tv Bloomberg Markets Bloomberg August 16, 2016 2:00pm-3:01pm EDT
i am vonnie quinn. welcome to bloomberg markets. >> we are live and bloomberg world headquarters over new york over the past -- next hour. covering stories from new york, las vegas. -- here is what we're watching. stocks are pulling back on comments from fed officials. mgm ceo is a lifelong republican, but why is he now endorsing hillary clinton for president you go we will talk to the business leader about why he is crossing the aisle in just a moment. >> with success comes more challenges. the ceo joins us for professionally -- professionally and personally in the tech
world. markets close in two hours. we had to the market best square julie hyman at the latest. off of the highs as a pattern we have seen for the past month. we have seen stocks fall back. falling from the open and pretty much remaining low whereby the same amount throughout the session. this is what we're seen for the past month. look at the s&p 500 over the past month. every time stocks have hit a new record, they have fallen the following day. that is what happened today after all three benchmarks closed at a record yesterday. if you take a look at the earnings-related movers, cody is one of them after it did not provide a forecast for the beauty businesses and is finding from procter & gamble and what those businesses will yield. raising the 2017 forecast
but not too as high of a level as analysts were anticipating. it is up 13% year to date. it is taking steps to remedy that. we have been watching telecom carriers today as they participate in the second government option for wireless spectrum. at&t and verizon. this also happens to be based in louisiana. we are watching the fence stocks as well, and air force program for ballistic missiles to replace an existing program that has stalled. bowling is now bouncing by a little bit. boeing is now bouncing a
little bit. or just spitting in a fairly broad-based, even though it is shallow, selloff that is occurring today. mark crumpton has more from the newsroom. mark: carl icahn says he is not sure on why donald trump's campaign is struggling to stay on message. he still believes trump is the best option for the white house. moments ago, he had an exclusive interview with my colleague. >> i would very much like to see trump when this, because i think he is the only hope to save business in america as the way we know it. consideringd he is the possibility of forming a super pac but has cautioned it is not a sure thing. rivers and creeks are still above flood stage south of the capital baton rouge. that could force more people to shelters so far. an estimated 40,000 people have
selloff. your insight.or coming up in the next 20 minutes of "bloomberg markets," leaders in the business world have been weighing in on the 2015 race. -- 2016 race. quentin they support despite being a lifelong republican. why, next. >> breaking 100 per dollar. meanwhile, he has made a big bet on the brazilian row. this is bloomberg. ♪
to the white house, another toublican seven forward support hillary clinton for president. a growing list of executives pushing back against donald trump's candidacy. in usa today, explaining why "this was easy. " what was the primary reason for stepping across the, as you put it? was an accumulated level of disbelief, actually, at a republican candidate that has managed to alienate and criticize so many people i care about. women and the disabled and minorities and muslim americans and a war hero like better mccain, who i deeply admire. it is really a contrast between this perspective of racially -- isolationism and fear mongering
versus the america that i love, which is diverse and and is winning. i know my company is. you are making this more than just a personal choice. you are making it as chairman and ceo. >> i have to make it very clear this is a personal decision and i am not representing the 68,000 be 75,000,soon to and telling them what to do, except for, i'm asked everyone to look at leave issues. i am the head of a company that the majority of my employees are diverse. their women from diverse backgrounds, and this is critical for me. >> a few minutes earlier, we spoke to carl icahn and he and
the trump has a better chance of delivering than clinton. take a look at what he said. i would very much like to see trump when this. i think he is the only hope to save american business as we know it. that?t is your take on very successful business. there are not winners and losers and great deals. there is common ground. if secretary clinton has proven anything over the past 40 years, it is finding common ground. i don't believe in the approach of threatening and bragging. i agree with rooting down and doing homework and finding common solutions. myt is what i have done at
company, what i did on wall street. that is really my approach. >> is there something you will do to try to defeat donald trump in the election? no, i am not an elected , i am a business person. i am happy to discuss issues that i care about, whether it is immigration or diversity and inclusion or sustainable ,nvironment or trade policies because as a global company i spend a lot of time in china and japan and the middle east. i am more than happy to talk about these issues. i am not running for office. talk about the trade policies, and one key reason for you to back hillary clinton is her stance on trade. she says she no longer supports several deals she did in the past. why wouldith her? >>
