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tv   Bloomberg Markets Americas  Bloomberg  October 30, 2017 2:00pm-3:30pm EDT

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paul manafort was indicted today based on all of the news that had been coming out of the special counsel. we knew that paul manafort had his home raided by agents earlier this year during the summer. president trump has known for several months that his former was in thenager crosshairs of this investigation. for that reason it is not surprising that president trump has not had a lot of contact and a lot to say about his former campaign manager. they have a relationship that goes back to the far. paul manafort represented the trump organization here in washington, d.c. at the same time he was working overseas and working with the ukraine and former ukrainian president. it's clear that president trump brought in paul manafort to his campaign not just to run the but to managetion the campaign and take it over. these are men who are very close for that period of time when he was on the campaign.
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now you see the white house distancing itself from paul manafort. it does seem like they haven't spoken in quite a while. if paul manafort has anything on president trump you can expect that bob mueller will be putting the pressure on very strongly to bring that information out. manafort has pleaded not guilty in court. rick gates has done the same thing. here?do things go from perhaps we will hear from attorneys. where in terms of process do we go now? >> the special prosecutor continues his work. they made it quite clear this has no affect on the congressional investigation. one of the key things is george papadopoulos bullis cooperation with the indictment. these are not necessarily finite.
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could find out new information and have further of them or others. it will be interesting to see whether or not there are more charges brought forward to these individuals are new ones. that's the process. sanders sayingy he expects miller's probe to continue very soon. is wishful thinking given how much it seems to be expanding. >> definitely. she did not provide any information about why she going tothe probe is be wrapping up soon. the white house has sort of herod this line for summer months saying this is just a witchhunt that is going to be completed very quickly because there are no reasons for president trump to be prosecuted or involved or targeted at all by this investigation. it does appear the special counsel is looking at different ways to advance the investigation.
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he is continuing to have interviews and talk to people. he has called on the white house to preserve all emails and all information that may shed more light on what happened during the 2016 campaign. there are still several leads that both the special counsel and the investigators in congress will need to follow. the white house may want to this to wrap up very quickly. the fact that we have charges just coming down now gives usthl and the investigators in congress will need to follow. a sense that this is something that is going to drag out for several months to come. shery: definitely. thank you for joining us. and of course marty schenker. plenty more coming up. do stick around. bloomberg markets. this is bloomberg. ♪
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scarlet: i'm scarlet fu. julia: i'm julia chatterley. paul manafort has reportedly pleaded not guilty to an indictment accusing him of laundering more than $18 million to support a lavish lifestyle and defrauding financial institutions. gatessiness partner rick also pleaded not guilty. trump saying sorry, but this was years before he was part of the trump campaign. why aren't crooked hillary and the dems the focus? also, there is no collusion. joining this is marty schenker and the u.s. legal reporter for bloomberg. here.ay out what we got
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is this any surprise in light of the investigations and the rumors we have had? when donald trump says this has nothing to do with the campaign is entirely correct? he is trying to so of verytions -- through a thin line. there are reports in the indictment that do spend the time he was campaign manager. what donald trump's people are saying is it didn't relate to any activities of the campaign. he may be able to make a case for that. what do think bob mueller's strategy is when it comes to obtaining information about the trump campaign and possible election middling? if the current charges have nothing to do with the election itself? a guiltylso obtained plea of a former foreign-policy advisor who was a 30-year-old unpaid advisor who admitted
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arlier this month in charges series of the overtures by russian officials to the trump campaign while he was working on the trump campaign and the russianse said had dirt on hillary clinton including thousands of emails was activelylos trying to arrange a meeting either with donald trump or high-ranking people in the campaign. be a problemto going forward for the trump officials to deal with. i assume they will attack the credibility of papadopoulos and minimize his importance. it signals that this investigation is going to be going forward for several more months. he secretly apparently pleaded guilty months ago. quickly remains to be seen how
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important it is. we and many others are reporting outit is key to figuring just where this investigation goes. it is true he pled guilty quite some time ago and has been cooperating with prosecutors. what he knows and what he can say and how he connected to the campaign and perhaps even higher up is the key issue and we are going to see that laid out in the next weeks or months. on the: it all comes out same day. i want to go back to the president's tweet. he needs to be very careful about tweeting. saying things like this was a year ago there is no collusion, to what extent can has words being used against him later on? >> it's theoretically possible. what we are talking about now is people below him who were working on the campaign. thee's no indication from top adult bullis charge which was filed after his guilty plea
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on october 5 that donald trump himself was actually involved in the collusion. to thed be up investigation to establish that through evidence and witnesses that that was the case. julia: fascinating that the lawyer came out and said, we are not discussing pardons at this stage. how important could pardons be at some point in the future? >> most political observers would say that pardoning would be a very difficult thing to do right now. it would lead to a partisan battle over obstruction of justice and his attorney went to he is nots to say firing mueller he is cooperating fully and that is the right messaging for a president who wants to keep this going as quickly as possible and not confuse matters or making them worse. scarlet: marty schenker, thank you so much. will be monitoring this developing story.
