This year have seen unemployment dropped to the lowest levels in the history of their state, and i hate to tell you, but misery happens to be one of them but ms. Lori happens missouri happens to be one of them. [applause] mr. Trump we have created nearly 2 million jobs million jobs. Think of it. We used to lose millions, but now we have created since i won the election. I want to say since you won the election. I did not win the election. You won the election. We will create countless more if we can sustain the 3 growth rate we have achieved the past two quarters, but we will do much better than that. I used to say he could hit 4 , and we could hit 3 , and they were all saying forget it. It was 1. 2 , doing terribly. We were flat, even. In all fairness, the stock market was going this way, and now we are hitting numbers that nobody thought possible, certainly not at this time, and the numbers going up are going to be much better than anybody anticipates. In fact, they are going to say that trump is the opposite of an exaggerator. The exact opposite. [applause] mr. Trump they are going to say, governor, that he ought to be a little more optimistic because his predictions were low, can you believe it . A year and a half ago they were saying he can do that, now they are saying that was quick. [laughter] mr. Trump by the way, the Commerce Department announced this morning that our gdp, that is the big 1 in the Third Quarter grew even faster than they reported a visit. They made a mistake. They had it at 3 . By the way, three percent, did you ever think you would hear that in less than a year . Now it comes in at 3. 3 , which is the largest increase in many years. [applause] and if we did not have the hurricanes, we would have been at 4 . The hurricanes were devastating. And i said they are worth a point. They said they are worth. 006 . I said they are worth a point. We would have been at 4 , maybe even over 4 . We had hurricane kit we took care of them. In texas, florida, they did a great job. Tremendous leadership. Puerto rico has been a tough situation because of the fact that it was in very bad shape before the storms ever had, but they are doing well there hit, but they are doing well there, it is healing, and we are giving them power and all the things they have to have, but a lot of brave people in every state we have great, great people, and it is our number one resource, believe me. Really great. [applause] mr. Trump but in order to achieve this bright and glowing future, the Senate Must Pass those tax cuts. Bring main street rolling back. That is what is going to happen. This is all done without the tax cuts, and i am not sure that people even believe the tax cuts. I want to see what happens. The big day will be either tomorrow or the next day. I would say do it now. We are ready. I sent to the republicans i want to tell you, these are good people i know they get hit hard, the senators, the congressman, but they are all working hard. It is not so easy. It is complicated stuff. It is not so easy, but we had an incredible session yesterday. Do the why i said can we vote today what do i know, im a business guy. They said how about friday. I said i dont want to wait till friday. I said billy, can we do the vote . Billy has already passed it. Then what happens, it passes, goes into this beautiful wetee, i call it a pot mix it up, stir it up, and bring all the best things out. You will have something i predict will be really, really special. [applause] mr. Trump right now really is. [applause] mr. Trump so, right now, americas tax code is a total dysfunctional mess. The Current System has cost our nation millions of american jobs, trillions and trillions of dollars, and billions of hours wasted on paperwork and compliance. It is riddled with loopholes that led some special interests, including myself, in all fairness is going to cost me a fortune, this thing. Believe me. It is not good for me. I have some very wealthy friends, not so happy with me. I keep hearing schumer this is for the wealthy. Well, if it is, my friends dont know about it. I have to explain why. It is great for companies because congress are going to bring back jobs and we are lowering the rates vary substantially. Right now we are bringing the rates down from 35 , which is totally noncompetitive the highest industrialized nation in the world by far, and were bringing it all the way down to 20 . That is good. [applause] that is good for everybody in the room, whether you have a company or you want a job, because were going to bring back jobs. What we have had is a massive giveaway to Foreign Companies which encouraged businesses to relocate offshore. You have seen what happened before this. Is, weas our tax code have toyota, big Car Companies coming back in, building plants in michigan and other places. You have a lot of businesses coming back in. They see what is happening. Jc what is going on. They see what is going on. Our current code is a giant, selfinflicted economic. It has been that way for so many years and nobody wanted to do nobody wanted to do anything about it. It will change immediately if Congress Sends a tax cut and reform bill the biggest tax cut in the history of our country, bigger than reagan if they send it to my desk, i promise all the people in this room, my friends so many friends in this room it is a great state i promise you i will sign it. I will not the tell that you thatthat bill veto bill. [applause] mr. Trump there will be no veto. Under the plan, a typical family 75,000ning 75 as an example will see their taxes go down by as much as 2000. That is a lot. [applause] mr. Trump now, we are doing that not just to help people we are doing that because it helps our country. You are going to take that 2000, and maybe you will save some common maybe you will spend some. We will make product back in our country again. It will be made here, elsewhere, but it is going