The week in washington, it would be unusual. I can think of another word, too. Donald trumps to strike a deal with the democrats. He tweeted this morning even worse the bill cleared Bipartisan Legislation to suspend the debt. Bloombergs chief washington correspondent joining us from capitol hill. Great to have you here. Today 90 republicans voting against the measure to increase the debt ceiling, including relief for Hurricane Harvey. Are you surprised by that number . Megan i am definitely not surprised, but we have to remember the politicking going on. They knew their boats would not matter because it would pass no matter what. Votes would not matter because it would pass to matter what. We have seen a little bit of blowback to the bill. We saw the Steve Mnuchin blowback. Fascinating. Hat so you hear this in washington all the time, but donald trump withing this deal democrats has ignited a lot of talk about him being a democratic president. That is not what happened. Donald trump has figured out that if he can cut deals with both sides of the il, that is a very Different Administration he hasorward. Once realized that he can give some people what they want, that is much more familiar ground. Julia kevin, come in here. There is the suggestion that look, youve got the house, the senate, the white house, and yet , where is the plant here in terms of policy . Why all the secrecy . Kevin i can tell you that for weeks i have been talking to republicans in congress and there he much very much behind the scenes they have said that the white house has this engaged. Disengaged. Been they have been missing in policy , whether it is Health Care Reform or tax reform. What they did this week was essentially say game on. I caught up with a top democrat on the House Budget Committee to see if he thinks this bipartisanship can last. Take a listen to what he told me. It would be nice, but i dont think so. Where thetwo areas democrats have leverage and can force a bipartisan approach, the debt ceiling and keeping the government open and funded. To be toonot going many opportunities to force republican hands. We now have an opportunity to get into december. Then so really, what president did was ignite a fire in the conservative freedom already blaming Republican Leadership and saying that they have not done enough with some of the policy wins they campaigned on. Trying to oust paul ryan as well, so the intrigue continues. Does it feel like something shifted this week . A recognition, a realization from donald trump as you are alluding to earlier that he could play both sides and doesnt need to maintain some greater degree of allegiance to the gop if they are not doing what he wants . If they are not passing policy, he will bypass them. Megan heres the thing. We are facing to Epic National disasters with harvey and irma. Nothing focuses the mind like that. He is grappling with, as mark wasntis morning, why repeal and replace on his desk january 20 . They have the house, the senate, the white house, and americans want to see action. They are sick of politics. I think he knows that. The political machinations that go on between Chuck Schumer and paul ryan and Mitch Mcconnell and nancy pelosi, people are fed up with that. Thats why they elected donald trump. He is going to try to capitalize on that wave of antiestablishment. He is going to push to get things done, and if you figures out a way to operate in washington, his administration if he figures out a way to operate in washington, his administration will strengthen. Going,and so the gop is we cannot be, so we have to join you . Republicans are not going to like if he keeps negotiating with Chuck Schumer. When i interviewed the House Freedom caucus chairman yesterday, he predicted there would be a rebellion should the republicans not get their act together in december. We are going to be talking a lot in theth megan murphy munster, about paul ryans political future if there is not a major win in the months to come about paul ryans political future if there is not a major win for republicans in december. Trump with donald starting to blame him to get the Replacement Health care bill, reform, this will affect the agenda. Have we learned the lessons to get tax reform through . Kevin goa no, i dont think they have. Kevin no, i dont think they have. Secretary mnuchin has said they have tried to correct course on health have care reform to leare right lessons, but point blank, when the speaker is pushing for revenue net neutrality, which is a nonstarter for many of these groups, that is more of a battle line than the border tax that the speaker lost out on. This is just all beginning to get good. Megan you know, irma is coming and we will see how they respond. That is what the American People will be watching. That is what we are watching. That is what the administration will have to focus on going forward. Thank you for joining us. For more insights on business and politics, you can check out the latest edition of bloomberg businessweek, on newsstands today. Here witholittle is the latest on the markets. Abigail small moves right now. The dow trading slightly higher. S p 500 and nasdaq trading lower. You can see the nasdaq is down the most, down by about. 