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tv   Bloomberg Markets Balance of Power  Bloomberg  August 22, 2018 12:00pm-1:00pm EDT

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former lawyer pleads guilty. >> it was a federal prosecutors who proved the statement that donald trump coordinated and the dated -- and dictated to michael cohen that he make those payments to these women. shery: how has the legal drama changed the upcoming midterm elections? will democrats try to paint republicans as a party of corruption? the fight to keep america's elections free of foreign hackers, we will speak to in a mama them fishel -- speak to a former obama official who says the government has been dropping the ball for years. ♪ david: news yesterday that two former trump aids were convicted of felonies rattled the market but only for a short time.
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the ramifications from the politics may last longer. to walk us through what it means is alex conant. he comes to us today from washington. good to have you. i want to start with a quote from a man named brian walsh. "serves as another tremendous distraction for republicans running for reelection and already facing tough headwinds. every day they are be asked -- being asked about legal questions they are not delivering the message they want to run the campaign trail." alex: there is no way to spin yesterday's events as good news for the president or republican candidates. brian is right. this is not what republican candidates want to talk about 76 days before the election.
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we want to be talking about the economy, the deregulatory agenda, and how electing democrats would undermine all that. instead, here we are talking about corruption within the party, the president's own actions vis-a-vis things in 2016 that may or may not have been illegal, it is off message and a big distraction. the good news if there is any, is that it is happening now and not 70 days from now when voters head to the polls. 70 days is a long time in politics. david: if you are a republican candidate for the house and a contested district, do you want the president to stay home for the election cycle? alex: republicans running in the house, most of this -- most of them do not want this to be a referendum on the president but on the economy. are you happy with the direction
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of the country right now? do you feel more secure economically now than you did two years ago? if that is what this election is about, most of the republicans will win. if the election is a referendum on the president, given his job approval numbers, it is a much tougher prospect. to the extent we can have the president take a step back, run a rose garden strategy, maybe not tweet as much, republican candidates would welcome that. shery: it is not just about the president. the broader gop seems to be facing problems. representative duncan hunter indicted over illegal use of campaign funds. chris collins of new york indicted for insider trading. is what the former housing and urban development secretary had to say after the chris collins drama. >> this is just one more example of the culture of corruption that has enveloped washington,
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d.c., during the trump administration and with total republican control. shery: you have hunter, you have chris collins, and around the president, manafort, michael cohen. it is not just about the president but about the broader gop party, they have an image that is a party of corruption and a party of the swamp. alex: i think both parties suffer to that -- from that to one degree or another. when folks look at washington, d.c., they think all politicians are corrupt. i think that is part of why washington is so unpopular. it is part of why presidents almost always suffer losses in the first midterms, because they are the party in power and voters in general do not like washington and want to send a message. clearly, the recent indictments
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and the one yesterday of duncan hunter is not helpful to republicans. it is another distraction and put seats that should not be a risk in jeopardy. chris collins is no longer running for reelection, yet his name last week was still on the ballot. that is a problem for republicans where if we are to hold on to the house, it will be a narrow victory and we cannot give up seats because of stupidity. shery: let's talk about the pragmatic aspect of this, because we are talking about california district 50. you mentioned chris collins, district 27 of new york. will the gop have to spend extra energy and resources on these districts they thought were safe? alex: yes. not a lot of districts around the country right now that you can look at in say, we don't have a problem here whatsoever. the republican running for reelection can take the fall off. democrats are motivated
