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tv   Bloomberg Markets Americas  Bloomberg  January 10, 2019 10:00am-11:01am EST

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success with china. and i find china, frankly in many ways, to be far more honorable than trying jet schumer and nancy pelosi. i think that china is much easier to deal with than the opposition party. are you goingnt, to have a -- after the meeting yesterday, are you going to declare a national emergency? president trump: i have the authority to declare a national emergency. if i have to come i will. -- to, i will. so when you say, was this past by congress, it was. other presidents have used it. some fairly often. i have the right to declare a national emergency. i have not done it yet.
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i may do it. if this does not work out, i probably will do it. . this is a national emergency. >> mr. president, this is not a national emergency. if it is, why haven't you declared it yet? president trump: because it makes sense to do it through congress, but the easy route would have been calling it a national emergency and doing it. i will tell you, this is a tremendous crisis at the border. look at president obama's statements from the past, numerous statements where he called it a crisis. this is a crisis. you have human trafficking, drugs, you have criminals coming in, you have gangs. we are taking them out by the thousands. this is a crisis. and they do not come in at the checkpoints, which they do also, but they go in between the checkpoints where you do not have barriers. >> mr. president? an emergency, if it works
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out, are you still thinking about -- president trump: i would say 100%, but i do not want to say that because maybe something is comes up. but if we do not make a deal, i would say it would be very surprising to me that i would not declare a national emergency and just ffund it. by the way, there is more than one mechanism, we have various mechanisms. and the lawyers tell me 100%. it would be nice to make a deal, but dealing with these people is ridiculous. i do not know if they know how to make a deal. we need, i will tell you what, a lot of democrats, i was looking at the numbers, democrats agree that we need national security. and the only way that you have it, the only way that you have it is you have to have a strong border.
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the only way you have a strong border is you need a wlll or you need -- wall, or you need some kind of a deal. you need some kind of steel barrier. if you do not have a still barrier or a concrete wall, forget it. >> pictures this morning show is still barrier wall, they are sighing through it. -- sawing through it. what good is it? president trump: there is nothing that cannot be penetrated, you fix it. but it is a difficult thing to do. they have other walls, we have many wells under consideration. even concrete. there is acid that can go through concrete, but you fix it. it very much limits. the wall that we are doing is very hard to penetrate. >> mr. president, you walked out on the democrats. will you bring them back? president trump: the news
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incorrectly reported, because i said, well, if we go back and everything is peachy and you say we will talk over 30 days, at the end of 30 days are you going to give us border security, including a wall? or a still barrier? she said, no. i didn't pound on the table, i did not raise my voice -- that was a lie. you should call the pinocchio, because if you ask mike pence or kevin mccarthy or anybody else in the room, they will say -- i know if i do that, you will report it -- let me just tell you something, i very calmy said, if you are not going to give us strong borders, goodbye. i did not rant and rave like you reported. , theyf the newspapers
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said he had a temper tantrum. i do not have temper chain jobs. -- temper tantrums. that is a live. i did not smash the table. i should have, but i did not smash in the table. and that is the story. all of that narrative is a lie. >> my question is, how can you get a deal if you are not talking with them? president trump: there is far more pressure on them, because the people of our country want security, we want to be a secure country. we do not want drugs pouring in. most of our jobs come through this -- drugs come to this other border, in between the barriers. >> mr. president? [indiscernible] president trump: you know who has more human pain, the parents of people who had children killed by an illegal immigrant.
