tv Bloomberg Markets Americas Bloomberg October 26, 2017 2:00pm-3:30pm EDT
chatterly. this is "bloomberg markets." your live in bloomberg headquarters in new york over the next hour. here are the stories we're covering on the bloomberg and around the world. the house narrowly passes the republican budget giving a major boost to the president's promised to cut taxes. we are moments away from a major speech from president trump on the economic toll on america's opioid crisis. latestc's announcements. two hours.s close in it looks like stocks are back on the upswing. are we near record highs? julie: we are near record highs.
there we are back to it. technical difficulties. the dow is there but the other averages are not quite there. it is peak day. we have some were coming after the close of trading. the s&p dream is earnings season about 0.4%. the transportation average is up about 0.9%. outperforming what we are seeing from the major averages due in part to earnings. increasesand price coupling to help union pacific make up for revenue that was lost in storm disruptions and also auto and carloads drop in those. fell. they climbed in the third
quarter, which was more than double an increase for a year earlier. .hey had a bigger gain actually, we will have to toss it back to you, abigail. abigail: thank you. good stuff. president trump is due to deliver remarks were the opioid crisis shortly. another pressing issue is in focus today, tax reform. house republicans adopted a resolution to cut taxes by the end of the year. >> this budget we passed in the house today brings us one step closer to historic tax reform. taxes, biggerrer paychecks for americans. abigail: kevin cirilli joins us now from the white house. kevin, thank you for taking the time. with the budget resolution , this puts house and senate republicans on have to
put together a tax reform bill next week. what measures are the sticking points that are keeping this shrouded in secrecy? kevin: house republicans passing vote.a 216-212 the house republicans that had concern about the budget, mainly over the state and local tax fore, but it against this the plan. that said, even with those 20 members opposing, should they ultimately vote against the tax plan that is scheduled remarkable november 6, that would still not be enough votes to block the tax overhaul plan by the end of the year. all democrats are expected to vote against it. the sticking point for how to pay for this. $1.3 trillion in revenue would be a result of this tax reduction issue. republicans from california and new york on taking issue with that, largely making up a block
of 20 or so republicans who voted against the budget. faced with the reality that if they do not get this done by the end of the year or the first month of next calendar year, there will be facing a tough reelection battle in 2018. listen to what representative crist collins has to to say when i asked about the political realities. collins: we need this done before christmas or it will be devastating because we disappointed our base rate we disappointed on health care. if we disappoint on tax reform, they will likely not vote next november. the house speaker paul ryan joked to reporters at a press conference earlier today the president will be overseas and asia when the planet unveiled on november 1 -- plan is unveiled on november 1.
scarlet: they want to do is sell the house capacity for things giving. what needs to happen in order for the bill to be introduced on november 1? that doesn't give us many days. kevin: it does not. by november 1, they will unveil this plan and they will have a markup, where it will go through the committee process on november 6. right after in a public hearing, they will likely take it if it advances out of the committee to the floor. the same thing happens in the senate. the clock is ticking down, but they are on pace with the passage of this budget. potential sticking points, a lot of asset managers are carefully -- the at the right in ratings how they will deal with 401(k)s, aarp, blackrock, having a presence on that front. of using such as property taxes and potentially from an energy
standpoint. as of right now, they are on pace. they do not need to come up with an entire way to pay for this, with some economists put a $6 million, because of the issue. abigail: the president -- scarlet: the president is expected to give a speech shortly on the opiate epidemic. give us a sense of what we should hear. will he give us more details about what the clearing this emergency -- what the this an emergency actually means? kevin: he is essentially freeing up federal funds to be sent to the state to help combat what has become a national crisis. you should note if you look at this neighbor -- labor participation rate overcapacity one years, alan krueger-2016 has a 2016an krueger study. there has been a 1/5 di
declined for men and one fourth labore for women in participation. this has impacted families across the country. abigail: $500 million is being spent on the opioid crisis. some experts say it needs to be closer to $6 billion. is there any way that could happen, and what does that mean for tax reform? kevin: quite honestly, there will be a lot of pressure. next week will be focusing on silicon valley. i think the big pharma industry is facing intensified presser for the role in this. i would note carefully back when when we were reporting on the health-care debate, you had a five partisan -- a bipartisan group really pushing for an increased amount of funding to, this national crisis. at the issue of what we have seen in regards to national does that -- natural
thisters, and now we have drug epidemic facing this country the president is signaling congress has to do something. if they are not, the federal government does have to play a role. kevin cirilli. thank you so much. our chief washington correspondent joining us. first get a check on the word news with mark crumpton. thank you. the house of representatives today overwhelmingly approves bipartisan legislation to impose sanctions on iran. they want to penalize iran for the long-range ballistic missiles while still keeping the 2015 nuclear accord largely intact. lawmakers want to hold iran accountable for what they call destabilizing behavior in the region. house speaker paul ryan says finding a solution for millions of young americans brought into the country by undocumented immigrants is a work in progress. dacadiscussed the
program at his weekly news conference. there are various possibilities to adjust the situation. you know we are working on a solution. there is no secret there. mark: president trump decided last month to end daca. they have a six-month window to act before they lose protection. in spain, the leader of catalonia says he will not call elections that might have resolved the crisis with the spanish government. the president accused madrid of trying to eradicate traditions. joe girardi was fired as new york yankees manager today after decades that produced just one world series title for a team that expects to win every year. this announcement came five days after new york lost to houston in the al champion series.