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everywhere and republicans are motivated, but not to the extent that democrats are. we have an enthusiasm gap and that is why days like yesterday where we hear about all of the promise of the republican party, that does not help with republican enthusiasm. i think every republican running for reelection should view this as the toughest environment they have ever faced voters at, and plan accordingly. ,f you have additional problems self-inflicted problems like we have seen in a couple of races, that clearly has a broader problem for the party because resources will be stretched thin given how big the battlefield is. david: you are a republican strategist and you have fought a lot of strategies. guide the president for the moment. how does he get on to the front base, butmbrace the people on capitol hill so they will work with him? alex: there is a lot packed into
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that question. the biggest problem for the president is he has never been able to control the narrative vis-a-vis the russia investigation. he has never been in control of the facts. i cannot think of an entire revelation that came from the white house, from the president. it continues to be a drip, drip, largely driven by the mueller and/or journalists investigating. i thought a long time ago the president should of had a full-blown news conference, laid out all the facts, said, this is what happened, and let the chips fall. he is continuing to let the media and mueller determine where the story goes. as a communicator, that is a bad look when you are facing a crisis. attorneyw even cohen's saying there might be something of interest to mueller. let's get a check of the markets
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which are looking a little bit mixed. abigail: mixed indeed. the dow, s&p 500, and nasdaq were switching between small gains and losses. the s&p 500 up about 1/10 of 1%, on pace for its fifth up day in a row, the longest streak since february. the nasdaq outperforming on some biotech contributions despite the political uncertainty. yesterday we had that all-time high. back in january, we had the previous all-time record high. at that time, we had the conditions for stocks very overbought. on the volatility of the year back down into oversold territory, climbing back higher, but the rsi is around 65. this may suggest more gains are ahead even though we have the s&p 500 below the record high.
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, let'snners on the day take a look at la-z-boy and furniture companies. la-z-boy up 11% on a strong quarter, beating sales estimates and the earnings a massive beat. .illiams sonoma as well if we turn to the home-building sector, not getting a bit of a lift from those furniture sales. and -- toll brothers trading lower. yesterday, toll brothers on a strong quarter had its best day since 2009. let's take a look at coffee, something i love. coffee over the last year, check this out, a big decline, down 29%. this has to do with the weakness for the bruises -- of the brazilian real, which is hitting . david: you get up at 3:00 in the
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morning, you like coffee. there is no alternative. later this hour, tim phillips joins us to talk about whether his group which sometimes has been at odds with president trump, has been a target of russian hacking. this is bloomberg. ♪
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♪ shery: this is "bloomberg markets: balance of power." david: we turn to mark crumpton for first word news. mark: michael cohen's attorney says the trump organization initiated the idea of paying off stormy daniels and karen mcdougal to keep them quiet about their claims of having a relationship with president trump. >> strong evidence, i think it is conclusive, but let's agree
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it is strong, the donald trump was that michael cohen going to be advancing money on his behalf to hush up the relationships with these women, and had a political purpose. davis says cohen has information of interest to robert dollar and says his client is not looking for a presidential pardon. nancy pelosi says increasing -- impeaching the president is "not a priority" for democrats. pelosi tells the associated press that "impeachment has to spring from something else." are now in nonstop mode, negotiations continue in brussels between the u.k. and european union in its attempt to avoid a no deal brexit. michel barnier said the two
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sides can find common ground, but the u.k. will need to respect the single market. they are trying to reach a deal on the terms of the uk's withdrawal by october. in hawaii, people are preparing to ride out a category five hurricane with 100 asked him out for our wind. the island predict will be hit by a glancing blow. hurricane lane could begin sweeping the big island by tomorrow. global news 24 hours a day on air and @tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. crumpton. this is bloomberg. david: the felony convictions of metaphor and cohen yesterday affects more than politics. it may shape the rest of the trump presidency. to talk about what may come next are marty schenker and greg farrell.