to be made here. Were opening up plants and factories and were going to be great too small business. Wait till you see the final product what finally comes out in what i call the mixer. The beating heart of our plan is a tax cut for working families. That is what it is. [applause] we are going to make sure that you keep all of your hard earned money. We are going to make sure, also, that you have a job that you want. Youre going to have choice. In education, we now have choice good word. Here you will have a choice. Youre going to have a choice of many jobs. People are moving back into our country. Under our plan, the first 12,000 of income earned by a single individual will be totally income tax free. Zero. [applause] mr. Trump and am married couple dime of income tax on their first 24,000 of it, of income. Zero. Our plan will significantly increase the Child Tax Credit and make it available to more middle class families because the single most important investment our nation can make is in our children. Do you agree . Even better agree. You had better agree. [applause] mr. Trump families will also benefit from a new credit for other dependents, like a child in college, or an elderly loved one. We have our mothers, our fathers, grandparents people that are elderly, that have done a fantastic job, they have grown old, you want to help them. Now were going to help you help them. [applause] we are also going to eliminate loopholes and complex taken advantage of by the wealthy. Who are they . I dont know. I think my accountants are going crazy right now. Hey, look, i am president. I dont care. I dont care anymore. [applause] mr. Trump some of my wealthy friends care. Me, i dont care. This is the higher calling. Do we agree . Said, what difference does it make . It made a big difference. Made a big, big difference. We want a tax code that is simple and fair, and that is for all americans. The plan that senators will be voting on this week, hopefully as soon as possible, closes the loop corporations used to ship shipped products to tax havens, and eliminates deductions for ceo salaries over 1 million. Tc with some of these people are making . A little ridiculous. I am driving of their stock, making a fortune, then they go to their board tell them what a great job they are doing, but what am i going to do . Them,nace many of honestly, i dont like. Some of these bankers, i dont like them, and they are making a fortune. Steve knows a couple of them i am talking about. They say what a great job they do. Right now anybody can do their job because we are making it easy for them because we are giving them a great and strong economy, and because we have cut regulations more than any president in the history of this country by far, and that is for full terms. That is not 10 months. Builders to build, and it allows farmers to farm. You know what i have done for farmers. [applause] mr. Trump where if you had a little puddle in the middle of your field, you go to jail if you touch it, right . You know what im talking about. Not anymore. [applause] mr. Trump not anymoremr. Trump . Lend. Allows bankers to so many people came up to me and said we had a 20year relationship with a bank, never had a default, a bad loan, and now we go back to the bank and they say we cannot do business they do anymore because not qualify, even though they are better than the people that do qualify. It is incredible. We are back to the strong days of our banks, and not the days of trouble. That. You saw what happened recently when the Certain Agency or bureau that was causing so much trouble to lenders, where they could not lend they could not lend. It was devastating. They were going out of business. We are taking care of that. Yesterday, you saw, we won the lawsuit. That is going to be taken care of automatically. We have to get back to business. Folkscus is on health the who work in the mailrooms and the machine our focus is on helping the folks who work in the mailrooms, the machine rooms, the plumbers, the cops, the teachers, the pipefitters, the people that like me best [laughter]. [laughter] ashley, the rich people dont like me, and that actually, the rich people dont like me, and that is fine. I like that trade. The people that like me the best are the workers they are the people i understand the bath. Are the best. Those are the people i grew up with. Those are the people i worked on construction sites with. All of the people that give their best each and every day to take care of their family and the country that they love. These are incredible people. They came out to vote for me. They came out to vote for us people that worked hard, to jobs, three jobs, that had not voted in many years because they have not had anyone they want to vote for, and they came out, i will never forget come in tennessee, a great congressman told me that early voting i tell you what, we went through four days of early voting. At that time, it was mr. Trump. Now they say mr. President , but it was mr. Trump, and they said if the other parts of the country are like what is happening in tennessee, people are coming from all over tennessee. They have not voted in years. Now they have trump shirts, everything trump, and he said ive never seen anything like it and i have been a politician for a lot of years, and if it is anything like tennessee, youre going to have one hell of a victory. It turned out to be a lot like tennessee, so [applause] mr. Trump and it turned out to be a lot like missouri. That i can tell you, because we had a big one here. And i promised josh that when he gets it going and he is god it in very good shape, from what i got it in very good shape, from what i hear. I said josh, when you are ready, you have my word, i am going to come here and campaign with you. We have to get you in. [applause] it is not enough for the middle class to keep getting by. We want them to start getting way ahead. We