Transcripts For BLOOMBERG Bloomberg Markets Americas 20170609

There is a disconnect. The s p and dow moving modestly, the nasdaq off i 1. 5 . Quite a disconnect. This happened over the course of the day. It wasnt like at the beginning of the dare the beginning of the day, we saw records before a fall back. It led the way downward, down one point 5 . The s p has been pulled lower in the last 20 minutes or so. If you look at these groups within the s p 500, the divergence is even more stark. Energy shares up 2 , financials more than 1 , materials more than 1 . Information technology down 2. 5 . There is some sort of rotation going on. It is unclear what triggered it. There was a note out from Goldman Sachs saying the volatility in the largecap tech stocks that have contributed to the gains this year, that that was a reason for concern. Take a look at the nasdaq over the past week and you will see a 1 drop some of the biggest drop in about nine weeks. Much of it happening in a single day, as we see the drop today. What is also notable about todays drop is that is happening on extraordinarily high volume. Tracks the nasdaq. This is volume versus the 20 day average. The 20 day average is in blue, today is in white. We are running about 60 above that 20 day average. Down here, it does it by time of day, sort of in 15 minute increments. Come back to those stocks i was talking about, the Goldman Sachs highlighted. It has a new acronym. It includes microsoft, apple, amazon, facebook. Trading lower today, pretty sharply. There does appear to be a rotation. The last time we saw a sizable a onedayff, it was event, then we saw a bounce back. We will see what happens this time. Thanks, julie. President donald trump says he is setting up a new counsel to help speed up Infrastructure Projects. Speaking at the department of transport, trump said any federal agency that consistently wills that delays this face penalties. Spoke to Steve Schwarzman in new york. We asked him about investing in infrastructure as well as the president s relationship with china. By getting his thoughts on the apparent disconnect between the scale of assets blackstone manages, and the current stock price of the firm at this moment. The biggest disconnect for me is, we have this huge amount of money we manage for limited partners who believe we will large we will earn returns as a result of 30 years of experience and our liquid part of our stockmarket noninsiders, comprises only 5 of the total money that we manage. Partners are 19 times the size and they buy off on what we do only because we do it. Our public investors must say, i dont think that is going to happen. Sort ofgive us a lower valuation, if you will. So how can 19 times that be right . That has something to do i think with the structure of the markets, how long people hold attitudeort of their on certain types of investments. Do you see the attitude changing at all . Yes. We just did something with infrastructure that i think sort of surprised or shocked a lot of people, and they said, i have read some Research Reports where they say, my goodness, you can continue doing this in scale. If you look back 30 years, you would see that that is what has been happening. So i am hopeful that overtime, that 5 will look at sort of what we do and the care with which we do it, and basically say, why wouldnt i want to own a part of this company . I certainly do, and i have no interest in selling everything selling anything. I love what we do, ill i love our strategic positioning. We are the largest in our industry, so the size of the next three or four together. Really verylows are substantial. This is one for patients, it you just wait and people watch and eventually, they give up. And they give in . Mentioned infrastructure. Why now . Why did you decide to do that now . It is something you have played with overtime. Your peers have thought about going into infrastructure. This seems like a very meaningful entry for you. We have done 40 billion of Infrastructure Projects over the dams inanging from uganda to wind parks in mexico and in the north sea and electric plants all over the world. So we have done a bunch of this. Is i thinkhis this is a good time for infrastructure generally, is one of the few areas where the democrats and republicans seem to have an overlap, that more is better. That an asset class sorty, has suffered from of a confluence of good intentions in terms of laws, but , and policies and regulations, but altogether, it has made it almost impossible for people to build things. Example, in the United States, it can typically take 10 or 15 years to get something permitted. In germany, and canada, it is two years. It is stunning. These are real countries. This is like, g7. Arent these two of the g7 doing this in two years without any adverse environmental consequences . , is there the political will, not just at the federal level but at the state level, to do that in the United States . I think some of these roads and other types of infrastructure, getting to the point, where you are wearing out your cars early. There is a consensus that our havestructure, if you traveled abroad, which i know you have, is vastly inferior to almost any other country of a significant sort of income. And i think we were rated d by one of the big Civil Engineering firms. We are 16th in the