he was of the end of his contract and sent he wanted to speak with his family -- said he needed to speak to his family before he decided if he wanted to return. 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: who is leading the global billionaires race? survey says asia. we will talk about the world's wealthiest individuals. this is bloomberg. ♪
billionaires, and that is the yellow bar, they still control the most wealth. the number of asian billionaires increase at a faster pace, the orange bar. global wealth rose 17% to $6 trillion in 2016, reversing a decline from the previous year. i want to welcome mike ryan. he joins us from his office in new york. her to speak with you. this report is -- great to speak with you. this report is so interesting, and it creates these new questions. let's start with asia because a new millionaire is created every other david. how long before asia take the lead as the largest concentration of wealth? what over four years, asia overtake the united states for billionaires. while asia grew in terms of
number of billionaires and continues to expand, the u.s. does remain the largest concentration of billionaires. the welfare billionaires in the united states increased by about 16%. it is not like we haven't seen wealth creation in the u.s. is happening in a faster pace and asia. abigail: some people are saying in chinat xi an is helping to produce these billionaires. ike: this is coming in terms of economic impact and incredible growth in the chinese economy. there is a way that is changing how china engages in the rest of the world. it has been more inward looking and now, because of their need to have access to raw materials and trade market, you are seeing an external view projected by
china. that was reflected in what president xi had to say. scarlet: i follow-up. if there isn't much of a connection between the rise of asian billionaires and president in growths that rates and wealth depended on? what is it most memorable two, as well? mike: i do not want to connect it to a rise of a single political leader or that he has no successors within the central committee of the communist party. what i would rather connect it to is we are the wealth. many of the same drivers were driving global growth are driving asian growth but it may be more impactful there. if you are seeing where it is happening, and is in technology, materials, and financial services. asian a benefit to economies like china, but also india. interestingething
to emerge from this study is billionaires are responsible for businesses that have a workforce equal to that of the u.k. that is stunning. what was the most appraising fact to you to come out of this study? guess the sheer numbers. about 28 million people are employed by billionaires. those who joined the rings of the billionaires are responsible for about 3 million in terms of employment. what we're seeing is this have a final impact. -- a vital impact. it is job creation over wealth creation. enhancing growth industries within the countries. i think there is a powerful role billionaires play in terms of initial -- a social game. scarlet: that make sense. you are seeing a global growth pick up as well. we are seeing this in europe, although i do not see any highlight their from europe when it comes to the number of billionaires. it has remained flat, hasn't it? mike: it has.
though.curring in asia innovation is driving the united states great one of the things we have seen in europe is a lot of times it is about inherited new creation than through innovation technology and entrepreneurship. while we still see strong pockets of wealth and steady growth of wealth in europe, it doesn't have the same dynamic feel that you see in east asia or the united states. abigail: philanthropy is an important thing to a lot of the world's billionaires. how i've ubs do you try to help create the billionaires create try to help the billionaires create their legacy? affectt is how they their own lives but also the lives of others. we see the lien years of line that wealth. we are seeing some cultural impact through the arts. certainly through sports
franchises. also through philanthropic giving. as accumulated, you see it tends impact on by having an on society. ing are seeing an emerg network that ties billionaires together and begins to affect change in different ways than it has in the past. scarlet: that's something we're all adjusting to. when you talk about ubs, targeting these high net worth is important for you. what services you offer first generation billionaires versus those who inherit the wealth? mike: we have many levels in terms of the way we -- we help in terms of stewardship but we help prepare the next generation as they inherit and become the successors. we get council to
build wealth and applying the wealth in terms of businesses and philanthropic. how we begin to educate and help the next generation appreciate their responsibilities in terms of being the next steward of wealth, as well. abigail: and maybe a little early for this, but what are the early readings on 2017 relative to the growth of billionaires? with the relative to 2016 -- well it be relative to 2016 -- 2016?t be relative to mike: i think it will be. the other countries are finally growing, so we seeing a synchronized expansion. and turned into a cycle where growth prospects are improving. it continues to generate wealth. if you think about the areas, this seems to be in technology. the pace of innovation is accelerating. a continued recovery in materials prices because of the ongoing final demand, that will continue to benefit billionaires
as well. especially those tied to the commodities site or materials prices. abigail: great stuff. mike bryan, chief investment officer of ubs. scarlet: you're for president trump to deliver -- we are waiting for president trump to thever comments about opioid crisis. he has not yet come to the stage to take the podium. when he does, we will take you to the white house. this is bloomberg. ♪
scarlet: we are taking back the white house with the president emerged and he will be giving remarks on the opiate crisis. let us go to the east room of the white house. >> thank you all for being here today. it touches my heart to see many familiar faces of the people i have been looking to get to know over the last few months. thank you for the time and strength and takes for each of you to tell your stories. we are today because of your courage. scarlet: i spoke too soon. that is the first lady. she will be introducing the president. we will bring you to the white house when the president begins thinking. in the meantime, let get to some business flash headlines. time for thes bloomberg business flash, some
of the biggest business stories in the news right now. nike is expanding its yield the line.- its yoga it will open 5000 pants studios on november 1. it will also spend more on product development for products like sports bras and head to toe looks. china has a new five-year plan. says itt xi jinping will focus less on economic growth and more on improving the quality of life for its innocence. approach wants to show company's willingness to improve living standards of workers. a wealth gap in world-class pollution. more than $1 down billion in debt for the last fiscal year. the chief executive officer went to overhaul the $37 billion endowment. that is your business flash
update. scarlet: we are awaiting the president to begin speaking. we will tell you what is happening in private equity. a big shakeup is coming in the world. carlisle billionaire founders are getting ready to hand their 30-year-old firm to new leaders. rubenstein spoke exclusively with erik schatzker and they discussed what the leadership will like in 2018. david: will still be involved in the firm. as co-cio.ve we are not walking away, we are changing our roles of it. we let the new people run the firm of it as they want. erik: how much leeway will you get them? david: a paramount. you cannot have a successful transition in your helicopte ring. we will not be helicopter parents. we will stay involved in tell us what he wants to do but you guys will run this day today.