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we will start with the law. davis, heard from lanny the lawyer, saying that president trump knew these payments were being made to keep the story quiet. is that a crime? and rudyt completely, giuliani has addressed this. if it is conceivable, trump was embarrassed about offending his wife and he is not necessarily exposed on that front. david: it may or may not be a crime. is it even a surprise? the american people know this already. marty: it gets to the political question of why hasn't the gop base turned on the president? frankly, it is not a surprise. we knew that donald trump was aware of the payments. we knew that before. it is not a surprise that donald trump had done things that are unconventional to protect
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himself and his reputation. that part of it is not a surprise. shery: could it make him more popular among his base? they are trying to convince themselves that all of this is ok as long as he keeps his campaign promises. marty: i think among his base there is that whole notion. you saw in the rally, there was not a hint of dissension among his base. they were as a busy asked because ever and donald trump tried to -- enthusiastic as ever and donald trump tried to dismiss it as just another witchhunt. it will be interesting to see what happens in the midterms and the implications of a democratic congress. shery: on building the campaign finance case against the president, does it help for prosecutors that these payments were made two weeks before the election, as opposed to john ,dwards, the former candidate
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who might be trying to conceal the affair from his wife? greg: that is a fair point. the timing of this, just before the election, raises doubt over whether it was just to protect his family. david: this is not a good day for president trump. mueller?t bob he is coming up so far pretty successful in his prosecutions. for bobt was a good day mueller, but everything we know about bob mueller is he does not think of winning days and winning the news cycle. he is a serious prosecutor. if it had gone the other way, it would have been from a public relations standpoint, a big setback. david: does it make it difficult for president trump to say, there is nothing, move along? greg: the first response from the president had to do with there is still no russia collusion here it that is the last stronghold they are holding
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out for, because mueller has compost a lot. a journey -- accomplished a lot. a jury conviction. shery: we are hearing from mr. cohen's lawyer they might have something of interest to mueller. marty: we are interested in what that is. lenny davis was at one point the clinton attorney, so you might think about this in a political context as well. thatb mueller does think mr. cohen has something of interest, i am sure he will be reaching out to find out what that might be. day,: at the end of the doesn't this all fall on congress? does congress have the leadership to move this issue forward if there was collusion? marty: my opinion, if it is just the campaign law violations and the republicans lose the house, even if they were to bring impeachment charges against
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donald trump, i do not think the senate would convict. now, my own personal view is there is not enough to remove this president from office. david: there is a lot of talk about pardons hear it i am not sure it is based on anything, but when the president was tweeting out his sympathy for paul manafort, saying he should never have hired him. there any limitation on the president being able to pardon these people? know, and trump has executed that power quite freely . he has demonstrated he thinks certain classes of crimes are not criminal and a tantalizing tweet today when he said manafort is a great guy, he held up and did not break. it is a suggestion that he does not want him to "break." shery: that would be political suicide if he pardoned manafort? it mayi am not sure, but
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not be that effective because he would still be able to be charged by new york state, and they have given clear indications they would pursue paul manafort if he were to try to be pardoned. greg: if there were a pardon before the midterms, that could hurt the republican party in general. timing of november 7 might figure in. i do not know what hurts and helps. shery: i am very skeptical myself. david: thanks very much to marty schenker and greg farrell. as legal drama swirls, the u.s. economy is coming along. lowe's is showing strong earnings, but some questions about the guidance going forward . this is bloomberg. ♪
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david: "bloomberg markets: balance of power this is." shery: our stock of the hour is lowe's, shares popping higher. a new all-time high after reporting earnings, abigail doolittle is joining us with the details. abigail: when i came in, shares were sharply lower and now all-time high, one of the biggest moves for the s&p 500. we can see what is happening. in the premarket, this was on the initial release of results which beat, same-store sales in mind, that they took down the guidance 5% but then steadily higher.