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u.s. markets close in just under two hours. let's check in with julie hyman for a big week when it comes to markets. markets are in the red today. markets aree the reacting to the bloomberg story that the house is considering as part of its tax proposal a slower more gradual phase-in of corporate tax rate cuts. we saw stocks take the lead lower on that and they have continued to trend down today. hadnasdaq is the one that been little changed earlier in the day and now is turning lower. the stocks that have been sharply in focus our sprint and t-mobile. this on the reports from nikkei suspending talks or canceling talks over a dispute over who would have ownership of the combined company. softbank is calling off those
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talks. and at&tks are down and verizon are also trading lower. on the tech front we have been watching shares of apple as we get more details on the wait for delivery of the iphone x. that is been raising speculations there is strong demand for the phone. apple shares have been strong today as have shares of suppliers. amazon continuing gains and facebook and of earnings this week trading higher by about a person. the nasdaq is doing better than the other major averages. on the bloomberg we have seen the nasdaq outperforming. what's interesting is you got the nasdaq and the nasdaq 100 on top. nasdaq 100 ishe doing even better with a 28 percent gain this year to the nasdaq's 24% gain which emphasizes the idea that large-cap tech has done very well. we will see if the momentum
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continues when we start to get more earnings reports. scarlet: we are getting some headlines regarding steve mnuchin. was traveling and he says that he is declined to comment on the fed chair search. he also says he will continue to monitor the market for ultralong bonds. he says their heads and been more interest in ultralong's and treasury doesn't feel demand on these ultralong bonds. the yield on the 10 year and the 30 year hitting session lows right around the times that these headlines crossed. higherexpectations of inflation and tax reform. some breaking news. this is the story we had an highly focused on today. paul manafort and rick gates pleading not guilty to the news they were charged in a 12 count indictment sought by robert mueller. have been placed under house arrest.
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any further news on that we will bring to you. there is other news going on. emma chandra has the headlines. in washingtonourt is barring president trump from changing the government's policy on military service by transgender people. mr. trump announced in august memo that he intended to reverse course on a 2016 policy that allowed troops to serve openly as transgender individuals. a u.s. district judge ruled today that transgender members of the military sued over the change will likely to win their lawsuit and bar the trump toinistration from reversing the united nations says iran is complying with the terms of the nuclear agreement. the head of the un's nuclear watchdog says all other participant countries couldn't fully abide by their commitments. president trump decided not to recertify the deal. in spain the government is cracking down on leaders of the
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independence movement. original official will be prosecuted on charges of rebellion. spain's attorney general has stopped short of ordering their immediate arrest. global news 24 hours a day powered by more than 2700 journalists and analysts in over 120 countries. i'm emma chandra. this is bloomberg. scarlet: shows of t-mobile and strength dropping: report that merger talks between the companies being called off. we've got the latest on the declines. from new york, this is bloomberg. ♪
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scarlet: this is bloomberg markets. i'm scarlet fu. julia: i'm julia chatterley. nikkei: japan's reporting that softbank plans to hold talks. need casing that softbank's board has decided it doesn't want t-mobile -- shares of both
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lower on the news. you have more headlines. on sprint. julia: looking for those now actually. deutsche telekom will see valuation as an obstacle in the discussion. that would be one indication providers a challenge to get across the finish line. julia: joining us now is sean butler. great to have you on. we were having this conversation giving them more leverage in this battle just how they can negotiate. do think that played into what we're seeing now? >> i think a little bit. the reality is both carriers need scale. i would say sprint needs it a lot more than t-mobile and i think t-mobile knows that. or deutsche telekom knows that. isrlet: the headline
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deutsche telekom will see valuation as an obstacle in the last 72 hours. perhaps because of t-mobile's results they are having a second think about this. specifically when you look at spring and its assets the most valuable asset is the spectrum. have the 2.5 gigahertz spectrum nationwide. uselow enough that you can it for regular cellular service and its high enough and you can use it for five g which is kind of where the world is heading right now. we all have lte phones at five years from now it's all going to be about five g. as you look down the road you need -- any carrier needs the spectrum assets to pull that off. scarlet: softbank and sprint can't monetize that on their own? >> they could. dealis indeed is a botched sprint and t-mobile will have to
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figure out how to go it alone from here. i think they both have adequate spectrum assets to do it in the issue with sprint is how do you finance the buildout from here. this was always going to struggle shortly with the regulators. tried to do this klein in 2014. you had the fcc and doj looking at this and the whole thing was dropped. why is this going to be different? they're still going to face the same regulatory battles they faced a few years ago. >> they were looking at a republican administration now and being we may get lucky. when it comes to the regulators and what they are looking at it's all about the consumer. i think it's hard to argue that since the at&t deal was botched years ago that the consumer hasn't benefited. we have. prices have come down dramatically. think anyone who covers the regulatory side was looking at it and saying -- not seeing a
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good chance for this deal to go through. boehner, great to get your insights. amazon is not part of that probe. increasing scrutiny of the tech industry in washington could questions fort the e-commerce giant. joining us now for more insight is she a long -- chieh huang. do you think there needs to be more regulate. oversight? -- more regulatory oversight? i didn't think to a certain extent. as you are looking at the position of amazon for example the fact that they can just a
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simple press release out there or file a simple trademark application and have an entire market react with billions of market cap laws, i think there's something to that. whether most folks in the market will say that is more bark than bite or that is a legislative action we will see in the future. scarlet: do you see any evidence that a company like amazon is engaging in anticompetitive outside of what they have done in the past with acquisitions -- is well-documented in brad's book. the past acquisition practices, in general it's really a conundrum because when you would say as they tried to lower prices, they try to inject more competition into the marketplace yet they have the ability to move markets solely by themselves. right now in a vacuum intentionally know. when you look at the events and their mo in the past, tbd.
