tv Bloomberg Markets Balance of Power Bloomberg February 20, 2018 1:00pm-2:00pm EST
shery: here are the top stories we are watching. its a huge week for u.s. treasuries with the results from the two-year auction coming in just moments. earlier the treasury sold three-month and six-month bills that yields not seen since 2008. special counsel robert mueller files more charges in the russia probe, this time against a former attorney. we will look at how this new charge impacts the broader mueller investigation. and as the u.s. doing enough to protect its voting systems from cyberattacks? fireeye. is the ceo of ♪ david: let's check in on the markets as we await results on the two-year treasury auction. here is bloomberg's abigail doolittle. abigail: the results of the
two-year option, we are looking at next trading action and the dow is down 3/10 of 1%. the s&p and the nasdaq is higher , the nasdaq is off 7/10 of 1%. -- we wereare look looking at steep declines for the doubt but that seems to have slipped a little bit after mixed trading action. after weeks of a volatility we are looking at two big names, amazon walmart. amazon shares are up nearly two and a half percent and one reason could be walmart down 9%. the company missed its earning estimates and behind that to some degree, weakness for the company's online business. growth the celebrated and came 50%. 23%, down from and on this, the 2018 your view is disappointing and we can see that amazon seems to be benefiting to some degree from this. other movers on the day, we are looking at the chip space.
look at the philadelphia semiconductor index, up 2% and outperforming major averages. we have annexed the semiconductors up sharply, up 60% on news the qualcomm has up its bid on the company. that dealt needed for to get done so we see bullishness there and qualcomm is fighting off a $120 billion bid from broadcom. let's take a look at the two-year yield at 222. if i take a look at the auction results we are going to see that the when-issued rate, what investors are really going to care about the two-year yield drawsresults we are going to set at 2.25% and the ,igh-yield has expectations excuse me a just taking a look
at this, the median bid was 1.80%.the low bid, and if we take a look at the bid to cover we are going to see, if we hop into the bloomberg here this is a look at the demand on the auction. the last two-year auction it had been at 3.25. 2.75 soropped down to that is how demand is relatively strong for that two-year yield note worried that is pretty positive or encouraging at least, relative to the bond demand, considering that we are in this week of huge monster issuance. if that demand is weak at this point it could point to problems ahead but right now demand is pretty strong relative to that two-year yield option. david: thanks abigail. shery: the two-year treasury auction, just wrapping up. joining us from princeton is i read jersey, u.s. rate strategist with bloomberg intelligence.
-- 2.72 against 2.22. how would you assess today's allocation? >> a little bit weaker. i think with all this debt that week, be digested this its not a huge surprise that we got a little bit of a weak option on some of the details. importantly, the yield came in the timeas expected at the final deals were put in a 1:00. so i would say it is a mixed results for this particular option. marketwould you say the is concerned about the u.s. fiscal outlook this year? ra: clearly with his particular result, not very. it will be interesting to see the seven-year auction on thursday. that's longer-term and if you have fiscal responsibility that is going to show up and longer terms and maybe some curve steepening. but this says, we don't expect
yields to be significantly higher than we expected right before the option, over the next couple of years. david: for those of us who don't follow these routinely, explain how you could have lower demand and not have the yield go up. i would think that that would drive the price down. that but atd expect the same time it was expected that yields would be a little bit higher in the particular auction. so the way people set up for treasury auctions is, dealers and others e accept what they think the demand will be from foreign banks and advisor and funds, and if they think demand is going to be week they will go into the option short, or under the market, said they will buy that back at cheaper levels. we were expecting around 2.25% and we got around 2.55% so a small tail there. i think that reflects the
fact the people were set up very well for this auction. david: we have a couple of more options going on this week. is this tell us anything about what to expect in the ensuing options? ira: it does you that markets were prepared for this. maybe tomorrow the five-year auction can go ok, and the seven-year auction also. but the farther we go out the curve, given how flat some curves are, it could be more challenging for the likes of the seven-year auction in particular, on thursday, to maybe clear at the level where it is today. the dollar is rebounding today but it has been weaker in the last few sessions. i will a weaker u.s. dollar fact the appeal of u.s. treasuries going into the future? : that makes it more challenging because if the expectations from foreign investors is that the u.s. dollar will continue to decline, it is hard to say, let's by u.s. treasuries and if u.s. treasuries are usually -- are