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these shares started to pop higher. the new ceo, investors are assessing the idea that taking down guidance gives them a bit of a reset. he is not managing to another , and announced a $500 million buyback, investors liking that. david: a reset is nice, but the question of what you do with the reset, do we have more strategy? he came up with jcpenney and threw in the towel. abigail: on the call he did retail 101, saying they need to fix the execution. they are shutting down under performing lines plus other per -- other segments. they are going to increase the supply of the high velocity items, did not outline what those are, but probably tools and paint colors selling well. in addition, lawn and garden,
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appliances, and cooling did -- cooling- coleman did well. retail 101, better customer engagement, plus what is interesting relative to the stock, shares even though they are at an all-time high come our trading at a discount to the group. relative to home depot, if we bloomberg, home depot historically has outperformed but over the last year, in blue we have home depot, in white is lowe's. outperforming, up 42% relative to home depot up 35%. if they continue to put up low numbers,- good intelligence analysts know of ways to produce in the near term and the stock could trade hider. shery: coming up next, as the
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ande house charged tariffs the gop strays from free trade routes, charles koch is reaching across the aisle. where they are looking to shell out their money and support. we will talk with tim phillips next. we are seeing stocks a little bit mixed. the dow is down 1/10 of 1% and the s&p 500 is flat after touching the all-time high yesterday, led higher by energy and tech but telecom and real estate are lagging. live from new york, this is bloomberg. ♪
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♪ shery: this is "bloomberg markets: balance of power." i'm shery ahn. westin.'m david for bloomberg first word news, we turn to mark crumpton. mark: a strong aftershock jolted venezuela's northeastern coast
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today following the most powerful earthquake to hit the area in more than a century. officials say neither caused major damage or deaths. apparently due to their depth. experts have warned venezuela's government is ill-prepared to deal with a major natural disaster. representative's office is downplaying speculation that a nafta deal with mexico is imminent. officials say there is still major issues to be resolved. mexico's economy minister says he is helping to resolve nafta issues and the next hours or days. russian president vladimir putin is are pitting his claim that economic sanctions imposed against his country by the u.s. are "senseless." speaking after talks today with his finished counterpart, president putin described the last months summit with president trump is positive, but he blamed mr. trump's administration for continuing to hit russia with sanctions. the white house added to a growing list of sanctions against russia on tuesday.
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the national security adviser john bolton says the trump administration has not decided yet when to release its long-awaited peace plan. bolton wrapped up a three-day visit to israel where he met with prime minister benjamin netanyahu. should the palestinians move on from president trump's decision to shift the u.s. embassy from tel aviv to jerusalem. global news, 24 hours a day, on air and at tic toc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg. shery: thank you. the guilty pleas and verdicts are coming down ahead of labor day, the traditional kickoff or midterm elections. organizations are stepping up in states across the country, spending on ad campaigns and shelling out local endorsements including americans for prosperity. which is been called the third largest political party in the united states. this year, some candidates across the aisle have been finding rare displaces for support.
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we welcome tim phillips, forident of america prosperity. today in new york. it is great to have you in the studio. tim: good to be in the studio with both of you. shery: you are here for fundraising events. all of these developments over manafort, mr. cohen, if anything, they will probably hurt gop enthusiasm. will this make it more challenging to raise capital? tim: we are not a political party opinion for anyone, to be clear about that. i think it does increase the headwinds for republicans. i know americans for prosperity, we focus on policies that can bring long-term prosperity to this country. that is -- shery: charles koch made it clear that he would support anybody, regardless of party affiliation. state of things, whether it is with all of these developments, but also trade tensions, and issues that you do not support, how open are you doing to her sides of the aisle? tim: we want to find candidates who will take the tough votes to
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move this country forward and will lead. this congress, to be fair, has done some good things. reformscuts and tax that republicans did, without a single democrat vote, which was disappointing to see, it is a big reason this economy is moving again. the administration is knocking down barriers to opportunity with a deregulation. the dodd-frank reforms had bipartisan support. they have done some good things and this congress. what we are saying to them, to both parties, is we are raising the bar. if we are ever going to put this country on the trajectory to long-term economic and broader prosperity, we have got to do that. we have done that. we are looking for candidates out there. we have a few for example, marsha blackburn in tennessee, we think she is a champion on these issues. we're talking about. there are significant challenges. through theus policies are you say you are a policy organization. that is kind of dumb, isn't it? are people going -- what does
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that leave you -- leave you, trade and immigration? tim: the omnibus bill that they did in the spring, it is terrible. it is exactly what folks were hoping to see change about washington, d c both parties have failed on that. david: is anybody taking that seriously? about deficitk hawks. i don't think you can find one in washington. tim: people who say bipartisanship in d.c. is dead, whenever you put a bloated budget bill that funds pork and corporate cronyism, you can find a bunch of folks from both parties. they have one more chance. i think that is the biggest test for this congress is that next spending bill coming up at the end of september. the immigration is important. we need a genuine comprehensive immigration strategy. what we have pushed is simplified it and go for two fundamental keys. number one, border security. that is a reasonable and good request.