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scarlet: 55% of all product searches began on amazon which has surpassed google. that has been something that has brought a lot of unwanted attention on amazon. how do you raise your company's profile in this kind of environment when amazon dominates? dominant, but there is still market share lufthansa rest of us. u.s. butnywhere in the the reality is a big part of our business is actually business to business. take for example the green room at bloomberg. ofre is just hundreds different snacks for everyone to enjoy. the folks who have stopped that entry are not going on amazon and clicking on ships 400 times. for us it is really finding the niches where amazon is not as strong and going after it. julia: i read about some of your
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best customers in the breadbasket regions of america. populations with 50,000 people. do you think they are insulated from the likes of amazon because logistically they don't really care about going to those? >> to certain extent. more opportunity for folks like us because there is quite a lot of opportunity out there whether it is in the cities or rural areas. there's 30 million folks in the u.s. that don't live within 30 minutes drive of a costco. whether they like cosco or not doesn't even matter because the brand is ubiquitous but the locations are not. that's how we have been able to grow so quickly. we went from $40,000 in sales in 2013 in my garage and last year cleared overnight figures in a 36 month span.
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there is opportunity. you can't take your eye off amazon. scarlet: you bored a lot from amazon when you delete your company. what do you think you do better than amazon? >> it's interesting. i feeling we have this really good ability to focus on customer. wants wholesale and it's really difficult because amazon is the everything store and they want to be everything for everyone. for us it's really tough when you get a single person living in a 300 square foot apartment in the upper he sighed and says box isn't for me. for us to admit that it isn't for you and it's solely for large families and folks who want to stop at -- stock up on something, that houston is difficult to concentrate on. i feel it we do wholesale better than amazon partly because as a wholesaler we can sell different sizes thatifferent amazon can't get their hands on. i wanted to ask you about
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automation. you have automated your warehouse and not lost any employees as a result. is that sustainable if you scale up? >> i think it is sustainable. folks will need to be able to work with those robotics in order to keep those positions. we didn't lay off anyone because of automation. and now wed them feel like their ability to have earning power over their career is a lot better. , ceo andchieh huang founder of boxed. lonnie chen of the hoover institution will be joining us next on tax reform. this is bloomberg. ♪
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♪ scarlet: from bloomberg world headquarters in midtown manhattan, this is bloomberg markets. we have commodity markets closing in the art. let's get you started with oil.
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-- crude extending its two-year high local benchmark now moving towards $61 a barrel amid signs that opec and russia will suspend supply cut the on the month of march. investors continue to monitor this instability in iraq kurdish region. if we look at gold, it is recovering from an early decline. up by 4/10 of 1%. president trump spake for venture will dominate the economic week ahead. he is expected to announce it on thursday. there is an fomc meeting that will give the all clear for december rate increase. then on friday, the jobs report will show payrolls jumped in october recovering from that drop in september. a lot to look forward to. republicans will unveil their plan to overhaul the country's tax code. a dollar rally
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since mid-october and selling off the head of a week destined to be dominated by washington drama. earlier, a bloomberg person revealed that a five-year phase-in was revealed of the corporate tax cut. joining us from los angeles is lonnie chance. great to have you on as always. you understand this process better than most as he worked on the romney campaign in 2012. the minute you start talking about things, you lose some, you bring some onboard. with you make from the phase in corporate tax cut? the dynamic is very difficult once you start talking about this specific provision that you are going to use to broaden the days of taxes. the phase-in is one way to handle attentional -- potential revenue loss from fastbreak cuts. some might call it a gimmick, but this is i you manage the process. it's i you get to a point where you manage tax rate reduction.
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not so many vegetables to eat with the desert. scarlet: now we are all seem to come out. from a practical perspective, the gop leadership at this point has the necessary experience of shepherding tax reform through congress. does anyone know how to do it? they have a very aggressive timetable. >> no one in this congress, certainly no one at the aroundtive level was necessarily when they did this last in 1986. the situation and political terrain has shifted dramatically. you have massive polarization in both the republican party and democratic party. something you didn't see in the mid-1980's. the scenario is different now. you do have people who are fundamentally dealmakers. who are looking to make -- get things done. the german of the ways and means chairman of the
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ways and means committee is someone who is done deals in the context. mitch mcconnell, these are all people who want to get this done. the specific experience may not be there, the legislators involved. but certainly they all understand the political dynamic, and more than anything, i think that's the important consideration right now. julia: where does the president to hear? paul ryan said the president is needed to pull everyone in together. we all believe this is very important for the midterm elections. what we saw last week on twitter was a 401(k). what we have seen is kevin brady hasn't embraced that at all. where does he fit in here? >> the president is a huge part of this. the president has to be the one to leave ever on tax reform. there's no way around it -- the president has to be the one to lead the way on tax reform. on the way they get this
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finished is if the president is engaged. it may be the case that they are in a better position that they will introduce legislation on wednesday. the president then leaves for asia on friday or saturday. that may be a good thing. tweets,y not be as many distractions, maybe focus on the hill can be exclusively on getting tax reform through. the agenda is still crowded and the bandwidth is still limited with all the news today about the matt forte situation and the indictments. it's going to be tough, but the president's role is crucial. he is the focus if you want it to pass. scarlet: earlier the white house believes -- believes bob mueller will be wrapping up his investigation shortly. give us your take on the investigation and how paul manafort and his associates have played not guilty to the charges while george pop that up list -- george papadopoulos pled guilty.