world, and i think most people have sort of said, this is enough. We have got to invest. We have got to fix things up. So in a way, some of it is a political question. Do they have the will . That in thisis kind of Divisive Political environment, there is relatively little to rally around. This happens to be something that i think can be rallied around. You have obviously been in vited by the president on numerous issues. Do you feel as you look at the administration and the economy, that this is the thing that could get done cap could get done . Ahead of taxes and help . This was in washington into it i was in washington for two days, so i am in cosmic confusion. Nonetheless, i dont inc. It goes first for a variety i dont think it goes first for a variety of reason. But i think there is a good shot a safes a saison zone for both parties, and if they can get together and do something, that would be, i think it would be ripped well received by the country. Has been on the mind of the administration, is china, something that really, you have ofeloped expertise and a lot deep relations with, largely over the last 10 years. What do you see as the most important snow step in terms of next step in terms of u. S. China economic relations . There has been a pretty visible dialogue in terms on the tradeulty deficit. This next year, it will be close to 400 billion. It is over 50 of the total trade deficit of the United States, with over 200 countries, and in the media, it has been articulated by the president as well. Thatnk it is fair to say the chinese have heard that, and least in myze, at view, from my conversations, a bighe this is number. For a variety of reasons, the u. S. Is quite serious about addressing this, so we have to address it. July 16, there is a deadline from the meetings where there is thet to be some progress in trade area between the two countries, and they are starting to announce different things, and there will probably be more by the 16th. Then, after the 16th, i think there will be a lot of interesting things that happen, both countries are engaged, both countries want to make progress. How would you say you are feeling about u. S. China relations now versus what you were feeling 1, 2, five years ago . We are optimistic. It is hard to always measure different periods. It is easier to talk about where you are now, maralago the meetings, which were very important, because the chinese like order. Things were pretty disorderly before those meetings, and they have four different work streams, with teams from china and the u. S. Working on both of them. The relationship between President Trump and president xi is actually really good. Forget what is reported. You can get this through, in china, one of the nice things is, they are so well coordinated as opposed to our government, when one person tells you something it is basically reflecting the view of the group. When three or four tell you, then for sure, they keep minutes at every meeting and everything is circulated. The relationship between the two a really good one. Were you surprised by that . It is sort of interesting. The president likes meeting that is the way he relates to people. He invited president xi to come, which is a very high risk invitation. Leaders of Chinese Companies dont normally just show up to somebodys house is a houseguest or something. Choreographedell behindthescenes, by some of the members of the u. S. Administration and the chinese. A process. Me with so this was a process meeting, and i was there for a little fourand you had your different sort of trains in different rooms, and it sort of left the two leaders sort of sitting there, or standing there, or walking around, so in a way, the circumstances of of, weing created a bit must be with each other type of thing. We have all been in situations like that. They dont all work out well. , it did andwhere they had some pretty candid talks about different issues facing them and the world. For whatever the reason, it just which iseally gelled, important in their culture, as well. Now, there is a protection, if you will, for everybody working on something, that they know top havetwo people on some common aspirations. Feel quite good about that. Of course, the biggest issue, in a way, is north korea. You ask the question economically, but north korea is a problem for both countries. In a way, that is common ground, not divisive ground. Most people who report on this think this is some divisive issue between the two countries. In fact, that is really not the case. They both have a problem. Nobody wants the north koreans to have Nuclear Weapons that can be delivered to their doorstep, and have a lack of confidence in the liability in north korea. They would like it addressed. We are almost out of time. One of the things you said to me in the printed or view that candidly as a writer, and the other writers who have read it shook their fists at how candidly eloquent you view yourwas, life as an endless series of short stories. Which again, as a writer, i think, that is a good line. In this current short story, what is the theme . There are a lot of themes. I get so many shots on goal, if you will. I get so many emails a day now. And they all involve situations that are fascinating, or else i wouldnt get them, because i have gotten rid of most of my, you know, monday and