yielding to a half percent in the dollar is going to fall by 3% that's not an attractive investment. if the trend in the dollar continues you could see foreign demand weakened. but foreigners have not been major participants in the u.s. market on a net aces over the last several years -- on a net basis over the last several years. david: there's a sense maybe we don't have as many foreign buyers today as we did he year or two ago. is that wrong, and to what extent is the volatility in the fx affecting hedging costs? ra: interestingly over the last two years net buying by foreign investors has been zero. if you look at the aggregate data you see there hasn't been a significant shift out of places like europe and asia into u.s. treasuries. what you have seen more is the u.s. deficit has really been absorbed by u.s. domestic and in particular
investment managers. so only about 50% of auctions have been taken down by foreigners, when it has been upwards of half in some options by investment managers here in the u.s.. are growingeficits must faster than gdp growth in the u.s.. how problematic will this be when there isn't enough tax revenue to cover that? have risingtainly deficits because you have mandatory spending going on, things like social security and medicare. so the question becomes, are you going to see debt to gdp rise to such a level that the u.s. treasuries going to fall. but i point to other countries that they finance their own currency and their is not a good correlation between places when you look at japan or when you look at other countries that fund in their own currency, you don't see yields rise a heck of a lot when debt to gdp passes
100% or some other number. that might be more problematic for places like argentina which funded almost all of its debt in foreign currency. thank you so much, i rangers in, u.s. rate strategist with bloomberg intelligence. jersey, u.s. rate strategist with bloomberg intelligence. coming up, robert mueller unveils new charges in the russia probe after last friday's sweeping indictment of russian entities for interfering in the u.s. election. we go to washington for developments, next. this is bloomberg. ♪
shery: this is bloomberg markets balance of power. david: from bloomberg world news we turn to taylor riggs. taylor: an official says a transfer from guantanamo may occur soon. suspectblack -- the pleaded guilty in 2014 and was supposed to be transferred today to a rehabilitation program for former jihadists and saudi arabia. president trump will host the swedish prime minister at the white house next month. the white house says mr. trump looks forward to exchanging views during the march 6 meeting on deepening ties between the u.s. and sweden, with a focus on trade and investment. the leaders are expected to discuss advancing regional and global security and achieving shared defense goals. u.n. children's agency has
singled out pakistan as the riskiest country for newborns. according to a unicef report out today, 46 of everyone thousand children born in pakistan dies at earth. after pakistan, the sink -- the central african republic is the next riskiest country for is thes and afghanistan third. babies born in iceland, and singapore have the best chance at survival. global news, 24 hours a day, powered by more than 2700 journalists and analysts in over 120 countries. i'm taylor riggs. this is bloomberg. ♪ david: thanks very much, taylor. on friday was a group of russian individuals and companies. today at the london-based lawyer who works for prominent international law firm. peschel consul weber mueller is demonstrating the seriousness and scope of his investigation into russian interference in the 2016 presidential election. welcome jeffrey kramer, a former federal and state prosecutor who has been at the center of complex international prosecutions. mr. cramer is now at berkeley
research group and comes to us today from chicago. we thought this was all about russia getting involved in our election. and we have this new indictment out and it involves an associate, he then was, not any ander, at a firm in london it appears to deal with ukraine. what is ukraine -- what does ukraine have to do with the russians? >> it might not have any thing -- am i not have anything to do with the russians, when it might have to do with is the manafort case and that is on ukrainian connections and moneys that were being laundered from mr. manafort and mr. gates into the u.s.. so this specific individual falls under that umbrella and the question is whether or not the manafort case, which is separate, can bleed into the russia investigation.