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>> i don't think as any surprise that paul manafort would have led not guilty, that his associate would have. the big question is whether this investigation goes now. thatcertainly not the case bob mueller has this initial set of indictments and that will be at. the question is what happens next. how distracting is -- will it become for the trump administration? the notion that it will be wrapped up soon, i don't necessarily agree with that. i think it will be an investigation that is going to be quite wide reach, far-reaching and could take years to finish. how much of a distraction it becomes when the agenda gets crowded is the question. we are doing tax reform, but we -- thatfigure out how the expiration dates for the last cut almost financing in the. government and increase in the debt ceiling we have a number things that happening. julia: how distracting is this going to be?
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do you think they can still get tax or farm done on the timetable? >> its aggressive, there's no question about it. i do the tax reform gets done, the white house has put out an aggressive timetable. i think it's good that they have it out there so people have something to shoot at. i think we will be in a very good shape if it gets done by the end of the year. summon suggests that the earliest of 2018. the longer this goes on, the harder this process becomes. it does not become easier, it becomes harder at individual interests begin to pick apart things like the market -- mortgage interest and action, it gets more obligated. scarlet: we will be speaking with one of the groups opposed to the current tax reform as it is going to be written. thank you so much for joining us. we will be bringing you more on tax reform later this hour with susan collins, republican senator from the state of maine.
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let's get your check on the headlines on bloomberg's first word news with emma chandra. the white house is distancing itself from the indictment of paul manafort, it is said that agreementve a plea involving a former trump campaign official. at the white house briefing, most of the activities to which he engaged to have been invited was placed before the 2016 campaign. she also was asked whether there were plans to fire special counselor bob mueller. >> there is no plan to make any changes in regards to special counsel. today's announcement has nothing to do with the president, nothing to do with the campaign, or campaign activities. hasreal collusion scandal everything to do with the clinton campaign, fusion gps, and russia. was also asked about
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the guilty plea by former campaign advisor george. she says he was a volunteer. president trump scathing prevent thell not soldier from receiving a first sentence for endangering comrades by walking off this post in afghanistan in 2009. a judge ruled that the court cannot be directly affected by the president' remarkss. while the republican nominee. , he repeatedly called him a traitor, and suggested he was shot or thrown from a plane without a parachute. trump revises comments when he pleaded guilty earlier this month. he faces a maximum of life in prison. a judge has denied a mistrial motion by new jersey senator bob hernandez, attorneys file the motion over the weekend, accusing u.s. district judge william wall of. he said today it had no problem there. he is charged with accepting replied on a private jet and other gifts from florida i dr.
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solomon nelson -- florida i dr. solomon nelson. king's election commission says president uhuru kenyatta, the poll was boycotted by kenya's main opposition group. election officials say he received 7.5 million of the votes cast. it was also declared the winner of the presidential election back in august, but it has been nullified by the supreme court. global news 24 hours a day powered by over 2700 journalists and analysts in over 120 countries. i'm emma chandra, this is bloomberg. julia: coming up, it's our stock of the hour. we will be digging into the weeds with medical marijuana company canada growth. after i today constellation brands but just shy of a 10% stake.
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we will be digging, that's next. from new york, this is bloomberg.
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♪ julia: this is bloomberg markets. scarlet: our stock of the hour writing high today. shares of canada-based canopy growth, the ticker is we. pricing after getting a new investment. julie hyman is here with the details. julie: weed cn, because is a canadian company. canopy growth is getting a big investment from constellation company.he big liquor they are going to be the largest shareholder after they pay about $245 million canadian, which is about $191 million u.s. for a 9.9% stake in this company which
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is a canadian seller of medicinal marijuana products. there has been a lot of talk within the pot industry that there would be more investment in it. and is really a legitimate, one of the first big investment by a public company that we have seen. not only are shares of canopy growth higher, but we are seeing a number of the other marijuana companies that are in canada also trading higher today because now there's speculation that there will be further consolidation and or investment in this industry. julia: is there any federal legality problem? julie: you want to make money from this. constellation brands did comment on this today. they said they don't plan on getting into this business in the u.s. at this time. they don't plan on doing anything that would cross the line. they have no plans to sell cannabis in the u.s. or other markets until it's legal. the legality by
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states. the companies have said that they may partner on developing some sort of average eventually -- beverage eventually. canada plan to legalize medical marijuana by july 2018. that doesn't mean it would be legal immediately, they are trying to save -- inch various products and. -- in. shares are up sharply. we will watch what happens in canada over the next couple of months. scarlet: coming up on today's walk the talk, catherine celestin, who is the ceo of power defined tells us why the intervening process is stacked against women from the get-go. from new york, this is bloomberg.