erik: this is largely a decision that was your stomach. when did you personally -- when and why did you decide that it could have happened at 67, 69, why 68? we began to -- david: we began to feel that it is time to hand over the reigns to other people. we do not think people who are 69 are the best leaders of the future. no one was saying we should go so maybe that was the best time to go. guys?why these extranet or talented person was worked in europe and the u.s. for us. the other, i helped to recruit about four years ago. there are a good investment schools and complementry -- skills and confidence reskill's
complimentary skills. erik: three of the best managers and corporate america left ge. the same thing just happened to kkr. re you doing about this risk? david: we have three people we put insignificant positions. i'm not aware of anybody in the firm who is a senior person who is not happy with this. as a result, i do not expect any senior people to leave it i think we have a good -- lee. i think we have a good transition. that was david rubenstein speaking exclusively with erik schatzker. awaiting president trump to begin his remarks on the opiate crisis. he is expected to declare the crisis a national public health emergency. that would mean there would be
more public spending directed to fight this effort. abigail: something that can be interesting to see is whether he addresses states. some states are holding back on certain drugs products, like methadone. whether his comments address that. scarlet: this is obviously a huge issue with the epidemic killing around 91 americans every day according to the cdc. they are embracing and getting ready for him to speak. still ahead, we will speak with he reports as growing trading volume. this is bloomberg. ♪
scarlet: we have the president speaking on the opioid crisis. let's listen in. most importantly, we acknowledge the families present who have lost a cherished loved one. as you all know, from personal experience, families, communities and city -- citizens across our country are dealing with the worst drug crisis in even, ifhistory and you think about it, world history. this is all throughout the world. worldwides, this is a problem. this crisis of drug use addiction, and overdose deaths in many years, it has been so long in the making. allessing it will require of our effort and it will require us to confront the crisis in all of its very real complexity. last year, we lost at least
64,000 americans to overdoses. that is 175 lost american lives per day. that is seven lost lives per hour. our country. drug overdoses are now the leading cause of unintentional death in the united states by far. more people are dying from drug overdoses today than from gun homicides and motor vehicles combined. think of it. motor vehicle crashes, gun homicides, more people by far from drug overdoses. these overdoses have driven been -- have been driven by a massive addiction. to prescription painkillers, heroine, and other opioids, last year almost one million and more used heroin than 11 million abused prescription opioids. by far thees is
largest consumer of these drugs, using more opioid pills per person than any other country by far in the world. opioid overdose deaths have quadrupled since 1999, and now account for the majority of fatal drug overdoses. who would have thought? no part of our society, young or old, rich or poor, urban or world has been shipped -- spared this plague, and this horrible, horrible situation. that has taken place with opioids. in west virginia, a truly great state, great people, there is a hospital nursery where one in every five babies spends its becauseys in agony these precious babies were
exposed to opioids or other drugs anyone. you,and -- indoor nods sleeplessness, and trouble eating, just the same as adults undergoing detox. some of these children will likely lose one or both of their parent to drug addiction and overdose. they will join the growing ranks of america's opioid orphans. beautifuliful, babies. beyond the shocking death toll, the terrible measure of the opioid crisis includes the families ripped apart, and for many communities, a generation of lost potential and opportunity. this epidemic is a national health emergency. seene many of us, we have and what we have seen in our lifetimes, nobody has seen anything like what is going on now. allowricans, we cannot
this to continue. this -- it is time to liberate our communities from this scorch has neverdiction, it been this way. we can be the generation that ends the opioid epidemic. we can do it. [applause] pres. trump: we can do it. [applause] pres. trump: that is why effective today, my administration is officially declaring the opioid crisis a national public health emergency. under federal law. allwhy i am directing executive agencies to use every
appropriate emergency authority to fight the opioid crisis. ins marks a critical step confronting the extraordinary challenge that we face. emergency this response, we will announce a new restrictiveercome a 1970 zero role that prevents care atrom providing certain facilities with more than 16 beds for those suffering from drug addiction. [applause] pres. trump: a number of states have reached out to us, asking for relief and you should expect to see approvals that will unlock treatment for people in need and those approvals will come very, very fast. not like in the past.