things you eliminated the nonfascinating things in your life . Not all of them. Some i have to do, but usually, if it is a problem that reaches me, it is a goodsized one. Ort is pretty interesting, if it is something going on in a notforprofit, if you dont solve it right, it creates other issues. And on the political side, when i try and help out, if you get that wrong, you read about it on the front page. I am not in charge of all of these things, but if somebody asks me an opinion, i will give it to them. I like it to work on my way, just like everybody else, because i think it is balanced. So each one of these things is really interesting. I guess that is a bit of a theory of life, a question. Have,k it is important to everybody has their own view. There is no right answer to this kind of question for myself. I like having a full life, and i like having it in different areas. I love my business life. It is great, the firm is wonderful, our people are fantastic, our prospect are really wonderful. That is really a fulfillment of 31 years of recruiting people and being part of developing great processes and delivering for our lps and our other customers. ,he notforprofit part of life i am very fortunate. I can write checks and that is not always so fortunate, because people call all the time, but that aside, you can address issues that are really important. That was Steve Schwarzman, at theone ceo, speaking bloomberg invest summit this week. Still ahead, apples new iphone may hit a major speedbump. We will explain what inside the gadget is preventing them from reaching their potential. This is bloomberg. This is Bloomberg Markets. Iphone goes on sale later this year, the iphone eight. They may not meet the need for speed. , who covers apple, has the story from san francisco. Great to have you show on the show. Explain to us why apple will be lacking competitively potentially this year. Right now, apple uses two main chip suppliers for the modem. The component allows the iphone and other devices connected. Some of them come from qualcomm, who apple is in a legal battle with. Other items come from intel. Intels chip is slower in terms of overall capabilities, which means apple uses two chips. The qualcomm is higher performer performance, but apple doesnt want to put out the same phone that has differing versions of the top speed capabilities. They are holding the capabilities of the qualcomm chip to the intel chip. All nextgeneration iphones can operate at the same speed. Speed is onehigher gigabyte download, right . That sounds pretty fast. Make zed properly, it it could make a huge difference. Is this something consumers are asking for . Yes, absolutely. Customs customers want to be able to Download Data at faster speeds. Although this beat is theoretical, it is never really going to hit unless you are in a controlled Lab Environment at that speed. Means thetical speed phones will operate faster than the current ones. Even if the theoretical will not be easily reached, the chip is still faster. Eventually, the phones will be able to make take advantage of faster speeds. Julia i am with scarlet on this. The incremental increase in speed, the utility value doesnt all that important. Or am i just backward in the Technology State . Buying thetop people iphone eight and go to competitors, or waiting . Apple has been in this position before, where their technology is less than others and that didnt stop people from buying their products. The samsung and other new phones do have this capability, but again, it is theoretical. Will it ever reach those top speeds . That remains to be seen. Consumers will have to make the choice. It will not hold me back from wanting the iphone eight. I do not think it will hold many people back, but it remains to be seen not by the phone because of that. I dont think it will have a big impact, but the importance here is because apple is diversifying its suppliers, adding intel in the mix, it is unable to put out the top speed found it would otherwise be capable of putting out. If they went 100 with qualcomm, which they are not for a variety of reasons, they are not they would be able to do this. They are not opening up a capability because they do not want some phones to be faster than others. Scarlet mark, thank you for that perspective. Julia a look at some of the biggest business stories in the news right now. Tesla has put another bigname carmaker in its rearview mirror. Is the fourth valuable fourth most valuable automaker in the world, i had a bmw. The market cap rivals gm and boosted the market cap to 6. 