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tv   Whatd You Miss  Bloomberg  December 16, 2016 3:30pm-5:01pm EST

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cast and they were counted. so that is on that point. what was the second one? reclassification. president obama: we will provide evidence that we can safely provide. that does not compromise sources and methods. will be honest with you, when you're talking about cyber security, however that is classified and we're not going to provide because the way we knowingople is by certain things about them that they may not want us to know and if we are going to monitor the stuff going forward, don't want them to know that we know.
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so, this is one of those unless thewhere american people genuinely think that the professionals in the fbi, our entire intelligence infrastructure, m served ine -- who previous administrations, many whom are republicans. they are less trustworthy than the russians. people should pay attention to what our intelligence agencies say. is part of what is part of what when i said that we have to
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think about what is happening to our political culture here. the russians can't change of us, or significantly weaken us, they are a smaller country, they are a weaker country, their economy doesn't produce anything that anybody wants to buy except oil and gas and arms. innovate. but, they can impact us if we lose track of who we are. they can impact us if we abandon our values. vladimir putin can weaken us the way he is trying to weaken europe if we start to buy into notions that is ok for him to intimidate the press or lockup people. or discriminate against people because of their faith or what
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they look like. about, moreorry than anything is the degree to which because of the fierceness of a partisan battle, you start certain people in the republican party and republican aters suddenly finding government and individuals who stand contrary to everything we stand for. that is how much we dislike democrats. some the people who historically have been very critical of me for engaging with russians and having conversations with them,
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also endorsed the president-elect even as he was saying that we should stop sanctioning russia and being tough on them and for together with them. i guess our common enemies. it was very top of mentor he of mr. putin personally. -- complementary of mr. putin. that wasn't news. so the above led made a career out of being anti-russian didn't say anything about it. election, they are asking why they didn't tell us that the russians were trying to help our candidate? on. there was a survey that some of the saw.
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it is just one poll but it is a pretty credible source. approveepublican voters of putin. over a third of republican approve of vladimir putin, the former head of the kgb. ronald reagan would roll over in his grave. how did that happen? because forin part , everything that happens in this town, everything that is said is put through a lens relative to democrats or president obama. we arethat changes,
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going to continue to be vulnerable to foreign influence. we had lost track of what we had more value and, what we stand for. with respect to the president-elect's appointments, it is his prerogative as i have always set for him to appoint who he thinks can best carry out his foreign policies and domestic altars. it is up to the senate to advise and consent. there will be plenty of time for members of the senate to go through the record of all those appointees and determine whether or not they are appropriate for the job. >> i want to talk about vladimir putin again. just to be clear, you believe that vladimir putin can sell
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authorize a hack and he believed donaldorize that to help trump? one of the things that donald trump bites is saddam hussein and weapons of mass destruction. can you say unequivocally that this was not china, that it wasn't a 400 pound guy sitting on his bed as donald trump says and do these types of tweets and statements from donald trump embolden the russians? obama: when the report comes out, before i leave office, that will have drawn together all of the threats so i don't want to step on their of time.k ahead what i can tell you is that the intelligence that i have seen gives me great confidence in their assessment that the
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russians carry out this act. dnc and the hack of john podesta. but again i think this is exactly what i want the report out so that everybody can review it. this has been briefed and the evidence in the closed session has been provided on a bipartisan basis. not just to me. it has been provided to the leaders of the house and the senate and the chairman and ranking members. the thing that your party scene is that the people who are city evidence don't dispute the basic assessment that the russians carry this out. i think what i want to make sure i give the
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intelligence community a chance together all the information. -- two gather all of the information. nothing happens in russia without vladimir putin. pretty hierarchical operations. last i checked, there is a lot of debates and democratic deliberation when it comes to policies directed at the united states. and i will confirm that this happened at the highest levels of the russian government. i will let you make a determination as to whether or not there are high-level russian .fficials who go road -- rocha and tamper with the u.s. election process.
