Skip to main content

tv   Whatd You Miss  Bloomberg  March 1, 2019 3:30pm-5:00pm EST

3:30 pm
mark: i am mark crumpton with bloomberg first word news. president trump claims his relationship with north korea's kim jong-un is "very good" despite the collapse of the summer -- summit in hanoi. the president tweeted they had very substantive negotiations. he did not address the pushback from the north which disputed his account of why the talks fell apart. the u.s. is imposing sanctions securitynezuelan officials for their alleged involvement in stopping humanitarian aid convoys from entering the country. the treasury secretary called the actions of the officials nicolas maduront
3:31 pm
reprehensible and unconscionable. it is the second set of sanctions announced on venezuela this week. president stepped down as chairman of the ruling party after more than two months of antigovernment protests rocked the north african nation. sudan has been hit since mid-december by demonstrations against rising living costs that developed into calls for him to step down. dozens have been killed in the unrest. bill gross calls -- called it quits after one of the most storied careers in finance. he has a few surprises left. he said he has asperger syndrome, the autism spectrum disorder. he believes that helped him to become such a successful investor. onit helps you to focus longer-term things without getting mixed up in the details. it allowed me to take what we call the secular approach, the
3:32 pm
long-term view and it was a good view to take. mark: do not miss the full special conversation on bloomberg tv tonight and over the weekend. he sat down with erik schatzker. 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 am mark crumpton, this is bloomberg. ♪ scarlet: this is bloomberg markets, the closed. the s&p 500 in the green. extent,gy helping to an amazon disrupting the retailers.
3:33 pm
that gives us a performance up by 7%. we are seeing concerns about the new initiatives being announced. theclosing of stores, market does not like it. the market is not liking the end area this feeds into the risk on sentiment, the dollar is higher, the end is lower. to do with china. scarlet: closing the week .9 of week ofhe 10th straight gains. you have better chinese data, manufacturing data improved. and a.m. indexes. far this yearso is up. risk on does not seem to encompass oil. oil down 2.5%.
3:34 pm
caroline: let's get some breaking news. all seems to be fair in love and war. and giving his congratulations to john zimmer and logan green, momenters of lyft, a big for ride sharing. many saying this is a clever thing to be doing. there is a much bigger valuation eating up a lot of the oxygen in the ipo market and ridesharing. they are getting in ahead of the curve. maybe the revenues are clearer for a company such as them. scarlet: perhaps what is left unsaid is we will be right there behind you. theline: time for a look at movers, deutsche bank downgrading delta airlines from a hold to a buy.
3:35 pm
and increasing downside. barclays upgrading hurts to equal weight increasing the price target to $18 per share and citing stronger prices for yields -- used cars. finally, deutsche bank boosting andprice target on gap keeping a hold rating. the company announced it would spin off old navy. it cautions it is overshadowing miss and a softer quarter. scarlet: we had a lot of data today. the fed's top official said the economy is in a good place after they took a positive raising rates. we discussed with the future looks like for the central bank and it -- in the current economy. >> it is an unusual business cycle. think about how it has taken to
3:36 pm
get back to full employment area in the language of being patient , they will take a positive weight for more data. numbers seem to push them off moving to more tightening moves. you had a tightening of financial conditions and stock prices went down. credit spreads widen. second, foreign growth looked a lot weaker especially in china and europe. there was not any inflation. the inflation was the story of the dark that -- dog that did not bark. you are not seeing an acceleration in wages and that was not feeding into prices. as long as inflation stays quiescent that will be on hold. if the economy keeps growing at above trend pace, more pressure on resources and inflation will start to drift back up. the fed is not done yet. >> how far did they go, at what point do you risk an accident? >> that is why i think they are being patient, they do not want
3:37 pm
to cause a recession with inflation this low. what a you do that for? if inflation want to accelerate they would have a motivation for why they are moving to a tighter monetary policy stance. >> what you did that for us to prevent downturn in the economy which this group here suggests may come in 20 or -- 2020 or 2021. the fed had more ammunition. >> that is one concern the fed is wrestling, the peak federal 2.5% to 3.5%. there is a lot of discussion among fed officials and other market observers, does the fed have enough firepower to get us out of that next economic downturn? there is more firepower than people realize. it has invented a bunch of new tools to use. for guidance, asset purchases,
3:38 pm
open ended asset purchases and we will buy assets until we achieve objectives of a recovery. >> one of the arguments is a lot of that success that the fed had with those tools came from the announcement value. now people know the tools are there so they may not have much of an effect. >> let's imagine we were in a economic downturn and the fed had reduced interest rates to zero. the fed announced we would do treasuries and mortgage act securities until we achieve this, that would be a good commitment strategy. rates will state low for a long -- stay low for a long time. that is powerful in terms of supporting economic activity. >> has a got too intertwined with markets? one of the reason the fed when i hold is the market problems and dislocations we saw in december and everyone is back in the powell play. >> it is tricky. the fed does not care about the thek market or
3:39 pm
3:40 pm
3:41 pm
. .