come: the charges did not down today. they are several days old and have been under seal. it is also a criminal information. is that indicate to you as a former prosecutor the might be a guilty plea coming? jeffrey: that's exactly right. an indictment is brought by a grand jury. an information is by agreements of the defendant didn't make prosecutors go to a grand jury and get an indictment. its an information with is just thenformation, which is a cult to get into federal court, and nine out of 10 times a plea follows. shery: does this push paul manafort to a plea deal? jeffrey: i think this is just another brick in the case. its a very strong case against paul manafort. corporateoverseas records, they have overseas banking records, they have property records in the u.s., mr. gates appears to become operating. so the case against mr. manafort is pretty strong.
this most recent information or case against the individual may make it even stronger. mr.its a tough one for manafort to defend and you have a look at an individual who believe is 68 years old, looking at 10 years in prison, it doesn't matter where they send you. a 68-year-old man doesn't want to go to prison for 10 years so i think there's a lot of pressure on him to cop a plea. president trump is saying he has been vindicated on the russia probe. looking at the investigation and the different branches of the probe, would you say so? jeffrey: its too early. i've seen pundits who say it exonerates him or goes the other way. i don't think either is accurate. we don't know what mr. mueller knows and that's the way it should be. he is doing what he should be doing, certainly on the most recent russian indictments, which shows how the russian government, you have to say, was --king to so discontent working to sow discontent.
what is the next shoe to drop? we don't know. it may be it. it may be an official lying to investigators. mr. mueller takes that very seriously, as evidenced by the case today, its lying to an investigator and destroying evidence. a may have nothing to do with the trump administration of mr. mueller is clear, when his investigators come calling on you, you need to come clean. david: that's a terribly important point because we in the media have rushed to a judgment that either implicates or exonerates and in fact we don't know. it doesn't do either at this point, as far as i can read the record. at the same time the was talk earlier about the president being asked to do in interview with mr. mueller and that seems to have died away. the you expect that he at some point will give an interview? an interesting question. it certainly hasn't died away among the lawyers. sooner or later something's going to happen. either is going to get interviewed by mr. mueller or ift any preconditions,
push comes to shove, a grand jury subpoena. i think that's extreme but i think one way or another, mr. mueller is going to want to talk to the president. and its not going to be done by simple question-and-answer. is probably going to be done in person and i imagine the lawyers are just figuring out the parameters of that interview. -- but i would imagine talks are still going on. david: we don't know the merits of this case one way or the other. does the fact that mr. mueller appears to be prepared to interview the present indicate anything about the timing, that its unlikely he's going to get more than one bite of that apple? and doesn't deck him at the end of the investigation? jeffrey: i think that's fair, maybe with a little cleanup along the way. but usually when you put these cases together you started the bottom. that's prosecution 101, and you work your way up. that doesn't mean he's a target or the subject of the investigation but certainly someone that needs to be talked
to. interview happens, in whatever form it takes, you may have a little cleanup on documents or other re-interviews, but i think that maybe nearing the end. say, and looking at this prosecution or mueller investigation, is proceeding at lightspeed. we are not getting links for mr. mueller which is not surprising. and he's going through a following the evidence where a goes. and from my perch, without any preconceived notions. what you have seen so far from leaks and different branches of the investigation, are you saying any elements could lead to an obstruction of justice charge against the president? jeffrey: i think that's very hard. legal minds differ as to whether a president can even be indicted. but set that aside for second. i think there are data points which could lead a prosecutor to an obstruction charge. maybe not against the president, but if it was just an average individual, there might be a case. canher a sitting president
be indicted is an open question but i think even an objective observer would have to look at certain things done by this administration and say, that is one point. it may not be enough because we don't know what mueller knows, but it certainly is an element of obstruction. there are individuals on the mueller team that are specifically geared toward appellate argument and the supreme court argument, so this maybe one of them. david: jeffrey, thank you so much. very helpful, i must say. gamer, a former prosecutor and manager of the berkeley research group. shery: damage control. facebook finds itself at the center of robert mueller's probe after information that the russians it used their platform for meddling. this is bloomberg. ♪