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you know who has more human pain, the wife that lost a husband to an illegal immigrant that came in five or six times that should not be here. that is human pain. and the people who will be paid, maybe a little bit later, many of those people are all my side. they want to see border security. the most dishonest reporters a longtime. -- of all time. >> mr. president -- [indiscernible] i have no idea: what they are doing. next question. what? [indiscernible] i cannot hear you.. [indiscernible] trump: we have plenty
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of funds if there is a national emergency. there is a lot of funds. we declare a -- if national emergency, we have a chairman this amount of funds. tremendous. if we want to do that, if we want to go that route. again, there is no reason we cannot come to a deal. but you have another side that does not care about poor security, the democrats -- about border security, the democrats do not give a damn about crime or gang members coming in and stabbing people and cutting people up. they do not care about crime. if they are not going to care then we should not do anything at the border. but i care about crime. we are spending a fortune on stopping drugs. they are pouring in through the
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border. i see it now, the democrats do not care about the border or crime. >> mr. president. [indiscernible] >> the emergency on the border -- when did it begin? president trump: president obama used to call it a crisis, too. look, look, you can all play cute. 85% of you are possibly in coordination with the opposition party. the whole thing is ridiculous. all you have to do is look at the borders. rent a helicopter, except you do not want to know the truth, and watch. here is the story. there is another major caravan forming right now in honduras. and so far, we are trying to break it up. but so far, it is bigger than anything we have seen. rone is not going to
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stop it. you know what will stop it? a nice, powerful wall. [indiscernible] president trump: the buck stops with everybody. they could stop this problem in literally 15 minutes. we could have border security, they could stop this problem in 15 minutes if they wanted to. i really believe now they do not want to. i really believe that. i believe they do not care about crime. i really believe this. the the mcgrath do not care -- the democrats do not care about crime. they have been taken over by a group of -- is so far left, they do not care about crime. sadly, they are viewing this as
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the beginning of the 2020 presidential race. taht is ok with me -- that is ok with me. they have been taken over by a group of people that do not care about gangs, they do not care about human trafficking and drugs. they do not care about anything. i will tell you why. they have gone crazy. >>[indiscernible] >> mr. president, how much longer will the shutdown last? president trump: we have to get a win or i will go with national security. either we are going to win, or make a compromise. i'm ok with a compromise. compromise is in my vocabulary very strongly. we will either have a win, make a compromise, because a compromise is a win for everybody, or i will declare a national emergency. >> mr. president, you have not even -- president trump: this is a thing
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the lawyers tell me is 100%. >> mr. president -- president trump: you have to speak the language. read the language. [indiscernible] president trump: we will have to see. there has been no collusion whatsoever. >> mr. president, what about paul manafort showing data from your campaign? president trump: i did not know anything about that. and hisabout jeff bezos affairs? president trump: i wish him luck. speakingresident trump at the white house before going to joint base injures -- joint base andrews, saying many things, comparing china with the democratic leadership, saying china was easier to deal with. he also said he did not raise
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his voice yesterday in that meeting. and he wants a wall that will be hard to penetrate. he also said he never meant mexico would write a check for the wall, but it would pay for it indirectly. kevin cirilli now, our chief washington correspondent on capitol hill. "either we are going to win or make a compromise, copper mines is in my vocabulary -- a compromise, compromise is in my vocabulary." this feels more like an ultimatum. kevin: it is. president trump is going to the border to meet with border security officials, but leaving washington behind him in a series of malts -- montrose this. no cover my has been viable for democrats. somethe past 48 hours, republicans have begun to question out loud whether or not the president is in the best position to broker a compromise with democrats, most notably
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cory gardner. the president, for his part, also with a state of the union address a couple weeks away, saying he might declare a national emergency, which would allow him to bypass congress to build the border wall. the question becomes, will republicans back that? and if not, will it lead to a court battle that could put him at odds, not just with the courts, but his own party? tehre are a lot of rumblings here that this is a bigger fight beyond the partial government shutdown. and in addition to the debt ceiling and the robert mueller investigation, we have a lot in the background. vonnie: he will arrive in texas around 2:00 p.m. eastern. thank you, kevin cirilli. battle is oneown of the concerns weighing on market sentiment today. romaine bostick joins us. we are we getting a little bit.