very, very quickly. ending the epidemic will require mobilization of government, local communities, and private organizations. it will require the resolve of our entire country. the scale of this crisis of addiction is why soon after coming into office, i convened a presidential commission headed by governor chris christie that has consulted with experts across america to listen, to learn, and report back on potential solutions. we await the final report which will come in next week. i know some of the report has already been seen because i want to see this as quickly as possible and some of the things they are recommending our common sense, but very, very important. they will have a tremendous impact. believe me. tremendous impact. today i will detail many of these aggressive steps with my administration, which we have
already taken. after we review and evaluate the commission's findings, i will only move to implement approximate and appropriate recommendations. i want the american people to know that the federal government is aggressively fighting the opioid epidemic on all fronts. working with doctors and medical professionals to implement best practices for safe opioid prescribing, and we will do something very, very special. we are requiring federally to receive,scribers finally, special training. the centers for disease control and prevention has launched a prescription awareness campaign to put faces on the danger of opioid abuse. cvsnt to acknowledge caremark for announcing last month that it will limit certain first-time opioid prescriptions
to seven days supplies among other important reforms, and i encourage other companies to do their part to help to stop in this epidemic. [applause] pres. trump: the fda is now requiring drug companies that manufacture prescription opioids to provide more training, to prescribers, and to help prevent that and has requested one high be withdrawn from the market immediately. requiring that a specific opioid which is truly evil be taken off the market immediately. [applause]
pres. trump: the u.s. postal service and the department of homeland security are strengthening the inspection of packages coming into our country, to hold back the flood of cheap and deadly fentanyl, a synthetic opioid manufactured in china and 50 times stronger than heroin. in two weeks, i will be in china with president xi, and i will mention this as a top priority. [applause] pres. trump: and he will do something about it. i am also pleased to report that for the first time, the department of justice has indicated major chinese drug traffickers, and they have really put very, very strong claims on them.
theyhave indicted them, drug traffickers, for distributing fentanyl into the united states. so jeff, thank you very much. good job. good job. [applause] and they have been indicted and we will not forget about them, believe me. they are doing tremendous harm to our country. the justice department is aggressively and valiantly pursuing those who illegally prescribed in traffic and opioids, both in our communities and on the internet. i will be looking at the potential of the federal government ringing major lawsuits -- bringing major lawsuits against bad actors, what they have and what they are doing to our people is unheard of. we will be bringing some very major lawsuits against people and against companies that are hurting our people. that will start taking place pretty soon. [applause]
pres. trump: we are also supporting first responders and medical professionals access to the tools they need to prevent deaths through life-saving overdose medications. at my direction, the national institute of health headed up by francis collins, has taken the first steps of an ambitious public-private partnership with pharmaceutical companies to develop nonaddictive painkillers and new treatments for addiction and overdose. so important. [applause] i will be pushing the concept of nonaddictive painkillers very, very hard. we have to come up with that solution. we give away billions and billions of dollars a year and we are going to be spending lots of money on coming up with a nonaddictive solution.
asking dr. collins and the nih for substantial resources in the fight against drug addiction. one of the things our administration will be doing is a massive advertising campaign to get people, especially children, not to want to take drugs in the first place because they will see the devastation and the ruination it causes to people and people's lives. watch what happens if we do our jobs, how the number of drug users and the addicted will start to tumble downward over a. big of years. -- over a period of years. i learned myself, i had a brother, fred, great guy, best looking guy, best personality. much better than mine. [laughter] pres. trump: but he had a problem. he had a problem with alcohol. he would tell me, don't drink.
don't drink. he was substantially older and i listen to him and i respected. but he would constantly tell me, don't drink. he would also add, don't smoke. but he would say it over and over and over again. never had a i have drink. and i have no longing for it. i have no interest in it. to this day, i have never had a cigarette. don't worry, those are only two of my good things, i don't want to tell about my bad things. he really helped me. i had somebody that guided me. he had a very, very, very tough life because of alcohol. believe me. very tough life. he was a strong guy. it was a tough, tough thing that he was going through. because of fred. i learned. that is what i think is so important. this was an idea i had where if we can teach young people not to
take drugs, just not to take them, when i see friends of mine that are having difficulty with not having that drink at 10 or, where it is literally almost impossible for them to stop, i say to myself, i can't understand that. why would that be difficult? we understand why it is difficult. the fact is, if we can teach young people and people generally, not to start, it is really, really easy not to take them. i think that is going to end up being our most important thing. really tough, really big, really great advertising. before they people start. so they do not have to go through the problems of what people are going through. [applause] pres. trump: we are already
distributing nearly $1 billion in grants for addiction prevention and treatment. and over $50 million to support law enforcement programs that assist those of facing prison and facing addiction. we have also launched and $81 million partnership to research better paying management techniques for our incredible veterans. and soon -- [laughter] -- [applause] pres. trump: by the way, secretary shall can is here. you have done an incredible job for our veterans in a very short period of time. [applause] and soon, hhs will launch a task force to develop and update best practices for pain management across the federal government. i am urging all americans to help fight this opioid epidemic
and the broader issue of drug addiction by participating in the national prescription -- drug takeback day this saturday. when you can safely turn in these dangerous and horrible disposal, that will be a wonderful, wonderful period of time for you. all of these actions are important parts of my administration's larger effort to confront the drug addiction prices in america and confront , strong.n, straight on we are going to do it. we are going to do it. for too along we have allowed drugs to ravage american homes, cities, and towns. we own it to our children and to our country to do everything in our power to address this national shame and this human tragedy. we must stop the flow of all types of illegal drugs into our
communities. [applause] pres. trump: four too along, dangerous criminal cartels have been allowed to infiltrate and spread throughout our nation. an astonishing 90% of the heroin ofamerica comes from south the border where we will be building a wall which will greatly help in this problem. [applause] pres. trump: we will have a great impact. my administration is dedicated immigration our laws, defending our maritime security and the securing our borders. we also have to work with other countries to stop these drugs where they originate. we half no choice. -- we have no choice. we have to work with others.