we want to enable your -- alienate some of our strongest allies. i think that is the wrong approach. i believe in more trade policies . i understand they are complicated. believe there will be a thoughtful amount of analysis on future trade deals. the one thing i learned from her when i hope to pass the travel promotion act back in 2009 and that she does her homework. >> what do you make of the tpp? should she be for it and is there good reason why it should not go ahead cap go i think it is the good start. i am supportive of that. -- i am going to
agree with hillary clinton on every issue, whether it is her total economic package or on tpp , but i think she is on the as opposed to being off the rails like the other candidate is. you also mention your travels to china. you just announce you increased your steak in mgm china. why do this at a time when it seems accounts are struggling? >> i believe in the long-term future of macau, and i believe owning more of mgm china overtime will be and accretive action for mgm shareholders. , you need to deals seller.uyer and a
in the case of the seller, i have been working on trying to work a deal with her for many quarters now. this is a relatively small deal, but large in this sense directionally. it signals the fact that it believes in the growth long-term. i believe it will have to be done in now. this is a relatively small deal, but large in this sense directionally. it signals the fact that it believes in the growth long-term. i believe it will have to be done in bite-size pieces. >> you are upping your steak to 51%. services are doing well when it comes to export services of trade. do you think you would feel differently if you are a manufacturing ceo or that is aal ceo? >> very valid question. i am in the business of service and hospitality. a $100 -- 100 million dollar business. i cannot speak to other ceos. everyone will have a different perspective on trade. are not alone we
in this world. we have to find a way to work with counterparties in other parts of the world and not alienate them. i don't think we are all going to agree exactly on trade think we should agree we will be part of the global economy more than being an isolationist. thank you so much for your time and do talk to us again when you are traveling to china. urren, mgm ceo. this is bloomberg. ♪ ♪
investment in brazil this week. in january the brazilian rail the dollar. today i think it is 3.17. in six an enormous move months. we will close the deal and two or three week. the question is should we further hedge our position because the movement in currencies is very significant? just as significant as when it went the other way. then it went from 1.672 414. that is quite a devaluation.
>> did the currency evaluation play a large role in your investment today than it would have five or 10 years ago? >> i do not think there is any question that the volatility of since theparticularly big recession has been much more significant than it previously was. from 1944 packed to -- 2005 and 2006. stable scenario that led to the growth of world trade. isce that time, stability growing them.
are you noticing something similar and your investments? >> i think the cost of hedging across the board is significantly more expensive than it was a number of years ago. as volatility obviously translates into cost. diversified that that is their natural hedge. do you take that view, a more complete global view of what you are putting your money into in that respect? >> yes and no. who does notdy understand the volatility of currencies runs a very significant risk. on the other hand, there is a lot of people today who i think are just a hedge over the hill.
for example, we make real estate investments in the foreign market. that is really unhedged bowl -- edgeable. that is really prohibitive. i think during that time it was going to get settled in 30 days, i went hedge everything. , up to a year that also makes sense. will go down, when this will go up. i do not think it as a very good history. vonnie: still ahead, we will talk to the new ceo. this is berg. ♪ -- bloomberg.
hillary clinton's campaign that says that former interior secretary ken salazar will lead the team planning her transition to the white house if she wins in november. the unveiling of the clinton cane transition project marks and intensifying of preparations that began months ago. the planning will be based in washington apart from the headquarters in brooklyn, new .ork 15 prisoners at guantanamo bay have been sent to the united bay emirates. the largest single release of detainees since president obama took office. some of the prisoners had been held at guantanamo for more than 14 years. officials in northern california say firefighters are making progress against the massive destroyed 170 and other, businesses structures and charred nearly seven square miles.