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the shutdown is a factor in that. retail also to think about. equity markets lower because of the concern in the retail space, or simply because they have been going up? >> a little bit of both. the retail earnings, that looks from macy's, target, that had a big effect on sentiment because there was sort of this idea the consumer was still strong. that the momentum from the holiday season was going to carry over into 2019. and based on forecasts out of these companies, that does not appear to be the case. the flipside is what jay powell has been saying and the perception the market has of how the fed might support this market. but when you look at the run-up we had over the past 10 days, the past 10 trading days, you can see maybe it got exhausted and a little bit ahead of itself. at the end of the day, the fed's message did not change, just
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basically what changed was the way they communicate the message. it is interesting, the most shorted stocks in the u.s. equity market are the ones that have rallied the most. you can find this on your bloomberg. we are looking at those stocks outperforming the ones in the broader market, the most shorted stocks having a real pop. is this a short squeeze? >> it is possible, but strategists will point at the valuations. when you look at the broad indexes in the u.s., you are seeing price-to-earnings ratios, the price to sales ratios below the long-term averages better basically down below the levels where they were during the last financial crisis. so a lot of analysts say, there is the buy moment. others look at a short squeeze, but that argument applies the very specific stocks. when you look at a market as a whole, it is more of a valuation
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play. people think they have found a four based on those -- floor based on those valuations and on the fact the fed is willing to support, but that is not fuel. that is why we see some weakness today. vonnie: airlines and retail stocks performing poorly today. macy's is down almost 20% right now after guidance. >> this is the worst day it has had on record. comp sales will be about 2%, down from 2.2%, but the real issue is they are not seeing the carryover from the holiday sales season. there was an analyst who gave this as a good example, like a as good as it gets kind of quote, saying all the discounts kicked in on the 25th. people were going in buying things at full price and is and as we got past that season, all of a sudden the retailers felt
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compelled to offer discounts at a level that is giving concern going forward as to whether there will be that much strength at of consumer spending. well, is&p down as friend -- after ireland's all -- airlines all have gone down. >> this has to do with economic conditions outside of the u.s., and the idea that these airlines were in the front seat where they could price their tickets how they wanted, because demand was there. we are looking at a little bit of drop off in terms of demand. and american airlines gave a fairly dour forecast. delta back on january 3, also warning about what was going to happen in 2019. they do not have the same pricing power, or they are alluding to that fact, in 2019 that they had in 2018. jonathan: romaine bostick, thank you. we will talk more on airlines and autos a little bit more,
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next. this is bloomberg. ♪
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guy: from london i'm guy , johnson. vonnie: in new york, i'm vonnie quinn. guy: before the break, we talked about turning our attention to the auto space. ford announcing it will cut thousands of jobs in europe and may close protection plans in the u.k. jaguar and land rover planning on slashing jobs as well. joining us from munich -- how bad is the european auto market right now, these companies having to take such dramatic steps? >> yeah, absolutely. it has been a bad day for carmakers in europe with ford
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and jaguar announcing layoffs. and these things we saw today, there have been rumblings along those lines for quite some time. it is easy to see why, we have seen jaguar and ford move as the first, because both are majorly depended on the u.k. and brexit has been a major factor. for ford, u.k. is the biggest market. jaguar has its main operations there. for both companies, you have had other factors at work as well. in the case of ford, an aging model lineup. not many suvs are popular with consumers at the moment. and the focus on smaller cars, that has not been lucrative. vonnie: how much are these individual stories in the sense that ford had been in gauging in -- had been in gauging in a restructuring and struggling for years, where jaguar is specifically calling out brexit in the slashing of its staff?
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>> can you repeat that? vonnie: how much is brexit a factor and how much are these individual stories? was sayingyes, as i in the case of ford, it would be a major factor because the u.k. is a major market. and we saw last year, sales dropping on a general level by 6.8%. consumers are holding back because they are not sure what will happen. in jaguar's case, they are worried about their supply chain because components have to move across the u.k. and vice versa. guy: a big diesel lineup as well, a big factor for jaguar. taht is a factor -- that is a factor as well. vonnie: the mcintyre lines tumbling after cutting -- american airlines tumbling after cutting forecasts on fares. we go to princeton now.