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i would be wrong in saying that the president thinks that authorized the hack? before, i think ist the president-elect still in transition mode from campaign to governance. i think he hasn't gotten his halting together yet. he still has campaign spokespersons filling in and appearing on cable shows, there is a whole different attitude vibe when you're not in power as when you are in power. me, i thinkot
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how he have to see is will operate and how his team will operate. they have been fully briefed on all of these issues. the have their hands on all levers of government and the extra making decisions. -- they have to start making decisions. one way that he could approach is that would be unifying is to say that we welcome a bipartisan givesndent process that the american people the assurance that not only are boats counted -- votes counted p roperly, but we have learned lessons about how internet
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foreignda from countries can be released into the political bloodstream. be more that this can servedisan, the better the american people will be. that is why i made the point earlier. i'm going to keep on repeating this point. our vulnerability to russia or any other foreign power is ,irectly related to how divided dysfunctional and partisan our political process is. is the thing that makes us vulnerable. if they can use being released issome foreign government
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reports thatcal to are being issued through parts partsian news venues, then it is not surprising that that foreign channel would have more influence. to the extent that little dialogue is such where everything is under suspicion, everybody is corrupt and doing things were partisan races. fullf our institutions are of malevolent actors.
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if that is the storyline that is by whatevert there then, when aower, foreign government introduces that same argument, the facts voters have been listening to that stuff for years. they had been given a set everyday from talk radio or other venues. they're going to believe it. if you want to -- if we want to reduce foreign influence on our elections that would better ourk about how to make sure political process and political byline -- dialogue is stronger than it has been.
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mark? your successor spoke by phone with the resident of taiwan the other day and declared that he wasn't sure why the united states needed to be bound by one china policy. he says it could be used at as a bargaining trip to get a better trade deal. there is only evidence that tensions between the two sides have increased a bit. the you agree that our china use a fresh set of eyes question mark and was the big deal with having a small call with the present of taiwan? or do you think this is sending ?s on a collision course : it is a gooda
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question, i am somewhere in between. i think all foreign policy should be subject to fresh eyes. i think that i have said this before, i'm very proud of the work that i have done. i think i'm a better president .ow than when i started that if you are here for eight years in the bubble, you start to see things a certain way and you benefit from -- america benefits from some new perspectives. be not justhould the prerogative but the obligation of a new president to examine everything that has been done and see what makes sense and what does not. that is what i did when i came in. i am assuming that any president will undertake these exercises. --en the important importance of the relationship between the united states and china, given how much is at
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stake, in terms of the world economy, national security, the president and the asia-pacific, worlds increasing role in affairs, there is probably no bilateral relationship that carries more significant. -- significance. there is also the potential that that relationship could break down and everybody would reverse off -- worse off. i think it is ok for him to take a look at it. what i've advised the president-elect about is that across the board on foreign you up-to-date sure that you are doing it in a systematic, deliberate and intentional way. onee there is only
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president at a time, my advice -- has beenen that that before he has a lot of interactions with foreign heernment, everything -- should want to have his full team in place. he should want his team to be fully briefed on what is going on and what is going on in the past. read the potential pitfalls maybe, where the opportunities we have learned from eight years of experience. so that as he has been maybe taking foreign policy in a direction, he has all the information to make the decisions. all government is moving at the same time. singing from the same hemline. with respect to china, let's
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take the example of taiwan, there has been a long-standing agreement between china, the united states and do some degree the taiwanese. that is to not change the status quo. thann operates differently mainland china does. china views taiwan as part of china but recognizes that it has taiwan as an entity that has its own way of doing things. taiwanese have agreed that as long as they are able to continue to function with some
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degree of autonomy, they won't charge forward and declare independence. that status quo, although not completely satisfactory to any of the parties involved has kept the peace and allow the taiwanese to be a pretty economy andnd -- people who have a high degree of self determination. understand, for china, the as importantan is their doctor. at thea of one china is heart of their conception as a nation.
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so, if you are going to up and tos understanding, you have have thought through what the consequences are because the theese will not treat that way that they will treat some other issues. they won't even treated that way. this goes to the core of how they see themselves. reaction on this issue could and a thing very significant. that is not mean that you have any have done the past. image after think it through. you have to plan for potential reactions. they may engage in the. right, politico?
