerosis job -- drug. teva andig seller for brought in sales of about $3.6 billion. mylan will have exclusivity for 180 days, at least on a marketing basis. shares up 19%. would be losing out and though shares are down 14%. i want to check on oil prices, because we had a fascinating weekly inventories report. it is not much changed in the price of oil, but you can see the volatility we have had in the wake of the inventory report . we had a big drawdown on crude oil inventory of about 6 million barrels, however a climb in inventories at cushing. exports from the u.s. set a a recordet imports at
low so exports and a high, imports at a low, and also production rose. a lot of crosscurrents here and it looks like all of that is equally not much change as there is a lot of push and pull in the market. oil holding above $50 a -- a barrel. vonnie: thank you, julie hyman. shery: donald trump could be one step closer to appointing the next fed chair. we are learning his advisers have given him a short list of candidates they are recommending for the position. janet yellen is said to be on that list along with kevin war jerome jerome warsh, powell, and gary cohn. tom keene asked stanley fischer about the leadership of the central bank in an exclusive interview. >> this is a choice clearly of the president and the administration, and that decision is up to them.
there are candidates whose names are in the newspapers. that is how important they are. it is really not appropriate for me to get into deciding who is going to be the next chairman. tom: i would suggest that is probably true. brendan murray would disagree. the basic idea of if we have the turmoil we have in america and the economic uncertainty in our theories, will that migrate us toward a more rural-based system and away from discretion over the coming years? of athink the attraction rural-based system is large and in practice you will find yourself having to define all the time when it is appropriate to divert from the rule, because the rules do not anticipate the many strange things that can happen in any economy, even such things as three rate hikes in a row, which is not a huge surprise, but it happened, and
the many other things that will change policy. i think roles are a good are a good- rules guideline to the basic part you are taking am aware you are trying to go, but i would not run monetary policy on the basis of rules where you strictly go down, look at this equation and say that is it, let's get rid of the central bank. tom: i believe you were in zambia years ago. do we need a fed chair like chair yellen who has read maynard kings 1936? i believe we have a number of candidates who have not probably gone through those key chapters which are considered the canon today. >> they should read it and read the whole book because at the talks about what happens when the interest rate gets too low. it is worth reading even today, what is in their bank. -- in there.
tom: do we have a new set up, a nonmonetary fed chair who has a vice chair of your capabilities or chair yellen's capabilities, or do we need to have that monetary expertise for crisis and shock as chairman? terms, oneound in my place as governor and another as vice chair, that having the basic economic fear -- theoretical knowledge and experience increases your self-confidence about what you are doing. is it essential? i doubt it. there are very smart people who can figure this out in many ways, but is it helpful? yes, very much. was fed vice chairman stanley fischer talking to tom keene earlier. for more on the future of the central bank, let's bring in bloomberg senior economist here
it we know president trump wants easy money so will he try to get a sympathetic fed? >> absolutely, and that is why we believe chair yellen will get the job. we think she has more than 50% probability of getting it. this is based on the assumption that president trump wants simply low interest rate person to do the job, so we think that would help his agenda, and it is really chair yellen's philosophy that would be appealing to the administration. vonnie: doesn't it feel like ing? weellen is reced have a chart of how she is receding. gary cohn has gone way down and janet yellen is right the side him at almost zero. it looks like kevin warsh is the most likely contender. yelena: when you hear about it
in the news, some names are floated and it increases the chances when somebody is mentioned in the news. i would say that the preference for low interest rates actually disqualifies some of those ,andidates such as kevin warsh because his preference, and he has been talking a lot about financial stability. i natural stability concerns would almost automatically mean higher interest rates, and this is not something president trump achievet if he wants to surface end growth in gdp. vonnie: stf financial came out with a note that said only fed governor powell has a -- tradable. is that true? yelena: i think he is next on the list after chair yellen. if she is disqualified because of her opposition to deregulation, which she clearly stated at jackson hole, i think
jerome powell has probably the most qualifications to get the job. shery: how about pushback from republicans? conventional republicans like john taylor. how is he doing? yelena: i think low interest rate policy preference would also disqualify the hawks, and obviously if you apply any iteration of the taylor rule, that would almost automatically require higher interest rates. that is now expected. shery: how will this fed chair race play into the tax reform, the fiscal options the administration has? yelena: it will have to interplay. if tax reform increases the speed of the economy, the potential growth of the economy, the fed will not necessarily need to raise rates. but if it is a simple sugar high tax cut, the fed will probably
have to do raise rates. shery: thank you so much for joining us. seniorrg intelligence economic economist -- economist. vonnie: let's check in on the first word news. secretary of state rex tillerson is staying on the job despite being criticized for president trump for his diplomatic efforts with north korea. >> my commitment to success of our country and president is as strong as it was the day i accepted his offer to serve as secretary of state. said president trump secretary tillerson was wasting his time trying to negotiate directly with pr gang. taylor -- young yang. -- pyongyang. tillerson denied the report he referred to the president in a derogatory term. the president is said -- set to arrive in las vegas to meet with
survivors of the worst mass shooting in u.s. history. photos have been released of the hotel room where stephen paddock was hold up and a number of weapons were visible. his girlfriend flew from the philippines and was met by fbi agents. at the-- a heckler conference said theresa may was fired. -- with turkey's president by his side, iran's president is in shoring borders will remained ensuring borders will remain unchanged. -- haven and turkey sent troops to their borders with the iraqi kurdish region. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries.
