10 18 03 this is a test caption from the national captioning institute. 10 18 07 this is a test caption from the national captioning institute. 10 18 11 this is a test caption from the national captioning institute. 10 18 15 this is a test caption from the national captioning institute. N. Rate in 2011. He now says 37 is too low and helps the rich. President obama suggested bringing the corporate rate into the 20s. They could not get it done. We did. We will work to make the middle income side of these tax cuts permanent because we know middle income families will benefit kevin . Benefit. Kevin President Trump is set to sign that tax bill in 30 minutes. He is able to do that because lawmakers have kept the government funded for one more month. They have a lot to do. In terms of setting the calendar for next year, what is the number one priority of this administration for next calendar year . Tony infrastructure is a very big priority. It is something we will be focused on. There are trade priorities. In this tax bill, we have repealed the individual mandate on obamacare. 80 of people who pay that tax made under 50,000 a year. We have opened up and walked up anwar. We are very excited about what we just did. Great market growth, great optimism across all sectors, manufacturing, small business, home building, and consumer. We will continue to talk about tax reform and big issues like infrastructure and others. There willou think have to be a longerterm cr . How do you navigate that, and what does the Administration Want to see to keep the governmentfunded . We need to get the budget passed. This is a way washington has been working for too long that is dysfunctional. The president has made it clear, we do not want to play politics with continuing resolutions. We want to fund the government and get away from this cr process washington has been operating under. Kevin thank you. We appreciate the stop here for bloomberg television, undersecretary of the treasury tony sayegh. Vonnie thank you. President trump tweeting just now, will be signing the biggest inr tax cut and reform bill 30 minutes in the oval office, and will also be signing a muchneeded 4 billion missiledefense bill. We will follow all of the developers and bring any pictures. Lets check in on first word news. A split in the white house cap President Trump from carrying out a Campaign Pledge and closing a loophole for carried interest. Gary cohn wanted to close the loophole in the tax bill, but Steve Mnuchin successfully urged keeping carried interest with no limits. Consumer spending in the u. S. Rose more than forecast last month. Purchases were up 0. 6 . The fed inflation gauge raised to an eightmonth high, both signs of economic strength, which should keep the fed on track to raise Interest Rates next year. The presence of catalonia is urging that spain recognizes victory in regional elections. Fled to avoid jail back in october. In the u k, businesses that rely on eu labor are concerned about the christmas holiday, worried that employees will return to their home countries the holidays and stay there. Many Foreign Workers feel they are just not welcome. Global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. I am emma chandra. This is bloomberg. Mark thank you very much. Futruresthe focus, the focus, bitcoin sliding 21 . Has the bubble burst . This is bloomberg. Is bloomberg. Bloombergs new European Headquarters in london, i am mark barton. Vonnie i am vonnie quinn. This is bloomberg markets. Plunge has extended to more than 25 today. The frenzy surrounding the Digital Currency facing one of its biggest tests yet. Joining us now is brian battle. I take it you are not particularly surprised by the plunge. Brian no. Bitcoin routinely has a 30 selloff. We are having a 25 to 30 selloff today. That is not that surprising. That is not surprising in an emerging asset class. It is going to be volatile. Advise ahat would you Retail Investor . Should they stay in if they can . Brian what about a definition, is it currency, commodity, or beanie babies . Cryptocurrencies like bitcoin are the bubble to and all bubbles. I would say its a speculative asset class. If you cannot take a 30 or 40 selloff, you should not be speculating in this asset class. Vonnie is this selloff isolated to bitcoin, and what are the reverberations to the futures market for bitcoin . Brian the great thing about the cme is it is institutionalizing the asset class. We have real futures. I think the market will get more organized. We have never had a Digital Currency in the history of the world. We are just figuring it out. We will determine what it is. I am not sure it is a currency because it is very slow and can be wonky. It is not a very good store of value. It goes up and down 30 in a week. Onare at the price it was december 6. In context, a huge selloff, but this is going to be a pretty regular thing until we get a bigger institutional market. Vonnie lets turn to oil. What