we have to get together because they have similar problems to what we have. some countries have bigger problems than we have a that country is china, whether it is a country in latin america, it makes no difference. we will be working with all of them. we are taking the fight directly to the criminals in places that they are producing this poison. here in america, we are once again enforcing the law, breaking up the gangs and distribution networks, and arresting criminals who peddle dangerous drugs to our youth. an addition, we understand the righto confront reality, smack in the face. that millions of our federal -- fellow citizens are already addicted. that is the reality. we want them to get help they need. we have no choice but to help these people that are hooked and suffering. so they can recover and rebuild
their lives with their families. we are committed to pursuing innovative approaches that have been proven to work. like, drug courts. our efforts will be based on sound metrics and guided by by results. guided this includes making addiction treatment available to those in prison, and to help them eventually reenter society as productive and law-abiding citizens. finally, we must adopt the most common sense solution of all. to prevent our citizens from becoming addicted to drugs in the first place. [applause] pres. trump: we must and are focusing so much of our effort on drug demand reduction.
we must confront the culture of drug abuse head on to reduce demand for dangerous narcotics. every person who buys illicit drugs and america should know that they are risking their futures, their families, and even their lives. every american should know that if they purchase illegal drugs, they are helping to finance some of the most violent, cruel, and ruthless organizations anywhere in the world. illegal drug use is not a victimless crime. nothing admirable, positive, or socially desirable about it. there is nothing desirable about drugs. they are bad. we want the next generation of young americans to know the blessings of a drug free life. in this enormous struggle against drug addiction and opioid epidemic, it really is that, it is an epidemic, our
greatest hope is the same as it has always been. through every trial, america has encountered throughout our history, the spirit of our people and the strength of our character, we win. each of us has a responsibility to this effort. we have a total responsibility to ourselves, to our family, to our country. including those who are struggling with this addiction. each of us is responsible to look out for our loved ones, our communities, our children, our neighbors, and our own health. almost every american has witnessed the horrors of addiction, whether it is through their own struggle, or through the struggle of a friend, a coworker, a neighbor, or, frankly, a family member. addiction crisis and especially the epidemic of opioid deaths will get worse before it gets better.
but get the better it will. and evenake many years decades to address this scorch and our society. we must start in earnest now to healthnational emergency. we are inspired by the stories moveeryday heroes who their communities from the depths of despair through leadership and through love. dan goran of new hampshire, great state, runs a whichm, safe station gives help at fire stations at any time. jessie and cindy swofford of dayton, ohio i've provided a loving stable home to two -- two children affected by the opioid crisis. i am calling on every american to join the ranks of guarding angels -- guardian angels, like the chief and the swofford's,
who helped lift up the people of our great nation. together, we will care for our citizens, our children, and our orphans. you know what i going to say. our foster youth. so many, so many. but we will lift them up and we will take care of them. we will work to strengthen vulnerable families and communities and we will help to build and grow a stronger, healthier, and drug-free society. together, we will face this familyge as a national with conviction, with unity, and with a commitment to love and support our neighbors in times of dire need. working together, we will defeat this opioid epidemic. it will be defeated. we will free our nation from the terrible affliction of drug abuse.
and yes, we will overcome addiction in america. we are going to overcome addiction in america. manyve fought, and won battles and many wars before, and we will win again. thank you, god bless you, and glut -- and god bless america. [applause] scarlet: that was president trump delivering his remarks on the opioid crisis. declaring it a national health emergency. devoting national resources to fighting this crisis. he promised a big ad campaign, a national shame, a human tragedy. he mentioned specifically that the united states social service and homeland security would be strengthening inspection of packages to target shipments of fentanyl, a synthetic from
china. and that he will mention this as a top priority with chinese president xi jinping when he visits next week. he added the u.s. will be bringing lawsuits against people and companies that are bad actors in the opioid crisis. he added that the doj has indicted major chinese drug traffickers. he named cvs, too. abigail: he did. it was interesting. he applauded cvs for imposing a seven-day first-time user limit for opioid prescriptions. down 5%, plunging around that time. that could have to do with the st. louis post headlines rain --t amazon farmer let licenses have gained. scarlet: let's bring in kevin cirilli, our chief washington's correspondent. the president shows the executive order in the action he is taken to declare the opioid crisis a national emergency. what stuck out to you?