shery: i'm shery ahn. caught in the crosshairs, facebook finds itself at the center of robert mueller's investigation. an army of russian trolls used facebook and other social media platforms to sow discord in the 2016 election. we welcome our reporter in san francisco who covers facebook. sarah, great to have you with us. we are hearing from facebook's vice president fred sales that the goal of this russian theuence was not to sway 2016 presidential election. what exactly is he saying and why is he saying it at this moment in time? >> those are rob goldman's comments on friday. they just sparked this firestorm of people who were trying to see whether he was trying to represent facebook's opinion. because facebook in the indictment actually comes across looking ok. i mean, they are involved in all these russian negativities but its very clear that they have mueller'srating with
investigation. then rob goldman is coming out saying things that seem to findings, mueller's and also making it seem like facebook knows everything he has, or has seen all that is pertaining to this investigation when really goldman is the vp of ads. he has only seen the ads, which as we know were only a very small portion of the russian effort. david: it sounds like its a -- ay senior positions in pretty senior position, the vice president of advertising, and can heat we privately without it being attributed to facebook? >> he was tweeting privately. he has since apologized to coworkers, i'm hearing from sources. he wasn't really trying to counter anything mueller was trying to say, he said. what clear is that facebook is trying to come across as a neutral party that's trying to do whatever they can to shed light on whatever happened on their platform that they didn't
see coming. of course its bad that they didn't see coming but they don't want to be further implicated. sound, fromt goldman's perspective, like they actually resent some of the blame that is being passed toward facebook instead of saying, we do see this as a problem and are going to try to fix it. so it certainly goes against the narrative facebook is been trying to portray the public. david: beyond that, there is a thatf posts on facebook are paid advertisements. why would he know about something that's not paid advertisements? >> exactly. in reading his tweets it doesn't look to me like he has read the indictment. i read the indictment and it definitely points for the organic posts russians made toward the groups that they set up, the false identities but they created, and the ads are of course mentioned in that. mueller said that those ads were purchased via accounts are accounts that were
created on paypal with the identities of real americans. so that would be extremely difficult for facebook to track or say that they found all of them. and we don't know whatever mueller has or what else he knows, so for goldman to speak about the qualification, really wasn't qualified to do so. david: sarah frier from san francisco, thank you. get more on how technology might be able to protect the u.s. election system as we head toward the midterms. ,ur guest is the ceo of fireeye kevin mantia. live from york, this is bloomberg. ♪ retail.
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by consumer staples, and telecoms leading the decline. s&p 500 curbing six days of gains, while the nasdaq is up after declining on the friday session. all eyes this week will be on treasures. we have a flood of debt supply today. volatility on the 10-year note is rising after three sessions of losses. the two-year yield is the highest since 2008. we have a ratio just a few minutes ago coming weaker than the previous auction. the dollar index beginning the free gaining ground, rising above -- dollar index regaining ground. david: taylor riggs has "first word" news. taylor: the supreme court is rejecting to challenges by gun rights groups. in my case, the ninth circuit court of appeals upheld the
california fee for sales of transfers of guns. the court said it would make people wait 10 days to buy again even if they already own one and the background check was completed sooner. today's action came less than week after a gun man in florida killed 17 people at a high school. about 100 students from that florida high school are going to the state capital today. they hope to pressure the legislature to vote for a package of sweeping gun control laws. president trump has signaled he is open to background checks being tightened. vladimir putin to boost spending on infrastructure after next month's election, going to people familiar with the matter. officials have discussed borrowing as much as $266 billion to build a new highways and railroads. putin is widely expected to win another term. a new report says the north korean sever virus known as reaper has emerged as a global threat. reaper is connecting a spin as
well beyond the korean peninsula. -- conducting espionage well beyond the korean peninsula. global news 24 hours a day powered by more than 2700 journalists and analysts in over 120 countries. i am taylor riggs. this is bloomberg. david: thanks so much, taylor. when it comes to the ins and outs of washington, no one knows them better organized operated at the highest levels longer, then joseph califano. he served as an a in the kennedy administration and then served president johnson and ultimately joined president carter's cabinet as the secretary of health, education, and welfare. in between them he has been a lawyer in washington and done a lot more. he is just out with a new book, his 14th called "our damaged democracy." welcome joseph califano to bloomberg. >> great to be here.