3:42 pm
caroline: amazon is reportedly does -- opening dozens of grocery stores across the u.s. be distinct from whole foods and not meant to compete directly with a grocery chain
3:43 pm
which they acquired in 2017. let's bring in matt day of bloomberg news. how well they not -- will they not somehow cannibalize each other? matt: there was some confusion when amazon bought whole foods, it is limited and high quality. there was widespread speculation that amazon would have to do something if they wanted to be a bigger player in the grocery market which they seem to do. scarlet: you can look at whole foods as a starting point. what did amazon learn from its foray into whole foods that it will apply with these new grocery stores? matt: they are still experimenting, they have been rolling out delivery from store shelves, some kind of pickup options, they have used it as an opportunity to experiment and learn about a business they had played around with, largely in their hometown of seattle.
3:44 pm
they have been the first to admit they are learned -- learning from that acquisition. caroline: this is hitting the rest of the market. walmart, target all seemingly and pressure. do we know which part of the u.s. they will be going into first, will it be u.s. focused or get international? matt: they have declined to comment but the journal had opening at there and of this year in los angeles, unclear where they might go after that which is a bunch of other major u.s. mantras being targeted. it is not clear to your part on stocks falling on this parts of competing grocers what amazon might be going for other than something in the high-end grosser they bought in whole foods. we do know that amazon has whole foods and amazon go which are the smaller stores
3:45 pm
without cashiers and there is amazon books, one not so far away from us in midtown. how will the stores be distinct from the other physical presence, is there a strategy that we need to be mindful of? >> live strategy is amazon has realized they need to play in brick-and-mortar. hopefully -- the biggest example is they are operating bookstores now, they have a store concept called for star which is turning highly rated products and a popery setting. they are experimenting and realizing delivery is not the only avenue to reach customers for them. just aside from what is going on in terms of the grocery, can you update us on how it feels to be in seattle with amazon, they are having battles and they have been york, do a from new have updates on the general expansion plans when it comes to real estate in its headquarters?
3:46 pm
.> they have been quiet the one thing news they made was confirming they would be backing out of a large seattle tower. that is the message at least locally and wherever they will place those 25,000 workers. probably not seattle. they still have plans to expand, they have more than 45,000 --ple in plans for seat seats for a few thousand more. scarlet: thank you. still a lot that needs to be clarified on amazon and any report that indicates amazon is entering a certain market gets everyone nerd -- everyone not nervous. on oure: we are gaining gains, accelerating into the close as we line up a week.
3:47 pm
it has been lacking in terms of volatility but did -- today we are on. scarlet: we finally have some direction and this is as we head into the weekend, pretty remarkable. from new york, this is bloomberg . ♪
3:48 pm
. . . . this isn't just any moving day.
3:49 pm
this is moving day with the best in-home wifi experience and millions of wifi hotspots to help you stay connected. and this is moving day with reliable service appointments in a two-hour window so you're up and running in no time. show me decorating shows. this is staying connected with xfinity to make moving... simple. easy. awesome. stay connected while you move with the best wifi experience and two-hour appointment windows. click, call or visit a store today.
3:50 pm
caroline: i am caroline hyde. scarlet: joining us -- joining us is joe weisenthal. your attention. joe: you hope it would be a jobs day. still plenty to talk about. the miss was fine, still solidly in expansion. add to the noise and confusion
3:51 pm
about what is the state of the economy right now. we are in expansion but we are trying to figure out how robust it is and indicates a little bit weaker than we may have expected. consumer -- sentiment, that came in weaker than expected. contradicting the numbers we saw that were a 18 year highs. scary but hard to gauge the strength of the u.s. economy. scary is what is german and italian manufacturing. china still in contraction but better than expected. that the rest of the world is slowing down. joe: there is so much hope that that will prove durable. >> there are a lot more gainers than decliners in terms of
3:52 pm
health care. all gaining at least 1%. energy is up. caroline: we have seen oil on the downside and we are seeing that divergence, stocks pushing higher as oil comes lower. maybe the correlation is failing to break down. scarlet: oil was leading the stocks but where are not saying that at the moment. on the downside there are five staples,clining, telecoms, household, and personal products. more defensive groups are in the red. here is how it looks for the day. we had direction so there is that and nasdaq getting ready to close its 10th straight week of gains. we are moments away from the close. seven and a half minutes to go. abigail gets us started of what they are looking at as we head into the close. theail: let's look at
3:53 pm