are going to have them start getting way ahead. Under our plan, middle class families will not only see their tax bill go down, but they will see incomes go up by an average of around 4000. We are goingecause to cut taxes on american businesses so they will compete for workers. Table raise salaries. The business is going to be happy, the workers at one of the happy, and the country is going to be a happy place, although we will have very strong borders, please remember that, ok . Please remember. Were going to have the wall. Dont worry about it. Were going to have the wall. Now a lot of people say now that he got elected, is he going to build a wall . The answer is absolutely. More so. It is not easy to without democrats. They want to have people poured into our country, the legals the legal steven . They dont care where they come from. They want to raise your taxes, they dont want to take care of your military, and all they are good at is obstructing. They may obstruct, but we have gone through all of the abstraction so far. We will keep it going. Believe me. [applause] mr. Trump today america has one of the least competitive tax rates on planet earth 60 higher than the higher in the developed world. Our taxes are 60 higher. Asia, every trip to single one of the countries i visited, even those with communist governments have slashed its Corporate Tax rates and slashed them genetically. It is very tough competition anyway, but when the taxes are a lot lower, it really makes it very tough, and that trip was a tremendous success. We brought back 250 billion in contracts. That is going to be over 1 trillion very soon. That is a good weekend at halfs week and a halfs work. Boeing came back. So Many Companies came back. I am proud of them, and we are doing great. At the same time, we are going to fix trade because trade is unfair. We are getting killed on trade. Ouroing to fix on trade a mussununga would like to continue with this horrible situation that we have unless anyone would like to continue with this horrible situation that we have. Our plan will bring us back to number one, where we were four years, but we have not been for decades. We will be right back at number one. Were going to work on trade, and were also going to work on military. Can we defend nations that are very wealthy, and we do it for weost nothing i say why i defending them we love them i will not mention names, but they are there are a lot of them. They are wealthy. One of them have a cash flow that they say is unsustainable because it is so large. How would you like to have an unsustainable cash flow . They dont know what to do with their money. And we defend them. It is going to change. Were going to defend them, but they are going to treat is fairly, and theyre going to pay for their defense. Does that make sense . [applause] wastrump and a lot of this for many years ago and we defended a defeated country, they became strong, rich, and we kept the same defense. What happened . Why didnt anyone go in and negotiate. When i was in asia i spoke to a couple of the countries about it, and they looked like this. That means they know they are getting away with murder, and they have to start helping us out, ok . If you dont mind, i will start bringing that up with some of our good friends. We are going to cut our tax rates to the competitive number of 20 , as i said. We will create jobs, and factories will be pouring into this country. They already are starting. A lot of people think it will happen. I dont want to say anything. I am not going to talk about it. I thought we would have health care, and we will have health care. It is going to happen. Votes, andwe had the then something happened a little strange. It is ok. Vote, thatse by one is called you go back. Some people say you failed with health care. What you mean you failed . Isthe way, what happened obama took a long time, years, to get obamacare, right . Again, 10 months . We have had two runs at it. Were coming closer and closer. I think now we have a plan that is going to be great, but we are not going to talk about it until after taxes, and that we take care of health care. Then we will have done tax cuts, the biggest in history, health care i know you dont want this welfare reform. Does anybody want welfare reform . [applause] mr. Trump and infrastructure. Scarlet you have been listening to President Trump stumping for tax reform. Stumping is the right word. E talked about fake news he said the democrats are weak on crime and the border. Tradeoaned a disastrous deal the u. S. Struck previous to his becoming president. He did say on tax reform i promise you i will sign the tax bill and that this tax bill is not good for me. So, it is what we have come to expect from the president when he does speak to his constituents, his supporters. Joe and he talked about the election a lot of the classic themes. Certainly not a policy speech, i would say. Scarlet lets bring in Laura Davidson and alex wayne from washington. There has been movement on the tax overhaul plan. Laura, let me start with you. Apparently republicans have raise deductions for passthrough businesses. This is a Sticking Point for a number of senators. 