Transcripts For BLOOMBERG Bloomberg Markets 20160803

Hours. Lets head to the markets desk where julie hyman has the latest. Bit of aeaking a losing streak, but not by much. You see a little bit of a gain, but it is a little one. We had markets open and even more little changed. The dow getting just 15 points, but that is enough to break the recent losing streak. Sessioneen on a seven that is an interesting chart. We have a little bit of a glitch. The dow had been on a seven session losing streak going into today. Here are some of the leading percentage of performers. Apple is rising as well and jpmorgan is getting some ground along with oddly the financials today and a bounce in some of the social oriented stocks. Twitter gaining after speculation about a potential buyout. That has not slowed down the stocks. Yelp to less of a degree. If you look at the financial stocks, American International Group Trading higher and the Company Announcing a new buyback authorization. Cityut with earnings, gaining ground and the oil stocks experiencing quite a dramatic turnaround after we saw a turnaround in oil prices this well this morning as well. They have fallen the most even since crude inventories rose. Shery we will see if the sustained. With get check on the bloomberg first word news with Mark Crumpton from the newsroom. Mark there was a dramatic scene in dubai when a packed emirates jet crash landed. It arrested in flames after sliding down the runway on its belly. The emergency parachutes were deployed and all 300 people on board escaped. One firefighter was killed during the response. The accident is the worst ever for emirates, the world against carrier by international traffic. The airport was shut down several hours before reopening. Donald Trumps Campaign says it raised 80 million in july along with the Republican National 20. Trump raised 64 million from digital and direct donations and 18 million from fundraising events. Mr. Trump donated 2 million of his own money. His Campaign Finance chair was on bloomberg earlier. Our major focus is for the Ground Campaign, for the benefit of him and the party. This is not a Traditional Campaign driven by paid media. He has over 20 million social media followers. Its like owning a newspaper. Hes happy to use it and happy to be on tv. Hillary clinton raised 90 million last month. Americans overwhelmingly disapprove over mr. Trump comments mr. Trumps comments over a gold star family. 50 say the remarks were inappropriate. Said 43 ofs americans said they supported a temporary ban on muslims immigrating to the u. S. The Clinton Library today released thousands of pages of files on Supreme Court nominee merrick garland. The file state back 20 years. Included is a letter from republican senator orrin hatch wellqualified. Republicans have refused to hold hearings on his nomination. Global news 24 hours a day powered by our 2600 journalists and analysts in more than 120 countries around the world. Im Mark Crumpton. Back to you. Is the s p 500 index has supposedly peaked or the year according to estimates by wall street strategists. Thats about 1. 5 below current levels. For some perspective, i want to bring in the chairman at holland and company. Good to have you with us. Let me start by asking about this commentary we got from bill gross, the portfolio manager. His Investment Outlook, a comingofage story. Aside from all of that, he had something provocative at the end of that. He said i dont like most bonds, dont like private equity, i like real assets. I wonder if you sympathize with bill gross when he talks about that . Guest its interesting because he and i have been in the business about the same amount of years and we started the program by saying stocks but also ons continue to flirt with all time highs, so that is usually the time to ask is there a lot left in this, is there a lot of risk . Hes saying the same thing. Yet smart people who have been in the business for a while saying that there are risks out there and both of them are saying sell everything. Ive been in the business too long to know if i go all in or all out, it will be the wrong move. Having come so far since 2008 timebonds and stocks, at a when Central Banks are not keeping the confidence of the public where they used to, i think its time to have some reserve. It looks like the market is finding a reason to go up or down. In the coming weeks, what will be driving the markets . Will it be earnings or the Central Bank Decision . What will it be . The markets right now are just searching for reasons to go up and down. Theres very little motion the last couple of weeks. Tomorrow, we have the bank of england and the jobs report. Those will be reasons to move one way or another. Theere talking about how bank of england doesnt give negative or positive, but it will be so out of character that it would move the market in one direction or another. I think it would be a one and done kind of reaction because the fed is on hold. We can talk about it every single day as we do, but it is not going to change anything because of one jobs report number. David how closely are you going to be watching that bank of england decision tomorrow . Guest since they have been the adults in the room, if they did something unusual, that would be big news to me. They did iect if would try to figure out why they did it. Theink the requisite thing, market economy has done reasonably well behind it and i think it will be ok tomorrow. Given everything we have seen in the markets, want to touch on the volatility landscape. We have a nice chart to go with it, but when it comes to the vix, they widen. That would be the highest possible reading since 2012. What does that mean for volatility and investors