3 , dragged down by the chip factor, the micro conductor. Not a lot of action here. On the week, declines for the major averages, and david at mainstay capitals says right now if north korea fires another test missile, monday could be very, very volatile. There could be more deterioration ahead for the major averages. In yellow, we have the s p 500. In white, technology numbers. Sign for bullish technology, above 82 , but look at that in blue. That is the number of financial members above the 200 Day Moving Average in the s p 500, absolutely declining. That is a real concern for s. Vestors and strategist those stocks are really starting to turn over. Banking the regional index is pretty bearish. We could see declines in the broader markets. Finally, wrapping up, we are having a bright spot for some of the reinsurance and insurance companies. Stocks have taken a huge hit this week ahead of Hurricane Irma and fears that these companies could have big capital losses. Today, we are looking at huge gains. Its the worst week since 2009. Now really pairing that lawson half. It will be interesting to see what happens with the hurricane loss in half. It will be interesting to see what happens with the hurricane. Hopefully, not to devastating. Julia absolutely. Coming up, the white house is considering half a dozen candidates to be head of the Federal Reserve. We will tell you what it means for policy. Thats coming up. From new york, this is bloomberg. Julia this is Bloomberg Markets balance of power. I am julia chatterley. Lets get a check on first word news. Mark Hurricane Irma remains a powerful hurricane. Speaking with secretary tom price, the fema administrator said floridians have never seen anything like irma. Obviously, Hurricane Irma continues to be a threat that is owing to devastate the united , florida, or some of the southeastern states. Complex forecast. Mark the storm is barreling toward florida, triggering a record evacuations from the miami area. People are dead and a city reduced to rubble following the strongest earthquake to hit mexico in a century. On magnitude 8. 2 quake hit the mexican coast last night. President Enrique Pena Nieto said major damage had been caused and that a Million People initially were without power, but that electricity had been restored to most of them. There were 82 aftershocks. Top republican senators say they have a new plan to repeal obamacare. President trump seems to have moved on. He tweeted senator Lindsey Graham is pushing for a vote this month. British Prime Minister theresa may says she trusts President Trump to keep the world safe. In an interview, she said the president would do what is right for security and safety around the world. She also said he has good advisers. Global news 24 hours a day powered by more than 2700 journalists and analysts, in over 120 countries. The white house is considering more than half a dozen candidates to fill the role of said chair. We spoke about the tricky time the fed faces and how the void by Stanley Fischer could increase uncertainty. Fed officials are trying to understand, like everybody else, inflation dynamics, productivity, wage determination at a time when they are trying normalize monetary policy. This is a tricky time for the fed and there are less people on the bench then you would like. Julia joining us is seth carpenter, chief u. S. Economist at ebs. He worked at treasury and Federal Reserve. Great to have you. Arely this should not be such big surprise. One would think that it is one of the most, if not the most a whitet appointment of house, you would want a long list. Obviously, this administration is a bit unorthodox. Hard to know exactly what they will do. Have two things going on. A lack of clarity about , and the potential rate hike in december with the retraction of the Balance Sheet at well. The federal government, as you mentioned, is unorthodox at time. To what extent is that playing into the bond market . Longerterm yields are quite low. Reflectsof ways, that uncertainty globally. I also think its the current inflationary environment and a of lowertrend inflation in the u. S. For the fed, people are kind of figure out what does it mean, but theres something a little unusual, where we have something of it is very gradual, very slow. One might think, given the alternative, they would be hawkish and aggressive, but it is not clear that would push up yields. If anything, it might keep inflation from getting back to that 2 target. Julia we look at the relation between employment and inflation, and the fed is not giving us much clarity. I want to talk about the hurricane and what we are seeing with insurers. One estimate is that it could be as high as 300 billion. Even if we are talking to hundred billion dollars