shares of delta airlines, on pace for the worst week of the year, weighing on the dow transports which had been briefly negative. we had negative -- analysts cutting shares to hold from a by saying that their macro headwinds are facing delta airlines and american airlines, if we look at this chart in moving average, shares to go below the 200 week moving average not holding support, dropping 55% from the most recent high before that , up and awayand up and we had the trend in the range. shares are flirting with that 200 week moving average. last year moving below it. that analyst may be right about factors holding shares back, perhaps dropping down toward that $30 level. >> the tesla bears have a lot more room to work with than the bulls do, those are the words of
3:54 pm
adam jonas. this morning after the dizzying array of changes. that tesla announced to its business including a lot of price cuts and different models. the shares had risen 7% in the previous two days after muscat announced that something would be announced but once the curtain was lifted and people got a chance to see what was under the hood, the shares giving back those gains, they are down 1% from the recent high back in mid december despite the broader market rally. not only are they cutting the prices for that new model three that is going out there, but there are four other versions of the model three that are getting effective price cuts. and a lower-cost version of its auto pilot plan. that might be good for revenue and man but the main thing analysts are worried about, the main thing wall street is worried about is the bottom line. the company was expected to post
3:55 pm
its third straight quarter of profitability. elon musk waving investors off saying that will not happen in q1. you.ine: we thank a week of big events but very little market reaction until today. u.s. stocks poised to close the week higher. developments coming from the failed trump-kim summit. there was a lack of volatility. why the set and to gains today? >> we talked about a sudden movement to gains but we are not seeing gains of 1% or more so how our perspective has changed since the end of last year. last year, we were used to gains or losses of more than 1% and now we see these gains today and they seem like they are large and there has not been a real it looksto date but like the s&p 500 could close over 2800 which would be bullish.
3:56 pm
joe: does this count? off to the races. >> i will say that many investors i have spoken with, many people who keep an eye on the charge have said if we close above 28 hundred, that would be bullish and also if you think about the evidence that has -- hedge funds sitting out this rally and retail investors, we close 2800, we might have some more people feeling incrementally more competent and put more money to work. our analyst is sticking with us. from detroit. how meaningful is the 2800 level in getting some of the buyers off the sidelines? >> we have been here before so over the last three months since october, we have tested this 2800 level of couple of times and each time we have gotten above it, we have drifted back
3:57 pm
down. you are right, as we look out over the next few weeks, if we can hold 28 hundred and get a trade deal, i do think a lot of investors have been caught flat-footed over the last two months. $90 billion have come out of u.s. equity funds since november. if we can get a sustainable level above 2800 and see stocks rise higher, there is some fuel to the fire to push stocks up toward an all-time high of we get a trade deal with china. caroline: is it tech that continues to lead the way? >> when you look at the cyclical sectors, they have led the markets so energy, industrials, technology. the three sectors that were the worst performers in q4 are the best performers in q1. havearkets and investors gravitated toward the cyclical stocks. you need energy prices to stay stable and need the dollar to
3:58 pm
remain stable and if we can get that with the trade deal, stocks and some of the cyclical areas can continue to do well. we have advised clients to stay balanced. have some defensive sectors in your portfolio and the cyclically exposed to things like energy industrials technology. joe: what are you looking forward to next week? sarah: we have the ecb and as you mentioned we have jobs day. i was thinking about next friday and the weights numbers that are coming out. it seems like jobs friday is important. the past couple of numbers seem to have been looked over. so that inflation is important. as the fed keeps mentioning that they can be patient because inflation is not showing up. it will be interesting, we have to get a surprise but even still if you look at what our survey is suggesting we might see on friday, 3.2 percent growth, it is hard to see that we can see
3:59 pm
3.3% and have tenure treasury yields where they are. we been talking about it for the last or hours, and we looked through u.s. stakes today. scarlet: how do you make sense of the data we have gotten? it is not been universally weong, and in fact, we know are not due for a recession anytime soon, but it puts into question how strong this growth is. our view, when you look for 2019, in terms of the u.s. economy, it is growing at about 2.4% for all of 2019. that is above trend and above the 2%, 2.1% growth since the financial crisis. in the states, even though some of the data has been mixed, we think things like unemployment being at multi-decade lows, manufacturing activity still pretty good and an expansion territory. we think we are in a better spot. caroline: the cheers are coming
4:00 pm