Going Forward . Do we just have to deal with more price points to come . Guest we have had very little. Hasst for the last 30 years been an incredibly volatile month come easily to the downside. Have been playing as they often do in terms of their guesses to the future. David what is your sense of what it has been doing question mark we have seen it rallying a little bit today. Definitely below 40 a barrel. Guest with the global slow economy, we dont have a reason to think we are going to get a massive move up or down. Maybe even bonds in a trading range where there is very little volatility. Oil is approaching 20 and people are talking about 50, neither seems to be sensible right now. Over the near term, we have an oversupply. The numbers came out in gasoline today and we have no reason to expect them to move up. The s p 500 trading near its highest multiple in a decade. What do you like . Do you have 10 hours . One can use the 10 year treasury or the one year treasury holds. The reality is nobody has a handle on where stocks should be valued and thats why people are still lush on the market. One third of the world sovereign market trading on a negative yield, it may be very rich on a historical basis but we have never had bond prices this high or yields this low. With theows starting worlds smartest academics or anyone on the federal reserve, this is a big experiment. Nobody has done it and we have no clue whats going to be happening over the next couple of years. To put some time reserves and maybe experiments can be successful from here or maybe we find out it did not work so well. Shery friends message me all the time asking what stocks they should buy. How should i know . Guest you have 90 of sovereign bonds trading at 2 over yield u. S. Stocks, good stocks. 3 00 new york at time when bill gross will be right here on bloomberg television. Coming up, questions being raised on one of Berkshire Hathaways ceos. Is he too tough for Warren Buffett . This is bloomberg. David this is Bloomberg Markets. Shery its time now for the Bloomberg Business flash, a look at the biggest stories in these right now. Tiaa is said to be in talks with ever bank financial. That would be the largest lender by deposits according to a person with information. Ever bank said it was in a position to sell itself to a well respected Financial Services company. Worth 2. 5uld be billion. David a report walmart is in talks to buy a online retailer jet. Com. Jet. Com has been in business for a little more than year. It is an clear how much walmart would pay but the company is worth a reported 3 billion. Isry a spaceflight startup about to take one giant step for mankind. The federal Aviation Administration has given the green light for moon express to set a robotic lander on the moon. Its the first time the government has approved a private mission beyond earths orbit. Successful, it could win the google x prize and 20 million. That is your business flash update. A lot of questions being raised about one of Berkshire Hathaways newest ceos. Warren buffett relies on managers like him to run berkshires farflung operations sometimes they are too harsh. Our reporter covers Warren Buffett. We said to harsh was a characterization. Tell us how he runs . I spoke with a number of current and former employees, folks who have direct experience with mark and the characterization they gave me of his management style is this is a ceo who pushes his people really hard and they have a review process where he goes around to the individual factories and in these reviews, these folks told me he would sometimes use violent language use profanity, really in an effort to get people to perform at the highest levels, but some of these folks told me to ease phrases and they were the kinds of things that strain basic decency. David i should say there was a Statement Issued saying there are many things factually inaccurate about your and it notes here. What was appealing to Warren Buffett about this company . Guest it is clear that precision has been highly, highly successful and a lot of that has been due to mark donegan, the ceo. He led the company before berkshire bought it and the stock rose 20 fold. He did a bunch of acquisitions. This is a company that produces an enormous amount of cash and its got a lot of qualities Warren Buffett has said he likes and businesses and since hes bought this company, hes done a lot of positive things. I should mention these folks i spoke with also had some positive things to say. They said outside of reviews, he could be kind. He was a ceo and when he showed up when you having trouble at a factory, he could the a really effective coach. Shery it is quite understandable given headline numbers out of the company that he does have a sort of cult status among investors. But why do their employees, if they have a harsh working environment, why would they put up with it . Guest thats a great question. The common thing i heard from these folks is that the hay is too good. This is a company that while it stock was rising, employees had an opportunity to buy in to those shares and many did quite well. Salaries,top of good if you are a salary worker or our or hourly worker, the wages are quite good. The pay definitely cap people around. Made stuff nobody else did, so im sure it is a casebycase basis, but those are some of the reasons i heard. David i was struck by the effort you make two square Warren Buffetts public image, he is a guy who is concerned about profit and hes running a successful business and there some ruthlessness you have to have to run a business like that. I think thats the interesting tension here because on the one hand, the fed has said he very much wants to own businesses run by