are you looking for out of wti for the First Quarter of taking . Brian it has been a whimpy market this year. Are 53. Ge we going back to 2015, the average is 52. It has been a quiet market. That speaks to the overabundance of supply. The question is, will there be demand . U. S. Tax cuts might help. Saudi arabia, they have a big change in leadership, a war in , and that is not over yet maybe they are sniffing around in the u. S. Shale fields. I think saudi arabia as the head of opec and one of the major oil producers, i am interested to see what happens with leadership there. That is really going to set the supply town for the rest of 2018. Vonnie happy holidays to you and everyone else at the cme. Brian is at Performance Trust capital. Mark a look at some of the biggest business stories in the news right now. Qualcomm is firing another shot at broadcom. Is chipmakers board opposing broadcoms nomination of 11 new nominees. The stages is being set for a blockbuster deal in the commercial jet business. Considering a is deal that would expand boeings reach into the highly competitive market for smaller passenger planes. The takeover today will create a global gambling giant. The deal is valued at 5. 4 billion. Online brands such as party casino. That is your latest Bloomberg Business flash. Is bloomberg markets. I am vonnie quinn in new york. Mark i am mark barton here in the city of london. Lets get to the latest in catalonia from the independentist party. President talan demandingigdemont is to allow him to end his selfimposed exile in belgium. Will rajoy listen to the demands made by puigdemont . Good afternoon. We are getting reaction from a very bad election night. Rajoy took a bet that did not pay off. They are going to have to clearly do some soulsearching in catalonia. Ajoy insisted that there is always room for dialogue. That also means respecting the sovereignty of the country, in contrast to what puigdemont is saying. The big winner of the night did well yesterday, saying he has earned the right for a conversation with rajoy. But he wants to do it outside of spain. Clearly he is worried about what will happen when he comes back to spain. He could be imprisoned for up to 30 years. The bigs, puigdemont is victory of the night, but the proseparatist are not exactly united behind a strategy. What strategy will they pursue when it comes to independence or their next step . That is right. We talked about this many times starting in october. Tensions were playing out in this coalition, a very weak coalition. You have three different parties that have nothing in common except for independence. Yesterday night, they were competing with each other. The party that was doing very well in the polls actually trail. Puigdemont did better. Governmentl catalan is in prison. This side of the coalition is saying we are facing the consequences of what we did. Brussels and in needs to get back to spain. We know that puigdemont is very concerned about his legal situation and whether that might land him in prison. Brussels and needs to get back to spain. Jonathan vonnie Mariano Rajoy needs to think of something fast. He says they have to take their seats before he can speak with them. It is going to be a standup unless he comes up with some kind of solution. That is right. He needs to come up with a plan. We need to remember the situation in catalan is very difficult for rajoy. The results yesterday clearly did not work out for him. They were wiped out, coming last in the election. The people of catalonia gave a clear message, we dont like you. This highlights how toxic the relationship between the Central Government and catalonia has become. Rajoy has to come up with something. A referendum looks very unlikely. Mark thanks a lot. Barcelona inck in the next hour with the chief economic spokesman of the party. Vonnie cannot wait to hear what he has to say. Uns. S. Condemns the criticism of their condemnation of the u. S. Recognizing jerusalem as the capital of israel. F israel. Cannot live without it. So if you cant live without it. Why arent you using this guy . It makes your wifi awesomely fast. No. Still nope. Now were talking it gets you wifi here, here, and here. It even lets you take a time out. No no yes yes, indeed. Amazing speed, coverage and control. All with an xfi gateway. Find your awesome, and change the way you wifi. Live from bloomberg World Headquarters in new york, i am vonnie quinn. Mark and from bloombergs European Headquarters in london, i am mark barton. This is bloomberg markets. Lets check first word news. Emma chandra has more from new york. Emma china is signaling and is ready to back another round of you and sanctions on north korea. The Security Council votes today on whether to cut deliveries of Petroleum Products to kim jonguns regime by 90 , a response to the longrange missile test last month. In japan, the cabinet has approved a record 46 billion defense budget. The country wants to improve its military capabilities at a time when north korea is becoming more of a threat. Japanse items on Shopping List a third layer of Ballistic Missile defense and its first longrange missiles. The british economy grew at the Third Quarter at the slowest pace since 2013. Annual growth was 1. 