in the bells ringing. 2000.sed above 2800 or we are up 19 points -- or 2800. we're up 19 points. scarlet: this a breakout? we been talking about this for weeks now. joe: what people talking about 2802? >> i've heard many different aspects. [laughter] scarlet: we are above 26,000 on the dow as well. we end the week on a note where it seems like there's conviction behind the buying. .oe: a little bit of conviction next week could bring a whole different narrative, depending on what the data shows. a nice end to the week. caroline: we had gains of more than a percent on the u.k. -- nikkei. for the week, the dow
4:01 pm
finishes unchanged, but the nasdaq closed with the game. 4:10 --love -- s&p up 4/10 1%. at 2800,i'm looking but not just on the s&p 500. the shanghai composite crossed above that level of resistance. this is a weekly chart of the s&p 500 in orange and the shanghai composite in white. last year was rough for chinese stocks. the s&p 500 cap coming up above the $2500 -- 2800 level. this is maybe providing hope the s&p 500 could clear those levels. as for the other levels on the s&p 500, investors want to look at 2814 and 2825. romaine: i'm taking a look at the on-time -- online retailing
4:02 pm
platform far-fetched. had a 20% stock that short interest ratio meaning any good news would shoot the stock higher like a cannon. the shares were up monday through wednesday, and today, they added 18%, up 43% this week alone. goldman sachs joining the bulls and upgrading it from a buy to a neutral. they gave earnings yesterday and gained relatively bullish guidance. eight companies raised to abide. at 2912, the stock surpassed reached an point and all-time high before giving back a few of the gains. it will be a nice stock to watch. scarlet: romaine and abigail, thank you. anthony ofus is
4:03 pm
america rise financial and sarah ponczek. at the s&p 500 close above 2800, i pulled of the vix which is at a 13 handle. it has gone down, the lowest level since october 3, 2018, before the selloff in the fourth quarter. sara was reminding us that today's games feel large because we have seen these modest moves early in the week and in the past few weeks. is volatility muted for now? have we entered a new volatility regime where you don't see big moves anymore? anthony: no. wrongould be the approach. volatility has been muted because pessimism was so extreme in december. as we worked that pessimism off are probably, we at fair levels in the stock market based on earnings, trade, and expectations for interest rates are. we are in a good spot in the markets, but as you go further
4:04 pm
out and look at possibly s&p 500 in q1 for , the macro data will be more influential on the markets so i think volatility can move higher, but i do believe we are in a good spot with stocks. youou are in a good -- if are an investor, having exposure to stocks and being cogs and it -- and being cognizant the volatility will increase, i think we will finish with gains on the year. joe: as we were pointing out, a monster work -- week for chinese stocks. most of the gains came on monday. nonetheless, how significant is this? the growing optimism about the chinese economy, trade talks aside, that's perhaps the bottom is not falling out there? -- wey: when you look at
4:05 pm
were talking about the u.s. markets being up 11% for the year. the shanghai is up 20% for the year. as expectations of a trade deal worked into the market, you see chinese -- china stocks react more positively because their economy has slowed more, and they have more to lose with the trade war with the u.s.. the trade deal that we get will probably be an evolution rather than a revolution. if china can agree to structural reforms, changing some of their industrial policies, kind of money they of the put towards a state operated canrprises, and the u.s. enforce that an monitor that, maybe the u.s. will be willing to take some of those tariffs off. like we have been telling our clients, a lot of a trade deal has been priced into the markets, what we don't believe a trade deal that takes tariffs completely off the table has
4:06 pm
been priced in. develop, asian markets, emerging markets, and the u.s. can perform well in the first half of the year. caroline: as joe is outlining, we had a strong set of gains in asia today. how big a deal was the msci saying they would include more weighting of china? sarah: it was a very big deal. amountu think about the of money tied up, my colleague crunched the numbers and she found $46 billion could be set to go into these funds because, of the larger inclusion of china in their emerging markets benchmark, and if you look at the amount of money tied up in investment strategies that do follow msci's index, about $1.8 trillion. goldman sachs says you can see othereffects as well as
4:07 pm
strategists start to move and say we want to match msci. scarlet: it was risk on from overnight developments as well. we pointed out that gold is falling, treasuries falling, yields are moving up. when you look across asset classes, it interesting oil is done by 2%. if: it's interesting because you were to look at the one-year chart of oil and stocks, they have been holding together closely. they both fell apart in q4, and rebounding to start to see the emergence. anthony, what do you make of oil and doesn't tell you anything about the actual real state of the global economy? anthony saglimbene -- anthony: where oil prices are right now, anywhere from $55 and $65 a barrel is a fair price. if we stay in that range, you will see investors not worry so much about a recession and economic progress can continue.