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i'm scarlet fu, it is acknowledged that is a pipeline problem for women in technology. once a candidate is identified the bigger issue is, how she's hired. in today's walk the talk, bloomberg's ongoing conversation about diversity in the workforce. i sat down with the cofounder and president of power defined, a global recruitment company for women. i asked her where the interviewing process works against female interviewees. katharine: there are many things that get in the way of the process. how the interviews are actually set up. scarlet: let's talk about the interviewing process. katharine: you look at how diverse panels are. you cannot have a panel of people interviewing someone who looks different from them. that person will feel like they don't belong. interviews are a two-way
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process. it's not just seeing if that person wants to come work for you. you want to also encourage a woman to want to work for you. having a panel of all white men is a really good way to make sure that doesn't happen. you want to make sure the people on the panel make it clear that the person who is being interviewed can belong in that space. making them feel like they belong. and also that they can ask questions that are relevant to their life because the person in front of them might be able to share a number of similarities when it comes to gender, culture, race, etc. scarlet:scarlet: in the general format, that doesn't happen? even if there are white men on the panel, that engagement and asking of questions doesn't take place? katharine: we often find that during the interview process the questions are being asked to women in ways that really relate to them that they are being asked to sit into a box that was
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built for white men. saturday -- traditionally workplaces were set up for white men. women have changed dramatically throughout the last couple of decades. we have done so many things to try to fit into the workplace. workplaces have done little to change for us. are still geared towards finding that perfect white guy. scarlet: among companies that execute well, you mentioned amazon. you said amazon gets it, that they are doing things the right way. what have they done specifically to address the challenges of hiring talented women? katharine: everybody is a work in progress. i don't want to say everybody gets it. i want to say that everybody -- i want to say that they get the process that needs to happen to get women into seats. they have set some quotas to be able to raise the number of
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women in the technology unit. they are honest and transparent about it. a lot of companies are trying to do that, as well. one of the things they are clear about is they want to interview 50-50 men and women and that their panels need to reflect that. they are very concentrated on making sure they get those women into the inquiry pipelines. which are a lot -- interview pipelines. we are a lot of people say not a lot of women applied for the job. we just don't interview and of women for. part of that is you have been messaging for decades that women don't belong in your company. we see this a lot in the financial services sector. we have a huge amount of work to do and we work with the major banks, they have a huge much of work to do when it comes to theaging -- countering messaging that these institutions are only built for men who can stay there for 14 hours a day and then go up or drink afterward. scarlet: you target womenscarlet: --scarlet: you
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target women in tech. it inevitably means that a certain age they have a certain amount of years and responsibilities. one thing you notice is that the recruiters from the companies are not from that same demographic. -- to that manifest itself how does that manifest itself? katharine: i wrote an article saying i was sorry to all the mothers i worked with. i wrote it because i was very frustrated when i talked to younger woman who would say things like we want more women and we want them to be mid to isior level but our culture all about what we are building in the office and we gropper dreams once a week. we have this great -- we go out for drinks once a week. we have this great bring your dog to work day. ping-pong tables, things like that. if you actually want women mid to senior levels, they tend to
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be in their mid-30's, having young children, that's the reality. you have to think about how your office reflects what those women need. also what those men need work in that space, to. scarlet: that was my interview with power to fight cofounder and president. julia: let's get back to today's top stories. progress on tax reform and the charges against paul manafort. bloomberg's chief washington correspondent is standing by. jim: we here with senator susan collins --jim: we are here with -- kevin: we're here with senator susan collins. does this but the issue of collusion to rest? susan: it does not. if you look at the specific charges against all metaphor and kevin gates -- paul manafort and
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kevin gates. there's a lot more work to be done. what this does show is that the independent counsel is making real progress in the investigation. to have this series of indictments left a guilty plea already is showing great progress. kevin: i covered the hearings of the committees here. national security officials have all said that russia tried to penetrate u.s. democratic systems. you think the president is effectively communicating the message to prevent this from happening again? susan: i think the president needs to do much more. all, if you look at what the leaders in france, germany, montenegro did, they put out the facts that the russians were
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trying to undermine the basic premise of western democracy. that is fair and free election. in my judgment, that helps to insulate those countries because the population was on guard for a propaganda effort. kevin: why is the president communicating that message? susan: i'd like to see him do more on that. i'd also like to see that the administration working closely with the government to help -- part in the election systems. kevin: are you satisfied with how the administration communicated with the state governments that folks try to hack into -- try to hack into? katharine: i thought they were too slow --susan: i thought they were too slow. kevin: do you think it will be completed by the end of the year? susan: i can't speak for the independent counsel's investigation.
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the intelligence committee and the senate will not have answered that question by the end of the year. i think by the end of the year we will be able to put out an interim report on our findings and recommendations with regard to russian efforts to interfere with our election and try to undermine the basic tenets of our democracy. that's important, because we have an election next year. kevin: you said you want a tax code that spare, simple, and progrowth. while this is going on, there's still the issue of tax reform, is this going to distract from that? susan: i don't believe so. we are on a good track to come up with a tax bill. there's been a lot of work done already in both the house and the senate. i think you will see a tax bill passed, and i hope it will be bipartisan.