22 , sohey raised it to the pastor is get a bigger tax break. This is a big deal, something that two senators in particular pushed for steve daines in montana, and ron johnson of wisconsin. They said earlier this week we cannot vote for the bill must we get this. They got it. The senate later today is supposed to vote on a motion to proceed, a vote to start debate on a tax bill. It is delayed a little bit. Folks are working on making sure this bill is competitive ruleiant with the byrd that does not add to the deficit outside of a 10year window, and the other thing people are wait about is this trigger this automatic thing that could increase taxes if growth targets arent met. That is a big topic of discussion. Were not sure how that theyre going to source that out. Julie alex, the president talked about how the tax plan is not going to be good for him and his rich friends are excited about it, but the pastoral provision will likely be good for the president , at least as far as we know from the one tax return he release from 2005, right . Alex it is difficult to assess what effect this tax plan would have on the president personally without being able to see his tax returns, as we have been able to do with every president that preceded him. Laura, it has not come up because it was not really a not a policy speech, per se, but the question of the triggers what mechanisms will be in place to address the deficit if the bill does not produce as much revenue as they claim. What do we know about . Laura moving target. Senator langford has been talking with folks on the house side in the way he is pitching it is if we do not hit growth targets over five years we increase the Corporate Tax rate from 20 to 21 , however senators coming out of lunch today were saying, look, what if we did spending cuts instead, or some combination of tax increases and spending cuts . That is more palatable to those on the conservative side that say it is hard for me to vote for a bill that has automatic tax increases in it. Scarlet so, it looks like ron steve dainesenator will be appeased by this pass through. What are we looking at in terms of what john mccain or Susan Collins need to sign off on the tax bill . Alex the bill partially guts obamacare. You would think that is a problem for both of those senators, but both of them, from what i can tell, are leaning toward voting yes. All republicans are looking for a reason to vote yes to the president has not yes. The president has not signed any major legislation. The contentment and to campaign on. They really need this, and they are looking willing to overlook a lot of ugly mars on the legislation to get something passed. Quickly, trump talking about revisiting how curious and is taxes are done, if they get done this that seem plausible, they might have a shot at . Alex if they got the individual mandate and the Insurance Markets collapse, they may have to revisit health care. Sure, that is plausible. Whenever they go back to obamacare repeal, they will face the same old problems they have always faced. The big one being republicans have never come to agreement on any sort of cogent policy to replace obamacare. So much. Ex, thanks alex wayne in washington. And Laura Davidson, she is with bloomberg tech. Alex len wayne is the white house editor there in d. C. Scarlet the market close is next. Big name tech names are declining. The s p is little changed. From new york, this is bloomberg. [applause] whatd you miss . Flu,turn of the fang but the dow is at a record. I am scarlet fu. Joe i am joe weisenthal. Whatd you miss . We want to welcome you to our closing bell coverage. The nasdaq is the mover we care about the most. 1. 3 , while the dow climbing to a record high. Joe its not often you see that. Definitely the story of the day. Facebook, amazon, netflix, alphabet. Tle with a 5 ol bounce as it tries to recover. Optimism thatme the replacement will push the recovery along. The recovery has been too slow for many investors. Autodesk seeing its worst day since 2005, adding fewer subscribers than expected and lowered guidance. Joe the Government Bond market starting in the u. S. , a solid move higher, especially if the long end, some steepening. A substantial move in the u. K. Following the news yesterday evening about progress on the divorce settlement. We saw a big moves in u. K. Ssets we also saw that move in the pound, pretty substantial. A move upward in the u. S. Dollar gaininghe yen, and euro slightly. Move was in bitcoin today bitcoin surging past 10,000, than 11,000 in the space of a single session, then 9500 andelow incredibly volatile day for bitcoin. Joe commodities red across the board. Crude oil dipping 1 . The Precious Metals losing today. We had that selloff and treasuries. 1 , and silver down 2 . Those are todays market minutes. Scarlet for more on markets, lets ring in the chief u. S. Equities strategist for bloomberg intelligence. Volume in equity markets today more robust than usual. The nasdaq 30 above the 20 day moving average, the s p 500 50 above the moving average. Is this the beginning of the wind down in tech stocks. It is early to say. This is a modest decline considering how far tech stocks have gone. This is reflective of broader rotation in stocks. It is not just tack, but the years losers in exchange for selling the years winners. This started yesterday when financial stocks started to surge on the Jerome Powell testimony. It is continuing today with news out of the senate that maybe the tax plan is inching its way through the senate and resulted ofinvestors shifting out lower taxpaying stocks into. Igher taxpaying stocks whether this will continue depends on what happens with policy. Charte a look at the here. If i can highlight what we are seeing. These are the financials. Here we have technology, which came up and is coming down. They have had these opposite. Rcs those of the two big groups where it has been most notable. A lot of this is tax. Some of this is the Regulatory Environment and how it can shift going into next year. Likely facels depleting regulatory costs or tech may faceas increasing costs are risks. Ech stocks did great we have seen rotation going into december and about half the year since 2009, so i think a lot of this is just rotation, but there is a policy angle too. Bill,f we do get a tax and there does seem to be momentum, from a math point of view it has the least to gain from it. If we get this deal is there more to go for the sectors that could benefit, how much is . Riced in rateking the Corporate Tax , if it drops to 20 s p 500 Company Earnings per share could go up 7 next year. Of that increases