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george, we see volatility in airline stocks typically, is this something that could be sustained? george: we are thinking going into 2019 that this is a sign that airlines do not have pricing power, there is too much capacity in their market. we believe it will continue into 2019. we do not see pricing power coming back, there is just too much capacity in the marketplace. i would suspect you will see this volatility into the new year. guy: if the government shutdown carries on, will the tsa have problems and will it ripple through into the airlines as well? george: it is precarious right now. airlines are adding too many seats to the marketplace, they are going about 4%, which is above gdp growth. if we get into a situation where the traveling public thinks going to the airport, it will be
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difficult to go through security and that begins to knock down the demand, without oversupply and the not down in demand, that could be a problem. margins are flat and falling. american, united, delta -- will this be the same for the lower tiered airlines? george: i do think the trend will rule through -- roll through the low-cost airlines. i think it will be more acute at the big service guys, like american and delta, because they do not have cost structures that can match frontier or spirit. if we get into a pricing war, it gets really hard for the big three to retain profitability while discounting fares to try to keep market share. i see it being more acute at the top of the grouping, the guys. is it to read the
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european market, given the fact we have the brexit story, which we were just discussing, trying to understand iag, which owns british airways, will have a problem flying in the event of a hard brexit? do you try to analyze the market and understand the profitability of these companies and potential for that going forward? how much of a coin toss is it? george: frexit is a big variable. but even away from brexit, when we look at the european market in 2019, we still see too much capacity coming to that market. i talked about 4% growth in the u.s., we see 5% in europe, so even more. i would say if brexit goes badly and really does interrupt air travel, you are in a bigger mess in europe. we think they will find a way to work through their problems, because it is in everybody's best interest to keep airlines
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flying between the u.k. and the continent. but if it does not go well, it could be even worse. we do see some deteriorating profitability in these european airlines as well. vonnie: thanks to george ferguson. and checking markets, we are off of our lows. s&p 500 down 4/10 of 1%. a little bit lower as president trump was speaking about the democrats and republicans, and their non-negotiations. taht is affecting -- that is affecting the markets a little bit. but we have improved. mrs. the worst performer in the s&p 500 -- and macy's the worst performer in the s&p 500. ♪
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vonnie: from new york i'm vonnie , quinn. guy: in london, i'm guy johnson. this is "bloomberg markets." vonnie: united technologies has
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decided to halt the sale of a unit, citing market volatility. they will focus on their portfolio separation plans instead. according to a report, it stal led after bids from buyers came in below expectations, according to people familiar with the matter. united technologies halting the sale of its a security business, because of recent market volatility. and activists involved in the stock as well. it is slightly positive now, having started a little lower. guy: now the bloomberg first word news. kailey: president trump is off to the border, where he wants to build a wall. he is flying to texas where he will meet with border patrol agent's. before leaving, he said he has the absolute right to declare a national emergency to build the wall. he said he will probably do that
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if you cannot reach a deal with congress. and bill elliott gas industry has not really felt impact from the partial government shutdown. according to the washington post, the interior department has accepted and published 22 new applications for drilling since the shutdown began. the department is not accepting other filings such as public records requests. and the near did not change much in the u.s. labor market, there is still plenty of demand for workers. filing for unemployment fell to a low last week. jobless claims down by more than expected, 17,000. and mike pompeo met with agent's president today. this is part of the nine nation tour meant to ease concerns about future market involvement in the middle east. he tweeted the meeting with the egyptian president was productive in the u.s. stands firmly with egypt and their commitment to protecting religious freedom in the fight against terrorism.