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>> what do you say to the electors that will meet on monday? the ones that of the year change in votes. do you think they should be getting -- given an intelligence briefing or should they bear in mind everything you said about that already? by theboth be bound estate as they have gone? long-term, do think that there is a need for electoral college reform? it sounded like to without was all one. that was all one. is the business you have seen company forward, is that what
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the party needs to be focused on thewhat do say to some of platform that it should not be thatpolitical approach? some of what they say think that your platforms have led to some of the losses in elections around the country. do agree with any of those? obama: i would think the second one first. perez has that tom i believe one of the best secretaries of labor in our history. tireless, he is wicked smart. he has been able to work across
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labor, business, activists, he has produced. if you look at his body of work, what he has pushed for, in terms of making sure that workers get a fair deal, decent wages, better benefits, that their safety is protected, on the job, he has been extraordinary. now, others will declare that they are also my friends and they are fine people as well. the great thing is i don't have a vote in this. so we will let the process unfold. i don't think it will happen anytime soon. i described to the earlier but i think is to happen which is the , whether thatty
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is entirely through the dnc or rebuilding of state parties or it hasher arrangement, to work at the grassroots level and it has to have a presence in all 50 states. it has to think about message and how we are speaking, directly to voters. i will say this, i will not engage in too much punditry. i could not be prouder of the coalition that i have put together in my -- each of my campaigns. because it was inclusive. it drew in people who normally would not be interested in politics. i think it can show in those
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elections that i cast a broad that. first and foremost that we are americans, we had a common creed, there is more that we share then that divides us. andnt to talk to everybody get a chance to get everybody possible boat. i still believe what i said in 2004, thisch is -- red state, blue state thing is a construct. it has gotten more powerful because of gerrymandering, big the way that the media is justtered, people are watching what reinforces their existing biases. there are all kinds of reasons for it.
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outside of the realm of a of electoral -- politics, i see people the way that i saw them when i read that speech. theref contradictions, are some regional differences. basically, people care about their families. the care about having meaningful work. thatare about making sure the kids have more opportunities than they did, they want to be safe, they want to feel like things are fair. whoever leads the dnc, and any going forward, i want them to feel as though they can reach out and find a common ground.
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you are right, i said this in my earlier remarks, what i was doing to do during my campaign was not what i could do during midterms. it was not that we didn't put time and effort into it. the coalition that i put together did not always turn out to be transferable. the challenge is that some of that has to do with the fact that when you are the party in power and people who are going through hard times are going to party.the president's -- of it
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the election is older. we do better with a younger election. i didn't crack the code on that. if other people have ideas about how to do that even better, i am all for it. with respect to the electors, i won't wait into that issue because again, it is the american people posture job to decide my success rate. it is not my job to decide my success rate. i provided people with a lot of what happenedout during the course of the election. more importantly, the candidates themselves talked about their and their vision for america. the president-elect, has been very explicit about what he
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cares about and what he believes in. it is not in my hands now. it is up to them. , -- e long-term >> we want to welcome our viewers tuning in live. president obama is giving his final news conference of the year. let's listen in. obama: they put a lot of premium on steaks. the senate was not elected directly. it was state legislators. it is the same type of thinking that gives wyoming to senators with half a million people in california with 33 million people say 2. -- the same 2.
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there are some structures that sometimes are going to disadvantage democrats. the truth of the matter is, if we have a strong message, if we are speaking what the american people care about, typically, the popular vote and the electoral college vote will align. guess part of my overall message here as i leave for the if we look fort one explanation or one silver fix for ourne easy politics and we are probably going to be disappointed. there are a lot of factors in
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what has happened, not just over the last few months but over the last decade that has made both politics and government more challenging. i think everybody has raised legitimate questions and concerns. i do hope that we take some time, take a breath. about howflect more get to a place where people are focused on working at least some on common set of facts. how can we have a conversation about policy that does not demonize each other.