16 billion. Theyk says big audio god oh companies try to kill the electric car. A request by democratic lawmakers to hand over information on operations. They mustrs say maintain confidentiality of nonpublic customersinformation. The commodities close and oil is higher today, but it is still not having a good week. That is up next. This is bloomberg. Scarlet from bloomberg headquarters, this is Bloomberg Markets commodity closing in new york. Lets start with palladium, touching its highest level since 2001. Investors are betting on tightening supply for palladium, which is used to curb harmful vehicle emissions. This is the biggest and removed for palladium since 2009. A check on oil, rebounding after a twoday decline but still headed lower for the week. Rising supplies from the u. S. And nigeria showing opec is struggling to clear a global surplus. Oil has given up most gains it made after opec members and nonmembers agreed last your to curb their output. Lets take a look at the movie and oil. The move in oil. The bars show the price change on wti crude. We have seen two declines at at least five percent, those are the big red bars on the bottom. We havent had any gains topping 5 this year. The last time that happened was in november, before the chart begins. The trend for oil this year shows the selloffs have been more intense than buying action. Julia lets get to one of our latest onstories, the the u. K. Elections as theresa may apologizes to her fellow conservatives for the devastating votes that wiped out her partys majority. Our London Bureau with the latest. This is a stunning setback for theresa may, though i noticed in the last few moments, she has hired the same cabinet ministers around her. She has a tougher job in getting anything done. This is such an embarrassment. Seven weeks ago, it was meant to be a landslide victory for conservatives, meant to strengthen her hand in brexit negotiations with the eu and strengthen her majority in the u. K. Parliament. No majority. E is she got 42 of the vote for the conservatives. Youre right, she is gathering the same dream team around her, the five ministers remaining in place, like philip hammond. She has to apologize for them, for to them come up or wiping out the majority she had before. This makes it more complex when you currently have less than you thought you had in terms of negotiating. Instead, she turned to the Northern Irish party, the du p. Toy want an easier route trade between Northern Ireland and the rest of ireland, which come i might remind you, is in the eu, so what happens to her hard brexit . Julia so you are saying this could make the brexit negotiations softer, and rules out a hard brexit scenario . Lets look at the reaction in the markets. Analysts say sterling versus the dollar could take 121 if we see a hung parliament. People are going, is this a better outcome ultimately for the brexit negotiations . Talking about the market reaction, it is phenomenal. We saw a big move in the pound. It was down 1. 9 versus the u. S. Dollar. It was the worst performer, down 1. 8 . You have to bring it into your minds eye that going into the hashtag, the pound crumbled but the yield of the guilt hardly changed. Brexit, see a softer reminding people of what hard brexit means, that would mean she would cast aside the easy flow of trade between the u. K. And the eu, the access to the single market. This is because she wanted to keep strength of borders and control immigration and control lawmaking. Now, with the Northern Irish dup party in her socalled coalition, friction says they wouldnt align themselves with a be hardxit and it will for her to achieve that. No wonder people in her own party says she have say she has to resign. Scarlet how will we know whether she needs to step down, and how will we know whether she is in the clear . Julia i think the jury is out. There is so much rampant discussion here in london that she probably will, but not yet. The jury is out. If she can make sure she comes out hard and strong in the eu, remember, it is just 10 days before brexit negotiations with the eu are supposed to start. If she can make a strong hand with them, reasserting her authority, perhaps saying that they will not be on the cusp of is currentlyns, as being demanded by the eu, she could manage together the strength of her own hardliners in her party, and keep the Democratic Unionist Party onside from ireland and push forward. Many have said, we need some sort of consistency here. The electorate doesnt want another general election this year. We have already had one every year, whether it the a referendum or the general election two years ago. Time will tell as to whether she can rally support. For now, she is hoping gathering the same old dream team around her will somehow give her consistency. Julia not such a dream team. Scarlet caroline hyde, thank you so much. In theurn to politics United States and how controversy surrounding President Donald Trump could affect the global economy. The Surveillance Team spoke with a global chief economist about how jammed janet yellen of the fedor handling this. The u. S. Provides the only global reserve currency. In u. S. Or not there is domestic politics, i think the fed is especially important because we are unlikely to see things happening on the fiscal side in the u. S. To sustain this recovery. The way in which the fed manages for nd balanced sheets shoot strain gauge matters. Bring up the chart here. This chart would be like a nathan sheets article. It is the Balance Sheet of the ecb, the fed in japan, to their gdp is. It is a stunning and ugly sight. How do you, in the classroom, dynamicsinterest rate of a central bank with the Balance Sheet and the desire to bring the Balance Sheet in . Is the cart attached to the horse . They can be completely decoupled. Thereason for shrinking Balance Sheet is political. It has nothing to do with monetary interest rates. You cant cut interest rates, all you have is the Balance Sheet. , 6 on the Balance Sheet they can execute the job. Yes. The can target rates and at same time, shrink or expand the Balance