4:08 pm
stocksthink, for energy and earnings, that stable price could be an opportunity. you've already seen energy prices rebound. one of the strongest performing companies took those
4:09 pm
4:10 pm
expectations down to the floor. i think there's an opportunity for companies to surpass those expectations. macro issues aside with brexit, which i don't think is an event for the broader market, if we can get earnings a little the one analyst are anticipating, i believe stocks can continue to grind higher through the rest of the year. wewill see volatility, and haven't talked about the fed, but if we have a strong economy and things are going well and earnings are growing, the expectations of the fed not doing anything for this year might be off of the table and
4:11 pm
might create volatility. i do think stocks can finish higher this year. if you to longer-term approach. scarlet: anthony, and their prize global market strategist joining us from new york , globaly saglimbene market strategist joining us from new york. and lyft files to go public. this is bloomberg. ♪
4:12 pm
4:13 pm
caroline: live from bloomberg world headquarters in new york, i am caroline hyde. let's get you up to speed with
4:14 pm
how u.s. stocks closed today. we break above the 2800 mark. joe: "what'd you miss?" caroline: the race is on. lyft goes public ahead of uber. grocery game,he amazon plans to open dozens of grocery stores as early as this year sending shudders through food retailers. and the road to extradition begins. canada ordered the start of the proceedings against the cfo of huawei. joe: we got an overseas eco-data blitz. factories saw the biggest slump in orders in nearly six years this month. manufacturing pmi's are sliding to 49.3, led by italy and germany. consumer price growth slipped to one point -- 1.1% while the
4:15 pm
headline right a minute 1.5%. it was a little better in china. there was a rally. to manufacturing pmi fell a little bit to 49.2%. romaine? romaine: we stick with the u.s. economic data because the factory gates goes to two-year lows. gdp beat expectations at 2.6%. for more details, let's bring in bloomberg news federal reserve reporter, matt boesler. let's start with the isn data because it did moderate or fall off from the levels we had seen in previous months. it still seems to suggest we are on solid ground. matt: the story with the i sm manufacturing gauges, we have had -- isn manufacturing gauges,
4:16 pm
we have had our highest levels in years and are coming back to a normal setting. if you dig into some of the subcomponents of the index, there are interesting details on the service. this shows the customers inventories of component. this is the question in the survey where they ask are your customers inventories to high or too low. the most manufacturers are saying their customers inventory since 2010. that suggests, unlike 2016 when the line was much higher, perhaps manufacturers don't understand exactly why we are seeing the slowdown we are seeing now. it couldd be positive, be negative, or it could suggest there is the underlying demand conditions in place for an eventual turn later this year in the manufacturing sector to the upside. joe: let's talk about gdp, which
4:17 pm
we got this week. , g# bttvt a chart here . what strikes you at what we're looking at? matt: the real bright spot was business investment. turn down inig 2015 and 2016. it has rebounded and that is important as a driver of underlying growth. the blue lodges the software investment component. if you squint -- joe: joe: maybe i consume a little bit -- joe: maybe i can zoom in a little bit. the question about what's we are seeing with the manufacturing slowdown is that normally it would lead to slight moderation in business investment, but if the composition of the investment is changing toward things like software, things that are not
4:18 pm
traditionally associated with manufacturing activity, maybe business investment can hold up, even though we see a little bit of a slowdown this year. caroline: let's talk about the consumer. we got consumer data that was not quite there today. what about what individuals are having to pay? you have a great chart. matt: there are a couple of interesting things in the income and spending report. we saw consumer spending closely, but this is one of the things we don't look at as much, the percentage of u.s. disposal income going toward interest payments. because youchart can see that back in the 50's, 60's, and 70's, people were paying a low percentage of their disposable income toward personal interest payments. now, the line has gone higher in the last two years or so with the fed raising interest rates. i think this is something we should keep a close eye on as that continues because income is
4:19 pm
growing at a steady clip, but this chart demonstrates that even though the income is growing, it is going toward higher interest payments. romaine: does that suggest that these are higher debt loads or just higher rates and the interest has piled up? matt: the debt loads are certainly higher than they were in the 60's and 70's, but they are lower than they were in the 2000s. you can't explain the increase purely as a function of higher debt. the higher interest rates play a big role there as well. joe: at what point might that become a drag? that's a pretty striking chart. at some point, that is money that gets taken away from everything else. matt: part of the problem is that when more of your income is going toward interest payments, that can create a pileup of debt. that is something we saw in the 80's, 90's, and to thousands.
