Transcripts For BLOOMBERG Market Makers 20150303

Netanyahu goes to capitol hill. Good morning, im Erik Schatzker. Stephanie im stephanie ruhle. We have a lot to do today. Before we do that, i want to take it to the bulletins for the top business stories of the morning. An hour from now, a joint meeting of congress will hear from Benjamin Netanyahu. The israeli Prime Minister is expected to reveal compromises the u. S. Has made while negotiating a Nuclear Agreement with iran. He is gambling those revelations will either delay or derail any possible deal. The speech is a controversial one. John boehner invited netanyahu without consulting the white house. The israeli leader spoke yesterday at the proisrael lobbying group. As Prime Minister of israel, i have a moral obligation to speak up in the face of these dangers while there is still time to avert them. Stephanie you can watch all of his speech to congress here starting at 11 00 a. M. That is not the only news out of congress today. Speaker boehner has agreed to hold a vote later today to fund the Homeland Security department through the end of the year with no strings attached. His effort last year to pass a threeweek extension failed one house conservatives rebelled against. It they want any funding bill to reverse the language reversing obamas executive order on immigration. A full year extension should win enough democratic votes to offset gop defection. Citigroup is selling off its subprime lending unit. Citi has agreed to sell onemain financial. The prize about 4. 3 billion in cash. The type of high interest credit paid back in chunks over time. Mike corbett says the business doesnt fit the banks strategy anymore. General electric ceo may step down as early as next year. The report says investors may be looking for a change at ge. Has been chairman since 2001. Embarq is report says Jeff Bronstein could be the front runner to succeed. Ge is not commenting yet. Auto executives are taking apple and google seriously as potential rivals. Apple is pushing to have an electric car in production by 2020. Google hopes to have a self driving car on the road within five years. Bloomberg spoke with the volkswagen ceo. These two companies intend to reduce vehicles, they could go fast. We intend to still make a lot of engines so it will be more difficult for them. To master the physics of automotive is not easy. Stephanie he says although apple and google will attract young tech savvy people to the business. Questions are being raised about whether Hillary Clinton broke government rules on email while she was secretary of state. The state Department Says clinton used a personal email account to conduct government business. That may have violated federal requirements. Her aides did not have her emails preserved, which is required by federal law. She has turned over thousands of pages of emails since. If nothing else, this will give congress a lot to talk about. Erik it made me wonder whether hackers are trying to figure out who her email provider was and where that server is and whether or not it is hackable. Stephanie the one thing i dont know is how many government officials use the personal email. When i saw the story, i thought it was a smoking gun, but maybe a lot of people do. I use my personal email at work all the time. Erik but you are not the secretary of state. Stephanie but maybe other people and government do. Do we know that only Hillary Clinton did . Maybe others did. I get it, i am not the secretary of state. Erik what appears clear is that Hillary Clinton exclusively use her personal email account to conduct official business as opposed to using state Department Email which is subject to archival requirements. That is the issue. It is an accountability and transparency issue. Do the American People have access to everything she wrote that they should have . Stephanie a senior official in the to sign off our back her or she will have a serious problem. Erik let us turn our attention to another matter. Is the surge in auto sales running out of steam or was it the bad weather . Fabbri numbers february numbers missed estimates. Let us bring in jamie butters. What can you tell based on what we are hearing right now . It certainly is coming in less robust than expected. It was already looking to be a bit of a slowdown. Maybe the slowest annualized pace since october. It may end up being worse than that. We are still talking about growth. Everyone is growing. Ford was down 2 but everyone else was up. The yoda was suspected toyota was expected to be the big winner but they havent reported yet. It was one of the coldest months on record, especially in the midwest and northeast which are important markets. Truck sales were good. Car sales were not. Kind of a typical wintry mix that you can expect. Erik the skeptic in me says we have seen months of bad weather before. Month after month it seems auto sales continue to come out ahead of estimates. Should we be raising questions that cold weather was to blame . Maybe. Or maybe as some in the industry are blaming the analysts for being too optimistic. One thing you would understand as well as everybody is we did that survey last week. The last weekend of the month is always really big for sales. All dealers try to hit their sales and the numbers. But then it gets cold and no one goes shopping. Then the dealers missed their numbers. When it comes at the end of the month, the weather has a bigger effect. That said, we had bad weather the previous february so the comparison was bad to bad. Stephanie the selling category bestselling category . Pickups and suvs are doing good for everybody. Fords f series was down. Gm had great sales. Jeep had good sales. Most of the cars were down. Erik we will leave it there. Thank you so much. Jamie butters in detroit bringing us a perspective on auto sales. Stephanie at the mobile World Congress in barcelona, much of the focus will be on one critical issue, net neutrality. Tom wheeler will take center stage to deliver the keynote address. Following last weeks landmark vote on tougher internet regulations, bloomberg is this week editor brad stone spoke with chairman wheeler earlier this morning. What did he have to say . He has come into the hornets nest here. Not that excited about being regulated here as common carriers. Chairman wheeler staged a spirited defense saying it will not hurt innovation or investment. He was a little bit fatalistic about the road to implementation. Is what he had to say about the potential for litigation. Everybody talks about this is a 317 page order. The rules take up eight pages. The other 309 pages are the explanation which in many cases is talking to the court because we know that the big dogs will take us to court. That was chairman wheeler. We also talked today to blackberry ceo john chen. Blackberry is moving away from the iconic keyboard the. They introduced a touch screen. They also will try to say themselves. Stephanie that is brad stone. You know how i feel about the blackberry. I have some true feelings of affection. We will be checking in with you later, brad. Erik when we come back, is it time to rein in the fed with more supervision . Some in congress think so. We will bring you their debate and hours. Stephanie the murder that had a Chilling Effect on Vladimir Putins opponents. We will be speaking with gary kasparov. Stephanie welcome back. It is time now to bring you uptodate on the top stories of the morning. The impact of the home insecurity funding could be over. Speaker boehner has agreed to hold a vote today on a full year extension with absolutely no strings attached. His effort last week to pass a threeweek extension failed one house conservatives rebelled against it. They