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how can we channel what i think is a basic decency and goodness of the american people that reflects itself in our politics. it being so polarized and so nasty that in some cases you voters and elected officials who have more confidence and faith then a foreign adversary then they'd have in their neighbors. those go to some bigger issues. have somethat we voters or elected officials who obama'sat michelle healthy eating initiative and school nutrition program is a
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greater threat to democracy than our government going after the press if they are issuing a story they don't like. that is an issue that i think we have got to wrestle with. and we will. people have asked how do you feel after the election. look. this is a clarifying moment. it is a useful reminder that voting counts, politics counts, what the president-elect is going to be doing is going to be different than what i was doing. -- people will be able to compare and contrast about what works for the american people. i hope that building up the
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, with thee have made president-elect is proposing works. what i can say that what we have done works. that i can prove. were inow you where we 2008 in i can show you where we are now. that we are not better off. we are. for that i think the american -- and id i think , and ihe american people think josh earnest for doing such a great job. [laughter] for that i think the american people, the men and women in uniform who serve. i have not gotten to the point where i have been overly
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sentimental. my last christmas party photo line, they are pretty long. thehe end of the line marine corps band comes in, those who have been performing. i take a picture with them. it was the last time i was going to take a picture with my marine corps band after an event. i got a little choked up. i was in front of marines so i had to tamp it down. but it was one small example of all of the people who have success.ed to our i am responsible for where we have screwed up. these successes are widely shared with the amazing people who have been part of this administration. ok. thank you. that was president
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obama giving his last news conference of the year. we want to wrap up his comments with our bloomberg politics reporter. he did not answer that many questions. his answers were lengthy and ran the gamut from the fbi and cia russians, hackers interfere with the election. they talked about syria as well. most of the focus was on russia and hacking allegations. what did you learn? aspresident obama came about close as we would expect him to to blaming vladimir putin straight up. , he knows his words with great confidence now based on intelligence assessments that russia was directly responsible for the hack of the dnc and john podesta.
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he said little happened at the highest level of the russian government without vladmir putin knowing. that was a remarkable moment. with respect to china, he indirectly gave president-elect trump advise saying when you make a foreign policy shift do it carefully, do it deliberately. saying, warning trump that china could react significantly and be very provoked by him taking a call with the leader of taiwan, or going after china and the way he has been. that issue goes to the core of how they see themselves. a little bit of advice for the new president-elect. we very much saw a calm, measured president. out is not someone going channeling the progressives who are shocked and feeling very upset at the way this election went down, especially in light of the allegations we have seen
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about the russian hacks. he is trying to remain to the extent that he can above the fray of a messy political campaign. that is the note that he wanted to hit in his final press conference. he wass there something supposed to have said that would have mollified the left who are upset with the coolness of his reaction. there is irritation that he did not do or say something else. it is hard to know what that would have been. >> one of the things many have wanted him to do for a long time is publicly call out james comey for his decision to go public with the fact that the fbi was looking into new evidence that could have been related to hillary clinton, and the private email server, and turned out to be a nothing burger. there is polling evidence that hurt her a lot in the final couple of weeks. thatis one thing
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progressives wanted president obama to do. he was asked about that. he simply sidestepped it. he did not go there. he said people like james comey, they have tough jobs. they have to separate investigations from politics. keeping hisabit of own political views separate from his assessment and he did not go there. progressiveshing wanted. he was asked about the electoral college, whether it should be abolished. that has become a very popular opinion among democrats. it was in 2000 as well. seems tolinton seems'twa have won the popular vote. he said if anyone can look for one silver bullet they will be
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disappointed. a little professorial take. aggressive's have a lot of work to do -- he said progressives have a lot of work to do. scarlet: there was a lady in the back of the news briefing room who felt sick, and they put the news conference on pause while they tended to her. he also seemed more resigned than in his last news conference where he put a positive spin on .he transition saying they had good conversations. he said they had a cordial conversation. even the words he used were different. what was your impression? >> this is vintage obama. this is calm, cool, collected. he has a very professorial way about him. he knows how to contain himself. isrealizes his primary role to ensure a smooth transition of power and any attempt, any
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swipe, and he backhanded swipe will not end up looking particularly good as he heads out of the door. will beleaves office it very interesting to see what he does next. this is a president whose approval rating is rising. it is in the high 50's. one of the reasons as he recognizes his people don't see him as wedded to what has been a very ugly presidential campaign. people see him as being more methodical, more reasonable in his approach. one of the important quotes that he said, i think it's important to quote, our vulnerability to russia is related to how partisan our process is. a little bit of a throwback to the 2004 obama. scarlet: excellent points.