david: what is wrong with washington -- in reading this book you say all of the above. i think the three branches of government have lost their constitutional baron. there is colossal power in the presidency. congress is crippled. and the courts are politicized, including the supreme court. , thisk for the president is 50 years of accumulated -- from public and government democratic -- this is a nonpartisan look. sent millions of americans into combat. a million have been wounded, 100,000 have died. no declaration of war. none. the only place in the world where war is not more is capitol hill. it is required in the constitution. there is supposed to be a
declaration of congress. mr. califano: but the presidents don't ask and the congress is cowardly as well as crippled. congress is consumed with raising money. for a senator -- incumbent senator to run for reelection, has to raise $30,000 a week every week. from aumbent congressman $50,000. david: you really have known washington for a long time come all kinds of eras. have you ever seen it retrench? stephen congress has a lot bigger stuff than it used to. does it ever go the other way? mr. califano: no. on congress' level -- the presidency -- the presidents have almost 2000 staffers. that exploded over the years. we have 50 in the johnson years, the kennedy years, the eisenhower years.
but you were talking about a national security council of over 400 people. what decided to the state department? it crushes it. and the communications department that is like a state run media. .gov, youtubeehouse 24 hours a day, internet 24 hours a day. there is nothing like it in a democrat -- we never thought of a democratic country having state run media. that's 4 -- i hate to say the word --russia, or for a monarchy. we have the kind of problem. one of thesay greater sources is undermining the individual vote and gerrymandering. we have this decision in the pennsylvania supreme court that has redrawn congressional district, and republicans are calling this democratic gerrymandering. how do you find a solution? mr. califano: both sides gerrymander. there is a republican case in
wisconsin, one from maryland for the democrats. you carve a district out so that theparty will win, whenever candidate is. what happens is, for the republicans, the primary becomes the election. you push the party to the further edge of the right. democrats pushing to the further edge of the left. they promise they stay on the far right or far left. they come to washington, and they don't compromise. they have made compromise if four letter word in washington. shery: you see the solution rests with the supreme court, and yet the court is not completely apolitical. mr. califano: in the last 10 years, 50 cases have gone -- 4 republicans party line, 4 democrats voted party line. we have to recognize that. but the court has got to take on gerrymandering. there is a one-person, one-vote decision -- musical, chief justice earl warren, all-district had to be about the same size. he said that was the most important decision of his tenure
on the court. justice roberts, chief justice, has a chance. david: having studied to this in your time in washington and also writing the book, what could possibly change it? people respond to national stimulus. how can we change the incentives? one,alifano: incentives -- the court is critical again. the court has got to reverse the citizens united case. that is number one. other people have to vote, but vote in the primaries. hillary clinton got the democratic nomination with 8% of registered democrats. 7% of registered republicans. get out there. it's your country. shery: earmarks, parties money to get rid of them permanently, and yet you say that is ineffective -- mr. califano: congress has cut off its nose to spite his
face with earmarks. you know who has earmarks now? the president. shery: mr. secretary, thank you so much for joining us. mr. califano: it's great to be on your show. shery: i read your book might like it. former secretary of the department of health and education, and welfare, joseph califano. coming up, fire i ceo kevin mandia. how is the cybersecurity, helping to secure election systems at the start of the primaries for the midterm elections? this is bloomberg. ♪
i am david westin. shery: i am shery ahn. horses government did not just hacked and the -- russia's government did not just hacked and the documents, it was able to weaponize social media, according to our next guest. as the u.s. looks towards midterms, how vulnerable are elections? we welcome kevin mandia, ceo of cybersecurity company fireeye. this is perfect timing to have you on the show. on a technical level come when you are looking at the midterm elections in november, how vulnerable is the u.s. compared to the 2016 presidential election? kevin: there's a lot of different ways to answer the question. technical vulnerabilities -- can russia hack documents? toolkit they can use, but it is obvious. when it comes to the sharing of ideas and ideology, we are an