combined, insurers have to get that cash out. Bonds selling or part of that money is bond selling. Is that going to put upward pressure on bond yields . This is a very complicated issue. Part of it is going to be a question of when the cache is paid and who is doing the paying. Fromatest number washington was Something Like 15 billion. When the treasury needs to pay more money, any time there is a shortterm need for cash, they tend to finance that with treasury builds. It is only over time that you worry. Julia so we dont need to worry about that in the shortterm. I want to talk to about cap at this week because this was interesting. The scent canada this week because this was interesting. The central bank is decoupling and raising rates. What do you make of this decision . They have price pressure, particularly in the housing market, but the fact that they are willing to take a step away and say whatever the United States is doing, we have to do our own thing here. They are being far more cautious. Canada is in a different situation. Very often they tend to follow the u. S. And monetary policy. We have to understand that a smaller economy is a much more open economy. Forces hit the economy harder. I think they felt a need to look at asset prices. So it perhaps allows them to worry more about asset prices rather than the relationship. Ifin contrast with the fed, you take bill deadly, the president of the Federal Reserve bank of new york, he made a speech last night and took head with assetgoing on prices. Instead of thinking it is a bubble, he said easier financial conditions are probably a boon to the u. S. Economy. Very different mindset. Ofia quickly, the events the last week, whether it is the debt ceiling, the deal struck this week that surprised many people, how has this week changed your analysis and approach in terms of political impact on the economy . It is definitely a monkey wrench. It is going to take a little time to figure how it all plays through. Typically, the debt ceiling is a little bit of political leverage. Now, with this deal that was struck that i think surprised everyone involved, the deadline, the dropdead date for the debt limit, is pushed until next year, so all of the budget negotiations are going to have to take place on their own terms. It makes it more contentious and probably takes a little leverage away from the republican side. Julia its going to be interesting. Great to get your insights. Left a path ofas devastation across the caribbean already with at least 21 people dead and thousands homeless. Now millions are evacuating florida as it braces for what could be an historic storm. We will take you live to miami. From new york, this is bloomberg. Julia this is Bloomberg Markets balance of power, im julia chatterley. Hurricane irma, now a category four storm, has triggered the largest ever in evacuation of Miamidade County and could become the most expensive storm in u. S. History. Nathan cook joins us live from miami. Great to have you. Thank you for joining us. Give us a sense of how miami at this moment feels. How concerned are those who remain . People are very concerned. The city feels empty. Peoplere not a lot of left. The streets are empty. There is no traffic. People have definitely heeded the evacuation orders. The people that are remaining, why are they remaining . What is there reason for staying behind . Hear a lot of different reasons. People are watching the traffic. It latest traffic is showing might shift west. Other people might not have a place to go. They want to protect their property. There are a lot of reasons why people are staying. A lot of people are also first responders, they want to be here to jump into action. Julia colin that makes perfect sense. Give me the stark difference between what weve seen here and in houston. Weve seen images of extremes on interstate 95 as people are leaving. Or it been a smooth process, have there been some difficulties. Nathan people had a lot of time. They started clearing out on tuesday, wednesday, thursday. Authorities have said if you are going to evacuate now, its probably the last chance to do once things start to get messy, the people that have , it was time. Its been smooth. Great to talk to you. Stay safe. Coming up, we will focus on the Economic Impact of this years hurricane season. Beginning ase Hurricane Irma threatens florida . This is bloomberg. This is Bloomberg Markets balance of power, im julia chatterley. David gura is off today. Lets check in on first word news with mark crumpton. Mark Hurricane Irma lost a little steam last night but could still be one for the record books as it takes aim at florida. It is forecast to slam into the southern part of the state on sunday. The storm has been downgraded to a category four with wins now at 150 miles per hour. Forecasters say it could potentially bring catastrophic storm surge. Been 650,000 people have ordered to leave miami and Miamidade County, the biggest evacuation there ever. Irma has destroyed about 95 of the homes on the small island of barbuda. It is threatening to be the most expensive storm in history. The Trump Administration is threatening to withdraw from nafta if a new deal favorable to the United States cannot be reached with mexico and canada. Commerce secretary wilbur ross todaythe Washington Post that the president has made it clear if a deal cannot be worked out, the u. S. Is going to pull out. 23yearold accord governs more than 1. 