cost conscious managers, people like mark donegan. He cited precision in his most recent letter, but at the same time, he does a lot of things in public that suggest capitalism is very fun. Is the annual Shareholders Meeting he holds in omaha. Its fun and has a carnival atmosphere, but if you focus just on that, you miss the fact that some of these businesses, it is a real grind. They are going to work and pushing hard and occasionally, you have management styles and culture that seems to clash with the fun image of berkshire hathaway. David it is a great profile. Still ahead, what team usa is wearing to the rio olympics. And the brand sponsoring hightech gear. This is bloomberg. David the olympics in rio officially been in on friday but the first event is today. Bloomberg businessweek was interested in what they are wearing to the games in rio. You look at the close that they where and their athletes who manage to infuse their presence with some individuality. Paul george and the basketball player come in nike,unks jerseys and shorts, they look for a lot of things in addition to the tattoos. And that isble something we heard throughout this package. The shoes as well, you need them to be light for the ask about team. What kind of sponsors are they getting to mark guest there are Different Levels of sponsorship. Things like mcdonalds and nike, huge ransom. Some of the athletes that compete in the less popular have brands like skechers who sponsor our marathon runners. Each Small Partnership is important. Many i was struck i how drew a distinction between competing for a National Championship versus going to the olympics. What do they have to say about the importance of this quadrennial event . Guest it is a totally different ballgame, no unintended. What when you are competing and getting paid, its a whole different thing. You are trying to represent your country and it just feels different. The ones that dont compete in a major sports leagues, this is there one shot. Shery you featured the womens rugby team. Tell us about that. Guest the first ever. Men are competing for the first time ever. You can only passed ball laterally or back word, but i believe there are five different ways you can score. They where whatever shoes they want. Hey where think jerseys they were unable to explain why the jerseys are pink. Thank you so much for joining us. In thee latest story latest Bloomberg Businessweek and hear from the magazines reporters on the weeks most talked about stories every saturday and sunday on bloomberg television. Still ahead, rio tintos profits for lighting as the stock price tumbles. We will hear from the mining giants ceo. This is bloomberg. David from bloombergs World Headquarters in new york this is Bloomberg Markets, aim he david gura. Shery im shery ahn. Commodity markets are closing in new york. Lets head to the market desk where julie hyman is with the latest. Julie we got the weekly Inventory Data today. This even though Oil Inventories rose. If you look here, we see the jump in oil prices up more than 3 now and above 40 a barrel once again. This is after falling to the lowest since april. Not just yesterday, but in fact touching that level yerl in todays session. So lets get a closer look at this Inventory Data. 2057, so you see here the weekly change in Oil Inventories in white. We had been seeing declining inventories. This orange dotted line is the zero line. Anything below it is a decline. Anything above is increase. A climb in Oil Inventories and drop in gasoline. That climb in oil normally would be bearish, but because we saw a company accompanied by that drop in gasoline that ended up being bullish for oil prices. Interesting phenomenon. The gain in oil today comes on the back of a long losing streak for oil prices. Here we go back to june 8 where which was the most recent high for oil prices. And were still down by more than 20 . Still that bear market for oil. The rebound coming off of a relatively low level. I also want to look at some of the other commodities today as we see oil bounce we seeing the lower gold and copper a little more of a risk on environment is helping things like oil, not helping things like gold and copper. Then taking a hit today as well. We have have had some mixed Economic Data in recent days, thrick some of the recent data on housing is giving traders in copper a little pause. David thank you very much. Appreciate it. The latest on the commodities. Sticking with commodities we have been tracking rio tinot shares, fell in london after the mining giant reported its worse profit since 2004. Whats to blame . Depressed prices for iron ore, aluminum e. And copper, the new c. E. O. , jeansebastien jacques, shared how he plans to weather the Commodity Prices Going Forward. Guest in term of growth i recall on this one is looking forward. Build and small buy. The word smart is important. You can put in capital letters. We have to ensure assets we would like to have in our portfolio, we would love. Those are tier one assets. As i said earlier large low cost. The other aspect which is important is about value. If i look at the example of copper in the recent months, two or three transaction has taken lace, if i look at tinke the process achieved by buyer where i think fully priced. Thats not what we want from that aspect is do we have the answer is we would be selective and smart comments about the treasury Going Forward about being built. Small buy. The second part of your question was around what we have done in terms of portfolio by putting together a cluster of assets called energy and minerals. Before you ask the question its not south 32 or 34. I know youre going to ask the question. The old logic behind it is simple. Its about