4:20 pm
from a financial stability perspective, it might make sense to keep that low to keep overall debts growth low and extend further. matt boesler, always great chart. thank you for bringing your perspective. cfo faces thewei music. canada has started extradition hearings. all of the details are ahead. this is bloomberg. ♪ this is bloomberg. ♪
4:21 pm
4:22 pm
joe: canada digs into huawei. the start of the extraditions against the cfo has begun. she had been detained in vancouver december and is facing
4:23 pm
fraud charges. she is scheduled to appear in court in march. we welcome our canadian government reporter. but let's in canada, start with this story. how expected was the start of the process for the huawei cfo? >> this is a symbolic development, but not an unexpected one. arguably, a procedural one. canada has 30 days to go over the paperwork from the u.s. request and those things are typically a rubberstamp situation allowing the hearing to take place. now, we go on to that stage. there is a step in the canadian government to intervene and say to thet send the cfo u.s., but that won't calm for quite some time. she has a lot of appeal avenues and things -- these things can take years in canada. joe: the other big story -- romaine: the other big story is the scandal that justin trudeau
4:24 pm
has seemed to got caught -- the story justin trudeau i seem to got caught in. what are the ramifications? are there real consequences to justin trudeau's leadership or his party leadership in canada? josh: is too early to say, but it is by far the biggest crisis he has faced yet. his previous attorney general said he tried to make a legal problem go away. he says he didn't break the law, but he was trying to save jobs of this iconic company in quebec. some polls have shown him coming down. the key question for him will be if other shoes dropped in other cabinet ministers speak out, to speak out orrs is there any police investigation coming to light? barring that, he is trying to weather the storm. the chinese government has taken
4:25 pm
notice, saying you try to meddle our country, why can't you release the huawei cfo. caroline: when you look at what the canadian dollar did today, you have the concerns about a recession over there. toh: i think they are ground a halt. i would expected, but not to this extent with canadian crude prices cratering last year. the big question is, is this the bottom of what is going on? we went through this in canada four years ago at the last election. the economy stumbled, the government party was in scandal, and that led to a change in government at the time. justin trudeau has history on an side, but going into election in october with all of this over your head. data, there was a story about the relief --
4:26 pm
release of the data. what happened this morning? josh: we still don't know. they say technical difficulties, which could mean anything. about 26dentally put minutes or so on their website before the data was due to be released. and it's cratered a little bit on that. that will bring up a lot of questions about why there was an early release into the market way before you thought you would. it was bad news, and how it came out was bad as well. it was a messy day here in ottawa. caroline: canada, what are you up to? josh: i know. [laughter] caroline: great to get your perspective, josh wingrove. thank you. that goldmanrned has no intention of raising its stock offer for newmont mining. at the same time, newmont is criticizing the operating model.
4:27 pm
the world's two largest oil producers have been making their cases to their biggest investors. the biggest u.s. supermarket chain is widening its ban. ban toan to expand their its food division. in july, kroger stopped expecting visa charge cards in california. up a new'ss shaking purchase. two of the most powerful executives are leaving their jobs at warner media. the chief executive officer is stepping down of cfo -- hbo. meanwhile, turner broadcasting president, david leedy, announcing his departure as well. coming up, is lyft coming to the market? they make their ipo debut on the nasdaq. all of the details on the first
4:28 pm
unicorn of 2019, next. this is bloomberg. ♪ is bloomberg. ♪
4:29 pm
4:30 pm
mark: i'm mark crumpton with bloomberg's first word news. gov. jay inslee has joined the crowded 2020 democratic presidential field. the 68-year-old announced his bid in seattle after recent travels to two of the for nominating states. -- four nominating states. he's highlighting his service and offering a critique of trump. -- lookingre waiting for ways to break the gridlock in washington dc. not daunted by'm
4:31 pm
not being the best known. i started about -- i started as an underdog in about 85% of the runs i have been in. iowa next week. -- plans his first trip to iowa next week. nato secretary-general that they does secretary-general -- nato's secretary-general says this is a pressing security issue for the alliance. >> we call russia to come back into compliance with the inf treaty. russian weapons can reach cities. mark: the united states formally suspended its obligations under treaty that bans ballistic missiles with a range of 310 to 410 miles.
4:32 pm
russia, which has denied any breaches, has followed suit. brought aofficials captured indian pilot to a border crossing with india for a handover today as a gesture of peace, promised by the pakistani prime minister. this comes amid a dramatic escalation with the country's archrival in cashmere. global news, 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. caroline: lyft is filing for its ipo today. the ceo of uber is treating its congratulations -- tweeting it's
4:33 pm
-- tweeting his congratulations. isext guest says lyft gaining a first mover advantage. great to have you with us. you are an investor in lyft. there has been handwringing today when we look at the scale of growth. it is still phenomenal, 100% growth in terms of revenue, but it is slowing down. something that worries you were not particularly? >> i don't think so. when any company or any tech company usually has the moments when a slowdown in growth, but we are excited for lyft's potential because they are seeing growth. in fact, in q4, they saw 47% growth with 18 million riders. the big eye-popping number was the $911 million in losses
4:34 pm
for 2018. they are growing rapidly along with sale. is the core business model of ridesharing profitable currently, in your view? or does this model still need to evolve with something about the rights themselves or additional add-ons like scooters and bikes to sort of make the business work and produce cash flow? jaclyn: i think they are on track. if you look at their numbers, they are growing and they started with 1% of the market in 2016, and now, there is so much market to gain from that's. loss, butnies have a that loss is decreasing over time if you look at the revenues increasing at 100%. romaine: a lot of the growth in lift -- in lyft and uber, it was done as this regulatory gray area, particularly in the u.s.. as this company sort of
4:35 pm
transitions into a much more of a public sphere with regards to stocks, how is the company going to address the fact that a lot of cities are gunning for these giveharing companies to them a little more regulatory burden and potentially more costs? jaclyn: as a great question. i would say of course there will be regulatory issues, but what lyft is doing that i would focus on more than burdens on the regulation is that they are helping communities all over the country. the numbers you could see in the -- 47% of the riders are exploring their cities more. effective 2018, 2 and a half billion dollars put into the city in and increase for lift -- for lyft riders. caroline: a driver tends to work not just for lyft but also works for uber, and it might work for
4:36 pm
june know if you're here in new york. it is interesting what lyft is doing to offer bonuses on drivers to get them on board with the ipo to process. how important is the relationship with the driver and what about autonomous driving? jaclyn: the relationship with lyft and their drivers is massive. it is very important to have a good relationship with the drivers and community, and while they might be getting bonuses, this is a way that does not undermine what they do to get these people on board. they have customer service and training for these people. you can't just sign up. there are hoops they have to jump through to be a driver worthy of getting on lyft. they are trying to get people to come on board and expand their markets, but if you're not the stars or write to ratings, you will not stay on the platform. they are keeping their standard high. joe: how much is riding on the investor appetite for lyft?