2 trillion in annual trade. Israel, the wife of Benjamin Netanyahu has been told she faces indictment on suspicion of misusing public funds. Allegedly paid for meals at the private residence. Benjamin netanyahu the accusations are absurd. Prosecutors want Martin Shkreli locked up immediately. A 500,000 dollars bounty for someone to grab hair from secretary of state hillary clinton. Global news 24 hours a day powered by more than 2700 journalists and analysts in over 120 countries. I mark come to him. This is bloomberg. Julia thank you, mark. A new report from wells fargo finds the total losses from hurricane hard he in texas are likely to be in the range of 90 Hurricane Harvey in texas are likely to be in the range of 90 billion. Joining us from charlotte, North Carolina is an economist at wells fargo. Thank you for joining us. Obviously, it is going to take them many weeks to quantify the losses associated with irma. But we can start putting the losses for Hurricane Harvey. 90 billion is your ballpark. From a big picture perspective, we see the house a fema funding bill of 15 billion. Its simply not enough given the extent of uninsured losses here. You are absolutely right. Funds this is additional to the fema amount of that is already there. Hurricaneactive season, they are likely to need inrevisit fema funding december. But lets take a step back and put it in context with the macro economy. Houston, we are looking at roughly 3 of gdp metro gdp. Irma is roughly about 1. 6 of u. S. Gdp. While not the entire economies of these cities will be going to zero in terms of growth, certainly, the slowdown on a regional level could be substantial. And we are forecasting 5 of national gdp if you bring the two areas together. How are you filtering the business disruption . Know you are forecasting 90 billion broadly. What were seeing is, the servicesome of sector jobs in houston are gradually coming back in line online, but in terms of power, infrastructure, and other sorts of capital, it is going to take some time and infrastructure rebuilding before they can rebound. That is a concern with irma barreling down on florida. A shocking data point to me regarding Hurricane Harvey was the lack of insurance by homeowners, around 60 only. , inle rehousing themselves many cases, the cost is going to be huge. You are absolutely right. That is the largest concern. Areviduals and households going to have to bear the burden of a lot of repair and recovery cost. National insurance and private insurance, but it is still going to be extremely expensive. , and to tie this together lets take a step back and go forward to the government in december potentially having to raise more funding. How does that affect to the latest negotiations as far as the debt ceiling . That going to set up a as wer kind of situation have here . Its a sensitive subject to vote against . We think there will be a distance byf september. Remember, the treasury has the option of using extraordinary measures to stay under the Borrowing Limit for a time. We are probably looking closer to the end of the Fourth Quarter before First Quarter before the debt ceiling deadline is hard. The funding bill would certainly need to be in place on or before december 8 or it would result in a partial federal Government Shutdown at that time. We also have daca and potential funding for a war because you have to assume trump has not forgotten that at this point. Is there a read is that a reason you are suggesting it will be harder . The sheert just volume, but how politically contentious a lot of these issues are. When it comes to Immigration Reform or the border wall, the politics are messy, to say the least. We are expect thing that going right to the deadline here. We have been talking about hissing and groaning as Steve Mnuchin was trying to sell this deal. When you hear stories like that, how do you incorporate that kind forecast . In two year for this year or the first . Uarter of next year it is a little more art than science, but at the end of the day, it is about understanding the dynamics on capitol hill. The far right freedom caucus, fiscal conservatives in the house of representatives, and now, even some of the moderate republicans are disappointed in house and Senate Leadership in the wake of this deal that trump struck with the democrats. It is difficult to quantify, but certainly, we look at it district by district and representative by representative to see who is unhappy and who may potentially support the president regardless of their position. Very