want any funding bill to include language reversing president obamas executive orders on immigration. A full year extension should win enough democratic votes to offset the gop defection. Shares of best buy are up as much as 5 today. The Worlds Largest electronic chain boosted its quarterly dividends added a special dividend, and announced a billiondollar share buyback. Best buy will launch another round of cost cuts. Same store sales rose the last two quarters. The Company Warns they may fall the first half of this year. Casino revenue plunged yet again last month. Down a whopping 49 . High rollers away during the chinese new year. That is blamed on china was crackdown on chinas crackdown on corruption. There were concerned chinese authorities would increase their scrutiny. Erik to audit or not to audit is the question Congress Must answer about the federal reserve. Rand paul is leading a faction of republican lawmakers who want to give congress more power over the central bank. He has almost singlehandedly turn this from a fringe issue into something more mainstream. Janet yellen says subjecting Monetary Policy decisions to gao oversight is a terrible idea. She has many supporters inside and outside the fed. Who is right . Let us bring into people with different views who very much mirror the debate taking place in washington. David russell of the Brookings Institution and mark. Mark my will begin with you. Mark i will begin with you. Why would subjecting Monetary Policy to a gao audit not result in the politicalization of a central bank . Lets keep in mind what the bill requires is an audit. It doesnt let congress set and Interest Rate or Monetary Policy. It just does what the gaos bread and butter is which is program evaluation. I can unfortunately say most members of congress dont even know the right questions to ask. To me just a gao helps inform congress on any other faction of government, it is important if we expect congress to be better informed. The value here is to try to increase the ability for senators and congressmen to us right questions and engage in a real conversation. We have seen this too many times when the hearings become political theater. When he to minimize that by having a more informed congress. Stephanie you think an audit is a bad idea, dave. Why . I agree with mark that congressional oversight hearings of the fed are a joke. Members of congress seem to be interested in using it to score political points rather than asking probing questions. What the law does is say what the bill does it say that any restriction on gao review of Monetary Policy is repealed so it would be possible if we had a senate or house chairman who wanted to arrest the fed to order up these audits. We dont know if that would happen, but that is the problem. We have a very difficult thing here. We want the fed to be accountable to congress. I dont think a gao audit is the best way to do it. Gao could play a role in helping congress as but a questions. Erik mark, let us talk about the whole oversight function. If you really do agree on the absurdity of some of the congressional testimony or the theater that it turns into when janet yellen and her predecessors have set before senators and congressmen in there twice annual testimony how would those people do a better job overseeing the fed than they do now . They would be better informed. As long as the incentives i should poke the media a little bit here. They will go up there and talk about what they want with their three minutes of time. But part of the problem is in my experience most measures of congress dont know where to start in terms of a question about Monetary Policy. You have seen it rarely back and forth as a a dialogue. We need to break out of that. We are stuck in his political theater. I dont see how getting the gao auditors over to the fed immediately after a decision to ask them questions about why did you vote this way or can i see your emails and memos. I dont see how that will make it better. I worry this is a trojan horse. For people in congress who dont like the feds policies erik go ahead mark. As somebody who has been on the requesting, deceiving, and assisting end of gao audits timely is never a word i would use. It will be six months. The bill itself says 90 days after the audit. This is not something someone can request 50 audits and constantly harassed the gao. We have to ask a bigger question. Do audits politicized at all . When need about thousand gao audits of u. S. Involved in iraq. Were some of those political . I bet some of the more. If you are a fed share chair that cant stand being audited, what are you doing being a fed chair . Stephanie if they did an audit, what do you think will actually come out of it in a productive way . We are talking about a town mired in good luck. That is a much bigger problem. Part of the question is why are we treating the fed differently . You can say the same thing of the gao audit of the dod or clintons emails. They are political. I think it is important that everyone to have an informed congress that we look at serious questions. Why is the fed so dependent on 22 primary dealers to do its business . Ecb uses 500 some counterparties. I would love to have the gao look at how became a primary dealer. Erik david, last word to you. I think the problem here is this could be a tool of harassment of the fed. There are better ways to give congress to get congress more informed and asked the questions that mark is asking. Erik are there better tools to harass the fed if that is what you want to do . There are. They are working on those. Erik thank you. Stephanie that is your crazy question . Erik we laugh, but this is a serious issue. Stephanie the saddest part is, it is all true. Thousands and moscow say goodbye to a murdered Opposition Leader. We will be speaking with another of Vladimir Putins opponents. Stephanie when we return russias antiputin opposition will be affected by the murder of one of its leaders. Erik we are waiting on israeli Prime Minister Benjamin Netanyahu. He will be speaking to congress on iran a little more than half an hour from now. Hes out there. Theres a guy out there whose making a name for himself in a sport where your name and maybe a number are what define you. Somewhere in that pack is a driver that can intimidate the intimidator. A guy that can take the king 7 and make it 8. Heck. Maybe even 9. Make no mistake about it. Theyre out there. I guarantee it. Welcome to the Nascar Xfinity series. Live from bloomberg headquarters in new york this is Market Makers with Erik Schatzker and stephanie ruhle. Erik good morning once again. Im Erik Schatzker. Stephanie on stephanie ruhle. Erik we will start with the top business stories of the morning. A half hour from now the Prime Minister of israel goes before u. S. Congress to try to derail a nuclear deal with iran. Benjamin netanyahu will show why he fears negotiations will lead to iran getting a nuclear bomb. He accepted this invitation to address congress from House Speaker john boehner. House was never consulted. Netanyahu is in the middle of an election campaign. President obama makes it clear what he thinks of netanyahus visit. We think it is a mistake for the Prime Minister of any country to come to speak before congress a few weeks before they are about to have an election. And makes it look like we are taking sides. Erik you can watch all of the Prime Ministerss right here starting at 11 00 a. M. Automakers came up short last month. Several posted sales in february that missed analyst estimates. Ford up 32 for mustangs and explorers. Barclays set aside and next or 1. 