4:37 pm
expect toyear when we see several ideas from the unicorns, the company's quite maturely from a revenue standpoint, finally coming to the market. in your view, for these other ones, are they perhaps waiting in the wings or is a lot riding on the uptake here? jaclyn: yes. a lot is riding on lyft. lyft is making history as a iling business to go public. everyone is watching whether it is this specific ridesharing or it is tech in general. people want lyft to be successful and want to see what happens. caroline: you are also in volunteer. many debates -- in palantir. many debates are coming in 2019. jaclyn: i think everyone is considering it. it takes time to go public, so
4:38 pm
maybe they start the process in 2019 and go into those and 20, but a lot more companies are thinking about going. hopefully, volunteer is one of -- palantir is one of them. joe: sticking with autos, more tesla trouble. elon musk says there are more .ob cuts here with more to break it down leads ourorter that autos coverage. lots going on in the tesla world right now. the headlines they want out there is a $35,000 model three. has a diminished range due to the battery. for people waiting three years or more for the model threes, are they happy with this? >> i think there are plenty of people who will say it is about time, but they're also fans who are excited and have been
4:39 pm
waiting, some of them very amazingly patiently for the three year wait. it was three years since musk the car, but he was talking about this price point before that. there has definitely been a ton of anticipation. it is the most anticipated car when it came out, that i can remember. this price point, roughly in line with what the average car sells for in the u.s., it puts them in position to take on the big boys. romaine: if you are a glass half-empty kind of person, and i am, if you look at that in your first question is, how do you make money off of that? we know he was already struggling to turn a profit at the higher price point. he announced significant cost reductions in some of the model three versions as well as the model s. from a profitability perspective, can he pull this off? craig: he says he can by making tot other big move, by going
4:40 pm
online ordering and closing most of their stores. that's going to be a big gamble. i think there is costs that can be taken out from doing that, but how you can a couple set while also not having a drawback from a service and repair perspective, which is something that he is also saying is a big priority for this year, how you can close down these locations -- some of them are transitioning to service and repair centers, but it is vague and unclear how much of that will be going on. how you sort of do this without customer service, that is a big open question they will have to answer. caroline: how has elon been responding to the negative market reaction to this? he's had a crazy week. he has seemed to go -- seemed to have gone more nuts on twitter. changed fromk he an elephant emoji to an alien
4:41 pm
over the course of a day. he has been all over the place on twitter. his fans love it, his doubters think he is not. joe: the doubters love it, too. [laughter] craig: is the craziest company to follow on twitter. it is good twitter or bad twitter, depending on your feelings on twitter. this week was definitely, even for a guy who is known for being all over the place and making a lot of headlines, he made quite a few this week. it was monday that the sec went after him -- caroline: is that still this week? if you like ages ago. craig: overnight tonight, spacex has a huge launch for the commercial crew program. so he is busy. caroline: he keeps us on our toes when you are a journalist. craig trudell, thank you for finding the time to talk to us. coming up, the last day as king. bill gross is calling it quits
4:42 pm
and sat down with an exclusive exit interview. the surprising diagnosis he says lead to a nature in the competition. that is next. this is bloomberg. ♪
4:43 pm
4:44 pm
caroline: bill gross is about to retire. today is his last day. he cofounded pimco and took this occasion to reflect on his career in an exclusive interview with bloomberg. disorderagnosed with a which he thinks has helped him in the business. of thinking,line i'm sure you are familiar with people with that
4:45 pm
condition, i wouldn't call it an affliction, do better as investors. do you think that is true? >> i think so. in mye understood it, experience, it has allowed me to stay at 30,000 feet, as opposed to one the ground. basically, the condition is one of which where i am sort of a. , and other people will know that when i come into a room, they say bill, and i will go i am appear. -- i am up here. that's not good for one because people think you are angry or le, but it helps you to focus on longer-term things without getting mixed up in the details.
4:46 pm
important was very because it allowed me to take what we call the secular approach, the long-term view, .nd it was a good view to take if i was a quantitative trader, hedge fund manager, not so good. >> interesting. do you think it helps you identify patterns better? probably, but i never thought about it in those terms, but probably, from the standpoint of 30,000 feet, yeah. aboutows me to forget minutia and focus on one big thing. the moment, asat opposed to five different things.