quickly, what is the likelihood that the trump the ald trump marches in their that donald trump are just in there and says if you are not with me i will work with the democrats again . Maybe this is the beginning of bipartisanship going forward. I think we would all be happy to see that unfold. Great to chat with you. Thank you so much for giving us your insights today. Appy friday coming up, the Trump Administration is planning more economic pressure on north korea as it moves to seize assets from Chinese Companies that allegedly laundered money in the country. The latest on that next. From new york, this is bloomberg. Julia this is Bloomberg Markets balance of power, i am julia chatterley. Drug company is trading at a record high after the Company Joining us is taylor riggs. Taylor just weekly numbers. I will get to the fullyear revenue, but first, i want to break this down for you. A sickly, this is coming up. 4 over the last basically, this the last up. 4 over week. Shares were up 6 yesterday. Decent followthrough, especially when we look long term. You can see the big spike today. Good for investors. This week versus the week before. Lot, butt seem like a if you take a look at the fullyear revenue estimates, you can see this company is having decent growth. They are looking at growth of 9 for fiscal year 2017. They have had doubledigit growth for the last two years. They are hopefully coming in at 9 this year. I dont think investors are complaining. Seeing those kinds of moves on these numbers, i would suggest this is critically important for these guys. What kind of revenue is it . They get tons of money. 65 of sales alone from hume ra. On a quarterly basis, nothing else comes close. Mira gets 68 , the next highest only contributes 9 , the other 10 contribute less than 4 . Thats revenue overall. Do you have any sense of how that is going to change over time . Taylor it has been stable. If you break it down by segment, you can see a list of 10 or 20 drugs they have. Has era is in humira been in a high percent for the last few quarters. I was surprised. Julia interesting find. Awesome insight. Thank you so much. Story first reported by bloomberg. The u. S. Government is planning to seize assets in Chinese Companies. Is a move by the Trump Administration to ramp up pressure on north korea. E have been covering the story our correspondent joins us now from our washington bureau. The company at the heart of this , some may remember as a company that violated iranian sanctions. Importancelain the of this company and facilitating some of the information being collected here . Quite sure. Sure. Is one of the largest manufacturers of mobile phones. They pled guilty to violating trade sanctions with iran. We went through a time with the u. S. Government where we were going to cut them off from doing business in the United States. In order to resolve that, they allowed the u. S. To have independent auditors come in and go through their financial records in order to get a look at who they are doing business with. Information is now relevant as the u. S. Tries to cut off north korea from surreptitiously the u. S. Financial system to fund their Nuclear Weapons program. Is a case of the Trump Administration using arermation collected they acting. The on this information or is the Chinese Government facilitating in any way are they acting purely on this information or is the Chinese Government facilitating in any way . What investigators found was that a lot of information was matching specific targets they had that they were already looking at. They were able to prioritize and get additional evidence in order to move in court to try to seize millions of dollars they said was being laundered through the u. S. Financial system. Julia are more Chinese Companies set to be sanctioned . That they areg preparing additional cases. I am hearing at least two more companies. It could be more . You could be more. Additional companies are being added to the sanctions list. Reads like a movie script. Prosecutors in june or involved in a case under a chinese name that was a front. Can you explain what was going on or what they believed they had found there . Sure. In of the schemes described Court Documents was essentially a company that has a number of shell companies. Taking coal from north korea, selling back on the market, and then buying products for north korea selling that coal on the market, and then buying products for north korea, technology and other products, and shipping them back to north korea. Essentially, u. S. Banking wants to exchange that money for u. S. Dollars, which is how most business is done in the world. But we would not have access to this information without the dab being forced to provide information about the connections they have. Tothey may have been able make the case. This makes it a lot easier. This connected a lot of the dots and play. This in play. There is a suggestion we could see another rocket launch from north korea over the