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thank you so much. this week we saw the federal reserve raise rates for the first time since december last year after the ecb signaled the bond purchases are not infinite. we will hear from the boj. will 2017 be the year they shuffle from center stage? i want to start with you. going into 2016 everybody said this was going to be the year of monetary divergence. the ecb was supposed to ease more. the dollar was going to surge. got one rate hike. how did that holdup? >> if anything it has been the year of convergence. this was the year when collectively different places all kind of discovered their own mortality. dotstime last year
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projected three rate hikes. we only got 1. now they are targeting the yield curve. $60 billion a month, not $80 billion a month. are now like we can go either way. for their own unique reasons they are ending up in the same place. scarlet: a lot of that has to hand things off to the government, to wait for policy to come in and take the baton. we are looking at a reflation trade across asset classes. which of the pairs reflects that the most? dollar-yen is the clearer signal. it has moved a great deal. emerging markets as well.
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dollar-yen is the one where you see divergence. even against its other pairs within the g-20 space. thesis, dollar long convergence versus divergence, almost everyone is hard to find a contrarian view on that. what is the contrary an argument? >> for the shirt time we are going into a year in which will bring dollar salaries. or imbalances within the asset managers with suggest there's going to be dollars selling. we will see. the counterargument is this is a bit of hope-ium. mitch mcconnell was already cuted back, not wanting tax
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that are not offset elsewhere. he wants to see a neutral bonu budget. what does that say with the democrats? how hard is it to get these policies through? this is g7 inflation versus trade weighted dollar. we can take a look at this chart. the idea is inflation is picking up. that has been the same since august. it really gathers pace following the election. give us some perspective. it is happening and we are getting to 2%. there is no indication it is running away from us. >> it is the thing that is most missing. we have sat here in the studio bemoaningimes bee central banks, bond yielding negative territory, and
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deflation. scarlet: no one says that anymore. >> that is all gone. >> for all this talk we are not --ng back to the balkan area volger era. >> one of the things you need to keep in mind, perspective, how poor central banks are with long range. we have been hearing since the financial crisis next year inflation is going to be 50 basis points higher and it never gets there. i'm not putting that much into this. the most striking moments from janet yellen's press conference, a surprising moment of hawkishness, she was asked by one of our own reporters about whether she wanted to see high-pressure
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economy. thetalked about studying merits of letting the economy run hot for a while. she downplayed it. how big of a deal was that? >> it could be a big deal. just 30 seconds of background. asked her the question about her speech in boston in october where she posed to be fair in an academic contest -- context the desire of running a high-pressure economy. he asked about this page you must have said i never said i wanted that. i just said it was a worthy question. i wondered whether she was protesting too much. the question was is she was getting ready to walk away from that completely. she speaks monday. that was hastily arranged or should i say scheduled late in the day. we will see what happens there. joe: thank you very much for
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joining us. scarlet: coming up, a dramatic week in which the u.s. central revealed a steeper path of rate increases. we have three chart you can't miss on the world's biggest economy from new york. this is bloomberg.
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joe: three charts that wrap up this week. big fed decision joining us now. we will jump into your charts right now. the first thing we are looking eurothis is a chart of the dollar butterfly. what is going on in this chart? thehis white line shows
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tightening that is priced for 2017 minus the tightening that is priced for 2018. you can see what happened in the election, this was the first the, traders thought that tightening outlook for 2018 had gotten bigger. fiscalsumption was that stimulus will take a while to work through. you may have a new fed chair. weekyou see later on this the fed meeting, the narrative traders see and now a faster pace of tightening than in 2018. joe: it is interesting because most of the media has been more inflation, higher rates, solidly from since november 8 on. distincte been two phases. >> they has been the presumption
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that the fed was going to wait and see. from the fed got on wednesday, that is not the message traders took away from it. it seems like the fed can't win. they want to impart this message that it is wait and see. given the way the economy is y beg, three rate hikes ma appropriate. but traders have taken an outlook regardless even with these unknowns. >> it's one to be interesting to see how this plays out. we are getting a lot of confusion and uncertainty. you can see that we are being pulled in different directions week by week. chart.: we have a second it has to do with real interest rates. as you come inside the bloomberg, what we have is the white line. the u.s. five-year interest
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rate. the blue line is the s&p 500. it is hovering near record highs. thehroughout the course of year, especially the last month or so, the market has been slowly pricing in that december rate hike. they don't want to do it all at once. basis point rate hike from the fed decision. apparently it was not all priced in. this chart illustrates a key points. whenever five-year interest rates have gone positive it has been a tough ride for stocks. that is the blue line. you can see these shaded areas. that is a major question, can the market handle positive interest rates? --has not in debt illustrated the ability to do that. that,en so many people do
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25 basis point increase, everyone dismisses it as it is not going to make a difference at all. inflation,just for the reality is different for asset prices. >> this has been a line in the sand over the last few years. the question is, they drove real rates deeply negative through qe over the course of the zero bound. can you unwind that successfully without causing market turmoil? >> speaking of unwinding, final chart, the fed stealth resort shrinkage. what are we looking at here? carlet: the white line shows -- >> the white line shows the fed balance sheet. that is by design. every fed meeting they talked about how they are going to maintain the size of their balance sheet.