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global news 24 hours a day, on air and at "tictoc" on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm kailey leinz. this is bloomberg. vonnie: market volatility at the end of last year didn't spare investment banks, our next guest says that outlook is good for 2019. anna is the managing director at moody's. you define global investment banks as the 14 global banks, including for example the likes re you positive on all of these, including european banks? >> this is a diverse group. our positive outlooks for global investment banks is based on free engineering, restructuring, litigation costs, over georgia billion dollars for this group, and they are supported by strong liquidity and improving profitability's. european banks have been weaker
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performers, but the outlook is good for the overall group. from a a couple names rating perspective as well. vonnie: it feels like the ecb will not give the banks in the help anytime soon with the rates. and growth is in a difficult position in many european countries, even the stability of european countries is in question. basicallyu go back to the research, what we're trying to say is, yes, we do have more momentum in the u.s. from an economy perspective. it is certainly weaker in europe, but these banks are global, they are globally diversified banks with significant u.s. operations. so they should benefit from u.s. positive growth as well. but the nutshell of the outlook is a lot of the restructuring costs, the investments in
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compliance, that is largely in the rearview mirror. so basically from more of a clean slate. so there is upside in profitability, even though maybe the opening environment and uncertainty is out there as well. guy: what would consolidation among european banks do to your models, how would it change? deutsche bank, if it was put together with another bank, what would it do to the european space? ana: that is an interesting theoretical question. ishave confirmed that that not something they are looking at actively, but it is speculation. we are looking at deutsche bank as one of the weakest performers in the group, the only noninvestment grade entity on a standalone basis. we are looking more at min investment grade level ratings for the other firms. so from that perspective, deutsche bank has suffered
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syndicate revenue -- and very low domestic profitability as well. this point, itom is uncertain how they will solve profitability issues, because german banking, if you go from retail banking it is relatively unprofitable, about 10 have a 20 20sis points compared -- 10- basis points compared to the rio spears. and -- compared to u.s. peers. it is not necessarily a combination that falls with profitability and structural issues for deutsche bank. guy: share prices trading north of seven at the moment, 7.4 and composition is a factor for investment bankers. so how big a problem is if for european banks to retain talent, considering the damage done to share prices? ana: if you look at part of their plan, it is also cutting a
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significant amount of jobs. and that is part of restructuring. they are continuing to take these steps, obviously. from the perspective of talent, it is always, there are young people who always want to join the investment banking ranks, but when a bank is in disarray attracting the top talent and maintaining it becomes more difficult. vonnie: talk to us about some of, i am curious as to the american banks, goldman sachs for example, jpmorgan, bank of america, which ones are you most positive on? ana: we recently upgraded jpmorgan. they have a rare rating in this space. a2 on a standalone basis. and most of the banks are in like the aa range, so jpmorgan is quite distinguished. one of the strongest.
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and that outlook for jpmorgan came in the sense that they have a strong balance sheet, but really very strong profitability. jpmorgan is one of the few banks for a number of years that has been profitable, making their cost of capital, which has not been the case for others. we also put bank of america and citigroup in review for upgrade. for bank of america, it has been a positive change from all the litigation costs they had, but the girly due to mortgage -- w hich were due to mortgage issues. guy: we are late cycle in the economic cycle here. ana, we are flirting with a -- at the moment in the united states. taht could go negative -- that could go negative. what does that mean? the keep in mind that
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positive quality of these franchises, roughly 20% on , thege for these banks deposit banks, they are not interest-bearing. so that is high-quality deposits. so even though the rates may not go further up or we have an inverted yield curve, they can still make money because of deposits. vonnie: come back soon, ana. ana: think you so much. -- thank you so much. guy: coming up, jay powell speaks with a david rubenstein today about the timeline for rates. that conversation will be a 12:00 p.m. in the new york our. we-- hour. you do not want to miss this. this is bloomberg. ♪
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andie: mdm up more than 2% star board is building a stake in mgm resorts and looking for changes. activism to begin the new year for star board, this time in the company of mgm. with the income of the stocks getting a pop off that news. we are out to mgm to see if they would like to respond. we will bring you more details as we get them. star board said to be building a stake in their resorts. jay powell will be speaking today at the economic club of washington. michael mckee joins us now. michael, do a reset. we have heard from a lot of federal reserve board