portfolio of smaller assets that we need to run as best as we can from the Free Cash Flow. Thats one part of the mission. And the Second Mission that alen as we have seen is about acting as an incubator for new businesses. We have some good prospect. You and i talk about it last year, but the position in the lithium business which is attractive. We have a good project that were looking at. Its not to south 32 or 33 whatever number you want to pick. John never going to bring up south 32. Ill let them do that on Bloomberg News. Ill never ask the question twice. You used to run the Copper Division over at rio. Incredibly well, you know steiner. Growth quite clearly is stable but not as commodity intensive as it once was. You operate the worlds second largest mining. It geared itself toward the growth in china. My question is, you bring up lithium, do you have to gear yourself to a new decade, new generation of commodity intensive activity . Is lithium the way to go . If you are looking at that, is that where you would expend . Guest i think the question, john, is clearly china has slowed down. And we go forward. Our assumption for planning purposes is to assume the Market Conditions will remain challenging and volatile in the foreseeable few tumplete we want to be the master about destiny. Which means were going to work very hard to continue to optimize portfolio in terms of tier 1 assets and work hard in others. To drive safety, problemivity to the next level. Whatever market environment we have, our asset will be cash flow positive and can pay dividends to our shareholders. Which is absolutely critical in this environment. Now, the second part of your question is as i said we have a project were currently assessing. Early days when we progress and when we conclude well come back to the market on this one. To talk about china more specifically, in the Steel Industry what they are trying to do is consolidate capacity. I just want to understand what that means for you. Youve got 1 billion trade, multibillion dollar trade with that contry. If they are consolidating steel capacity, what does that mean for iron ore going into the country . Guest thats a question here once again, i spend a lot of time in china the last three months to meet with customers, partners, and to meet with, for example, the chairman to really understand what china inc is trying to do. I have no doubt in my mind they really want to restructure not only the Steel Industry but Mining Industry and remove the low performing assets. The question mark i have, and hence my comments about us having multiple scenarios when we look at china is the speed of the plan. We all know in china employment is an important consideration. And therefore that triggers some question mark by the speed of conservation of the Steel Industry or Mining Industry. We watch it very care flifment what we want carefully. What we want is something thats bulletproof or weather proof which means under any kind of market were cash flow positive. Shery the new c. E. O. Jeansebastien jacques speaking to john exclusively on bloomberg this morning. Lets check the headlines on the Bloomberg News this hour. Mark has more from the newsroom. Mark president obama has shortened the sentences for 214 federal prisoners, including 67 serving life sentences. Its the most commutations in a single day in more than a century. Almost all the prisoners were serving time for nonviolent drug offenses. Most will be released december 1. Theres a report that senior republican officials are exploring options if donald trump quits the president ial race. Abc news reports those officials believe mr. Trump is so unpredictable he might withdraw. A new candidate would have to be selected by 168 members of the Republican National committee. Officials say a deadly wildfire continues to spread near californias scenic big sur. They are now saying it was started by an illegal campfire. Officials are still trying to determine who started the fire and they are asking for information from campers who were in the area. The fire has charred more than 69 square miles and destroyed 57 homes. In indiana, at least 22 people are missing and in india, at least 22 people are missing and feared dead after two buses fell into a river after the collapse of an old bridge. The collapse occurred late tuesday and the rescuers havent found the buses or survivors. Its monsoon season in india and various parts of the country have reently been lashed by heavy downpours. Mark global news 24 hours a day powered by more than 2,600 journalists and analysts in 20 countries. This is bloomberg. David coming up, more on that discord and disrummings mark was talking about. Can Donald Trumps camp control a candidate with penchant for courting catastrophe. This is bloomberg. Shery this is Bloomberg Markets. Im shery ahn. David im david gura. Time for the Bloomberg Business flash. A look at some of the biggest business stories in the news. U. K. Electricity, National Grid has started an auction to sell a controlling stake in its domestic gas network. People with knowledge of the matter could value the business at more than 13. 