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>> exactly. the pink line shows the currency in circulation. this is a big component. you can see how that grows naturally. constant, the size while allowing currency in circulation to continue growing, they are draining results. that is the purple line. you can see the blue line is the total size of the balance sheet minus that currency in circulation. that is the amount of high-quality liquid assets. you can see that is under $3 trillion as of the last few weeks. there is a component here where reserves are coming out of the banking system. high quality is becoming scarce. alix: the white line -- joe: the wi-lan is not what they should be looking for to get into the economic sense. you should strip out that
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currency in circulation. there is a decline. >> exactly. you have that quantitative tightening going on and the price tightening. scarlet: is this something you have heard that officials think about? >> the thing that got me thinking about this chart, they gave an interview saying he thinks they should start shrinking the balance sheet next year, which is sooner than anyone house is talking about. that was an interesting thing to hear from a fed official. he is one that wanted to start shrinking before raising rates. he has had this idea for a wild. if that comes into play then there will be a lot of fireworks to watch. joe: matt basel, thank you very much. thatet: stock slipping chinahas a drone in the
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sea. this is bloomberg. ♪ generosity is its own form of power.
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>> president obama holding his year in news conference at the white house with russia and cyber security on the agenda. mr. obama told reporters he harbored concerns about hacking and interference in the november election. early september when i saw president putin in china i felt the most effective way to ensure that that did not happen was to talk to him directly and tell him to cut it out or there would be consequences if he didn't. >> see said moscow retreated after the conversation but by then emails were already in the
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hands of wikileaks. david mccormick has the inside track to be donald trump's defense secretary. he is president of the world's biggest hedge fund, bridgewater associates. he was considered to be a candidate for treasury secretary. u.s. is demanding the return of a drone seized by china. a chinese naval ship sees the drone 50 miles northwest of the philippines. it was deployed by an american survey vessel. china has boosted naval patrols in the south china sea. photos released indicate china has deployed weapons on reclaimed reefs in the region. more than 120 countries.
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this is bloomberg. this is bloomberg. >> thank you. outside of today's drone incident, another recent incident is when donald trump received a congratulatory phone call from the president of taiwan. he broke years of diplomatic policy with the u.s.'s biggest trading partner. president obama addressed the situation. >> the taiwanese have agreed that as long as they are able to continue to function with some degree avatar me that they won't -- degree avatar me they won't declare independence. , though notquo completely satisfactory to any parties involved has kept the be a and allow them to successful economy and people of have a high degree self-determination. joe: joining us from washington
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is in the, and -- is nick and alex. how is donald trump's initial interactions, antagonism towards china going over? what has the response been like? >> china is waiting to see what donald trump is going to do. the initial response to his phone call with the president of taiwan was measured by chinese standards. they did protest but it was fairly measured. they were more stern with the taiwanese leader. the impression we've gotten is that china is taking a wait-and-see attitude with president-elect donald trump, as president obama said in his press conference, it is a situation of one president at a time. they are dealing with the obama administration. they are being quite careful but taking a way and see attitude.
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are taking ahey wait-and-see attitude does that mean we are not drunk a connection between the seizure of this u.s. drone with what donald trump has done? >> to be honest, anyone who tells you that they know the motivations of the chinese government is either delusional or lying. it is difficult to know what is going on in this situation. there are two contexts. the south china sea. china does occasionally send signals like this. it would not be a surprise if they would say you are going to make these comments, both about taiwan and the south china sea. we are going to show you how serious we are before you even become president and make a move like this which is a serious departure from what i have done in the past. joe: donald trump is a big
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departure from obama in many .ays including foreign policy things like talking on the phone to the president of taiwan have ramifications. they have a sense of two presidents? >> it feels that way to me for sure. i would appreciate if one of these guys would stop as it presidenting for a while. scarlet: how much did donald trump talk about china u.s. relations? outside of this unfair trade balance with china? did you get into anything else? human rights, one china policy? did it ever come up? does hit a of thinking on that? >> i have not heard him talk much about china outside of an economic viewpoint.