from consumer stocks and domestically Oriented Companies that pay a higher tax rate on average. We all know what will happen with repatriation. Tech stocks hold the most cash. Verseas you could have a lot of volatility in tech and health care stocks. They might get a lot of cash back. Scarlet what extent are share buybacks showing up in some of the estimates for next year . Some people have more ammunition to buy back shares and boost eps. It does not show. Share buybacks for the index this year have fallen relative to where they were a year ago. That does not normally happen in a year with profits growth. Share buybacks follow profit growth. Share buybacks have been missing from the situation. Where is that cash going . They are holding it on the Balance Sheet. A lot of this is uncertainty about taxation. Why do something with it now when you can pay lower taxes in the future . There is some Evidence Companies are holding back on spending ands, share buybacks, appointment of capital in general waiting for more visibility here. What are they going to do . One of the motivations on the tax cuts is that they will spend that money. What do we know from history when we have seen Corporate Tax cuts as to how that money is deployed, if at all . If you look at the major tax cuts in the 1960s and 1980s, there is not a lot of evidence that lower rates resulted in major capital spending. The most recent example where we 2005ee an impact was in when we had a repatriation event. Im not sure this is applicable. This is more of a permanent tax change. Im not sure anybody knows the answer to the question except that we will see some relief. It reduces the uncertainty with a lot of companies to plan. It would generally suggest you have upside from tax reform because you have relieved this uncertainty. That has resulted in financials trading at their best level since before the financial crisis. Joe remarkable. Thank you very much. Speak to ian we robertson on how bmw plans to gain share in the electric car market. From new york, this is bloomberg. President trump claims the republican tax plan will cost him a fortune. He said if the plan will benefit the rich, my friends dont know about it here . I promise you i will sign it. I promise. I will not veto that bill. Visit marks the president s in missouri to sell his plan. Heartbroken is how Savannah Guthrie described the news that her colleague and cohost matt lauer had been fired by nbc. She read a statement from nbc news chairman andy lack describing a detailed complaint concerningeague inappropriate sexual behavior in the workplace. The memo said the complaint received monday night may not have been an isolated incident. Coanchor became the of today in 1997. Paul ryan says Sexual Harassment should not exist anywhere, let alone in the United States congress. The fact that some people halls walking these when they came here to serve their country and ideals, that is wrong. That is a disgrace. We will not tolerate that kind of behavior. Considering as similar measure for its members. The president has spoken with xi jinping about north koreas latest missile tests. Mr. Trump is promising more penalties against the north. Made in clear determination of the United States to defend ourselves and our allies. Global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Whatd you miss . Vehicles are making inroads. By 2025, every sixth car will be electric. A leading manufacturer is bmw, which has made a big push to gain market share. Joining us now to discuss from the l. A. Auto show is ian robertson. To talku for joining us about what is going on at bmw. Talk to me about the electric lands for the company and what you are rolling out at the auto show. Sellis year, we will 100,000 of electrified vehicles around the world. Us four years to sell our first 100,000. Equally we are bringing more models to the market. There are nine currently across of a range by 2025 when the market develops we will have 25 electrified vehicles, 12 full battery electric. There is no doubt in our mind whether in the u. S. , china, or europe, this trend will accelerate. Talk about your plans to make the mini all electric in the u. S. With partners to lower the costs right now. What is your timeline . In 2009, i was here where we e, thed a mini Development Car for projecti. First fullyring the electric many in 2019. It is a very exciting product. It is really appropriate for that urban environment. The on that, we are looking to expand into other countries as well. Conversations as inhow we grow the mini china, and discussions will continue over the years ahead. Joe i want to talk politics, particularly the situation in tomany, the ongoing efforts form a government looking better than a couple of weeks ago. Domestic policy ramifications do you have your eye on for bmw . Many governments have gone through electric processes electoral processes. We had elections in france, the u. K. , brexit as well. We are reaching one of those points of intensity to see how brexit and the uncertainty can be reconciled as we go into 2018. Those are some of the key issues we are keeping on top of. Some of thet differences between europe and the u. S. , i am curious how your Car Sharing Service in the u. S. Is working out. The european version of the service says car sharing does not work in the u. S. As well as it does in europe, for example. We are in 15 cities now across europe with a drive now. We have over one million customers regularly using that as a service. It is very appropriate in the big urban centers, munich, london, and this is where car ofring is part of the future mobility. In the u. S. , we wanted to make a broader offering. Its not just about self drive. With reach now, you can have a driver come to you, a premium car come to you, deliver it to different locations, daily rentals. In the u. S. , it is a broader perspective and very appropriate for some of the