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provide the funding for that. number two, let's give legal certainty to gamers. , they deserve and they need a certainty of other legal status. we think it should lead to citizenship. let's give certainty to them. then you can work through the other details of immigration. david: on the question of the deficit, have you found serious candidates who have a chance of leading us toward deficit reform? tim: i mentioned marcia blackthorn. she actually still voted no on the omnibus bill, she is opposed the foreign bill, she opposed to the export import bank which was a big crony of stick -- cronyistic bill. we need more folks. i look at governor scott and florida. he is running for the senate. you look at the budget reforms and the tax cuts in florida, they have done very good things. he is worth keeping an eye on. he is running for the senate this year. shery: to talk about the spending bill, immigration. how concerned are you that president trump is trying to
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change the narrative away from his legal problems? and in fact go ahead and do what he threatened to do, shut down the government? tim: we are looking at the on the bill -- omnibus bill coming up. the president deserves credit for the effort he made. after the omnibus in the spring, he said i am not signing another one of those. good for him. he pushed the senate and the house to do a rescission to clawback the spending from the omnibus bill. he deserves a lot of credit for that. but the president has a big opportunity this fall with that next omnibus bill. and with the spending bills that congress will send you already, we have seen big spending republicans in the senate and house saying, and this is a shocker, but the levels back in the spring, even though it was 600 billion in brand-new wasteful spending, not enough. we need more money. we need to blow through those caps from the spring. i know it is a stunner. but they are already saying that. we will stand with the president
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if you will say, no way on that spending bill. one other issue that is worth looking at is criminal justice reform. issue. a bipartisan it just received 360 votes in the house. democrats and republicans. the senate has a big opportunity on that front. shery: republicans have control of the presidency and congress, yet there are so many distractions. you could to say that even want more democrats come in order to achieve some level of bipartisanship, so you can move forward with other issues such as the ones he mentioned? so far, people keep getting distracted. an: we look at things on individual race by race or canada by canada, or political leader by political leader basis to see where they stand on the issues. if they are willing to take the tough votes, if they are willing to genuinely lead and unify this country. we have a divisive, tough political environment. everybody deserves blame. we said we even have blame for that. i think the criminal justice
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reform issue is one of those issues, it brings people together to get folks a second chance. david: let's talk about the political environment. in order to get things done, we have to have a functioning democracy. we have russian hackers who even over the weekend and yesterday there were reports that they are trying to mimic other people's rights. do you have evidence that someone is trying to mimic your site? tim: we don't. in the past we have had folks who have tried to hack. in a representative democracy, you need a secure ballot box, number one. number two, media sources that are trustworthy. if there is foreign efforts, which it does appear to be on facebook and other platforms, it is good to expose those americans know, without harming general first amendment rights of individual americans. david: are you confident the president of the united states agrees with that? i haven't heard president trump speak out on the russian issue.
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is he taking a forceful enough position? tim: i will let the president speak for himself. certainly, we urge political sure that we are protecting against foreign interference in our elections, whether it is trying to break into the ballot box, with voting online you have to worry about that. the fake with some of media tried to break in and have accounts that are not real. shery: they are now attacking conservative groups like yourself. are you concerned you will get targeted, what are you doing to defend your system? tim: we have strong security measures in place to you always -- one thing we have learned is you can't be complacent and this era. the hackers are always moving. we do have a strong security system that seeks to protect private communications and the public pronouncement. david: tim phillips, president of america for prosperity. good to be here. coming up, president trump says the manafort and cohen
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convictions were not about the russians to we will talk with a former white house official who saw the russian hacking coming and we could have stopped it. live from new york, this is bloomberg. ♪
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♪ shery: this is "bloomberg markets: balance of power." i'm shery ahn. david: i'm david westin. some people saw the russian interference in the 2016 election coming. obamabruen served in the white house and is the director of global engagement. he warned of the russians were trying to expand their cyber cap -- cyber campaign. cannot find the money to fight the hackers. brett bruen is now the founder and president of global situation room and international public affairs consulting firm. he comes to us from washington to welcome to bloomberg.