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i have not heard him talk about human rights. the first time i've heard him address the one china policy was when he talked to the taiwanese president. you think the chinese don't play fair and are beating us and has promised to make that stop. scarlet: since we have the situation where the pentagon has protected against the seizure of , whichderwater vehicle was in international waters, so it does not in contested waters, have we expect this to play out? something like this has happened in the past. there's a track record of these kinds of squabbles. >> i would not put this on the level of the 2001 incident. you have the chinese plane collide with the u.s. plane which had to make a forced landing. there was a huge negotiation and george w. bush's administration where they had to get the whole
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crew from a plane out of chinese territory. we have seen repeated incidents. a chinese vessel basically cut in front of a u.s. naval ship in the south china sea. the thing that is different here, this occurred within the philippines exclusive economic zone in international waters. pretty far from any territory that is disputed. if a chinese vessel does this where it makes no claim at all on the territory or on the maritime area where the ship is operating, analysts say this may be a violation of international law. >> guests that we had early in tension talked about
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that could arise and suggested north korea could be one. perhaps china would become less of a partner trying to deal with that issue. does that seem like a plausible place where tension could arise? if the antagonism continues to ramp up? >> certainly. donald trump has accused china of not doing enough to help with north korea. you have to look through the prism of china. they see taiwan as a core interest for them. this isn't just a foreign-policy issue on the other side of the world. this is an island they consider part of their territory. it is a matter of national sovereignty. north korea, they are afraid if the economy collapses you have refugees pouring into china. they have an interest in keeping that country afloat. an area whereeen the u.s. and china have traded
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accusations in the past. it is a place where china could exert leverage over donald trump again. scarlet: it does appear that the president-elect has brought up north korea as a potential area of concern, after his first meeting with president trump -- president obama following the election results. we know that his go to people on foreign policy will be rex branstad.and terry have they given indication on north korea? do they have experience in that area? >> they happened. , they haveesting suggested one china could be a bargaining chip on north korea. not only on trade but i suppose by threatening to recognize taiwan, he thinks he could leverage the chinese and taking
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a forceful stance against north korea. i think this is a dangerous game to play. china does view taiwan as part of its territory. it is as if a foreign power threatened to recognize puerto rico as an independent country. these are high-stakes he is plying with taiwan. he is playing a game that could end in war. scarlet: thank you so much. joining us from washington dc, our foreign policy reporter and our white house editor. i sat down with mexico's ambassador to the united states. this is bloomberg. ♪
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joe: donald trump's foreign-policy has some more aid. specifically our neighbors to the south, promising to build a wall, tension between the two countries is that an uncomfortable high. i spoke to the mexican ambassador to united states. and if he isafta concerned about its collapse. it is a mechanism that has , theited the two of us three of us if you include canada. there are going to be alternatives to continue growing in these trade agreements. >> do you believe there is scope to negotiate with the trump administration, to alter, change, improve nafta?
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>> we consider it to be updated. that is what we are aiming at. to get the best of what was not continue the attraction for the investment in the united states and the ago, to make it more competitive. your government have any plan to engage with the new arenistration, or their specific plans? >> we are watching what is happening so far. we don't have specific issues. everything is -- we are seeing different scenarios on how we can position ourselves.
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i emphasize what is good for the region. >> since the election of donald trump, has your government had much communication with canada about getting on some sort of mutual approach in the region? >> we have been having conversations. have to evero not see them. we have details. that a few alternatives are presented. that is the point. joe: in addition to trade, one of the policies donald trump ran on was the wall, building a wall. what is the position of your government on the construction of the wall leaving aside his promise of wanting to get mexico to pay for it.