kevin: so much. from a policy standpoint, the president urging private businesses to work with the federal government in order to combat what has become an oh lloyd crisis, he specifically lawsuits.ward but also toward working with the private sector on innovative ways to craft painkillers that are non-addictive and yes, there was some politics. he noted the -- he argued for the importance of bolstering u.s. mexico border security. he did it through a geopolitical lens, arguing that impacts latin american countries. there is something different about this speech. since covering then canada donald trump since the beginning of his campaign, there was a personal side to the speech that stuck out. inside we rarely see when we hear from president donald trump. that of course is when he discussed his late brother, fred. he described in personal terms how that has led him to the
conclusions to advocate for his policy prescriptions in many regards. in terms of more federal funding, this he is doing without congress. congress does need to play a role. when you look at the health care head of the 2018 midterms elections, you will note several republicans -- and some democrats have allocated for that -- but the president trying to break through that red tape by acting on his own. saying he is going to use a combination of both private partnerships as well as lawsuits to take on this crisis. there was a quote i will read before iraq. he said "it is an epidemic, our greatest hope is the same it has always been through every trial. we win." abigail: a helpful tone from president trump. heavens really, thank you. -- kevin's thank you. the opioidcus on
crisis, we want to bring in julie hyman for our stock of the hour. we look at the xl the which tracks the health care sector. you can see it is that session lows. of news.ere is a lot i want to talk about the moves we have seen in the past few moments. lows of thes at its day. there are a lot of earnings news. also, coincident with the president's comments, there were headlines that came out from the st. louis post-dispatch. him mention cvs. he praised cbs's program to curb opioid abuse. those shares turned lower as he was talking. which seemed on. as though this was the effect of the st. louis post dispatch story saying amazon has been amassing pharmaceutical licenses in at least 12 states. is not ast -- it though he just did that. it is a backward looking story
that has been amassing. we saw roots for example also take a tumble. we saw mckesson which had earlier been higher on earnings take a sharp turn. it seems as though that is the pressure, in addition to the earnings and everything else that is going on. scarlet: amazon shares moved higher as well. julie: they did. ahead of earnings. abigail: that will be a big report. julie hyman, thank you so much. scarlet: we will continue to monitor the markets. we have terri duffy, the chairman and ceo coming up next ,o talk about trading volumes up 10% year on year. from new york, this is bloomberg. ♪ who knew that phones would start doing everything?
see how much you can save. choose by the gig or unlimited. xfinity mobile. a new kind of network designed to save you money. call, visit or go to xfinitymobile.com. abigail: it's 3:00 p.m. in new york, and 8:00 p.m. in london. i'm the gail doolittle. scarlet: i'm scarlet doolittle has i'm scarlet fu. markets." "bloomberg
♪ abigail: we're live in bloombergs world headquarters. here are the top stories we are covering on the bloomberg and around the world. a -- thats reporting janet yellen is out as president trump's contender for the fed, citing a source. ecb president mario draghi unveiling a new strategy for its massive on the buying program. the latest details and what it means for investors worldwide. us to discussins earnings, the fcc's latest announcement concerning something. scarlet: let's begin with terry duffy. shares are rising today. the most in seven weeks. that is after the exchange operator topped earnings estimates. while meeting estimates on the
line. daily volume increase 10% from a year ago. joining us now to discuss the results, and the environment for trading is terry duffy, chairman and ceo of cme. thank you for taking the time to speak with us. terry: my pleasure. thank you for having me. we talk about the volume, up 10% in the third quarter. even as we see volatility across classes, the whole year the is record lows. what is driving the growth in volume? terry: i think people realize they need to manage risk no matter what the situation may or may not he -- b. their arm -- so many manufacturers, whether it is supply numbers. those are factors that go into the marketplace where people need to manage risk. even though we are in a low interest rates and a high equity market, it does not mean people will stop managing risk. aroundre many concerns the world. you heard what the president
said about the opioid crisis, you heard the administration talking about tax cuts. we have the geopolitical events going on in north korea. people need to manage that risk even in the low environment -- low environment. scarlet: helping support volume. how likely is it that you think we might get a pickup and volatility in the next few months? if we do, what will that do to the growth trajectory of the volume you have seen? terry: it is hard to predict with the growth trajectory is. that is the hardest thing to do. i will say, we are continuing to volatile -- if volatility trickles into the marketplace, we will see more trade. that is the way it works. there is no avoiding it. whatet: when you look at the cme does, energy trading makes up 20% of your total revenue. your margins are the envy of your competitors. we have seen overseas traders take to it. helping push open interest in wti.
what is the most important what is the most important driver in prompting the rest of the world to use wti as their new benchmark? terry: i don't know if there is a single driver that could be attributed to the west texas benchmark. when you look at what congress did a year and a half, two years ago, by lifting the expert ban to be distributed, the rest of the world looked and said, we can price our product on the american oil. we are the price discovery mechanism. we set prices for all different products in the united states. it is one of the things we enjoy . scarlet: i am looking at a chart that highlights wti futures and open interest. you can see the red line steadily moving higher, volume is the blue bar as well. in addition to that, i want to talk about what deregulatory landscape looks like. you told bloomberg in the past
the cme will benefit from the mifid iity caused by in europe. that will drive business to your exchange. yet, we know the cme shut down its european business this year. was that a missed opportunity? terry: no, not at all. it was not a missed opportunity. to peg thee liquidity, create it around the and disseminate that throughout the world. for us to have a brick-and-mortar institution in other parts of the world, it was no longer necessary with the technology and distribution we have today. that was the decision going into closing down that operation. regulation,k at the mifid ii has no bearings in the united states. it only affects the institutions in the european union. up from ae looking regulatory standpoint is not much so much on to but a mere point 2.0.