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kevin: one of the issues is the administration is saying there are no plans to fire bob mueller, should the president changes mind, what is your opinion? susan: i don't think there's any chance he will change his mind on that. there would be such an uproar, not only by congress, but the public at large if mr. mueller was fired. he is the evzio person for this difficult job. he has the experience, qualifications, and integrity. the president appears to now understand that he needs to allow that work to be done. kevin: tony podesta has stepped down from his lobbying group, obviously the allegations and indictment against paul manafort. also silicon valley is facing scrutiny. you will be on a committee with regards disclosures for social media company. does tech get it? why were the disclosing that a foreign government was paying for ads for propaganda on the
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u.s. business sites? >> that's exactly the question we are going to raise. there were actually ads with ruble, the ribbon currency -- russian currency. that should've been a huge red flag that a foreign government was inappropriately and giveally trying to something of value to an to undermineidate our election process. kevin: are there laws on the books that social media companies should have been following? susan: absolutely. that's the question i'm going to ask them. kevin: is it acceptable, in your opinion, that people like mark zuckerberg are sending general cast -- are not find?
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susan: all i want on the people who can answer the questions. if that's the general counsel, that's fine with me. the questions are not going to be any easier. last week, bob corker raising very intense concerns suggesting that president trump is " a danger to democracy." do you agree with that? what you say to focus -- what are veryo those who concerned about what they are observing right now about the state of our political institution? susan: i'm very concerned about the divisions we see in our country. the partisanship here in washington dc, and as a senator who has decided to forgo a run for governor of maine and stay here, i'm going to continue to work with democrats and
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republicans, house members, senate members, and the administration. i think that's my job and i'm going to try to work out compromises and bring people together on the issues. i believe that's what the american people want. kevin: in a word, your thoughts on this morning as a whole. put in a perspective for me. it certainly is significant. to have someone who once served, however briefly, as the president's top campaign ad, the indictment is significant. even if it's not directly related to what he did for the president. i think we have to be cautious about leaping to a conclusion that there was collusion between the trunk campaign and the russians -- trump campaign and the russians were not there at this point. we need to go through the evidence and the special counsel is going to be going down his
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track and looking at whether there are other criminal wrongdoings. kevin: thank you so much for taking the time to speak with bloomberg. we appreciate it. julia: chief washington correspondent kevin cirilli there. one hour from the close of trading, let's get a check on markets with julie hyman. weie: we are seeing major -- are major averages down. the nasdaq has been bouncing around relatively narrow range. it had a big day on friday, tech earnings rising to a record. let's look at some of the groups that are on the move today. in terms of the biggest underperformance, we are telecoms and health care as the biggest drags, even as we see energy, real estate, and cap hold up well. the big downturn in telecom ofing after we got the news the potential merger between sprint and t-mobile.
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,oftbank's plans to merge it but it a serious snag. earlier, we had reporting from nikkei. is down, t-mobile is down, as well. some telecom companies are bouncing back, as well. they have been declining about concerns of what the merger with due to the negotiating power. american power and crown castle bouncing a little bit. speculation, we have to talk about what's going on with dunkin' brands. we had some headlines on it earlier. this is coming from street inside is reporting saying jgb holdings is looking to continue with a potential deal. we haven't confirmed this. to thisk is reacting speculation into this particular story. health care with the other drag we were looking at. shares of merp are down after the company withdrew its application in europe for a
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medication to treat a type of lung cancer. in vision health care is declining ahead of its earnings report. is among the biggest decliners within the health care today. a check on the 30 year, as well. the long and bonds -- the long end of bonds. talking about the demand for ultra long bonds, which is surprisingly low. after that, we saw that the yield making the lows come into the 30 year. you can see is off by four basis point right now. it's a big week of big reveals. investors are waiting and watching for the fed's latest policy decision while still awaiting details on the republicans tax bill and the unveiling of president trump's for fed chair. reports from facebook and apple
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later this week. us now is mona, investment strategist at allianz global investors which oversees more than 500 million dollars in assets. probably the best decision is the least of investors's worries. when it comes to the backdrop do any have the potential to make this market stumble? mona: i think this week we have two major pieces of news coming out. first is the federal reserve chair, which president trump has said will, on thursday. our best guess is powell will be the winner there. him,e case that it's not that i can't is taylor or yellen, that could be a potential market moving news. betting on indicate 82% chance of powell. we think it makes sense.
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trumpa new pic and donald as indicated he wants to have his own people. he is in favor of deregulation. yellen has indicated she wants to keep the dodd-frank regulation in place. powell has said he wants to take back some of that regulation. i think that's favorable from a trump perspective. you want deregulation. scarlet: we think it's going to be favorable for the markets. with detector for could be favorable for the markets -- we think caps off want to be favorable for the market. mona: i looked at bloomberg this taylor'snd it said rule is indicated 3.79% as the fed funds rate if we apply his rule. despite the taylor rule and a lot of its rule-based fed
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policy, i think he will be a sensible guy. he will take market policies swell and said he as well. julia: is there any knee-jerk reactions? mona: i think there will be a knee-jerk reaction if we get a surprise in taylor. equities would selloff, we would see rates move upward. scarlet: given all the moves that we saw last week, the 10 year yield getting to that 2.748%. were people making too much of that? are they looking for reasons to say that we are on the cost of a new inflation point? mona: i think it makes sense for them to start steadily moving up. we are at inflection point in terms of monetary policy. the fed has started balancing tapering. we are on a fed rate hiking cycle. they have done for rate hikes so far -- they have done for bank rate hikes so far.