open country, and we have to to sort out as a nation where the boundaries between how people -- you can have one person in today's world be represented by 500 to 1000 online personas and that exaggerates or often analyze the influence of a single individual. influencing operations like that are here to stay. every government is going to use them to some extent. we have to find them and counter them appropriately. of theyou are at the eye cybersecurity storm, per se. you released a report on chinese cyber spies. kevin: five years ago. shery: five years ago. how does this compare, what russia has done, to what you have seen in the past? kevin: there is a general continuum. i have observed russia my whole career, and on offensive operations from these to be rules of the playground. good operational security, military against military, government against government. that started to change around
2015. d arational security slippe little bit. but targeting broad and a little bit. the rules of engagement seems to spiral into other areas, like doxxing and releasing documents. it is obvious to me that we have not settled on what are the appropriate also engagement -- appropriate rules of engagement between nations. david: how much of it is because we don't take the time and effort to defend ourselves? all of those e-mails that were stolen, they say that they could've taken basic steps to protect the e-mails. kevin: think about playing goalie against wayne gretzky. sooner or later the puck is going to get in the net. david: what then what is to be done? why should they agree to rules of engagement? kevin: good point. it is asymmetrical. we have to impose some kind of proportionate response. make risk of
repercussions can weather news diplomatically -- but if all we do is play defense, it is a long slog and the puck will get in the net. shery: just hours after the school shooting in florida, we had these twitter accounts linked to russia sending out hundreds of posts taking of the gun control debate. why can't these bots be reined it? kevin: we are a country that defends free speech and every culture will set their own bar for what privacy means to that. it is hard to impose in a global economy one privacy quote file. this one privacy profile. we allow conditional anonymity, we also allow the free expression of ideas. shery: when you exposed chinese cyber spies, you were expecting retaliation from china. the fact that we have 13 russians being indicted, what can we expect from russia? kevin: people ask me right before the election, what do you expect from russia.
there are times when you expect hybrid diligence. i imagine there is many nations that want to influence elections and oneother countries, of the tools you have it your disposal is the information operations, influence operations , where you can just magnify chaos. david: i'm not going to make you responsible for foreign policy, but given your technical expertise, we hear about the bloody nose approach to north korea. is there an equivalent of that in cyber? do we have to at some point attack them in a limited way? of of there will be a lot varying opinions on that, david, but he was what i think -- if we launch attacks in cyberspace against russia and they are all successful on the launch attacks at us and they are successful, we will lose. we are more dependent on "america -- open communications. our economy has an all-night basis to it that is more powerful than any other economy. house, andhe glass
we have got to be careful there. david: to come back to shery's first question, as you come to the midterms, is the greater iteat from hackers -- would be more the ideological threat that you describe? we don't know what they are saying and who is saying it. kevin: the ideological threats for forever. the technical threat -- during elections we will continue to learn how to do more digital-based elections, and we will be doing shields up. everyone will be cognizant during elections to protect the vote tally. shery: even if there is not an impact on the vote tally, there will be a massive shutdown. will this give rise to suspicions about hacking to delegitimize election results? kevin: that is everybody's goal sometimes, right? you have to have redundancy, you have to have multiple ways to count and track it. i believe in a separate security
there are the means to protect it, and we will do a good job doing that. shery: thank you so much for your time today. perfect timing for us to discuss this. kevin mandia, ceo of fireeye. time for the start of the hour. six flags entertainment declining today after the company reported attendance declines. .atural disasters played a role joining us with maurice taylor riggs. taylor: attendance fell 3%. some analysts expected attendance to be thought. a lot of this came down to things they cannot control, like whether. topline revenue growth came in at a record. $257 million in the fourth quarter. that did beat the average analyst estimates. overall for the attendance did grow 1%. they got two new water parks. doing all of this breaking prices on the ticket.