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good to have you here. tell us in a nutshell, what do you see coming and what did you try to get done? brett: in 2014, we saw the russians throw everything in the kitchen sink at the ukrainian elections. we stood up a time -- we set up a task force that was effective at pushing them out of those elections. we only are arguing have a few more months until elections commit in 2014, we were able to do this in another country, i think we can do it here as well. david: how much would it cost for the united states to do that? as you say, we have elections coming up in a couple months. brett: we do not have any money. we simply used duct tape and a little bit of elmer's glue to try to put together a team and some resources. it does not take a lot to what we have discovered in the past is when you take an assertive approach, the russians will back off. shery: why hasn't this been done in the past then? brett: i think there's a lack of
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era craddock well. if you go back to 2014, we were facing the rise of isis. we had a number of other challenges around the world. soft power was not considered a hard problem. shery: now we are seeing iran, today, the latest news of trying to meddle in the elections. that is coming on top of russia. how cheap and effective is meddling through social media that all of these countries are trying to do it? brett: i think the case of iran is very concerning. one, because it is something that i have been wearing about for a wild. other countries, other groups, are going to work -- look at what russia did and say, indeed, this is a cheap and effective way to impact and influence other countries, including the united states. shery: the facebook ceo zuckerberg was saying the security is not something you ever fully solved. what is the next best thing? brett: i think what you first want to do is create a better
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tracking system. right now, we do not have a system that tracks the information warfare. every company, every country, every government agency in the u.s. is doing their own work. we need to unify those efforts under one command structure. so that we are tracking these issues. second thing is we need to build better defenses. we need to have the ability for a congressional campaign to call one point of contact and get the resources and support they need. the last part is we need to did -- we may deterrence. information warfare is like nuclear warfare. , telled to tell moscow them that there will be consequences if you meddle in his elections. david: there are at least two different sorts of threats. sometimes we mix them together. one, direct interference with the electoral process. hacking into computers. another is the media. the facebook situation, twitter
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situation. in your judgment, which is the more threatening? brett: i think the latter is a lot more threatening. that wavet yet seen of attacks in this election cycle. what you are seeing come out for facebook and microsoft are really just the early attempts to extract information that will be useful later on. in the saw in france run-up to their presidential elections was that information the last weeks, last days, of a. it can be quite destructive. david: does there need to be a government solution or can we rely on the microsoft and facebook's? in the last 72 hours, they have said that they cut these guys. continue to be concerned that this is an effort at an individual company level. microsoft is a large company. what happens when it impacts a small company that does not have the kind of resources, capabilities? is not necessarily
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sharing of the lessons learned from this experience with others. we need to have a way of collaborating, and coordinating those efforts across companies. shery: what is the biggest vulnerability in the coming midterms? brett: i think, in fact, we are really vulnerable to fake information. while they may hack into emails and spell them out into the public, they will insert as they did against president macron's campaign. emailed that nobody read, images that are fabricated, and that is a very difficult issue to work up against. shery: what about suppressing voter turnout? these polling places, making it difficult for people to actually get to the polling booths? brett: absolutely. there will be efforts to sew doubt, confusion, discord. i think again, and the latter part of the campaign is when we are likely to see a lot of that
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take old because that is the time in which it will be most impactful and when the response is going to be the most difficult to mount. come back to to shery's question. why haven't we done this? there must be something in the political process that draws from us the political will to do it. is it because the incumbents are worrying about messing with the process because it has worked for them in the past? is a newrt of it is it phenomenon. information warfare is not something that we saw as a threat until a few years ago. there is no government agency, no bureaucrat, that is responsible for this. there are small efforts that have been mounted that really are no more than pilot projects and there has not been the political will. there wasn't in the last administration, and certainly not in this administration to do something about it. if i could, i also want to mention, this will not stop in politics. what russia is doing is also going to spread into wall
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street, silicon valley, other sources of western power. if i am sitting in a cease we do right now, i ought to be as concerned about this as i am sitting in a congressional campaign. shery: right. brett, thank you so much for that. brett bruen, former white house director of global engagement under president obama, and current president of the global situation room. coming up, tesla against the sec. will it undermine its ability for future investigations? live from new york, this is new york. ♪
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shery: we have breaking news. khalafrabia is set to the aramco ipo.