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>> the last 30 years we have been building bridges we have been modernizing the border. this is what we are aiming at. how to make the border secure but efficient to be more competitive. that is the point we don't like very much walls. we like bridges and communication, and efficiency. we are competing against other regions in the world. that is important. and what will be the response of your government? >> we have said time and again we are not financing the wall. joe: outside of immigration, what about security issues. what about working with this administration regional security? askedglad you
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regional security. how the three of us could play an important role in the security of the region, displaying an important role with our southern border and our northern border. it has to lead to an avenue. joe: one of the things we have seen an bloomberg has reported on, companies have delayed plans for direct investment in mexico. u.s. companies waiting until sure whatlarity, not to do, they don't want to be attacked on twitter by the trump administration. >> it is very important. uncertainty is not a good friend of investment. what isto have exactly
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going to happen in order for everybody to make decisions. that everything is well understood. we are putting on the table what is at stake. how relative it is. and a uniquely allied. that is something that has to be brought into consideration. do business leaders that you talk to, what do they say about that relationship and their plans? >> there is a lot of things at stake. in the united states, they are waiting to see what is coming, what is going to be on the table . how the production chains are
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changing effectively. 40% of things produced together. we are exchanging products on a daily basis. need everybody to understand. that is why it is so important, that we continue having this relationship. it is going to be much better for us. mexicant was the ambassador to the u.s.. scarlet: coming up next, "rogue one" hits theaters. just beginning of what disney has planned for the franchise. how it will do all of that, next. ♪ >> in all of this moment, the force is strong. ♪
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in the: rogue one opened u.s. and canada at the beginning of a long list of releases to expand the star wars universe. disney projects it will make $140 million this weekend. the originalel to 1977 "star wars". joining us to dig deeper into disney's plans, when we say that this is a one-off, a separate it is lower than it would be for a movie that is part of a trilogy? >> it is a lot lower. no one expects this to blow force awakens out of the water
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but they need it to do well. this a big part of the disney strategy. they want to expand this universe. they want to tell all of these side stories so they don't have to progress the main story every year. star works geeks, they have a sense of ownership of it and feel like they know the different characters. how difficult is the balancing act for disney to expand the franchise, blow it out to make a lot of money, while preserving the character for the people who are obsessed with it. >> when disney bought lucasfilm everyone was worried about that. what are they going to do with this thing they call the expanded universe. hundreds of books and comics and video games. scarlet: the movies were a small part. >> yes. they consider that part of canon. they got things ok and they
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wrote all of these books. in 2014 they shunted that over to something called legends. that is a totally noncanonical thing that they have. people were worried about that. they lost all of this content they had been working 30 years on. it was all of the granular things that you see in the movies that are not explain. it is something people miss. i think disney is trying to re-create some of that and build a universe back out with movies like "rogue one". scarlet: why do they decide to move away from it? is it important to appeal to international universes? >> i think it is about control. disney wants control about where they are going. they don't want to be held to whatever people did before, aside from george lucas.
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now, they are building it through books. it is not just rogue one. it is not just the han solo movie. they have created books to span the gap between the sixth and seventh movies, 20-30 books have come out. joe: the next one in 28, is that going to be back on the linear plot? or is this another side one? >> next year the 2017 movie is the next episode, episode 8. the one following that will be another side movie. scarlet: so we see the pattern being set up here. you saw the movie. four thumbs up? >> let's do three and a half. scarlet: nice work. joe: what you need to know
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tomorrow for tomorrow's trading day. ♪
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scarlet: stocks closed a little changed down. it was a sleepy friday afternoon
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even after the news of the chinese seizing the u.s. -- that caused a little blip. in terms of what is coming up, next week janet yellen delivers a keynote address. that is at 1:30. joe: i will look at vladimir putin holding his news conference on thursday. that is always a trip that goes on for a long time. a lot of questions should be interesting. scarlet: nike, fedex among companies scheduled to announce our earnings. that is all. have a great evening.
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>> you watching bloomberg technology. president obama stop short of saying president vladimir putin himself orchestrated the russian hacking of u.s. political sides
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during the election but he confirms it was done at the highest levels of the kremlin. mr. obama spoke of his last news conference of the year. unprecedented move north carolina's outgoing governor has signed into law a gop backed bill stripping the incoming governor of some of his powers. suecooper is threatening to pat mccrory, who conceded the race a week ago. a $25s. is offering million reward for information leading to the whereabouts, arrests or conviction of an islamic state leader. that is more than double the 10 million previously offered. he is said to be responsible for thousands of civilian deaths in the middle east, japan and other areas. according to three people familiar with the matter, mccormick was i'd earlier as a

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