their on the findings of months long investigation into russia's involvement in the 2016 election. we are standing by for that and will bring it as it happens, the news conference expected to shed light on ties of president trump and russia. let's bring in kevin cirilli. and max chaffed ken, businessweek columnist. idea what we might hear in the next few minutes? max: within the past -- kevin: within the past 24 hours there has been a shift in focus in terms of silicon valley's role in the invest -- in the election , and giving russia the leeway in order to have advertisements, whether via facebook or youtube in which they were using ,ladimir putin's propaganda arm selling ads and bundling it in google preferred.
it really has been a rough time on capitol hill within the last giantl weeks in terms of social media companies' involvement. we remember facebook's mark zuckerberg having to release that video, facing intense pressure. the toptable that both republican senator richard burr as well as the top democrat mark warner on this committee are giving a joint conference. to some extent they decided to do this routinely and offer the appearance of having it be nonpartisan, and having it stay above the ideological, political fray. that is notable. whether or not they have you -- emerge to have several differences, we will have to see how this plays out, but in terms of democrat mark warner, many have wondered about his own political future within the party in the next presidential cycle. it will be interesting to see how he interacts with senator burr. shery: from what we have heard
so far, we have investigations going on in the house as well. what do we know so far about the extent of the meddling in the 2016 elections and what have these firms done? forgetting a third investigation, counsel mueller's investigation. it is the one we know the least about. what we know so far is there were 3000 advertisements, that is what facebook has said, connected to the russian government. we have got an indication from folks on the senate intelligence committee that they think this is the tip of the iceberg. that is the quote that keeps getting thrown around. . am interested in two things first, do they see facebook as potential evidence of collusion between the trump campaign and russian government? i think that is the most important thing that will give us hands to what the special counsel -- hints to what the
special counsel is thinking. there is an article about how facebook lobbied against election disclosures and you can imagine the senate intelligence committee using this as an silicon valley on the knuckles and force them to disclose who is buying these ads. vonnie: what is the worst outcome? max: for facebook, the first risk his embarrassment. people have had generally really good feelings about this company, and to see them in the center of this mess, of the possibility that a foreign government messed with our .lections, that is damaging from the point of view of advertisers, that is not necessarily a bad thing. if you talk to people in madison avenue, advertising folks, the fact that facebook ads are this to them is interesting and validates facebook as an advertising platform. that is regulatory risk
somehow washington will say, you need more human disclosure. that could eat into their bottom line. shery: when i was thinking about this issue, when i use google, facebook, youtube anywhere in the world i do never -- i never think of it as an explicitly american service. how difficult is it for regulators having to draw the line for foreign leaders participating in domestic politics? theyfor years, they argued should not have to have any oversight so it is not clear how you draw the line. that is one of the reasons mark zuckerberg and facebook have emphasized creating global policies so they do not have to go country by country. they have done that with certain countries. in germany, certain kinds of neo-nazi propaganda is off facebook, so there are definitely ways facebook can be more -- respond more closely to
what the government wants. they do not quite know how to do it. vonnie: stick with us, both of you. is our chiefally washington correspondent and with us is max trafton. kin.haf mohamed el-erian was weighing in this morning. we have that news conference, and we will bring you the headlines from that news conference and what it means. this is bloomberg. ♪
chairman richard burr and ranking democrat mark warner on the findings of their months' long investigation into russia's involvement in the 2016 election. they are expected to shed light on ties between president trump and russia. for more on what to expect, let's bring back kevin cirilli, chief washington correspondent, and max chafkin, bloomberg business week columnist. we are seeing them walking to the podium. we will hear what their remarks are. this is the senate intelligence committee with the latest on the russian investigation. around the country, mark and i recognize the tragedy of nevada this week. to say point, i'm glad it does not seem to have a terrorism that this. that is not -- this. our heart goes out to
all the people affected directly and indirectly. from an intelligence committee standpoint, we are providing many assets to local law-enforcement and those tasked with investigations of this unbelievable act. so we are here to update you about -- you and the american people about the investigation into russia's meddling in the 2016 election. when we started this investigation on 23 january this .ear, we had a very clear focus we were focused on an evaluation communityelligence assessment of russia's involvement in our 2016 election. the investigation was to look into any collusion by either campaign during the 2016 election. the third piece was an assessment of the ongoing russian active measures,