founding dayeir anniversary. Do you think that plays into the intensity of the efforts to try wantck down, aka, if you more sanctions, you need the evidence to do it . Interesting when you look at the cases made in court. They take a long time to develop the evidence. See things get prioritized, specifically in the National Security division in a case like this where things are ramping up in terms of aggression with another country. And the yuan is considering dropping a resolution drafting the u. N. Is considering dropping a new drafting a new resolution. Have you heard anything about that . I have not heard anything on that front. In terms of pressuring china, sanctions cases can bring china to the table, which is obviously something the president has been trying to do. Julia interesting. Great to get your insight. A super interesting report. Coming up, more insight on north korea. What the Homeland Security secretary said today about the threat. From new york, this is bloomberg. Homeland security adviser tom bossert speaking at the White House Daily press briefing , discussing Hurricane Irma. Lets listen in. We are sending in air operations and surface operations to evacuate people. We are doing that in st. Maarten and saint martins, the dutchfrench island. It has been reported that there are some american citizens there. We are in final preparations to evacuate those citizens. Those american citizens will be removed via surface and air means. Planningad to do some adjustment for surface conditions, wind, and hurricane owes a jose. We look forward to planning adjustment for surface conditions, wind, and hurricane owes a that missing the United States. It is unfortunately causing havoc in the islands. Somell be executing plans point today, and we will see american citizens and others evacuated if necessary, including anyone with acute medical needs. That is where i would start on the update and i will take your questions. One of the big problems with the florida evacuation is that so many gas stations are running out of gasoline. What is the federal government doing in the next one he four hours to get more fuel to people . To getere 24 hours more fuel to people . A number of things. Evan or scott has provided Governor Scott has provided tremendous leadership. What we are fuel shortages, texase fuel shortages in because people appropriately gas up their generators, cars, boats, so forth. We will need to pull in additional fuel. Will run up against the onset of Tropical Storm force winds. What are we doing . Bringing inasmuch refined fuel gettings possible and help in that effort. Its a little technical. Its called the jones act. The Homeland Security can waive that act. Until it is waived, only u. S. 2sels can move fuel from do point domestically. We have waived that prohibition pointm point to domestically. We have waived that prohibition. Thats the best we can do. In addition, planning intermodal points from trex to tanker ship port locations into from to tanker ship port locations. At some point, they will have to stop operations. That is one of our messages. It is not tough love, it is clarity and honesty. At some point, people are going to be on their own. Need to be prepared if they th to be ready for food,rs, to have enough water, shelter, before the government can get back in. We cannot get to that final point until conditions permit. One housekeeping question. , theema to have resources president has to pass legislation. Any idea when that is going to happening . I would like to thank congress for passing emergency funding. Fema has the money they need. There is no break in operations. I want to clarify that. Julia we will bring you more headlines from todays press briefing in the next hour. You can also watch it on tv. From new york, this is bloomberg. So we need tablets installed. With the menu app ready to roll. In 12 weeks. Yeah. The world of fast food is being changed by faster networks. Data, applications, customer experience. Which is why comcast business delivers Consistent Network Performance and speed across all your locations. Fast connections everywhere. Thats how you outmaneuver. It is 2 00 in new york, 11 00 in san francisco, and 7 00 in london. I am julia chatterley. Welcome to Bloomberg Markets. Scarlet we are live and bloomberg World Headquarters in new york. Here are the top stories from the bloomberg and around the world. Hurricane irma verily toward florida after wreaking havoc in the caribbean. A storm has already triggered the largest ever evacuation for parts of florida but we have yet to know where it will move. Meanwhile, in politics, Congress Passing a debt ceiling bill would provide 15 billion for Hurricane Relief but Steven Mnuchin did not get a warm reception from conservative republicans when he pitched the measure. Credit reporting agency that would fax relay after a data breach put half of americans at risk. U. S. Markets close in two hours time. Lets get a check on where stocks are trading right now with