2 billion dollars to cover costs of settling an investigation in currency rigging. The ceo says that might not be the end of it. We are required to provide for what we can reasonably estimate at this time and that is what we can reasonably estimate. I cannot say that will be the end of Foreign Exchange provision because the discussions are still ongoing with a number of the authorities. Erik give him credit for honesty. Jet can stick over barclays in 2012 and has since eliminated 14,000 jobs and cut more than 2 billion in costs and shrunk the investment bank. A new report from Barclays Says General Electric may have a change at the top coming. Gao Jeffrey Immelt may step down in the next year because investors want a change. He has been in charge of ge since 2001. If there were a Global Financial crisis right now, banks would come up short on liquidity. The worlds banks are 341 billion short of easy to sell assets. The rule here does not take effect until 2019. In southern chile, a volcano erupts in spectacular and terrifying fashion. Was spewed as much as two miles away. No one was killed or injured. It is located near a popular tourist resort in southern chile. Stephanie i was just about to say you love chile. Erik i lived there. That area is just spectacular. Stephanie i have never been. There is more volcanic corruptions in d. C. The standoff over Homeland Security funding could be officially over. John boehner plans a vote as soon as today to fund the home and Security Department through the end of 2015 with no strings attached. Peter cook is in d. C. Is boehner throwing the towel in . He is effectively throwing the towel in. This move will anger some conservatives. We know about the blowup on friday and they fiasco on the floor when he couldnt get a threeweek extension passed that included language rolling back the president s executive immigration action. He is looking to pass the vote today with largely democratic vote. This is a move by john boehner to end this controversy and move on to some thing else. He runs the risk of anchoring his conservative colleagues one more time. Stephanie as this folk going to be overshadowed by the israeli Prime Ministers address today . Peoplewill people Pay Attention to what boehner is doing . You pointed out what could be the exact strategy behind this vote. All the attention in washington right now is on netanyahu and his speech. This will be a secondary story if the house does indeed pass this home and security funding later today. Maybe that was the goal all along. Two big stories today but netanyahu will soak up a majority of headlines. Stephanie give us an idea of what will go down at the speech today. We will have a certain number of lawmakers our tally was somewhere in the 3050 range that threatened to boycott. I spoke with charlie wrangle who said all along he was not going to take part because he did not like the invitation process and how netanyahu got invited. The white house wasnt involved at all. Is not going to go because he thinks it has been a distraction. He doesnt agree with the premise but he wants to show his solidarity with israel. Tough choice for democrats in particular. Erik do we have a solid count yet on how many will not take part . Some people reporting as many as 55. Our tally was 37 earlier today. We could be down to 36 because that included charlie wranglerangle. Some very close to israel decided not to take part because it is so close to the israeli election and they think this move will undermine the president s leverage in negotiations with iran. Stephanie thank you to peter cook. He is working overtime today. Erik we are more than an hour into the trading day to let us find out what is happening in Financial Markets from scarlet fu at the breaking news desk. Nasdaq backing away from matching its record high. We will keep an eye on that. One name making a little bit of a comeback is lumbar liquidators. David strasser says yesterdays 25 plunge on the back of the 15 minute story was overdone. He now upgraded lumbar liquidators to buy. He says it is compliant with california regulators. The basic thesis here is his sense of management risk everything for a little does not make sense. It has gone from under 40 a share to as low as sorry it has gone from 70 a share to 48. Another stock is no longer a buy micron will. Will need to increase micron will need to increase to fight samsung. You were talking about disappointing sales for carmakers. Autozone not affected. Shares trading at a record high 663. 38. Erik thank you very much. Stephanie when we return, he is one of the most prominent members of the russian opposition. Former world chess champion Garry Kasparov will be here to tell us why the west is partly to blame for the murder of a fellow Opposition Leader. We will have that and more when we return. Stay with us. Erik a few moments to bring you uptodate on the top stories of the moment. Minutes from now, Benjamin Netanyahu will make his case to congress. He has inspected to disclose come from eyes as the United States has made in order to negotiate a nuclear deal with iran. He said a deal could lead to iran developing a nuclear weapon. Citigroup has agreed to sell its subprime lending unit onemain financial. Spring leaf and onemain are two of the largest providers of installment loans. Some advice from one possible president ial candidate to another. Jeb bush tweeted that Hillary Clinton should release her unclassified emails from a chua secretary of state just say he did as the governor of florida. We said obama says continues a personal email account to conduct business and that may have violated federal requirements. She has since turned and thousands of pages to the government. Stephanie slain russian Opposition Leader Boris Nemtsov was laid to rest today in moscow. Thousands turned out to pay their respects. He was shot four times in the back last week days before he was to lead a rally against president Vladimir Putin. John major had this to say at the memorial. He stood for a word liberty. He stood against aggression oppression and anyone who thinks his words will be silenced by his murder, i believe they made a very serious mistake. Stephanie he former world chess champion who now runs the Human Rights Foundation here in new york was also a longtime friend of Boris Nemtsov and our condolences to you. It is very hard to describe. I was watching the funeral this morning and i have to admit i was crying. It is even more difficult because i could not be there. Stephanie because it is not safe. My trip to moscow would be a oneway ticket with predicable consequences. I am ashamed to hear all the speculation about different possible suspects and scenarios. When you investigate a crime you should look for the motive and capability. Boris nemtsov was the one who released numerous reports about corruption. Will support only, he was about to release his new report about the Russian Troops in ukraine. Be just a money would include testimonies it would have included testimonies from soldiers and others. Stephanie could we still see that report . I doubt it because after watching away all the traces of the murder, they rushed into his apartment and he raced his computer and every bit of information they could find. Erik boris clearly knew there were risks. His mother was terrified he would be murdered. In the days before his assassination, given the fact that such a high profile figure in the opposition was taken out in this manner, what do you expect from opposition politicians and those more generally opposed to the putin regime Going Forward . I think this message was very clear. Anybody who speaks against Vladimir Putin is erik a dead man . It is no longer about days months, years in prison. You could simply be eliminated in front of kremlin in such a brutal manner. Stephanie