biggest of these. You also have the Great Outdoors here and big distances between various cities, and that at the moment is not the key priority for car sharing. Thank you for joining us. Coming up, bitcoin soaring to 11,000hts, 10,000, time plummeting 20 . We have the charts you cant miss. T miss. Scarlet it is time for our new weekly segment, charts. Thank you. , it took out 10,000 and 11,000, only to drop 20 . Technicalso talk is the head of Technical Analysis at oppenheimer. What a day to bring you in here to chart bitcoin. What you make of this volatile day . The chart you ask me to talk , chart violation right here. Scaled an arithmetic chart of bitcoin. This move over the past few to 10,000 8,000 from about 25 , same as a move from 2000 to 4000, a doubling in price. We dont like to pull out charts that move so widely. I always feel guilty one i use nonlogged charts. You can see that uptrend there. Anything we could see like a reversal on the downside . At this point it comes down to following the trend. At this point it comes down to following the trend. The train has left the station. It has moved a lot recently. Here are the levels you have to watch for. It is making higher highs and lower lows. Every time bitcoin has moved above a prior high, on the pullback it has held that high. 8000 is nearterm support, there is a gap up right there. If you cant hold a thousand, then the dynamics of the trend start to change. You next chart talks about specific levels of support. Lets talk about your levels. Bitcoin stair see stepping higher. Support, thereme is the a thousand dollar level. You think above a thousand dollars we are ok, but the low 8,000 would suggest a fall to 5,000, 3000 . What with the worstcase scenario be that you could make a case for . Below 8,000, that the nymex of the trend change. We might see a pullback. 6,000, that is your next important intermediate support level. Participate in 500 returns coming you have to stomach 40 drawdowns. Survey that lifetime chart, that longterm chart, there is an economist who talk about the ideas of panics and crashes, greedy, exuberance, delusion, and perhaps here wrote balls in. It will be interesting tos and perhaps here weve all show in trend following, nobody knows how high this can go. Bitcoin came into existence in 2010 has an alternative to fiat currencies around the time the Federal Reserve started its qe money printing. People wanted something a little bit different. Chart, if wefourth can pull up 3689 we will see the view on gold. With gold is that there is cost opportunity here. We would rather be in equities. I think the floor has been found. I am not bearish on gold. We are going to be in this range bound market after this 10 year that secular trend has been broken and we will be years, 1970,or 1980, 10 year ride, then range bound for years. If you could only invest in gold or bitcoin, which is the winning trade . Equities, invest in cyclical equities. If you dont one volatility, gold. If you can stomach the volatility, bitcoin. Thank you. Bake to you. Coming up next, janet yellen speaking for perhaps the last time in her role. What she says should keep americans up at night. From new york, this is bloomberg. A Key House Committee move forward today on a bill to expand gun owner rights, the first action on Gun Legislation killedassachusett massive shoos more than 80 people in texas and las vegas. The committee is set to vote on the bill, which would allow gun anyrs to carry a handgun in state that allows concealed weapons. It is backed by the nra and rights groups. Secretary of state Rex Tillerson says to United States may target additional Financial Institutions with sanctions following north koreas latest Missile Launch. Speaking tillerson was in washington during a meeting with the crown prince of bahrain. Tillerson said he is not giving up on the diplomatic effort to resolve concerns about pyongyangs Nuclear Weapons program peacefully. He says we working at it every day. The United Nations syrian envoy arrived in geneva today ahead of continuing peace talks. With syriane met opposition leaders and representatives from the permanent members of the un security council. In theed on rival sides wartorn countries to get down to business and upcoming peace lks. P ar a former Bosnian Croat general died in a dutch hospital after drinking a liquid in a courtroom where judges had confirmed his 20 year sentence. He diedesman said despite efforts to save him. He yelled in court that he was not a war criminal and had taken poison. The tribunal did not elaborate on the nature of the liquid that he drank. Global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Scarlet lets get a recap of todays market action. You can see the dow closing at a record high, up 104 points. The nasdaq lower by 1. 3 . Joe that is the story of the day. In particular not doing well. We have a chart of the percentage change, the gap 3. 9 en saying and s p 500, come the widest we have seen going back several years. Otherwise, whatd you miss . Frome latest testimony janet yellen and Jerome Powell this week. For many it was a case of meet the new boss. We do think it is important to gradually move our policy rate towards what i will call a neutral level, which would be consistent with sustainably strong labor market conditions. Are strong,conomy unemployment is low, growth is strong and has picked up, so it is time for us to be normalizing interest rates. Wage increases are modest. Wages signaling tightness in the labor markets. They are not significantly overheated. There is no sense of an overheating economy. Has been below the 2 objective for most of the past five years. Inflation has been below the 2 objective every single month but one since i joined the board of governors in 2012. Comeainst this backdrop the fomc has indicated that it intends to carefully monitor actual and expected progress towards our inflation goal. Is