if we look at the revenue by admission, he does make up their largest segment. 55% of revenue comes from the admissions ticket. segments,nd and third merchandise, licensing agreements, did grow as well. really important for them to see growth on the admissions side, given that is a big contributor to overall sales. david: what about international? taylor: they did highlight that. they are noticing and realizing that international locations does need to be a key part for them. they are looking at china in 2019 to 2020 as the middle class starts to grow. beyond that, looking at vietnam and dubai as potential opportunities. david: thanks so much, taylor. that was fascinating. very interesting. coming up, theresa may's government is considering a backup plan if the eu does not offer a trade deal it wants. live from new york, this is
shery: this is "bloomberg markets: balance of power." i am shery ahn david: i'm david westin. british prime minister has been huddling on the major speech on brexit, but news has been leaking out on how they plan to move forward. we welcome our bloomberg colleagues who covers the ukraine government and politics. good to have you here. give us what we know this far and what we expect to hear out of theresa may as far as her strategy goes. like covering is a rocket towards the launchpad. it is very incremental, very slow. we are starting to get a sense britain'sgent -- what
negotiating request is going to be. that is not the same as when its final position will be, but it is what they would like. what they would like is for nothing to change except for the things they would like to change . stay with me. would like the trading relationship -- like goods to be able to move freely into the eu as they do now. what they would not like to have to have is european assistance coming. if they could get that, everybody would be happy. and they would like to be able to set their own regulations where they want to set them. david: early on this was called the "cake and eat it too" strategy. rob: and the europeans have noticed. david: the europeans have said we are not interested in that. she is now saying reportedly, if you don't go along with what we want, we will not pay that money be promised you. rob: yes -- what she is saying about that is not necessarily
for don't get the exact deal we want, but if you try and stop any kind of trade moving forward, at that point we will give you -- we will not give you the money. as the talks move through a series of stages, and we get to a point shortly where britain has to write the check and handed over, but we are not there at the moment, so the check is not signed, and there is this idea floating around within the government that perhaps as the check is not signed at the moment, britain has a moment of maximum leverage to say, look, not the final the old, but if we don't get an agreement -- not the final deal, but if we don't get an agreement on the source deal, things moving forward in a way we would like we are not going to sign that. shery: is the way, the prime minister needs to present an ambitious deal as she has a divided cabinet.
rob: yes. one of the reasons why there at the moment is the british position is ambiguous. they can say to businesses at nothing has davos, changed, because that is what the private sector wants, and at the same time boris johnson will say it is massively different. that is also up the government wants. as the fine, so long government's position is we will have our cake and eat it. point, it will become clear where on the spectrum -- how much britain is going to get. at that point you start to get real attention and the possibility of either side walking out potentially. jeremy corbyn not being
that ambiguous -- we hear that he has confirmed that his labour party will campaign to keep britain inside the customs union of the european union. rob: yes. he has been fantastically ambiguous, and he, too, is edging towards parity. in what he has said today, if written has to be inside because -- if britain has to be inside the customs union, that is different what the labour party was saying months ago. it is not mean he will let say something different. several people in the labor seemed to be saying that the way that you solve the problem of the irish border, essentially that britain has promised that there will be no border in ireland, the way you do that is you have to stay in some kind of customs union, and whatever customs union you stay in, it ends up looking like the customs union britain is currently in. shery: great to talk to you. u.k. government and politics reporter with the
latest on brexit. sign up for the "balance of power" newsletter at bloomberg.com/politics. coming up on "bloomberg markets ," we continue to watch the stock market. we are seeing a bit of an expected with the dow and s&p 500 edging lower, but the nasdaq is up .7%. david: you can catch all of our interviews on the bloomberg with the function tv . you can find breaking news, charts, and watch the interview with kevin mandia, fascinating interview, and joseph califano earlier in the program. go to tv on your bluebird. live from new york, this is bloomberg. ♪
for scarlet fu. welcome to "bloomberg markets." julia: we are likely in bloomberg world headquarters in new york over the next hour. here are the top stories we are covering on the bloomberg and around the world. equity and debt markets on pretty shaky ground. we will get insight and analysis from catherine keating, ceo of commonfund. feasting on debt -- bond traders digesting $250 billion-plus worth a treasury auctions over just three days. we will discuss. under the value at bhp, the world's largest miner come on digging up profits and battling asset management. the u.s. markets close in two hours. let's check with taylor riggs. taylor: you mentioned the shaky grouwe