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the markets haven't it yet fully priced it. as we get closer to a fed , closer to potentially rising inflationary environments, we are going to get rates start to gradually move upward. our view is the you move upward. we've seen some outperformance in the tech names, amazon in particular. where does that fit in to what we see for the rest of the year? how do you make money in the rest of the year? now, i think the backdrop remains behind. we have a good -- remains to be nine. we have good earnings environment, we continue to see u.s. equities supported. i do think we will see our performance continuing in technology.
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i also think we have more rotation into valued names. energy sector for example. well,e financials, as they are beneficiaries of not only the rate rising, but the regulation. i think there are way to make money beyond tech. scarlet: what you have to warn investors to watch out for? mona: there are still things, tax reform is gaining momentum, but it is not definite at this point. we have seen in fighting between president trump, senator corker. we have seen 20 republicans voted no, that's because of the state and local tax deduction. i do think the other supplies -- surprises inflation. we saw a little bit in the last non-from payrolls, we are averaging earnings by 7.92%. whether that was a one-off or not, we will see a friday -- we will see it's friday.
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julia: where is your probability now protects report? mona: we moved it up to 40%. scarlet: still the all-star that it doesn't get done. mona: they have to prove themselvesmona: -- still the odds are that it doesn't get done. mona: they have to prove themselves. julia: thank you for that. let's go to the headlines on the bloomberg's word news with emma chandra. >> the fbi is reportedly investigating the controversial $300 million contract to rebuild rodrigo's power grid after devastating hurricanes -- rebuilt puerto rico's power grid after devastating hurricanes. the contract went to a tiny company based in whitefish, montana. the hometown of interior secretary line cd. -- ryan zinke. puerto rico has said it plans to cancel the contract. may's u k, theresa settlement is planning a new
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brexit charm offensive. david davis will try to win over skeptical european leaders in a series of upcoming meetings as part of a drive to push negotiations forward. the u.k. wants to move past actual terms, to future trade relationships. many people across the northeast and united states are cleaning up today and are still in the dark after severe weather pounded the region. powerful winds left one million -- 1.5 million people without power. trees --rt that down down trees and impassable roads. global news 24 hours a day powered by over 2700 journalists and analysts in over 120 countries. scarlet: coming up, the white house distancing itself from the indictment of paul manafort. we go live to washington for the latest. from new york, this is bloomberg. ♪
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julia: we're hearing from paul manafort's lawyer. represented pro-european union campaigns to the ukrainians. in that, he was seeking to further democracy and to hope that ukraine come closer to the united states and the eu. 2014,activities ended in over two years before mr. manna report served in the trump campaign -- mr. on menopause served in the trunk campaign. is using a counsel novel very to prosecute mr. paul manafort. the united states government has only used that six times since 1966 and only resulted in one conviction. the second thing about this
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indictment that i myself find ridiculous is the claim that maintaining offshore accounts to bring funds into the united to conceal from the united states government is ridiculous. thank you. julia: that was all manna for -- speakingfort's lawyer to the washington, d.c. district court. they both pleaded not guilty. the belief is that the prosecutors are as suggesting $10 million bail to be set during the status hearing on november 2. this is the latest. let's go to white house reporter
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who is standing outside the federal courthouse. we just heard from his lawyer, saying this is totally ridiculous and these charges will be far -- fought. >> his lawyer is pushing back very hard against the charges that were brought by the special counsel. he was pointing out some of the charges of the foreign agent registration act has been charged six times in the last 50 years, with only one conviction. there are other charges, including money laundering, that paul manafort is going to have to face. right now, we hearing that the lawyer is pushing back hard, saying the offshore accounts are not a sign of trying to evade taxes. for are basically routine someone who has an international business practice having accounts in various parts of the world. ais is obviously going to be
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situation that will play out over several weeks and months as these charges get brought. one thing we heard is that all of these activities, when it comes to paul manafort and his business activities, happen before he was part of the trump campaign. this is all pushing back against the idea that this was impartial of the trump campaign and any ties to russia or collusion. a similar message from what we heard from the white house, saying this has nothing to do with the trump campaign. we can see both the white house and paul manafort's team pushing messages that there was no collusion and it had nothing to do with the campaign in 2016. julia: his work for the trump campaign isn't included in this indictment. scarlet: that's critical here. associatesrt and his our next scheduled to appear in court on november 2. let me bring in the other
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gentleman which is, george papadopoulos, he did have a connection to the trump campaign. his guilty plea have to do specifically with his work with the trump campaign. >> that's exactly right. if you look at these cases, it does seem the most damaging to the trump campaign is george papadopoulos. not only did he plead guilty, which means he may be cooperating with bob mueller on any charges that may impact the book closer to president trump -- to the people closer to president trump, he admitted to working with people who had ties to the kremlin. he said he was in regular contact during the campaign with people who wanted to set up a meeting between trump and president putin and russia. the documents released today showed he was in contact with high-ranking people within the trump campaign who seemed to be