the fire was 20% contained as of yesterday. authorities have arrested a 40-year-old man in connection with the blaze and charged him with 17 counts of arson. turkey is taking another step with israel.ciling israel is authorized a $20 million payment to compensate the 10 victims families. the restoration of ties is expected to unlock energy contracts with billions of dollars. global news 24 hours a day powered by more than 2600 journalists and analysts and more than 120 countries. i am mark crumpton, this is bloomberg. turning now to the on-demand economy. attracting more than 22 million consumers per year. nearly $58 billion in spending. here to talk about the trend is the new ceo of task rabbit, an
online marketplace that is outsourcing household errands and profiled in the bloomberg businessweek special interview series. she joins us from san francisco. congratulations on your new ceo position. tell us how you make decisions when the previous ceo is still around, and you have to work together and cooperate. >> we have a great relationship. we really did a great job when dividing upther responsibilities. making theseme decisions, and it is great. what have you brought this -- -- from theperience google experience? one is that the scarcity
brings clarity and focusing on things, you will get to great outcomes. task rabbit was successful in the googling our business last year because of that focus. and building a great leadership team. it is one of the reasons i love working at the company. we create meaning and economic impact. vonnie: how concerned are you about the silicon valley economy ? we were talking about dropbox going public. things, you will get to great outcomes. how in that environment do you raise more funding? i believe you are trying. >> in our case i think the future is bright. a lot of people seem to think the social movement has lost its meaning. it really has not. we have created a new place for
people to think about the asset that they have, creating the value that they have. people are living a new of freedom and empowerment. i think our future is bright in this economy overall. >> you have also had a lot of pushback. how in foreign is the distinction to your company's bottom line? how do you deal with the risk of legal action. >> the client to use task rabbit appreciate the quality and experience they have. pastors who 50,000 come and have the flexibility. they make on average $35 and our . 15,000 come to task rabbit every month. we see this as a new way of work . it is a new normal i like to think of. at the core of it we are
creating every day work for everyday people. people are using task rabbit every day to pay major bills three times a month. oftalk about the competition --and amazon and uber >>. our competition is really people choosing to do it themselves. we want to every client to think when they need something done around their home. right now we are just trying to be top of mind for them. we do not see the competition as other companies. when you think of meeting the , we want youleaner to think of task rabbit as your every day place. >> are you raising funding? >> everybody is always raising funding. usfitability will give
freedom to choose how we want to grow index and. we believe we will have the opportunity to do that next year. >> good luck in indoor and -- in your new position in business. stacy brown-philpot. story on thethe bloomberg terminal ansi b stars every sunday on bloomberg television. now to the new york commodities. another day of broad-based gains. have a lookwe believe we will he on the bloomberg. the bloomberg commodity index is up nicely on the day. helping to push of oil to a one-month high. energy in the environment sector of 1.5% there. earlier, bhp the litan the eeo, andrew mackenzie, said the worst of the decline in commodity prices may have passed. -- the hp litan. bhp bil as markets come
back into balance, they may trade more on the back cap. that is why when we look at carbon prices we predict we would deliver $7 billion of free cash flow this year, which will be the highest cash flow yield since they were formed in the company through merger since 2001. we have a very strict capital allocation that we used to determine. since --rst and instance we will look after maintenance capital. we have a dividend we pay up 50% of the underlying attributable earnings. then it is much more of a choice. an additional dividend.
i think the preference going forward is to continue to pay debt. not to the extent we would not to use the opportunity, tragically was $7 billion to make good on the commitment to increase cash returns to the shareholders and look after very long-term growth plans for the economy. plane outlined a six-point to grow the value of the company at the prices that existed then by nearly 70%. that is something we want to continue funding. >> i sat down with the ceo of rio tinto. we talked about the possibility of m&a activity. thatlked about the prices were attracted to him at least. why not put that to m&a?
>> pretty much. our capital allocation framework would suggest unless we can get the returns through making those sorts of transactions, it is preferential for us to invest in her own business, so even returned to the money -- the money to the shareholders. that is how the market has panned out today. we have a lot of opportunity to grow the business with the options we have created for ourselves. this next point plan i have laid out back in may, which we talked about growing the valuation of the company by 7%, did not anyire any m&a and significant improvement in commodity prices beyond what i have just forecasted. increasingly that looks much more compelling than acquisitions, which at the the returnst offer that would suggest it is value adding for us to do. what are the conditions
where you would really ?aterially grow the capex really commit to longer-term projects? what are the conditions you >> we may to do that? grow it slightly from the levels the sheer. we have been so good at improving capital efficiency. -- almostcute all him all of our growth plans. it would certainly go up a bit if we saw an uptick. we would want to get growing more in the onshore business. but relative to the amount of capital we used to spend, we are twice as efficient as we once were. we can do most of what we want to do with capital not that far away from carbon levels. >> when do you see the market for copper, iron ore start to
we see marketo >> coming back to balance in sort of a sequence. we are starting to see evidence at the domestic gas market. the cost curve is so flat, you do not see a big movement in price. i think the set -- the next oil market,be the and that is probably a year or two off. we have to go to the end of the decade to see a fully rebalance market for energy -- for copper .n iron or is likely to be oversupplied for some time. it is very hard for me to predict that ever coming back to balance. i say the same thing about liquefied natural gas.
invest in likely to the lot more, but we have positions that said at the bottom of the cost curve. particularly in iron ore, this will still be a high margin of business for us that will offer a very decent return and make a significant contribution. vonnie: that was andrew .ackenzie earlier today a quick programming note, stay tuned for the next hour on what did you miss? they will talk with paul krugman at 4:00 eastern. you do not want to miss the conversation. let's have a look at the data. index down 1%. below $95. this is after phil dudley made remarks about september and potential rate hike. the yen above 100.