4:47 pm
>> do you think finding that out , recognizing it, and perhaps coming to terms with it on a personal level helped or hurt? >> i think it helped, personally. it explained a lot. basically, but, i've always had problems and going up to somebody and say hello. i expect them to say hello to me --ot because it explained a lot. like you say, it is a mild condition. it's nothing to be ashamed of, like i said, i am proud of it, but it explained in part why i was who i was.
4:48 pm
not to gauge my upbringing, family background, and how i came out of the oven, we all come out of the oven with a personality. [laughter] have two and i bet they are different. >> they are. it made it so i don't necessarily have to say it is my fault. i'm trying, but i can't compete with the extroverts. it would be nice to be able to do it. >> as someone who knows about it and can look back on your career and a into fire -- and identify what it did and did not do for you. what would you say to the younger people who find themselves with the same condition, who are entering the financial markets as you once did?
4:49 pm
is there any benefit of experience that you would offer them? >> if it was the same condition as mine, and i assume everybody , i would say it is a positive that can be used in terms of careers, to be able to look forward and not get dragged down into the day today. have a plan to succeed, and if you are down, you can get back up. i would also say the markets are substantially different today than they were when i started. day-to-day, it is more robotic, it is more machine-dominated.
4:50 pm
it's not the negative, but is probably -- it's probably not as much of a positive. , givens you time to work market conditions. staccatotoday, it is as opposed to when i started. caroline: that was the exclusive interview with janus henderson portfolio manager, bill gross, who retires today. this is bloomberg. ♪
4:51 pm
4:52 pm
romaine: we are going to talk amazon and beer. amazon plans on opening dozens of grocery stores and u.s. cities, according to the wall street journal. theirve would expand footprint beyond whole foods and
4:53 pm
maybe explore the idea of purchasing a regional grocery store chain. here with more is craig jim owner -- craig. oft would be the purpose expanding beyond that brand, particularly if you're going to acquire something? >> your question is what a lot of us have. one thing would be to sell mainstream products that are not allowed into whole foods. when they bought whole foods, the feeling was maybe they would lower the standard. people want organic foods and also really like diet coke and doritos. that is well foods got into trouble. i go to walmart and go to kroger, i buy the mass-market stuff i want. you can't do that at whole foods. this seems to be a mainstream play. joe: does amazon have a theoretical edge? setting brand aside, it is a data or distribution edge?
4:54 pm
what can they bring to the table that the kroger's of the world cannot do? craig: amazon has been trying for more than 10 years to crack fresh food. amazon's great at batteries, stocks, but fresh foods have been bubbling for them for a baffling to them for a long time. strategy, werocery have not heard much of how they are going to crack this. caroline: and they are spurring others on to do what they do and do it well. there's a fruitcake here, fresh directs, you name it. craig: the biggest impact we have seen is that walmart and kroger have spent billions of dollars getting their e-commerce operation into shape. they were forced to do it when amazon bought whole foods. romaine: one thing i have noticed that has changed at whole foods is they have a lot more personal shoppers, whether
4:55 pm
it is the one through amazon or some of the other services. is that something they have not found traction on? i feel like they are everywhere. craig: they are. you see it in the store by our office, flooded with that. i go there for lunch. delivery is tough. it's extremely competitive and expensive. i think that is why you see those shoppers. caroline: let's talk beer now. u.s. alcohol consumption, what are you doing? 2018.pped third -- 2.8% 2.8 since 2018. everyone the story and is into diet drinks, all the young ins -- young-ins. craig: it said the calorie
4:56 pm
counting is showing up in our hall, but this has hurt the biggest brands. there's a ton of options and we see this across grocery stores. joe: i'm in with the trend. i didn't realize that. romaine: i will start drinking mezcal when it's no longer cool. joe: someone to drink alcohol because everyone wants to look at on instagram. craig: they want to get up the next morning, go hiking and get a good picture for the grandma. --s is why cbd and marijuana marijuana is part of this conversation. it is zero calorie, you go to sleep, no hangover. 18 to 21-year-olds have access to legal marijuana and are swapping out the bud light's. joe: it makes sense to me. caroline: yeah. romaine: what you guys doing
4:57 pm
this weekend? joe: go to sleep early and getting up. caroline: i'm having a site or. cia. -- cyder. cya. this is bloomberg. ♪
4:58 pm
4:59 pm
5:00 pm
emily: i'm emily chang in san francisco and this is "bloomberg technology." hour, liftn the next off. kicks off the public race with a public filing. amazon is planning to open dozens of grocery stores in the united states. how does this fit into the tech giant's overall retail strategy? where no man has gone before, spacex is on the brink of what could be its biggest


info Stream Only

Uploaded by TV Archive on