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governors and even the chairman a couple times. he will speak again today. is there anything more he can say for the market? >> i think the message has been clear. he who very clear in atlanta last weekend. and the rest of the board has been speaking out since. everybody has been saying the same thing, we will wait and see what the data tells us, we will take a pause and setback for a little bit and figure out what is going on before we move in any direction. now, the concern about recessions and the economy falling off a cliff has eased as markets have gone back up, but there is concern on whether we will slow down, or whether we will have a strong year. vonnie: they have said any rate hikes that will happen will be benign and to a level not exceeding neutral, how many is that this year, do we know? michael: it depends on your definition of neutral, they see 3.5%, so really
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anywhere between 2%-4%, but the two more moves this year would get us to 3%. it could be 2.5% is roughly neutral, we will find out if the economy slows. guy: will trade be the ultimate determinant of where the fed goes this year? maybe we will get a deal, maybe we will get none? michael: i spoke with eric yesterday and he suggested that was a wildcard. if we get a deal, that could smooth the way for stronger growth. if we do not, it could raise issues on how fast growth will be and whether we will get extra restraints. that is an important part of it. in general, the fed and most private-sector economists see growth at maybe 2.5% in this year, slowing down because the impacts of the tax cuts will fade. but well above potential and
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nowhere near recession. guy: when are we going to understand what the fed's final decision is on the way it will manage monetary policy? michael: that is an interesting question. this brings in the balance sheet and how big it will be. they have made it clear they will stick with the system they have now to have the top end the the interest on axis reserves, the bottom the reverse repos. they were not go back to the old system of just setting a rate. where the balance sheet ends up will depend on a lot of factors, but it is the getting to seem like they are getting closer and closer to making a decision on that. now, well they all be tied up in what they think the economy can withstand in terms of how much tightening we get -- we do have eight meetings to go this year and it looks like they are on hold for the first quarter. they said maybe into the second quarter. it could really be may or june
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before we get any monetary policy decision. until we get that, i do not think we will get decisions on the balance sheet. vonnie: today, retailers are wen, airlines are down, and are on the 20th day of the government shutdown, that will kick into the consumer economy tomorrow onward. so this has to build into the forecast at some point. michael: i would hesitate to get excited about the retailers, we do not know what overall consumer spending is and we have seen consumer spending, the separate report from the commerce department, which we will not be as long as the government shutdown goes on, but we have seen that come in stronger than just retail sales. a lot of what people spend money on, they are spending money on experiences, they go skiing or to the beach, so we may see some of them are spending not reflected in what macy's actually sold. vonnie: thank you, michael mckee. coverage of the powell event
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starts today at 12:45 p.m. eastern time. guy: and u.k. retailing is really bad at the moment, the pub sector is really good. blackrock to cut 500 staff. that is roughly 3% of its global workforce. this continues a process that has been underway for quite some time. the pressure within the asset management sector. thi is one of the biggests asset managers. and this continues to be brutal. it is driving down of costs implementing those staff losses. 500 to be cut at blackrock. this is bloomberg. ♪
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guy: i'm guy johnson. vonnie: i'm vonnie quinn.
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shares of macy's plunging 20% after they cut their forecast, is slow down during the holiday months. the retailer cutting annual sales and profit forecast. taylor riggs, this is across the board, not just macy's. >> we will start with macy's, because it is one of the stocks off the most this morning. come into the terminal. as we know, store sales is the key indicator we are looking at and they are pointing at disappointing numbers. it is below expectations of 2.2%. and we now see for the first time this quarter, it will come in less than 2% according to the earnings estimator. heavy discounting and promotions did not do enough to really help spur sales as they got through cyber monday and into black friday, into the rest of december. mid-december things started to slow down and it did not pick up after that. that will be weighing on
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margins. they are going into 2019 with lean inventory. and if we want to look at the trends, come back into the terminal because it really shows foot traffic and what has happened. black friday, cyber monday, they were great, but things started to slow down as we got into it and traffic just continuing to slow down, even as we get into january. guy: it is not just macy's, it is a lot of retailers. and i will draw a line through amazon's good numbers. >> kohl's was another one. they say that they are off, they rose just about 1.2%. last year, that was about 7%. and fines and noble with another similar story, heavy discounting and promotions helping to bring the shoppers back, but it was not enough and it hurts margins. if we look broader, it could be as good as it gets.