a transitory or are there more fundamental things at work here . We are all watching carefully to see and will have to be guided scarlet by the data. With more insight into the fed will and what the look like under Jerome Powell is our guest. You work at the fed for a decade and worked with both of these folks. There outlook is similar. Them and working with them, is there anything we are missing here . Are the key differences between them we should know Going Forward . The differences are very slight and narrow. Powell his the continuity choice from janet yellen. He believes in the program. Doing thethe fed is right thing and believes in the Balance Sheet runoff, etc. A slight going to make difference, Jerome Powell is not an economist, so while he understands the economic models , he does notcy have the same underlying belief like janet yellen has. He does not run swerving the believe inflation will rise. Joe could that mean that their paths would divert as the and aion comes up noneconomist and economists see the same set of facts . I think where that comes up his next year. I think Jerome Powell his more pragmatic. Inflationhe said if does not perform as they expect, he will take signals from that and go easy. I think he continues on that. Believes thathe next bit of tightening will push inflation rates higher. One of the things that has been argued in terms of the dot plot is the fed needs to get to a higher rate so that it the economy does worsen, they have room to cut. Would he not look at it from that angle, approaching it from an economics perspective . I think he would dismiss that argument. Yes, anybody else who would take that job would love to have 550 ,asis points of rates to hike but that is unrealistic and will not happen, so raising rates now to give yourself room for the future increase the probability you will need to use those rates. I think he will turn to the nonpolicy sided needed in the future. Event the economy turned south, what are some of the unexpected things that he might have to face . Is it Something Like bitcoin . We dont see bitcoin has a systemic market threat. He did not either. The fed looks at Financial Markets at how it will pass through into activity or inflation and only worry about those changes in that they will destabilize them or push them away from their target. Joe i want to get your perspective on inflation. I thought that was an interesting point about the. Conomist view what is your explanation for why inflation just has not bounced back the way some of the people would have guessed . Has been a struggle. I have to go to meetings once a month to reaffirm my belief in the phillips curve. Prices are how we allocate goods and labor in the economy, so at some point those pressures have to put upward pressures on prices, but we have not seen it. Where the you look at wages or inflation, they simply have not moved up. There have been lots of excuses, dollar, the space,ties, the retail spray but none of those explain the weakness. Was sometoday there anecdotal evidence that price pressures are starting to rise. Is this what it looks like when we begin to get sustainable inflation . To be true,ove that but over the last five years we have seen indications that inflation is just about to go. I think the same thing here. We are not seeing it in the aggregate data. Feds have looked at. Ifferent parts of the basket but overall, we have not gain traction. Inflation will rise from its low levels this year. Those one off factors will go away, but as Jerome Powell said yesterday, it is more than the transitory factors. Scarlet thank you so much. Coming up, we speak with the head of Global Fixed Income strategy for emerging markets and morgan stanley. This is bloomberg. Scarlet oliver whatd you miss . Let next guest says emerging markets will be the most attractive asset class in the first half of 2018. Attractive in the first half, but the second half, what will happen to result in that drop off . We are still thriving off positive fundamentals. We also have a benign risk back drop. U. S. , year in the concerns about being late in the cycle will take over. We are bearish on highyield in the u. S. , so that will negatively impact Venture Capital spending and impact markets. Prefer the local currency or the dollarbased and nominated to . Denominated debt . We think it will be a but wee rally in both, prefer local. There is more to be gained. We had a strong year in 2017. Emerging markets has come back in 2017. A lot of the flows have gone local markets, the next frontier in terms of positioning , and they wish ands are more attractive. The outlook for rates in the u. S. Given the new prism fed chief Jerome Powell the new fed chief Jerome Powell, how that for emerging markets, or is that the trajectory they will continue to go up and it is not as important . Iswhat really matters for us the risk context. If we have a steady drift higher , we think in emerging markets could take it because fundamentals are much stronger than they were at any point in the last five years on aggregate. The Treasury Curve happens to be quite bullish. We think it will flatten, and that is not a negative for emerging markets. It could become at some point if the market gets too obsessed about a recession, but we are not there yet. We think this is a sweet spot for emerging markets. About yourlk specific picks. Along russia across all asset classes, not just corporate debt, but sovereign debt and equities. Country wherene we see the biggest delta in terms of growth. You have the world cup there that will give you some additional upside in terms of construction investment. It is a country that is counterintuitive because we have sanctions on russia. Russia has d leveraged away from that and is one of the countries that has the highest real yields, so currency and bonds are well supported there. Of your other preferred countries, india, indonesia, colombia, peru. Asianlot