4 billion. They are selling 51 of its four regional gas distribution networks. Looking for first round bids to be submitted by late september. Shery shares of family charter are rising today. First half earnings fell 46 . Charges fell by a third. In the first year on the job the c. E. O. Has raised capital, suspended the dividends, and laid out land to cut 15,000 jobs. Hes also restructuring or divesting 100 billion of risky assets. David world most expensive city onar bnb, rio de janeiro. The places to say will cost an average of 206 a night. Thats only a 15 discount to the average hotel room. Plus all of latin america, air bnb bookings are cheaper than hotels. Thats your business flash update. Donald trums campaign is pushing back against a number of reports that its operation is in turmoil. The top aide told fox news, quote, the campaign is in very good shape. Donald trumps week has been dominated bice his criticism of a military family and refusal to endorse House Speaker paul d. Ryan and two other senate republicans. Managing editor of bloomberg politics. Lets start with this endorsement issue. John the campaign is in very good shape. I would hate to see what paul would describe as very bad shape. Given the circumstances. Just saying. David fair enough. Last night the news breaks about paul ryan. We had Donald Trumps running mate, mike pence, saying today he does in fact, endorse paul ryan. Maggie who donald trump said does not write good in his words. How do you explain this divide between the two running mates and how precedented is it to have this type of endorsement . John one unprecedented thing thats happening is to have at this late stage in a president ial campaign the head of the party, donald trump, nominal, the leader of the party, saying that hes not going to endorse the highest ranking republican elected official in the contry. David who did endorse him with hesitation. John in his primary race. Totally unprecedented. Never heard that before. By the view of most republicans like pretty close to totally insane. The second unprecedented thing is the fact that running mate in the nominee are at odds publicly over a wide variety of things. First starting with mike pences reaction to Donald Trumps now fourday Running Campaign of criticism against the khan family. Mike pence came out and said what most people expected, would have expected donald trump or other nominee to say, which is we honor the kahns and the service of their family and he made. We always new that this was going to be an uneasy marriage between donald trump and mike pence. Mike pence is a pretty standard issue quite conservative republican, but an establish. Republican through and through. Donald trump is not, barely a republican in a meaningful sense. And they are temperamentally couldnt be more different. Pence is in the awkward position on a variety of issues where hes having to be true to himself but also try to clean up a lot of messes that donald trump is making that are imperiling not just trumps candy say but the republican party. Shery when it comes to the statement by pence it came under his name. Just wonder how much has leeway has the Trump Campaign given mike pence to act on his own . John i would say probably pretty much everything mike pence says is approved by the campaign. From the standpoint of the campaign having him out there trying to calm the waters is a good thing. But no Vice President ial nominee has any leeway on any tict ever. On any circumstances. There is nothing he says thats not determined from above. The top of the ticket. Thats not unusual in this campaign. Mike pence is not freelancing. Everything he says has been approved by the nominee. David you have this congressman from upstate new york, republican congressman, who is going to retire, saying hes no longer going not going to support donald trump. Meg whitman, who ran for governor in california, as a republican, saying shes going to support hillary clinton. There is a sense that perhaps tides are changing here and you have people, maybe Establishment Republicans in particular, deciding they are not going to be beholden to the party above all else. John i think its not a question of being beholden to the party, its a question of being beholden to donald trump. The collective view of most republicans was it is in our political interest to try to prop up the nominee to the extent possible. We may have disagreements with him on a variety of things, political and policy wise, but having a collapsing nominee would be bad for all of us collectively. David do we have that now . John so now you have a situation where, i think, again, put aside action by principle, there are a lot of republicans now looking at trump and worrying that in fact supporting him would be more damaging to their prospects than abandoning him. We havent hit that Tipping Point yet. There is a loft talk right now in washington about a lot of people thinking about doing what this one congressman has done. About whether people are going to retract endorsements. Whether they are not just distance himself from trump but renounce him. Well see where that leads over the course of the coming days. It may all subside in the next few days. But every time we have a controversy like this, it pushes people closer to that edge. We know donald trump will Say Something else two weeks from now, three weeks from now, a month from now thats going to be problematic politically for a lot of the party. And every time he does it, they get closer and closer to kind of saying, ok, i cant bear this anymore. Not as a matter of ethics or principle, but as a matter of pure political selfpreservation. Thats the danger right now for, again, the whole republican enterprise right now. Not just donald trump. Shery were hearing these reports that primary republican leaders, including the r. N. C. Chair, are now trying to, hoping to push from, to reset his campaign. Is that feasible . What would that entail . John what i think it would entail would be deciding you were going to do a major speech that would be an attempt that was declared to be a reset speech. Kind of again a crazy thing given his acceptance speech at the Republican Convention lastless than two weeks ago that was supposed to be a reset. Thats what it would look like. Theres a lot of talk about