if he has just made it known to the world that Vladimir Putin is the ultimate gangster what should World Leaders from the western world think of this . You just saw john major speaking about freedom and boris and his contributions to liberty. John majors signature was on the document of the the best memorandum alongside bill clinton guaranteeing Ukraine Territorial integrity in exchange for the nukes. It is not about one or two nuclear devices. Ukraine has a Large Nuclear arsenal. Can you imagine putin will do anything against ukraine if he had hundreds of Nuclear Warheads miles away from moscow . For 20 years, he invested almost nothing because he believed it was protected by the United States and united kingdom. Now erik i understand the point you are trying to make, but is that tantamount to saying there is blood on the hands of western nations . It is not about nations. It is about leaderships. Erik we collectively take the responsibility because we elect them. The world is getting more dangerous so someone is responsible. Naturally people who could change the events like the president of the United States whether Prime Minister of the united kingdom, they should at least share the response ability. Erik what should they do . Stephanie if you were sitting with president obama today, what would you tell him to do . To resign. 3stephanie to resign . Over this issue . I believe everyone is counting the remaining time that he has in the office. Stephanie how does president obamas resignation solve this . I apologize. Im emotional. He proved to be a weak leader. This is the only man that putin counts as a potential opponent. Looking at obamas and action putin believes he can do whatever. Every negotiation shows america is weak and indecisive and not willing to take the responsibility which it is supposed to carry as a leader of the world. Erik what would a strong leader be doing . They would not let it happen. Things with guys like putin do not happen overnight. They take time. It took time for him to recognize he could do this and that and that. Many milestones in his rise to the current moment. Erik i understand things take time, but my impression is that pretty much everybody was surprised by his encouraging crimea. It wasnt a surprise. I went on twitter on fairbury 20 february 20 and the very fact they were surprised it is even worse that they werent surprised because they let putin destroy the very foundation of european security. It was based on the territorial integrities. Stephanie all of this toothpaste is out of the tube now. A leader has been murdered. What can be done today . Unfortunately, whatever you do it will not bring boris back. To protect his memory, the western leaders must guarantee ukraine will be protected because i believe putin will move forward. Ukraine needs weapons and political support. You have to show strength and dry red line that will be drawn by america and europe in front of putin. Erik they have effectively drawn a redline. Major the line around natos borders. We havent seen it tested. It putin and i believe he will move forward, are you sure you when i hear the same voices from estonia and latvia that we cannot find on a map . Stephanie you are more passionate than ever . Arent you afraid of your safety . Im in new york and boris was killed in moscow. I believe i have to speak just elevate his memory. Stephanie you dont think there are russian gangsters in new york . I have faith in the police. Stephanie i am so sorry. Our condolences. Erik let us take you back out to the breaking news deskk. Here is a doubledigit percent increase for the japanese carmaker. 13. 3 increase in february vehicle sales for toyota. Analysts were looking for in increase of 15 . It misses the mark here and it is consistent with what we have heard from chrysler, ford, and gm. A lot of people blaming the Winter Weather and storms across the east coast for the disappointing numbers. Theater getting a boost because of the week yen making cars affordable. Toyotas shares are falling about 4 10 of 1 in u. S. Trading. Erik thank you scarlet. A slight decline in those shares. Stephanie a lot to cover today but that will be it for the two of us. And abbreviated edition of Market Makers. Mark halperin and john hyland will be taking on live coverage of Benjamin Netanyahus address to congress. Erik and i will see you tomorrow. Welcome to bloombergs special coverage of Benjamin Netanyahus special address to congress. That is really by minister will walk into the House Chamber any minute to give a controversial address to lawmakers about the dangers posed by nuclear a riran. Of any foreign speech this has been that has been given on a mercantile, this has been very controversial. What do you think the stakes are . Like a state of the Union Address when the president has multiple audiences Benjamin Netanyahu will have multiple audiences as well. He will get lots of applause. This is a hot ticket in washington. He has an audience at the white house. Also audiences around the world. s warnings of iran are clear. It is what he wants to do next because he doesnt like the negotiations. There is a more cynical or skeptical take. A lot of people who follow israeli policies would say the only real audience here is the israeli electorate. Benjamin netanyahus job is in jeopardy and some think this is what it is all about. The election is march 17. Prime minister netanyahu will be heard shortly with a lot of democrats and republicans. You see john kasich one of the many people from the country who has flown into here from Prime Minister netanyahu. He has a long history with american political leaders. The election again is march 17. Conventional was them is doing this speech in part for that election. Let us go to the capitol hill and white house for our two colleagues. Peter cook is at the capitol hill. The president will not watch. Why not . According to white house officials, he has meetings including a conveniently planned 11 30 Video Conference european leaders dealing with ukraine. That should run right in the middle of one netanyahu is speaking. In the white house, they dont want to act like they are giving a lot of attention to the speech. Top National Security officials and white house political aides will be watching and paying close attention. The president himself will not. It has another meeting relating to another Foreign Policy issue scheduled during the speech. The administer should has been unhappy about the speech since it was first announced. Over the course of the buildup to it, has the situation gotten any better or just increasingly worse in terms of how much enmity there is now about this whole thing . Behind the scenes, it hasnt gotten much better. Publicly you saw yesterday sam power and another trying to ratchet it back a little bit. They said to friends like the u. S. And israel will have disagreements at times. You saw Benjamin Netanyahu saying the same thing. There is a feeling that this has reached the brink right now and then need to ratchet it back. Anyone you talk to in the white house right now thinks the only way this relationship is better is probably through a looks oriole elect oraloral change. You saw john boehner who invited netanyahu to controversially address this meeting. Joe biden is not attending this meeting. He is out of the country. Peter is still with us on capitol hill, but i want to bring in gwen ackerman. How much israelis are paying attention and caring about the speech . They care a lot about the speech. I imagine nearly everyone is tuned in wanting to hear what he has to say. People who are supporting the speech are supporting it with all their hearts. The opposition who thinks this is not a good idea and