back for whatu happened in 2010 when the past administration tried to do an overreach on describing what is a u.s. person. those are things we are concerned with now. i think when you look at the our of the united states, regulation is behind us under dodd-frank. when i talk about mifid ii, potentially driving volumes to other parts of the world, that is because of the uncertainty of mifid ii. we have the clarity of regulation in the u.s.. participants in the marketplace want the rules of the road. they will be an compliance with the rules. they want to understand them. right now, they do not have the full picture of what is going on in europe. scarlet: do you think regulators have done enough to clarify the rules of the road, even with mifid ii being adopted in europe? tore have been questions as how the u.s. companies and u.s. exchanges would operate. has that been clarified for you? terry: i think there is no question in the u.s..
you may or may not like some of the rules, i am not fond of the volcker act, the way it was written. i think the volcker act was not appropriately written. i think that could be modified. i think there are other things in the dodd frank act that could be changed. what is going to happen is the regulators will look to make numeral changes -- new rule changes. the president talked about what his agenda is coming forward. taxes is a big part of it. agenda is crowded for washington right now. i do not see that happening other than rule writing. scarlet: i want to switch gears to m&a. it is not often we get you on. i want to touch on all the topics. have set youou prefer large-scale deals, that often means cross-border which can be difficult. for the last couple of quarters, whenever i have asked you about m&a, you have said you are keeping your options open. do you see any need to add etf
trading to your mix to capture the growth in that product? terry: no. i don't. i don't see that as something we products tointo our have growth. people ask me all the time, where is our business today? if you were to related to baseball, i think we are in the early innings. if you look at this quarter alone, our growth in asia was up 17%, our growth in europe was up 20%. year-over-year -- that is impressive numbers. the otherneed to add products such as etf's into our products week in order to grow. scarlet: got it. i get that the perfect segue into cryptocurrencies which is another area where they are releasing an explosion of interest. you have your own a coin index. what is getting in the way of starting a bitcoin futures product? the cboe is announcing
they will go forward with that. they have an application pending. from my standpoint, we look at a whole host of products that we would like to bring to market that we think there is a demand in to-- to participate mitigate the risks associated. i think cryptocurrency is in that round. we have yet to make a decision of how we will move forward in the crypto world. -- story isstories not over with. i not referring to the price of the crypto, i am referring to how it is dealt with in use of commerce. our objective is not to say how high or how low a product should be. it is how to manage that risk. if we get into the crypto business under the rules that we have in place at cme so the spec rules and everything else we can apply to it with our distribution, i think we could be successful in the crypto world. chairman and ceo terry
duffy in the business of managing risk, thank you for joining us from chicago. abigail: let's get a check of the headlines on the bloomberg first word news with mark crumpton. mark: thank you. an event you saw on bloomberg television, president trump aclared the opioid crisis nationwide public health emergency. a step that will expand access to medical services in rural areas among other things. and ministration officials made clear the declaration which lasts for 90 days comes with no dedication -- dedicated dollars, but it will allow them to use money to fight the crisis. pres. trump: the national institute of health headed up by francis collins, has taken the first steps of an ambitious withc-private partnership pharmaceutical companies to develop nonaddictive painkillers and new treatments for addiction and overdose. house minority leader nancy policy calls the republican budget that narrowly
passed today a line in the sand between the middle class and working families and the wealthiest people in the united states. >> we have the republicans in congress who are in their dna committed to a mission of giving tax breaks to the wealthiest people in our country. but as the budget they put four. the tax cuts82% of will go to the top 1%. vote allows congress to enact tax cuts later that will increase the federal deficit by up to $1.5 trillion over 10 years without concerns about potential blocks by democrats. secretary of state rex tillerson says washington sees no future for president bashar al-assad in serious government, insisting "the reign of the assad family finally is coming to an end." tillerson made the comments today after what he called a fruitful discussion with the
geneva.ian envoy's in u.n. mediated syrian peace talks are expected to resume in the coming weeks. talked --kenya through tear gas at protesters, him are boycotting today's rerun presidential election saying it is not critical. did notolling stations open because of security concerns. global news, 24 hours a day, powered by more than 2700 journalists and analysts in over 120 countries. i mark crumpton. this is bloomberg. abigail: thanks, mark. up next, the fed is not focused. white janet yellen may have gone -- why janet yellen may have gone from zero to hero. this is bloomberg. ♪
♪ this is "bloomberg markets." i'm abigail doolittle. it is time for the bloomberg business flash, the biggest news in the story now. in the opioid case, junko por has been arrested and charged with racketeering conspiracy and other felonies. former managers are accused of bribing doctors to write excessive prescriptions for the opioid fentanyl which has been primarily for cancer patients. he is scheduled to appear in court later today. nike is expanding -- expanding its yoga line to improve growth. it will compete with lululemon. open studios in stores on november 1. the athletic retailer will send -- spend more on product development such as items on sports bras.