including information and influence campaigns that may still exist and may be ongoing. the investigation started with those three buckets of interest. now we are over 100 interviews later, which translates to 250 plus hours of interviews. almost 4000 pages of transcripts. almost 100,000 pages of documents reviewed by our staff and some by members. it includes highly classified intelligence reporting. it includes emails, campaign documents, and technical cyber analysis products. the committee has held 11 open hearings this calendar year that have touched on russia's interference in u.s. elections. i can say that our dedicated russia investigative staff have literally worked six to seven
hours a day since 23 january to get us to the point we are today. >> six to seven days a week. >> six to seven days a week, excuse me. so far in the interview process we have interviewed everybody who had a hand or a voice into the creation of the intelligence community assessment. nine times the amount of time that the community spent putting the ica together, reviewing it and all the supporting documents. in addition, the things that were thrown on the cutting room door -- four a might not have found appropriate for the ica itself but we might have found of relevance for our investigation. we have interviewed every official of the obama administration to fully understand what they saw, what clarets -- clarity and
transparency they had in the russian involvement, and what they did or did not do and what drove those actions. i am reminded we will come out with a finding at some point, and part of that hopefully will be recommendations as to changes we need to make. we have tried to think as thoroughly through this as we can. we have interviewed literally individuals from around the world. so for those of you that choose to stake out when the next witness is coming, some have snuck through because you do not know who they are. now, it is safe to say the inquiry has expanded slightly. initial interviews and document review generated hundreds of additional requests on our part for information. it identified many leads that expanded our initial inquiry. the volume of work done by the staff has prepared the committee
to look at some areas of our investigation that we hope will very soon reach some definite conclusion. but we are not there yet, we are not ready to close them. one of those areas is the ica itself. given that we have interviewed everybody who had a hand in it, there is general consensus among members and staff that we trust the conclusions of the ica, but we do not close our consideration of it in the unlikelihood that we find additional information through the completion of our investigation. the obama administration's response to russia's interference, we have interviewed every person within the administration. a have volunteered and been unbelievably operative to share everything they knew -- they have volunteered and been
unbelievably cooperative. ,he interview at the mayflower let me be specific, these are not issues that have been closed . we have not come to final conclusions. we interviewed seven individuals who attended the mayflower event. the testimony was consistent with each other, but we understand with a current investigation open there may be additional information we find that pulling that thread may give us additional insight we do not see today. the platform committee -- and i am addressing some things written by you in this room, and they may not have been on our chart, that we felt we had to dig deeply into them. the committee staff has interviewed every person involved in the drafting of the campaign platform. campaign staff was attempting to implement what they believed to be guidance to be a strong ally of the ukraine, but also leave
the door open for better relations with russia. i am giving you the feedback we got from the individuals in the room making the decision. again, not closed. .pen for the continuation the last one i want to cover is memos.ey this topic has been hotly debated and the committee is satisfied that our involvement with this issue has reached a logical end, as it relates to the russian investigation. again, this is not something that we have closed, but we have exhausted every person that we can talk to to get information that is pertinent to us relative to the russian investigation. questions you might have surrounding comey's fire ring are better and sold -- firing are better answered by the justice department, not the
select committee of the -- the united states senate. , the committee continues to look into all evidence to see if there was any hint of collusion. now, i am not going to even discuss initial findings because we haven't any. we have a tremendous amount of documents still to go through, and to put it in perspective, i said we have done over 100 interviews, over 250 hours. we currently have booked for the balance of this month 25 additional interviews. eating thet end up total, but as of today there are 25 individuals booked to meet we have more work to do. picturedevelop a clear of what happened. serviceian intelligence
is determined, clever. i recommend every campaign in election official take this very seriously. as we move into preparation for the 2018 election. sen. warner: i am very proud of this committee. the way the committee has acted. the enormous amount of work they have done. chairman and i see many of you in the hallways every day. it feels like it is taking a long time. getting it right and all the facts is what we need to do.