not the way to fight the iran deal are watching because they want to hear what he has to say. Israelis are very sophisticated politically. It has a was been a cornerstone of this has become a partisan event. What do israelis think about that, the way in which netanyahu has introduced partisanship into the relationship . People are split on it read. They are attacking this as part of the election campaign. They are saying he is creating a crossice crisis. Its not good at all for the iran deal. His supporters and the people who are to the right of that party think he is doing the right thing that he is standing up for israel. Dignitaries are interest entering the chamber. We want to bring in peter cook from capitol hill. They had been debating sanctions in geneva. How much are members of Congress Going to change their posture on sanctions if at all based on what they hear today . I would be surprised if they change their posture that much. There are some lawmakers calling for sanctions for some time or in republicans got something past and the democrats said they would not some ordered on the floor. Unless there is a bombshell in here that Benjamin Netanyahu has that has not been shared, i dont expect to change. I expect them to make a strong appeal to members of congress for stronger sanctions. I think that will be one of the clear messages of the speech. Will this be carried everywhere in israel . We only have three channels. I see one channel is carrying it area. It will be delayed by five minutes. Everybody can see it on all the channels. There will be a delay of five minutes. They will be able to circumvent the delay and broadcast on the website. She is one of many dignitaries who have come in for this speech. We have seen democrats to not attend the speech. The you know the total number . By our tally it was as many as 37 a short time ago. Charlie wrangle changed his mind. It should be done to 36. Some reports had it as high as 55. We need to reconcile who is in the room. The anguish on their face the choice to go or boycott, they are loyal to israel. It was a wrenching decision to attend. This is a remarkable event. Netanyahu is seeking a fourth term. He is coming to the United States on the eve of a contested election. It has caused a lot of controversy. What happens after this speech regarding his role as the talks in geneva continue . I think its going to be hard for him to put things back together. He must believe that he can cut arise these wounds. Dennis ross said if this were not a political thing, there was no reason why he could not ask to have this after the election. He has seemed to be a master in terms of the way he understands american politics area people feel that he has missed or overplayed his hand. Its going to be hard for him to bring this act together. He is in a bit of a box. He has defense Officials Saying there isnt a great military option and that would encourage the iranians to build a nuclear weapon. Then you are left with sanctions. How much does he talk about additional sanctions . How much does he say let the negotiations continue rather than accepting a deal . President obama leaves the talks are a good idea. He is in a bind as well. There is no way to get a deal without removing all of the sanctions. That would require congressional action. Netanyahu is going to get a heros welcome in this chamber. I dont see how republicans would remove the sanctions. I agree with that. It will be interesting to see how explicit and statesmanlike he is at this moment and just talks about the threat of iran rather than lobbying for specific policies. I think there may be a chance if he tries to pull back from that so he is an accused of trying to meddle in american politics or it. This is the third time he has addressed a session of congress. Lots of debate even as the speech takes place as how likely a deal between the United States and other western powers and iran. I want to go back to Phil Mattingly at the white house. You have heard various Administration Officials talk about the odds of a deal. It has been as high as 60 to a low of 30 . Most people have been less optimistic. What do you think the administration believes is the actual chances that a deal could be struck . The president said it still below 50. That is the range they have tried to stick to public. The pathway forward for this deal, there are not a lot of them. Not only do have pressure from israel and netanyahu you mentioned the republicans in congress. Here comes benjamin net yahoo . We want to make sure that people can see the reaction. Most people have not seen these. It looks like a president ial entrance at the state of the union. He has a great feel for american problem politics. He will work the room like the president. I think you made a great point about the republican congress. There are things the president thinks they can do unilaterally to implement a deal. They cant ease back all of the sanctions. That is a difficult area for the iranian negotiators to deal with. Then you have the deal itself. One thing to keep an eye on today, the Prime Ministers aide says he would consider reseen some of the details of the negotiations. When it comes to this relationship, Officials Say that if he were to go that far and take that route, that would be an enormous problem. John kerry made that morning explicit saying he would not want any of the details released which are sensitive area. At which point, they would be in the same position. If there is no deal, we will have to think of more sanctions or military action. If there is not going to be a deal in the end, and a rational world they should be Standing Shoulder to shoulder they green out what to do next. The damage to the relationship could be such that it would be hard for them to do that. You saw newt gingrich. He is making his way up to the well of the chamber. He is escorted by various congressional leaders including mitch mcconnell. Harry reid is in there. Patty murray is from washington state. He has a long history in the United States. He is very politically and media savvy. He knows what buttons he needs to press. Lots of audiences for this speech, including back home in israel where the election takes place march 17. As you watch him work this crowd, when you think about what an extraordinary they gear he has been in modern history of israeli politics and his role with the United States, this relationship between obama and netanyahu is as frack to us as any fractured as any leader during this is ministration. This story begs to be told. It has been filled with dramatic moments and a lot of bitterness. Gwen ackerman in jerusalem, peter cook, thank you. We will listen to what is expected to be a 30 minute speech and we will join you in the back half for analysis and discussion. Lets listen to Benjamin Netanyahu talk about iran and its Nuclear Program. I have the honor of presenting to you the Prime Minister of israel, Benjamin Netanyahu. [applause] speaker of the house john boehner senator Orrin Hatch Senate majority leader mitch mcconnell, nancy pelosi and kevin mccarthy, i also want to acknowledge harry reid. It is good to see you back on your feet. [applause] i guess its true what they say, you cant be good man down. My friends, i am deeply humbled by the opportunity to speak for a third time before the most important legislative body in the world, the United States congress. [applause] i want to thank you for being here today. I know that my speech has been the subject of much controversy. I deeply regret that some perceive my being here as political. That was never my intention. I want to thank you democrats and republicans for your support for israel, year after year, decade after decade. [applause] i