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this is really hard to be, comps versus last year when we had the tax reforms, so all of these posing problems. but target was a good story. so you have to be a stock picker here. vonnie: we will bring in sarah. does this continue to be the amazon affect, is there a point at which we can move beyond amazon, or are all the retailers eventually going to have to find another way? isa: amazon's effect something at play, but we see these retailers trying to adapt. macy's, for example, has expanded their online assortment unit they did say they saw double-digit growth in their e-commerce business, the store was where the trouble was. i think what some of these retailers need to do is figure out how to make the brick and mortar experience more interesting as a different as ar from -- differentiator from amazon. guy: there is a sense that the
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u.s. consumer is very strong still, has that been undermined by what we have here? sarah: i think it is too early to say that, because we have strong results from target, 5.7% increase in comparable sales and growth was strong across categories, but this does play into investors' worst fears. they see the softening housing market, they wonder what it will do to consumer spending. an you also have the prospect of tariffsd going from 10% to 25%, that could stretch pocketbooks further. so there are some gloomy headwinds here in terms of consumer sentiment. vonnie: thanks to sarah. blackrock is cutting 3% of their workforce. now, more details from annie. 500 members of the global workforce, 3%, not huge. the reason why blackrock might be doing this now?
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annie: it is a pretty big cut from blackrock, the last time we saw this was in 2016. the reasons that were cited in the memo that we saw from the president of blackrock to the staff was there is market uncertainty, and it is time to make cuts worldwide. guy: is this to do with the increasing cost competition or market uncertainty? annie: market uncertainty was decided in the memo, but -- cited in the memo, but asset managers do see pressure and all kinds of pressures to the stock and the business. guy: do others have to follow? is this something we will continue to see going on? when you look elsewhere in the industry, as we continue with automation and as we continue with the move into passive, it is a 3% move and this is a fairly chunky one, but will it
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continue with a big asset managers? annie: this is not the only reduction in headcount we have seen this week. my callings have reported state street has also decided to cut 15% of their senior management ranks, so we have seen other cuts happening at blackrock's competitors as well. vonnie: the stock has not been faring well at all. from coming off of a high a few months ago, but is this maybe to implicate investors? 500 from the entire staff, it does not feel like a massive amount to meet. there are 13,000 employees and we know that they have turned rates at every company. is this a move to boost stock price? annie: the last time they did this was 2016 and they have seen growth since then, so we cannot get inside their heads necessarily, but it could be
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part of the calculation. vonnie: thank you, annie. time for our latest bloomberg business flash, a look at the biggest stories right now. the partial u.s. government shutdown could delay two anticipated ipos. bloomberg has learned neither uber or lyft received into the about the proposed offerings, both have filed confidentially with regulators. steph curry has agreed to a partnership deal with a japanese e-commerce company. the company already sponsors the golden state warriors. and it is the title sponsor for his basketball camp. retailers, the holidays were about survival of the fittest. the biggest retail chain boosted christmas sales that beat expectations. and there were stronger food a sales. clothing business in a slump. sales fell and no one company is
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in talks about refinancing with lenders. that is your latest bloomberg business flash. guy: now markets. a look at where we are right now. we have a little bit of steam taken out of the rally, that we have been generating so far this year. equities under pressure, the dollar is bouncing back and crude is still trading north of 50. gold is trading a little softer as well. we will hear from chair pal very shortly -- powell very shortly. this is bloomberg. ♪
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guy: 30 minutes to the european close. johnson. vonnie: i'm vonnie quinn. this is the european close on bloomberg markets. we have some interesting things happening. we have a little but of a rollover taking place in equities -- bit of a rollover taking place in equities. outave seen big news coming from the auto sector in europe where we have seen forward cutting back -- ford cutting back. we have also seen what is happening with the british pound right now. we have a number of interesting crosscurrents taking place in the brexit story. jeremy corbyn has been speaking as well. the leader of the opposition talking about a deferral but increasingly is becoming very

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