7 , well below the rate seen before the boat to leave the European Union 18 months ago. British households are being squeezed because prices are rising faster than wages. Palestinian later Mahmoud Abbas says many countries can replace the middle east in the peace process. Abbas met with french president macron in paris. He said the u. S. Disqualified itself from the process recognizing jerusalem as israels capital. Macron said he is working on innovative solutions. Thanl news powered by more 2700 journalists and analysts in more than 120 countries. I am emma chandra. This is bloomberg. Vonnie well, speaking of the future of the middle east, thomas pickering, former undersecretary of state for Political Affairs, former u. S. Ambassador to the United Nations , jordan, and russia is our guest. He joins us from washington. You some amount of us you saw Mahmoud Abbas in paris with macron. Many countries of the United Nations condemning the u. S. For its position on jerusalem, notably asked abstentions from australia and canada. What is the future of u. S. Middle east policy as you see it, ambassador . At the momentk worse than perhaps prefer the president s decision, which seemed to have no real u. S. Interest in mind. Lets be clear. I was also ambassador in israel israeliyears, with leaders in jerusalem. There was never any doubt as to where i had to go to deal with the leadership of the country. Thathe important point is since 1948, the policy of most nations, if not all, has been that they would take no steps unilaterally to change the status of jerusalem, opening the door for a negotiated outcome. In policy ision still very important. There was not any effort here in any way to negate israeli aspirations, so much as not wanting to interfere in a delicate these process which now seemingly we have done, with really no return for u. S. Interests. Perhaps some domestic return for the president in one way or another. With perhaps some of his major funders. Beyond that, i find it hard to see what it was we really gained, and we lost a great deal by, in a sense, beginning to prejudice the outcome of negotiations. Vonnie the current u. S. Ambassador to the u. N. , nikki haley, said the u. N. Had singled out the u. S. For attack. To strong . Rding does it serve the president at all to be on a cooler level with the United Nations . Thomas i think there are times when we dislike what the u. N. General assembly does, and what its members do. We have for a long time objected to some of the resolutions, if not all, that related to israel. We had a strong connection and still do with israel. And obviously, a serious interest in protecting that relationship. On the other hand, when it comes to hopeless causes and the use perhaps of financial pressure, it may go a little bit beyond where things have been in the past. Cause moresult, opposition and opprobrium. The fact that canada and australia chose not to join us, but to abstain, is a signal that they thought we were overreaching. They are good allies and would not do that kind of thing to us without very serious consideration at the top level. Ambassadormark pickering, what are the best hopes right now for a peace deal . Thomas you are saying to me if there is an impossible situation before us, how can we really work it out . That is a terribly difficult and challenging problem, and it is one that is not getting easier. What i think has to be there is a two state solution, despite the fact that many people have given up on it. I see no viable alternative. A solution in which both states will have an opportunity to have their capital in jerusalem something that i think is a very important piece. A solution in which obviously settlements are dealt with in a way that is fair and equitable, but in fact a sures that palestinians have the rights in their own territory, if they choose to wish to seek an arrangement in which there might be settlements there under palestinian law. They may have that option. A solution in which there is security for all certainly for israel and for the new palestinian state. And one in which in fact refugees have an opportunity to find their home, i hope, in the New Palestine but maybe some left back in 1948. There are not many left and they are not going to be producing children. They at least have the theoretical right to return to the country they left. But i think under conditions in which one way or another would be made more advantageous to them, moving into palestine rather than back to israel, from which they came. Those are a few, i think, of the principles that ought to guide a solution. They are not agreed to by each party yet. Each party and each