stories that emerged in the late summer around mr. trump junior's meeting. would love tond i find a way to close things down. we see strange threads we need to keep pursuing. i want to talk about what richard has already said. measures didctive not end on election day 2016. they were not only cured at the united states -- geared at the united states. france,e taken place in the netherlands, we have seen concerns raised in germany.
electoral systems -- least the opening of the door. it has been very disappointing that itd the chairman took 11 months for the department of homeland security to reveal those 21 states. know why last friday was the date they chose to reveal that information. a moreeeds to be aggressive government approach in terms of protecting the system.
making this change doesn't require penetration into 50 states. i believe in virginia and new jersey, and 34 days we have elections. to help statesg with elections that are happening this year. there is anake sure organized government approach. before wea, discovered we were one of the 21 ate electoralt caution.ued a vote of one of the things we wanted to
nmphasize is that this is a ongoing concern. if states don't proactively we will be getting into primary seasons shortly in 2018. this is an ongoing challenge. there is still lack of clarity about whether the appropriate individuals were notified in texas and california. i want to raise an issue that the chairman and i have been working jointly on. russian's use of social media. us turn tojority of in a wayon from news that is very different.
if you look in the realm of political advertising, we have seen over 700% of an increase in the use of digital political advertising between 2012 and 2016. it has the ability to target vo ters. that some ofed these companies did not take this threat seriously. they are recognizing that threat now. they have provided us with information. important that the three companies we've invited hearing,ar in a public so that americans can hear about how we're going to protect three areas. making sure that if you see
an advertisement that appears on a social media site, americans can know where the source of that act was generated. -- that ad was generated. if you see a story that is trending whether that is because americans are liking page,tory or liking that whether that is generated by orl individuals or bots falsely identified accounts. facebook has indicated between 30,000 and 50,000 accounts were taken down in france due to russian investigations. both of us have been in politics a long time.
it advertisements are running against you, you have -- if ads are running against you, you should be able to go down and take a look at content. i turned back over to the chairman. we don't release documents provided to our committee. the senate intelligence committee is not released document provided by witnesses, companies, whatever the classification. it is not a practice we will get into. any social media platforms would like to do that, we are fine with it. scheduled andy open hearing because we believe the american people deserve to hear it first hand. on october 25, we will have another open hearing.
invitedber 1, we have social media companies to be our guest at an open hearing. we feel confident they will take us up on that. ica. the committee has hit a wall. we have on several occasions made attempts to meet with mr. to include the vice-chairman and myself. those offers have gone unaccepted. the committee cannot decide the credibility of the dossier things understanding
like sources and some sources -- subsources. we are investigating an expensive russian network. the we have been incredibly enlightened in our ability to rebuild bacvkward -- backwards the steele dossier to a certain point, getting past it has been impossible. i don't think we will find any intelligence that unlocks that key to pre-june of 2016. his side ofn hear , versus for us to declare in our findings what his intent or actions were. i say it to you and chris steel e.
potential witnesses we might ask to come in in the future. i strongly suggest you come in and speak with us. if you believe you have ifething valuable to bring, you don't voluntarily do it, i will assure you, you will be compelled to do it. that will be done in a very public way. the committee has proven to be balanced, professional, and willing to listen to everyone. for those following our press, youon, in the only sequences of the amount of work that the committee has done. we have done much of the work behind closed doors to ensure privacy and protection of witnesses and the citizens.
committee has stayed focused on building a foundation to be able to finish our investigation thoroughly and in an accountable way. when we started, we chose wisely by choosing our professional staff to spearhead this investigation, and not listening to the talking heads around the country that said we could do this unless we hire a new group. we look forward to completing the work in presenting findings to the public. date as to when that will be. we will share with you when we have exhausted every threat of -- thread of== t
intelligence. every potential witness. if we haven't met with them, you would have question us -- quest ed us as to why we didn't. none of us in this room may know everyone we have met with. we're not going to share the interview and what they will tell us. we're not going to share the documents we got. but we have more than 100,000 documents. a large group of that came from the trump campaign. when you look at this country's most sensitive intelligence, we're going to get the best view of what happened. that anyone could possibly get.
we will be sure we present to the american people are findings as best we can -- our findings as best we can. facebook ads these are specifically associated with the russian campaign, the trump campaign, or any political campaign? ads was toect of the create chaos in every group they could identify in america. in many cases, these folks didn't take some of the most technical tools that exist within the social media companies. i would defer answering your question until we completed the investigation.
there will be more forensics done. we will at scale, france versus havenited states -- they some more work to do. the president said any talk of collusion is a hoax. is the president right? i will let you ask him questions about what he says. we want to rule out the president knew of anything of these contents. sen. burr: the issue of collusion is still open.