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saudi arabia called off domestic and international listings according to reuters. the giant energy company that produces 10% of the world's oil in fan nine says. -- in finances to this is huge because they were supposed to be rigid -- raising more than $100 million for a southern wealth fund. david: this is a central part of the crown prince's plan to redo the academy. true, it would set them back. at the same time, not a complete surprise. it got delayed and delayed. they do not pick the bankers yet. asking when this would happen. shery: this was expected to produce hundreds of millions of dollars in fees to the wall street banks are we have not confirmed the report yet budget writers saying saudi arabia is set to call off the aramco ipo. be a huge deal, especially for mohammad bin salman, the crown prince who is spearheading this. the company would be worth at
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least $2 trillion. david: it could leave a hole in their budget in the kingdom. we are going to turn back to tesla and elon musk. tweettimate -- infamous may have put the sec on the spot. the agency had been quietly taking a look at the company but the muska tweet raised a host of questions and put the spotlight on the sec and the way -- in a way it is not used to. matt robinson is here to take us and through why this could be a problem. explain why this is not the way the sec would like to broach these things. matt: normally as investigations go on, most of the public does not know. they take a long time. they were looking even prior to this tweet. now that this is out there, this has gotten so much media scrutiny on what the statement meant, is this market manipulation? that elonhe issues musk, tesla could face? david: one of the reasons the sec likes to keep quite is if
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they decide not to do anything. this time they will not be able to do that. matt: absolutely. there are investigations are evidence, gather up and they may decide, defense attorneys come in and say this wasn't a violation. no one knows about it. shery: the sec was already investigating tesla over their production of model three's. matt: right. they were already taking a look. the average investigation takes about two years. thehis case, given scrutiny, given this tweet, given how everyone is focused on it, they may break it off and try to look at this distinct issue to see if this tweet was -- did violate security laws. shery: either way, the sec, doesn't matter what they do. they always face criticism. matt: right. marketlly in manipulation, because i think now the information has come out but it does not seem that yuan to makeasonable basis
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the statement. but was the intention of the tweet? that is a pretty high bar. to your point about criticism, they are constantly -- the security laws are not necessarily what people think should be right or wrong. david: pretty high bar. it is a limited investigation. it is a question of what elon musk thought and there are not many people who know what he thought at the time. maybe it will not take two years. matt: exactly. since this is a distinct period, they will get subpoena for emails, chats, conversations to her there should be a limited number of people to figure it out. david: many thanks to matt robinson. great piece about the sec and elon musk. shery: breaking news, reuters reporting saudi arabia has said to call off the aramco ipo. saudi arabia had called off both the domestic and international oilk listing of the state
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giant, aramco. that is according to four industry sources. we have yet to confirm this information. but, this would have been a huge ipo, the largest in the world. this would behat worth at least $2 trillion. david: the crown prince has ambitious plans for the kingdom, including building the new city. and going into entertainment and all sorts of modernizing of the kingdom. the question is if he does not have aramco, how will he raise the money? important also money for wall street banks who were trying to get a piece of the deal. now we are hearing the financial advisors working on the proposal listing have been disbanded. live from new york, this is bloomberg. ♪
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♪ scarlet: i'm scarlet fu. this is "bloomberg etf iq." we focus on the access, risks him and rewards offered by traded funds. ♪ scarlet: after five months of losses, goldman is getting a bit with a metal above $1200. john hancock teams up with a pioneer in investing to enter the etf world. we speak with steven deroian of smart hancock

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