party leader, i think, has promised much more than they could possibly deliver under current circumstances. So any negotiation will have serious concessions. Pickering, weor have the u. S. Security Council Voting at 1 00 p. M. In new york on the fourth resolution against north korea in 13 months. China has signaled it is ready to back another round of you and sanctions. Does it make a difference or not . Will it halt in any way kim jonguns Nuclear Ambitions . Wait ande will have to see, but it is much better than if china were able to say, we will not back another move, or we will water it down to become insignificant. The tests. Be what will the text me . How much can we get of what we need . The other interesting question here is, will this lead to the opening of the door to negotiations, which secretary tillerson has backed, more or less, and which the president seems to object to at the moment but which are very necessary to put this pressure to work to shape the kind of solution that we seek . It is over the long term, obviously, a nonnuclear korean peninsula. The big roadblock to that is in the north now, where there is still going on testing and other kinds of things which ought to be stopped immediately. Those are things that you can achieve with a combination of pressure and negotiations, i certainly hope. Vonnie we have to leave it there. Our thanks to the former undersecretary of state for Political Affairs and former u. S. Ambassador to the United Nations, israel, russia, jordan, and other nations. Coming up, bitcoins bad day, the Digital Currency facing one of its biggest test yet, plunging almost 30 , nearing 10,000. It is down 16 now. President trump could be giving the gift of tax reform before the christmas holiday. He is expected to sign the bill into law before he leaves washington, any moment. Much more ahead. Vonnie Senate Majority leader Mitch Mcconnell holding his yearend news conference, saying it has been a year of extraordinary achievement. We will bring you more details as we get them. President trump will sign the tax overhaul bill any minute. We will bring you any pictures we get from that. Bitcoins losing streak continues. The cryptocurrency selloff this week appears to be gaining momentum. The columnist joins us now. In hindsight, it is always easy to say we knew this was coming. A lot of people did not know this was coming. Who knows. We might go back to where it was. The thing to look for is transactions. They have been up a lot. People have said, to the people who say bitcoin does not have value, look at these transactions. You are using it more. It should be worth more. The problem is whether these transactions were inflated by the bubble, drawn in by the rising price. That shows transactions. If we see a transaction drop off, we know it was a bubble. Mark stephen, yesterday was, some might say, a seminal day, when long island ice tea changed its name to blockchain. Signify thet could mania phase of the bubble. Could we pinpointing when we might be near a top . Guest it is hard to do that. I wrote a piece of month ago, and probably 10,000 points ago, saying people say we are in a bubble, but it does not matter. I can still make money off it. There are lots of signs of mania. It is hard to know the ultimate sign. I do agree with some people that this is a sideshow, the long blockchain company. It does show a great demand to get in. As places are going to trade it more it is on the cme, the for people supply who want to invest in it increases, and that is going to make the price go down. Vonnie it has captured the popular imagination and brings of important questions about the way we interact, right . But does this bleed over into other sever currency trading . Guest it has. It certainly leads over. Bitcoin to look for is cash, right . Also bitcoin gold. Those are the split offs. Thehose go down, that means value from bitcoin is not just going somewhere else. It is shanking. It is certainly going to go into other coin categories, other digital cryptocurrencies. The question is whether it believes to the market and economy. Im not sure about that part. Mark what is the next phase we should be looking ahead to, stephen . Where almost at the end of 2017. What is the next chapter of the Bitcoin Cryptocurrency blockchain saga . Stephen i think goldman is going to start trading it. They said they are moving close to it. Other banks are going to start trading it. What people were looking for in the last week is that as the bigger financial players come in, as there is an established futures market this was supposed to dampen volatility. It has not, clearly, this week. It has been as volatile as it has been all year. If we dont see a decrease in volatility with more people entering the market, that is going to be a problem. Vonnie i want to point out someone very clever showed me an app that has all the Digital Currencies on it. Ethereum is down 21 , ripple down 11 . It is