of the hot east countries. Is there a reason you are avoiding those . East asia, low yielding countries, the periphery of china, we like them, but we stay away from the rate side. We think asia is in a totally different phase of the cycle. They are late now. Inflation is picking up. Rateis where we expect hikes to come through and negatively impact the bond story. Thank you for coming in. Scarlet lets get you some breaking news. Nokia is in talks to buy juniper networks. We are hearing from reports that they are in talks to buy the company. Networks getting a huge pop on that report, up by 20 . Juniper networks is a name we all know well. Joe they are a real survivor. Everything else was down today and juniper was up 5 . Hotonly that, it has had a streak, nine sessions in a row it has been up. Scarlet trading below 30 a share is where closed at today before this report came out. If you look at the bloomberg, you can see when it was around 340 back in the heyday. Joe you have not made back your money. Scarlet you have not. From new york, this is bloomberg. Whatd you miss . A volatile day for bitcoin. It tumbled almost 20 from its wiping 2000 from its price in a single session. Joseph stieglitz sounded the alarm earlier in an interview with bloomberg. Bitcoin is successful only because of its potential for circumvention, lack of oversight, so it ought to be outlawed. Stieglitz get off my lawn commentary. Populary it has proven recently. Do we know why what happened today happened . One of the adages was on coin base. Had outages. Nges they are seeing a surge in volume, a massive surge and probably him. 10,000 is a big milestone andrew a lot of headlines and brought more signups to the site. Wrote how there is a lot of institutional money coming in, but this might be a sign it is not quite grown up yet. Isrlet do you think that helping to drive the price up as well . What is generating this extra frenzy . Most cryptocurrencies, the conferences are fans of cryptocurrencies. Focusedys conference on Institutional Investors and bringing big money into crypto, so that could have contributed to the price increase. Joe can you disentangle the price action today with the stability of the exchanges, or are they inherently mixed . The price in different exchanges widened and it seemed like the situation on each exchange was a factor. The exchanges have outages, it can cause the price to drop more because it is a is notat the system stable, so it does not give people confidence in investing in these assets. When we getens Bitcoin Futures in the First Quarter of next year . Does that stabilize the whole system, or does it create such that thee in demand exchanges get overwhelmed on a regular basis . Be interesting to see what happens when they launch futures contracts. A lot of people are saying this is legitimizing this asset class , giving bitcoin credibility. People have hand, said the price could fall because it is another way to short it coin. Torlet your day job is cover equities. When you look at equities, the Semiconductor Companies have been most tightly linked to bitcoin because they are making chips to mine these cryptocurrencies. Nvidia and amd, their chips , butsed to mine ether could be correlated to the move in bitcoin because people lump cryptocurrencies together. There are a lot of other stocks moving in relation to bitcoin. Overstock. Com is the first major online retailer to offer bitcoin and have launched a Bitcoin Exchange and are doing and ico. There are all these Companies Getting into crypto. Go ahead. , i it sounds like basically dont want to say shady companies, but Small Companies doing pot, gold, uranium, and now bitcoin mining. One Company Changed its name in rebranded itself to become a block Chain Company and its stock surged. We see the trend of companies that are rebranding themselves as crypto block Chain Companies and say massive stock surges. Biotech to block chain. All signs of a bubble. Exactly. Have we seen those little stocks be volatile along with the cryptocurrencies . Yesterday actually when the price of bitcoin, they were not moving together, but most of the time in the last couple of weeks or months, we have seen the move closely together. Thank you for joining us. There is a lot to talk about when it comes to bitcoin. Joe coming up, which you need to know for tomorrows trading day. This is bloomberg. S bloomberg. Scarlet whatd you miss . A selloff in big cap tech names. Opec holding its 173rd meeting in vienna. We will find out whether the extension is official. For personalbers spending it jobless claims coming out tomorrow at 8 30 a. M. New york time. We will see if these numbers translate into spending. The undersecretary for International Affairs at the u. S. Treasury joins us on Bloomberg Markets at 2 30 p. M. Eastern. That doesnt for whatd you miss . Bloomberg technology is up next. Joe have a great evening. This is bloomberg. Retail. Under pressure like never before. And its connected technology thats moving companies forward fast. Ecommerce. Real time inventory. Virtual changing rooms. Thats why retailers rely on comcast business to deliver consistent Network Speed across multiple locations. Every corporate office, warehouse and store near or far covered. Leaving every competitor, threat and challenge outmaneuvered. Comcast business outmaneuver. A House Committee moves forward on the gop bill to expand gun owner rights. On gunhe first action legislation since the Mass Shootings in las vegas and texas. It would allow gun owners to carry a handgun in states that allow concealed weapons. Security talks today following north koreas most powerful Missile Launch today. Came after new demands by President Trump for beijing to get tougher with pyongyang. The pentagon said the talks were scheduled before the surprise launch. Nbc news has fired matt l
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