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open to the idea of having meetings and discussions. not only between russian government officials in the trunk campaign, but meetings that were specifically to provide dirt about the hillary clinton including emails. that could be the smoking gun that is focused on in this campaign -- in this investigation in the weeks ahead. julia: white house reporter for bloomberg news speaking there. also getting further headlines. rick gates, former business associate of paul manafort, is also facing charges. we are seeing reports that he was terminated by bank colony capital following today's indictment. scarlet: for more insight on this developing story, we want to bring in tim o'brien. he is out with a new bloomberg view column titled, -- "why the
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indictment should shake trump." this is in contrast to the message sarah huckabee sanders gave today, which is there are no connections to the trump campaign and this happened ages ago, before he was running for office. there's a lot of truth to that. i think the immediate collusion issue of trump and the kremlin, and the 2016 campaign, i don't think it is front of mind for the president. , collusion in the campaign isn't mentioned at all in the manna fort -- paul manafort indictment. the president over the last week has been tweaking about all of these things -- tweaking about all of these things. i think what he's concerned about is the money trail and the extent to which the mueller investigation is looking at the hisp family's finances and
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own financial and business dealings that involve russia or people representing russian interests. julia: how important is george papadopoulos, someone who clearly may have been a volunteer but is ultimately involved with these people? >> the president is not mentioned in any of it, being unwitting is not even an issue. he is not mentioned. i think for the impeach trump movement, or everyone else who is waiting for a moment to come along that would give them the sense of momentum around legal action against the president, this is not that moment. julia: this is 31 pages, this indictment. my other question would be is this it? --ut more charges be added could more charges be added? >> certainly more could be added . it would allow more charges to
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be brought. scarlet: at the very least, trump and his family have pushed hiring, sonafort's they appear reckless in not doing their due diligence. jared kushner also has some business dealings that could come under a microscope. -- they own a building on 6th avenue, it is struggling. there's been an issue about jared reaching out to chinese financiers, or possibly russian financiers, to get financial aid to rescue the building. scarlet: is that fair game for mueller? >> we already know he's looking at those at a minimum to see what was behind them. julia: if they had anything that could tie these characters to collusion in the 2016 election,
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would we have not seen charges applied at this stage? >> this is early innings. the way these go is we see people on the bottom on the way up to the top. we are early on, right now. scarlet: tim o'brien, executive editor of bloomberg gadfly. still ahead, options insight. trading electronic art ahead of earnings tomorrow after the close. . the stock is up almost 50% in 2017 this is bloomberg. ♪
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♪ is bloomberg markets. scarlet: it's time for options insight with julie hyman. julie: joining me for today's options insight is mk holdings. let's not forget we are in the midst of earnings season. i asked you before we came on,
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heading into this week's set up for earnings if there was anything that stood out to you? facebook.entioned was i would make a comparison that was interesting is these are large companies with volatility embedded in options is not incredibly risk. points of highw volatility priced in that last week. if you went out to november expiration and bought about a 4% out of money call, you would have been up about nine times with stocks 13% higher. facebook is similar, pressing about a 4.5% move, less than it usually moves in absolute terms on earnings. with theup last week other bellwethers, is there more upside in facebook post earnings later this week? not sure. you go out in november, by 187.5 spread call outright, you pay
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about $238 for that, and you have amazon like exposure if you get that catalyst. julie: if you think the move is going to be bigger than the markets pricing in. let's get to a company that will be coming out with earnings, that is ea. you are looking at this sector, which hasn't done that will recently because it has pulled back or delayed a game related to star wars, which people were banking on as a big seller. your analysts think this earnings support isn't going to be a fad. >> game makers have had a great year, if you look at activision, up significantly. ea has led a bit relative to them -- ea has lagged a little bit relative to them. the studio was shut that was creating that game. we think that shut down an opportunity.
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stock has been in the 120 range back to july, we want to look at earnings as a callous. we think they feed on the quarter, this is their fiscal second-quarter. we think they raise full-year 2018 guidance. we think that helps the stock get out of this range. what we want to use to get exposure to that is go out to january and by 120--- buy 120-135. you can almost 2.8 pay off with the stock, 135 or higher at expiration in january. julie: why january? it's post this earnings, but doesn't fully capture the holiday. that they would be reporting after that. >> one thing to think about is an amazon-esque situation, and you want exposure. ea maybe not that sort of event, but one that catalyzes higher gets it up out of this range.
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we think this can begin a trend higher in two-year and. we want to use options to capture the density of that over a longer. of time. a longer peiod of time. scarlet:scarlet: netflix is pulling house of cards after season six. this will be after the next season. julia: are you up today? scarlet: i'm not. -- julia: are you up to date? scarlet: i am not. this is bloomberg. ♪
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as a white house -- at a white house briefing sarah huckabee sanders says most of the alleged activity for which men afford placed is indicted before the 2016 campaign. also asked whether there were plans to fire special counsel robert mueller. intention oro plans to make any changes. today's announcement has nothing to do with the president, nothing to do with the president's campaign or campaign activity. the real collusion scandal has everything to do with the cap -- with the clinton campaign and russia. she says papadopoulos was a volunteer. and secretary of state rex tillerson are scheduled to testify before the senate foreign relations committee today


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