know that no matter which side of the aisle you sit on it, you stand with israel. [applause] the remarkable alliance between israel and the United States has been above politics and it must remain above politics. [applause] america and israel we share a common destiny. The destiny of promised lands and cherished freedoms and hope. Israel is grateful for the support of americans people and president s, from harry truman to barack obama. [applause] we appreciate all that president obama has done for israel did. Some of that is widely known. [applause] some of that is widely known like intelligence sharing and opposing antirid israel antiisrael resolutions at the u. N. Some is less wellknown. I called him in 2010 when we had the forest fire. He responded to my request for urgent aid. In 2011, our embassy was under siege in cairo. He provided vital assistance. His support for more missile interceptors during our war with Hamas Terrorists last summer. [applause] in each of those moments, i called the president and he was there. Some of what the president has done for israel might never be known. It touches on some of the most sensitive and Strategic Issues that arise between an american president and an israeli Prime Minister. I know it. I will always be grateful to president obama for that support. [applause] israel is grateful to you, the American Congress for your support for supporting us in so many ways, especially generous military assistance and Missile Defense including iron dome. [applause] last summer, billions of israelis were protected from thousands of hamas rockets because this capitol dome helped build our iron dome. [applause] [applause] thank you america for everything youve done for israel. I have come here today because as Prime Minister of israel, i feel a profound obligation to speak to you about an issue that could threaten the survival of my country and the future of my people. Irans quest for Nuclear Weapons. We are in ancient people. In our 4000 years of history many have tried repeatedly to destroy the jewish people. Tomorrow night, on purim we will read the book of esther. He plotted to destroy the jewish people 2500 years ago. A woman, queen esther, exposed the plot and gave the jewish people the right to defend themselves against their enemies. The plot was foiled and our people were saved. [applause] today, the jewish people face another attempt by another persian to destroy us. Irans Supreme Leader spews the oldest hatred of antisemitism with the newest technology. He tweets that israel must be annihilated. He tweets. There is not exactly Free Internet in iran. He tweets in english that israel must be destroyed. For those who believe that iran threatens the jewish state but not the jewish people, listen to the leader of has bola. He said if all the jews gather in israel, it will save us the trouble of chasing them down around the world. Irans regime is not a jewish problem. No more than the not see regime was a jewish problem. The 6 million jews murdered by the knot sees were a fraction of the People Killed in world war ii. Irans regime poses a threat to the peace of the world. To understand just how dangerous iran would be with Nuclear Weapons, we must understand the nature of the regime. The people of iran are very talented people. They are heirs to one of the worlds great civilizations. In 1979, they were hijacked by religious sell itszealots who drafted a constitution for iran. It directed the guards to detect the borders but also to fulfill the Ideological Mission of jihad. The founder, ayatollah maney asked for revolution throughout the world. The difference is so stark here in washington dc. America produces life, liberty the pursuit of happiness. Irans pledges death, ti rany and jihadist. Iran is charging into the void to do that. Their goons in gaza, lackeys in lebanon, they are clutching israel with three tentacles of terror. Asad is attacking syrians. Backed by iran they are seizing control of yemen. Along with the straits of vermouth, that would give a joke point on the oil supply. Choke point on the oil supply. Iran carried at a military exercise loading up a u. S. Aircraft carrier. That was last week, while they are having Nuclear Talks with the United States. For the last 36 years, the attacks have been anything but mock. Iran took americans hostages and murdered american soldiers in beirut and was responsible for killing and maiming servicemen and women in iraq and afghanistan. Iran attacks america and its allies through its terror network. It blew up the jewish Immunity Center in buenos aires read. It helped al qaeda bomb in africa. They attempted to assassinate the saudi ambassador in washington dc. Iran dominates for arab capitals. If their aggression is left unchecked, more will surely follow. At a time when many hope iran will join the community of nations, they are busy gobbling up the nations. [applause] we must all stand together to stop the march of conquest subjugation, and terror. [applause] two years ago, we were told to give them a chance to bring change and moderation to iran. Some change. Some moderation. The government hangs gays persecutes christians, jails journalists executes more prisoners than before. Last year, he laid a wreath at the grave of the terrorist mastermind who spilled more american blood than any other terrorist besides osama bin laden. I would like to see somebody asked him a question about that. The regime is as radical as ever. This should not be surprising. The ideology of the revolutionary regime is deeply rooted in militant islamic. That is why they will always be an enemy of america. Dont be fooled. The battle between iran and isis does not turn i ran into a friend of america. They are competing for the crown of militant islam. One calls itself the Islamic Republic and one calls itself the islamic state. They just disagree among themselves about who will be the ruler of the empire. In this deadly game of thrones there is no place for america or israel no peace for christians, jews, or muslims who do not agree with their medieval creed no women, no freedom for anyone. The enemy of your enemy is your enemy. [applause] the difference is that isis is armed with butcher knives and youtube and iran could be armed with Nuclear Bombs. I will say it one more time, the greatest danger facing our world is the marriage of militant islam with Nuclear Weapons area. To let iran when get Nuclear Weapons would be to win the battle but lose the war. We cannot let that happen. [applause] that, my friends, is exactly what could happen if the deal now being negotiated is excepted by iran. That deal will not prevent them from developing Nuclear Weapons. It would all but guarantee that they get those weapons, lots of them. Let me explain why. It has not yet been signed certain elements are now a matter of public record. You dont need intelligence agencies and secret information to know this. You can google it. Absent a dramatic change, we know for sure that any deal with iran will include two major concessions to iran. The first would leave iran with a Nuclear Infrastructure providing a short break out time for obama. That is the time for a bomb. That is the time it takes to make a nuclear bomb. Not a single Nuclear Facility would be demolished. Thousands of centrifuges used to enrich uranium would be left spinning. Thousands would be temporarily disconnected, but not destroyed. Because the program would be left largely intact, the breakup time would be very short, about a year. If the work on advanced centrifuges is not stopped, that breakup time could be a lot shorter. Certain restrictions would be imposed on the Nuclear Program and the adherence to those restrictions would be supervised by international inspectors. Inspectors document violations. They dont stop them. Inspectors knew that with north korea. North korea turned off the cameras and kept up the inspectors. In a few years, they had the bomb. In five years, they could have an arsenal of 100 Nuclear Bombs. Like north korea, iran has defined international inspectors. 