investigateto intelligence and witnesses. we have not come to a finding on that. are you pursuing the question of a link between these ads and the trump campaign? if there was any connection, that would be pertinent to our investigation. we have had incredible access and cooperation by those social media companies. some of them have been interviewed twice. day, we will the
be prepared to ask the right questions at that open hearing. i was concerned the first path was not thorough enough. the only ads that were produced well paid for -- were all paid for in rubles. companies are understanding their actions needed to match public statements. they need to realize how important it is to maintain the integrity of the democratic process. >> can you characterize the level of cooperation from trump
campaign officials? there are some individuals that may have been involved in the trump campaign -- we might have limited the scope of our questions. we have them come back when we know more. defined the documents that you have reviewed and truthful -- have you found the documents that you have reviewed been truthful? outside of specific areas, we in an exploratory mode.
trying to piece together what people did, where they were. we have access to enough records, text messages, phone records. voluntarily. when you get stuck voluntarily, untarily,s -- stuff vol someone is probably going to tell you the truth. we will take everything the staff has put into transcripts and we will test that against every piece of intelligence. let us go through that process. if someone comes in and isn't being truthful, we will catch them. they will come back. whatsed on the work done, is your assessment of what the
russians did do in 2016 and what they are doing now and in the f uture? sen. warner: there's large consensus that they hacked into clinical files, will -- political files and released them. to test they tried vulnerabilities of 21 states' electoral systems. the socialy used media firms in terms of paid advertising -- and what i believe is more problematic, they created false accounts and others that would drive interest to sew stories or groups
chaos and drive division in the country. they have used this pattern in other nations. i fear if you add up all they have spent, it was a decent rate of return. sen. burr: we can certifiably accurate.llies are the outcome of the election -- they did not in any way alter that. i want to reiterate, you can't walk away from this and believe russia is not currently active in trying to create chaos in our election process. we saw inactics
montenegrin, -- montenegro, belgium, will continue to be tested in our structure. they say 10 million people saw these ads. an information campaign waged against one candidate by the russians. they probed 21 states. can you look at the american public and say the election was not influenced by this massive russian operation? neither mark or i said there was a campaign targeted against one. ica did not look at
collusion. russian involvement in the nottion process -- we have come to any determination on collusion. solely the social media advertising, there's no way you can look at that and to say that was to help the right side of the ideology and not the left, or vice versa. they were indiscriminate. one of the things so challenging to this investigation is, with the exception of certain pieces that have already been discussed, it seems that the overall theme of the russian involvement in the u.s. elections was to create chaos at every level.
they have been pretty successful. theow would you rate administration and the country's response in terms of preventing this from happening in the future? how ready are we for the election of virginia in 2018? role is not to necessarily suggest here are the things we need to do. our investigation should create a roadmap for committees of proper jurisdiction to follow. for states to follow. mark and i made the decision to take the initiative in our bill that there would be a designated person in every state to has a security cards to be briefed on election issues -- have a s ecurity clearance to be briefed on election issues.
just the fact that there wasn't someone cleared at a high enough level would mean states would be notified -- wouldn't be notified. we will hopefully come a -- con vey better suggestions. \ sen. warner: let me add. putting this impetus in our intel bill. that we tellange election officials what is going on because of a lack of clearance. dhs has changed that position as of last friday.
but i would say the government approach about protecting the electoral system in terms of siebel -- cybervulnerabilities came from this morning's[ hearing in that the equifax breach may be in the hands of rogue elements, there were no appropriate cyber protections. this whole realm in cyber, we need to step up our game. do think this conclusion needs to happen before the 2018 election to warn people about what can happen next? sen. burr: i am not going to set a deadline.
we have to make our facts as it relates to russia's involvement public prior to the primaries getting started in 2018. it is my aspirational goal to finish the entire investigation by then. ago,we started nine months we had several buckets. i can't predict what witnesses are going to share with us. sen. warner: the committee has been very good at following the facts. we want to do it as quickly as possible, and do it right. trump jr -- is there any
progress forward on creating that would regulate how political ads work on these platforms? sen. warner: we are working on something. with a light touch that would sure for aning advertising doesn't penetrate the political system. and there is an ability to look at the content of these campaigns. the same way that similar roles -- rules regarding the rest of media already have.
one of the first people i want to share distract with is my chairman. -- this draft with is my chairman. there should be broad bipartisan consensus. companies are open to this type of disclosure. it is illegal for foreign money to find its way into u.s. elections. so far, you have not been able to verify the intelligence community's assessment that russia was on the side of trump? sen. burr: we for confident that the ica