they make uniforms for various companies. gnk is rising. there is a potential deal that would create the largest supplier of industrial gas. linda confirming they are in talks. a deal may not result. this is how the share traded in germany. then there is another potential deal with gnc or general nutrition centers as it was known in the retail business. the shares getting a kick up after the company is expected to start the sales process next month and could get bids from various chinese buyers. we are looking at natural gas, which has been bouncing of it. oil prices also bouncing as we see the dollar fall. this has given a lift to the energy companies. that is a group that is on the
rise. marathon petroleum -- petroleum one of the best performers. finally, morgan stanley. this companyed took a 2% stake in morgan stanley. the shares are up 2.2% on the filing. we continue to see them roll in to see if we get any other interesting tidbits. vonnie: thank you for that. a new poll shows hillary clinton gleaning -- gaining ground on her presidential rival, donald trump. we will have the numbers next. this is bloomberg. ♪
shery: this is bloomberg markets. i'm shery ahn. vonnie: i am vonnie quinn. is planning to deliver a high-volume fully autonomous the occult for ridesharing in 2021. automaker actively working with more than 40 startups in addition to expanding the silicon valley operations. we will eat to the ceo, mark fields. a judge has given the health.ght to cvs claiming they like to investors about how much insurance to resolve lawsuit. andsettlement includes cvs its insurer, american international group. the network accused the company of lying about insurance from a 1998 settlement. apple planning to
investment. china the ceo of apple, tim cook, made the announcement during a meeting with the vice premier. a state media report says apple is planning to set up an independent r&d center in china year's end. that is your latest bloomberg business flash. shery: turning now to politics. the swing state of florida appears to be moving decidedly toward democrats hillary clinton. a new poll shows clinton leading donald trump by nine percentage points in the sun shines date. meanwhile, neither candidate has to centralpeal voters. i want to bring and scott hill copper in -- scott hill from washington. toward candidates moving
ideological sensor. why isn't this happening? >> a number of reasons. the main reason, the whole idea voter, the swing voter of progress is shrinking. it is shrinking in a massive way. we have seen studies that say in the 1960's there was 60% of the electorate that was persuadable, roughly in the center. now that has gone down to 5%. more and more elections have gone down to base elections. is 75% ofreason independent voters have a party preference. even if voters are registered as independent, the last majority prefer one party to the other. it makes it very difficult to persuade them. the candidates are acting accordingly.
>> is there a different kind of swing voters this year? will it be based more on ethnicity than anything else? >> ethnicity is one of the dividing lines between hillary clinton and donald trump. election.nusual trump is doing pretty well with white voters overall. he is doing poorly with better educated voters. very poorly with nonwhite voters . he is doing very badly with young voters. in terms of whether that affects the strategy, it certainly does affect hillary clinton strategy for example. hispanics tend to lean left on a lot of issues. is leaning on tuition free public college. cracking down on wall street. it is about mobilizing the base. trump, likewise, is sticking to
a unique native nationalist platform that work well for him in the primaries. he is sticking to the proposal to build a wall on the mexican border in crackdown on illegal immigration. it, this is like an american first brand of politics. now we see this poring over to foreign policy. now we are seeing asia experts warning in an open letter what this will do for the u.s. if he becomes president. tell us what they are saying. >> what we are seeing is a trend of numerous foreign-policy officials that observed in or in -- previous administrations, including republican officials who are coming out against trump for a variety of reasons. they believe his economic and foreign policy be vastly disruptive to the post-world war ii global order as we know it. the word from asia right now is that his economic policy to byrt a trade war with china
goods made there and the united states would be very damaging to the united states economy and the order in asia in the region. and his proposal to potentially let japan and south korea build nuclear weapons to defend themselves so the united dates does not have to, is part of the plan to reduce the united states footprint across the world. there is concern it would lead to a nuclear arms race. i think the foreign-policy see some value in maintaining a global order that has at least worth for the past half century or so. we have seen hillary clinton oppose the tpp now as well.
>> that is the million-dollar question everyone is asking. there are many republicans and democrats who doubt hillary clinton's commitment to tpp based on the fact that she was for it when she was secretary of state. she has done everything she can thessure critics and skip -- skeptics. she did a speech last week where she promised she will oppose it during the lame-duck session and presidency. it would be very hard to walk back from this. thank you. you can follow all of the politics action. this is bloomberg. ♪
welcome to bloomberg markets. ♪ we are live from bloomberg world headquarters in new york for the next hour, covering stories out of san francisco, chicago, the united kingdom. here is what we watching. stocks are under pressure. the fed will move soon on interest rate. shery ahn: a key measure of inflation, the price that came a change -- unchanged for july. vonnie: ford just announcing is a big invest in driverless cars, expanding its facilities. we hear on the ceo on his will have a fully autonomous vehicle available in 2021. like we said, it is one hour on the close of trading in the