that is your business flash update. central banks in focus take here the european central bank announcing it will cut its bond buying all you in half starting january. this is a first step toward ending the program that has been more than 2 trillion euros trying to drive inflation. here in the u.s., politico reported janet yellen is out of the race for than it federal reserve chair. that would leave jerome powell and john taylor's in the running for her position. here with the latest is michael mckee. has arse, the president final say here. he could change his mind. michael: he could change his mind. as the political report was nuance, he said -- they said one source was telling she was out. and that he noted the president went on television last night and said he liked her. that was followed by a washington post story that suggests that three sources had told them she was out. the political story -- politico
story and the washington post they was quick to add that president was quick to change his mind. we do not know what the president is thinking. the only clue is that he said last night that, you want to make your own mark so that may be a strike against her. taking that literally, maybe she is lower on the list of than the other two. abigail: one candidate who stands out, john taylor, policymaker at stanford university. warsh, onee, kevin possibility that makes him attractive is the fact that he is a part of the current regime all the way back from the financial crisis. plus he is known as being more hawkish. michael: he does not seem to have one anymore. he has moved down on the list. there has been reporting suggesting that he alienated people at the fed when he was there and they might not like that, and that he is considered too young at 47 years old. he needs more seasoning to be
able to command the gravitas you look for. there have been reports that sources say he is out of the running. we never know until the last minute with this president. scarlet: do you think this has investors on edge? we saw the 10 year yield go bast -- past that 2.47 level. i'm sure there is a technical term for this. abigail: breaking out of resistance. scarlet: thank you, abigail. it is something that keeps coming up again that we see -- that we are seeing a market reaction. are we reading too much into that? michael: probably. we can talk about the ecb decision which is affecting currencies. there is going to be a knee-jerk reaction. there is going to be the relet and the wheel -- roulette wheel reaction. you have to change your investments. but then it will get faded. whoever is selected is going to have a hard time getting the fed off of its current policy path.
even john taylor who's famous taylor will would suggest that rates should be three times as high as they are now is not going to be able to come in and get 12 bank presidents and the two holdovers on the fed board to agree that rates should go up that quickly. as though there is any reason to make a major investment change. scarlet: speaking -- abigail: speaking of the ecb, nothing too shocking came out. there was one comment by ecb president mario draghi that was interesting. todownside risks continue delay primarily to global factors and developments in foreign exchange markets. abigail: that seems to be his most explicit comments on the euro. what do you make of that? michael: at the last meeting, the euro was more front and center. they are concerned about it because of the strength of the euro is keeping inflation down. is saying that we are
seeing global growth that should help bring inflation higher, as long as the euro does not get out of control, we should be with ourontinue process of normalization, which they are trying to start today. there is much less to this than meets the eye. they are cutting their to 30 billion a month starting in january. they are starting to pick up the pace with reinvestment, and they will start running off. according to the calculations but a couple of european banks have made about 15 billion to 20 billion a month. you are really looking around 45 billion to 50 billion a month. not much different in terms of the money they will be spending. draghi was not pained to say that it is the stock of the amount of bonds we hold that matters. we will not be changing the flow all that much. abigail: interesting nuance. it will be interesting to see if
they end the program altogether in september of 2018. michael: we will have plenty to talk about. abigail: indeed. michael mckee, thank you so much. still ahead, options inside. the bond market is having its moment of truth. why you should be paying attention to this treasury etf. this is bloomberg. ♪
we have already seen something of a move to that affect. what have you been watching? even the firstot to sound the alarm. bill gross did this a couple weeks ago saying the 240 area yield was want to watch. apparently ray dalio said similar comments about risk in the bond market. that is why i brought this up to talk about. talk aboutou not this when it is such an important financial instrument and such a major mover of the markets are all keeping and i on this? gete: you don't too often option trades. you have the tlt that is a proxy. it is the ishares 20 plus year treasury bond. if you take a look at the bloomberg, i pulled up the chart of those with its moving averages. we have seen it move down lately. that yellow line is the 200 day moving average. it is getting close. we have already had something of a downward move in price and jump in yields. aree: this is a test they
talking about. this will not be a perfect proxy. it is close. it has a longer duration than the 10 year. you will have more movement than you would otherwise. it will follow closely because it is longer-term treasury. there was curve risk. you have to think about if it is down here and you have this as a major potential turning point, what do you do if you are seeing a potential turning point? would say, you could argue, one of either way. we are going to plunge through the moving average and all hell breaks loose as that could happen. or, you hit a support level and it has made your market for various reasons. thinking in the way of a strangle as a way to hedge that risk out. julie: how does that work? steve: we are basically buying -- we are buying a call that struck a dollar above the level of tlt pair that will cost under
two dollars. what that is going to say is if this thing has more than a two dollar move from here in either direction, meeting a bounce off the moving average, then you can profit in either direction. it is a nondirectional bet. i am not going to take on these guys in terms of having a view. them, but not just also may be take on president trump in a way. as we just talked about, the bond market will be affected by whomever the fed chair ends up being. steve: that is why i thought the trade was appealing. you have not seen the implied volatility is in tlt pickup. they have been around the levels we have been seeing steadily throughout much of the summer. what you see in markets when you are getting your turning point is you see volatilities kick up we have not seen that which is interesting. julie: i do think that is happening? steve: i think markets are complacent across the board that people are reluctant to bid up volatility. there has been a lot of
public health emergency. overdose deaths involving prescription opioids have quadrupled since 1999. treasury secretary steve mnuchin is in israel where he met with benjamin netanyahu the thank him for his support of the united states and the trump administration, while steve mnuchin said the united states doesn't have a better partner in the region that israel. he is in israel for three days. an explosion at a fireworks factory near jakarta has left at least 47 people dead. a police official says most of those killed were trapped inside the factory when it burst into flames. dozens of others were injured. the kenyan president cast his ballot in his hometown in today's presidential election rerun. he told reporters that 90% of , and hetry is calmed will work to unify the nation if reelected. >> is time we move