republicans trying to do prior to that an intervention with trump. Where people are supposedly being rounded up to maybe work with family to try to go and tell him he has to change course. All of these things are out there. The bigger question is, does any of it have any chance of having a real effect or lasting effect on donald trump and his conduct . I dont know a republican who is optimistic about that. David and yet the Trump Campaign still raising a lot of money. Our colleague spokes with the National Finance chairman for the Trump Campaign earlier today. Hear what he had to say. Our major focus on raising funds is for the Ground Campaign both for the benefit of him and the party. As you said this is not a Traditional Campaign driven by paid media. He has over 20 million social media followers. Its like owning a newspaper. As you guys know hes happy to use it and be on tv. David be on tv indeed here. I imagine if you have these big fundraisers starting to peel off, your ability to raise money to contribute to this grand campaign will be a rifpblgt john they have had a successful month in terms of fundraising. Its the only successful month they have had. The notion that trump is going to be at a significant financial disadvantage all the way through november is baked in to the cake. With all due respect to steve and his optimistic view, trump is an unTraditional Campaign. He has done well running that way. His social media accounts are david they are big. John most of the way that now modern campaigns, modern 21st campaigns think how you run a campaign, identify potential supporters, how you persuade them, how you motivate them, and get them to the polls on election day you have to target Data Analytics than a twitter account or Instagram Account or facebook account which are really powerful platforms but broadcast platforms. They are not narrow test platforms. Hes right, they have those tools. But i think if you talk to people at the romney campaign, Obama Campaign and clinton campaign, the people who are deploying data and ground operations the most, kind of modern sophisticated ways. Ok, thats great. You have the social media accounts. Tell me how thats going to help in suburban pennsylvania with College Educated independent voters in this neighborhood and suburb that will make the difference of winning pennsylvania. Shery even with all those platforms, still trailing Hillary Clintons fundraising. John he will be behind all the way through to the end. Shery john heilemann, managing edtory of bloomberg politics. Catch him at 5 00 p. M. New york time right here on bloomberg. Coming up o bloom bherg markets tesla out with earnings after the bell. How will the cars impact the companys bottom line . David this is Bloomberg Markets im david gura. Shery im shery ahn. Finally this hour tesla c. E. O. Is raising capital to aguirre solar city and burning through cash to produce production of cars and batteries. The bloomberg editor cory johnson joins us from San Francisco to break it down ahead of the teslas earnings after the bell. Consensus estimates seeing another operating profit loss. What should we be looking out for, cory . Guest we know how many cars estimate, they gave us that release over the fourth of july weekend. It was below their guidance. But thats not the mystery. I think one of the interesting things to look at here are the Gross Margins. Gross margins, we have the model s in full production for a couple years. The model x also in full production now. They are start up mode. With this full production you would think the Gross Margins would be getting better, but instead we have Gross Margins coming down. When a factory runs more it should run more efficiently. Were not seeing that at tesla. I think thats one of the things we want to keep an eye on from tesla. Its so the efficacy of this business is part of the sales job with solar city. Trying to tell solar city shareholders, under the tesla shareholders, when solar city is under our wings well run it more efficiently as a business. We want to see that kind of Operational Efficiency from tesla that could be reflected in tonights results. We see if if we get that. Well see if we get that. David dana was tweeting something out earlier today from brian at barclays ahead of these earnings. The requirement of being a Public Company still necessitate earnings release. A bit tongue in cheek. This is a company that has big dreams yet the Company Still needs to make money. He talked about getting to a positive cash flow. Is this company reckoning with that enough . Guest thats the right question. It always seems the promise is on to come. Very exciting the great ideas he can come up with. You look at those gross margin numbers. The change in Gross Margins and how much worse that is getting. And the losses are big. Were talking about Free Cash Flow losses of hundreds of millions of dollars every single quarter. That is going to catch up with tesla if they cant find more funds or turn a Free Cash Flow positive. David thanks very much. Appreciate t cory johnson loomberg news editor at large. In the next hour of Bloomberg Markets as we mentioned, bill gross will join us in a few minutes with his latest Investment Outlook where he warns investors to stay away from stocks and bonds. This is bloomberg. David it is 3 00 p. M. In one in new york. Bloomberg markets. Over the next hour, were covering stories in seattle, and tokyo. Here is what were watching. A message for investors, avoid stocks and bonds. When he joins us live in a couple of minutes. Walmart is considering buying amazons competitor. The retailer could pay as much as 3 billion for the company. David Autopilot Technology and criticism of its recent deal at solar city