currently bleeding into the cryptocurrency space. A lot of Retail Investors lost their shirts already, stephen . Stephen a lot is probably hard to say. It is not it is not dotcom, not real estate. If it is a bubble, it is a much smaller bubble. I think there are some people on the some people who are those kind of people who jump in after investment frenzies have lost money, but to say it is a lot is probably an overstatement. Vonnie Stephen Gandel is a columnist for bloomberg gadfly. Great function. Time for the Bloomberg Business flash, a look at some of the biggest business stories in the news right now. Shares of nike lower today, the worlds biggest sports brand posting Quarterly Sales in north america that missed estimates. Nike sales were better than expected in china, europe, the middle east, and africa. The parent of google no longer needs adult supervision of one of the tech worlds biggest names. Eric schmidt is stepping down as executive chairman of alphabet. He was brought in when google had 200 employees and its founders were in their 20s. He will remain on alphabets board. Off musks spacex will cap a record year with a launch of a rocket carrying satellites from californias central coast. It will be the companys 18th mission this year, more than any other competitor, and more than twice as many as last year. That is her latest Bloomberg Business flash. Vonnie still ahead, a gift heading into the Holiday Weekend positive Economic Data. Home sales rise to precrisis levels as Consumer Spending surprises to the upside. And we want to mention that Senate Majority leader Mitch Mcconnell is holding his yearend news conference. He says it has been a year of extraordinary a compliment. Accomplishment. President trump will sign the tax overhaul any moment. Stay tuned. Mark live from bloombergs European Headquarters in the city of london, im mark barton. Vonnie in new york, i am vonnie quinn. This is bloomberg markets. Fresh Economic Data out. Home surging in november to precrisis levels. Joining us with more is the Bloomberg Intelligence chief u. S. Economist. Why the surge . This is not just new homes, existing homes. Generally, the highfrequency data has been better. Housing data has been strong heading into the end of the year. There have been a couple of factors. There is a lot of rebuilding activity in the south, due to the hurricanes earlier this year. That does not fully explain what is happening here. There was strong results in the west and even the you even the northeast. Given the strong activity on the coasts, that leads me to wonder if there is not a bit of a rush to close housing transactions before tax reform takes effect in the new year, potentially weighing on mortgage deductions, property tax, and state and local texted actions as well. There may be rushes into transactions. That means the strength we have seen in september, october, and november is likely to carry into december as well. Vonnie President Trump has signed the stopgap spending bill, including missiledefense money, 4 billion worth of missiledefense money. The stopgap spending bill has been signed. We know the president was due to sign the tax bill as well. We will bring you news of that when it comes. Some of this has to do with the way the economy went in the fourth quarter. Without the First Quarter and Second Quarter . A memberrowley of j. P. Morgan chase saying the impact is going to be earlier in the new year than we expected. As people register those refund checks or lower amounts of tax payments, it might not happen in january, but as the First Quarter wears on, i think they will start to realize the extent, and for some folks, it will be very small. For some folks, it will be considerably larger and we will start to see that influence economic activity. The fed is looking for as much, when we look at those forecast revisions from the last fomc meeting they know pretty much what the spirit and form of the tax reform package would be. They marked at the 2018 gdp forecasts considerably. They did not change the outlook. That means that at least at first glance, the fed is saying this is a sugar high, not a sustainable change in the speed limit of the u. S. Economy. Vonnie a lot of things sunset in a few years. Carl but what does not sunset is a lot of the corporate provisions, which should encourage capital deepening, which would boost productivity, but the fed did not acknowledge that as something that would raise the speed limit in the longer run. That could evolve later this year. Mark on the inflation front, todays pc data is it enough to persuade the doubters both inside and outside the fed that inflation is moving toward target . Carl i think this is a cold comfort that the inflation soft patch of 2017 is at least not deepening. But i think that it there is very little indication that it is coming to an end. At least we know maybe the worst is over, but the turnaround or the firming back towards the target could