2005 2006, 2010. They broke the locks and shut off the cameras. I know this is not going to come as a shock to any of you iran not only to faisal inspectors it plays a good game of hide and cheat with them. The Nuclear Watchdog agency said yesterday that iran refuses to come clean about its military Nuclear Program. They were caught twice operating secret Nuclear Facilities facilities that inspectors did not know existed. Right now, they could be hiding Nuclear Facilities we dont know about. As the head of inspections said in 2013, if there is no installation and iran, it will be the first time in 20 years that it does not have one. Iran has proven time and again that it cannot be trusted. That is why the first major concession is a source of great concern. It leaves iran with a vast Nuclear Infrastructure and relies on inspectors. That is real danger. Iran could get to the bomb i violating the deal. The second major concession is a greater danger that they could get to the bomb by keeping the deal. Virtually all of the restrictions on the Nuclear Program will automatically expire in about a decade. A decade may seem like a long time in the political life. Its the blink of an eye in the life of a nation and our children. We have a responsibility consider what will happen when Irans Nuclear capabilities are virtually unrestricted and all the sanctions will of the lifted. They will be free to build a huge Nuclear Capacity that could produce many, many Nuclear Bombs. The Supreme Leader says that openly. He says they plan to have 190000 centrifuges. Not 6000 or 19,000 that they have today. 190,000 centrifuges enriching uranium. They could make the fuel for an arsenal in a matter of weeks. My friend john kerry confirmed last week that iran could legitimately possess that centrifuge capacity when the deal expires. I want you to think about that. The foremost sponsor of global terrorism could be weeks away from having enough enriched uranium for an entire arsenal of Nuclear Weapons with full international legitimacy. If the inner Ballistic Missile program is not part of the deal, they could have the means to deliver that arsenal to the far reaches of the earth including to every part of the United States. You see my friends this deal has two major concessions. One is leaving them with a vast Nuclear Program. Two, lifting the restrictions in a decade. Thats why this deal is so bad. It does not block their path to the bomb. It paves their path to the bomb. Why would anybody make this deal . They hope that they will change for the better in the coming years or they believe the alternative to this deal is worse. I disagree. I dont believe that the regime will change for the better after this deal. This regime has been in power for 36 years and its voracious appetite for aggression grows with each year. This will whet appetites for more. What iran be less aggressive when sanctions are removed and the economy stronger . If they are gobbling up for countries right now under sanctions, how many more will it devoured when the sanctions are lifted . Would there be less terrorism when they have more cash to fund it . Why should the radical regime change for the better when it can enjoy the best of both worlds, aggression abroad and prosperity at home . This is a question that everyone asks. Israels neighbors, irans neighbors know that they will be more aggressive and sponsor more terrorism when the economy is unshackled and it has been given a clear path to the bomb. Many of these neighbors say they will respond by racing to get Nuclear Weapons of their own. This deal wont change iran for the better. It will change the middle east for the worst. A deal that prevents Nuclear Proliferation would spark a Nuclear Arms Race in the most dangerous part of the planet. This will not be a farewell to arms it will be a farewell to arms control and the middle east will be crisscrossed with tripwires. Small skirmishes can trigger big wars. If anyone thinks this deal kicks the can down the road, think again. When we get down that road, we will face a much more dangerous iran a middle east littered with Nuclear Bombs, and a countdown to a potential nuclear nightmare. Ladies and gentlemen, i have come here today to tell you we dont have to bet the security of the world. We can insist that restrictions on irans Nuclear Program not be lifted for as long as they continue its aggression to the region and the world. [applause] before lifting those restrictions, the world should demand that iran do three things. First, stop its aggression against its neighbors in the middle east. [applause] second, stop supporting terrorism around the world. [applause] third stop threatening to annihilate my country israel the one and only jewish state. [applause] if the world powers and not prepared to insist that they change their behavior before a deal is signed, at the least, insist that they change their behavior before a deal expires. [applause] if iran changes in behavior, the restrictions would be lifted. If they do not change their restrictions, they should not be lifted. Behavior, they should not be lifted. If iran wants to be treated like a normal country, let it act like a normal country. [applause] what about the argument that there is no alternative to this deal . That the nuclear knowhow of iran cannot be erased, its program is so advanced that the best we can do is delay the inevitable, which is what the proposed deal seeks to do . Nuclear knowhow without Nuclear Infrastructure doesnt yet you very much. A driver without a car can drive cant drive. Without thousands of centrifuges and enriched uranium, they cannot make Nuclear Weapons. [applause] irans Nuclear Program can be rolled back well beyond the current proposal i insisting on a better deal in keeping up the pressure on a very vulnerable regime, given the collapse and the price of oil. [applause] if i run iran threatens to walk away from the table, calder bluff here it call their bluff. They will be back. They needed a lot more than you do. [applause] by maintaining the pressure on iran, you have the power to make them needed even more. My friends, for over a year, weve been told that no deal is better than a bad deal. This is a bad deal. Its a very bad deal. We are better off without it. [applause] now we are being told that the only alternative to the bad deal is with war. That is not true. The alternative to this bad deal is a much better deal. [applause] a better deal that does not leave iran with a vast Nuclear Infrastructure. A deal that keeps the restrictions in place until the aggression ends. [applause] a better deal that wont give iran and easy path to the bomb. A better deal that israel and its neighbors might not like but with which we could live. [applause] no country has a greater stake in a deal that removes this threat. Ladies and jerome and, history ladies and gentlemen, we must choose between two paths. One path leads to a bad deal that will at best curtail their Nuclear Ambitions for a while. It will lead to a Nuclear Armed iran whose aggression will lead to war. The second path, however difficult, could lead to a much better deal that would prevent a Nuclear Armed iran and a new clear eyes middle east and the horrific consequences of both to all of humanity. You dont have to read robert frost to know that you have to live life. The difficult path is usually the one less