take a lot longer than what many analysts are anticipating. I suspect that this could actually factor into the Monetary Policy response from the fed next year, leading them to move more slowly than would have otherwise been the case. In 12 months, we might have a completely differentlooking fed. Get your crystal ball out. What is the fed going to look like, due to the personnel changes . What sort of slant is it going to have on the sort of dove hawk bias . The complexion changes. It is a more hawkish fed next year. That being said, when we looked at the hawkish dots, the hawkish end of the forecast spectrum, and the feds most recent updates, it did not look like they were getting increasingly nervous. A lot of those hawks on the fed are supplysiders, and may be willing to give the benefit of the doubt to see if some of this capital deepening could actually give us some free Growth Without having the inflationary followed as a result, or at the very least, policymakers are being savvy and understanding that faster growth in 2018 does not necessarily mean from inflation in 2018. The inflation may ultimately take until 2019 to really arrive. Vonnie our thanks for all your work all year long. Carl happy holidays. Vonnie breaking news at the white house, where President Trump will be signing the tax cut will into law any moment. He has already signed the stopgap spending bill, which included 4 billion of defense money, and he plans to head to maralago at about 11 00 eastern. Theing us is marty shanker, chief content officer. Is the president happy with his year . Marty he is ending the year on a high note. He is going to sign the tax bill he set out to do, which two months earlier was only given a 50 50 chance of getting through. It is a Major College meant and i am sure he is going to tout it in his typical style, as a major victory for the American Public and the economy. Vonnie he preannounced he was going to be signing at on twitter, and he is thanking companies such as at t, comcast, boeing on their spending. Marty that turned out to be a very strategic thing for these companies. They clearly had this in mind days before the bill was passed, and were ready to pounce when it was passed. At t is in the midst of an acquisition that they really want to see get accomplished. Vonnie comcast and boeing may also want to be. Marty this is a very transactional president. You scratch my back, ill scratch yours, is i think the theory at work. Mark marty, the stopgap spending bill it takes into the long grass, or at least for a few weeks. Longstanding issues. How dong, daca those issues and others which i have not mentioned get resolved . Marty they are not going to be resolved in the next three weeks or two weeks before Congress Comes back. They just punted this because they could not reach an agreement. Besides i are getting even further apart from each other. January 19 is going to be a very extraordinary day, if they are able to come together. They are going to need democratic help to get some of these things done. Right now, the democrats are demanding action on things like backup. If they do not get it, there could be a shutdown on the 19th. Resolving those issues is going to take priority over infrastructure and the welfare system. Did we get to a point where it is too late and we are approaching the midterms . That is the next stage after resolving these initial issues. View, the Midterm Campaign has artie begun. It began in alabama. You see people lining up the democrats feel they have a great shot at taking back the house. Some think they could even take back the senate. The stakes are very high. There is various reporting that the republicans are trying to figure out what strategy to 2018. T a bloodbath in that would include working with the democrats. You may have seen a hint of that in Donald Trumps treat today. Vonnie marty is sticking with us as we await pictures of the bill signing. We already had the signing of the stopgap spending bill. Mitch mcconnell, Senate Majority leader, still speaking. Stay tuned. Vonnie breaking of the white house, where President Trump has signed the tax law. New tax legislation in effect as of now in the United States. Trump signing the republicanbacked bill to overhaul the tax code. Joining us is bloombergs chief content officer. To what extent has life changed in the last minute in the United States for most people . Marty didnt you feel it . [laughter] it is a moment in history, right, which us journalists really savor. It is a monumental change in our tax system, full of unintended and intended consequences that will play out over the next year and next decade. People will look back on this day and measure his performance on the promises made against what actually happens in the real world. Vonnie and there is the corporate side of things. Corporations have already started to look into what this will mean for them, bu
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