traveled. It will make all the difference for the future of my country the security of the middle east and the peace of the world, the peace we all desire. [applause] my friends, standing up to iran is not easy. Standing up to dark and murderers regimes never is. With us today is a holocaust survivor. [applause] elie wiesel. [applause] your life and work inspires the meaning of the words never again. [applause] i wish i could promise you that the lessons of history have been learned. I can only urge the leaders of the world not to repeat the mistakes of the past. Not to sacrifice the future for the present or ignore aggression in the hopes of gaining peace. I can guarantee you this, the days when the jewish people remained passive in the face of genocidal enemies, those days are over. [applause] we are no longer scattered among the nations, powerless to defend ourselves. We restored our sovereignty and the soldiers who defend our home have boundless courage. For the first time in 100 generations, the jewish people can defend ourselves. [applause] this is why as Prime Minister of israel i can promise you one more thing. Even if israel has to stand alone, we will stand. [applause] i know that israel does not stand alone. I know that america stands with israel. I know that you stand with israel. [applause] you stand with israel because you know that the story of israel is not only the story of the jewish people, but of the human spirit that refuses again and again to succumb to historys horrors. [applause] right up there in the gallery, overlooking all of us in this chamber is the image of moses. He led our people from slavery to the gates of the promised land. Mosys gave us a message that has steeled our resolve for years. I give you with his leave you with his message today. Be strong and resolute, neither fear nor dread them. My friends, may israel and america always stand together, strong and resolute. May we never feared nor dread the challenges ahead. May we meet the future with strength. May god bless the state of israel and the United States of america. [applause] the israeli Prime Minister gave a passionate speech. We are with you, we will talk about the speech and about his message. He says he wants a deal with iran to dismantle its Nuclear Program. He does not want this deal with this iranian government. In a way, we knew he was against the deal. The question was could he late out a path forward. Could he get a better deal . A military option would be a difficult sale. There is not much appetite for it. He seems to be saying we need to wait for regime change in iran. That is the most important thing. No deal until iran changes leadership and changes its role in the middle east area. That is an important way to frame the argument. He is a pretty good politician. Here he is, milking in the applause. We will continue to watch the chamber and the theatrics. That paul is filled with democrats and republicans and dignitaries. Unlike the state of the union, there were plenty of applause lines and standing ovations. He praised president obama. He talked at some length about the Iranian Regime and its activities around the world. It is one of the great propagators of terror. He made the case without going into much detail that the iranian government could not be trusted with the terms of the deal. Lets go back to jerusalem with gwen ackerman. I am wondering what you think and how you thought the speech will be received by the israelis in the context of the election coming up. Many israelis will withhold opinion until they see how the United States reacts. This seems like a carefully crafted speech. He was careful to point out how wonderful president obama has been. He did not go into minute details about the deal. It was a veiled detail. The question remains has he created a rift with the president . With the americans . The israelis are split. The people who are opposed will wait before the voice opinions. Lets bring in the top and most veteran Foreign Policy voices that we have to offer. He is the director of the james a baker center. Mr. Ambassador, he had a message to the american government. What was the message . I think the Prime Minister threw down the gauntlet to the administration saying dont make this deal. The public aspects of it are known. Go for a better deal. He basically had a very strong message. He did not use these words, the crucial part of the deal is to allow iran to have a uranium enrichment capability under International Safeguards. Thats the heart of it. They are never going to accept the deal in which they dont have a civilian enrichment capability which is permitted. He did not mention that. I ran it will be able to produce many Nuclear Bombs if this deal goes through. He is attacking the substance of the deal in terms of a 10 year deadline. That is the blanket of an eye in historic terms and then they can do whatever they want. The third condition that he put down was dont lift sanctions based on what they do on the Nuclear Issue but what it does in its overall policy in the middle east. Basically, if you put this all together, what he is signaling to the administration and the congress is this is a bad deal dont make it go for stringent measures. If his conditions are met, there will be no Nuclear Agreement. I am curious, yesterday susan rice spoke at ai[ac. She said we cannot let an unachievable ideal stand in the way of a good deal. He does not think this is a good deal. I am curious what you think on the basis of what you were just saying. I think she is right. Dont make the perfect the enemy of the good. If a viable, verifiable agreement can be reached between the United States and iran, then that gives diplomacy a chance and the International Safeguards system a chance to monitor Irans Nuclear capabilities and any outbreak for nuclear weapon. That is better than having no deal. It has to be a good deal. It puts iran under International Surveillance that is verifiable. It gives diplomacy a chance to see if we can change irans behavior. Having said that we do not nor does israel have to dismantle any of the safeguards we have. Our military might, our political influence. We could go back to increased sanctions and all options are on the table. Whered you think the world is left if the negotiations and without an agreement . What happens at that point . I think we are going to see a rush toward economic sanctions in the first instance against iran. I think the relationship between iran and the west and israel will become much more problematic. I think we will see negative policies on the part of iran with no hope of changing in the region. That is why its important to try and get a viable structured sustainable agreement in place. The alternative is more of the same in a very turbulent region of the middle east where everywhere you look, the region is in great turmoil. Let me ask you one last quick question. There has been a discussion about the longterm ramifications are. Do you think there has been damage done by the Prime Minister coming here and speaking in the context of the election . There has been damage done. Having been an ambassador to israel, this is the most muddled procedure i have ever proceed ever seen, having a sitting chief of government, head of government, the israeli Prime Minister coming to address the united dates congress, going around the white house in doing so. Remember, the constitution of the United States gives the president the primary responsibility for the conduct of the United States. Congress has a very important critical role. What it is the president but the president , to bypass the president just weeks before the israeli elections this is a very important part of his coming to washington