Sheets. Inflation, it means rising wages, some tendency towards potential gdp. Is anything like that going to happen in our lifetime . It is likely to be miserable. Less than 2 . We may get a little lift from deregulation. That may be in the pipeline, but tax reform, infrastructure, i think it will be limited and not enough to provide a significant boost. It inion, i havent seen any advanced economy in so long the phillips curve has expired. What you aren talking about with the treasuries and the world economies growing or going, and what we are seeing with janet yellen, does the World Economy care about brexit . Absolutely. It manages, because the u. K. Is still 34 of the worlds gdp. The manner in which it happens may hold implications for the future of the eurozone, so even if there is no in arma significance directly to what the deal is, the implications it for the eurozone, for the first time, look possible with the new Franco German relationship that is reestablished thanks to the election of macron. The world cares. They are not expecting help from the u. S. But it has been an a pleasant economic surprise. They have sorted out the spanish bank without involving the taxpayer, which is almost , and active insight and intelligence. The eurozone at the moment looks good. The global chief economist at citigroup earlier. A big week for Central Banks next week, including the fed. We will bring you spend special coverage, as well as Janet Yellens News Conference. We also have the bank of england and the Swiss National bank, then friday, the bank of japan. Lets check on headlines at this hour. Secretary of state Rex Tillerson is calling on saudi arabia, egypt, the united arab emirates, and bahrain to ease their blockade on qatar. Some governments accused qatar andunding extremist terrorist groups. Secretary tillerson says the blockade has humanitarian concert once a zend is hidden ing humanity humanitarian consequences and is hindering u. S. Humanitarian efforts. We want to strengthen relationships. We ask that there be no further escalation by parties in the region. Previously, the u. S. Insisted the qatar crisis would not affect u. S. Military relations. Secretary tillerson says the u. S. Will support efforts to mediate the crisis, along with kuwait. Cyprus will be held this month in geneva. That is according to a spokesman the human general assent the u. N. General assembly, which says the meeting will bring together leaders from both sides as well as the European Union. The major issue standing in the way include security and how much territory each side will be assigned. The u. S. Ambassador to the United Nations nikki haley continues her trip to israel, meeting with the defense minister. He thanked the ambassador for her strong defensive and support of israel, and presented her with a gift, a miniature highheeled shoe, and called her the you the new u. N. Sheriff. She said, israel is no longer the u. N. s punching bag. President trump promises to streamline the permit process for Infrastructure Projects. The president called the current process a burden on the economy. No longer can we allow these rules and regulations to tie down our economy, chain up our prosperity, and sap our Great American spirit. That is why we will lift these restrictions and unleash the full potential of the United States of america. President trump also announced a new council aimed at helping project managers navigate red tape, and an online tool to allow tracking of Major Projects through the approval process. Local news, powered by more than 2700 journalists and analysts global news, powered i more than 2700 journalists and analysts, this is bloomberg. Julia President Trump continued his push for infrastructure reform while trying to ease tensions between qatar and saudi arabia. Today, he met with the president of romania. Theye are expected are expected to hold a News Conference in a few moments and we will bring that to you when it gets underway. Chief joined by our washington correspondent at the bill, whoe, and covers national security. , this willously focus on President Trumps response to the hearing yesterday and james comey. Absolutely. We are live in the rose garden, awaiting remarks from President Trump and the president of romania. There is no question he will be asked about the testimony yesterday. This morning, the president we did he feels vindicated as a result of the testimony, but questions remain, including whether the audiotapes of his conversations with the former fbi director he fired will be made public. He will also face questions as to how he will move forward to accomplish the legislative agenda. Scarlet before we address the president s News Conference, i onted to get your take secretary of state Rex Tillerson calling on the saudi arabialed coalition to ease the blockade of qatar. What is the significance, when behind the scenes, lots of people are saying it was President Trumps tone of America First that allowed saudi arabia to take a more strident approach towards the middle east and its neighbors . We have seen back and forth on the issue of the saudiled blockade of qatar. The Immediate Reaction from the administration and people like secretary tillerson was, we are willing to moderate, everyone should calm down, lets find a negotiated solution. Then President Trump seems to side with the saudis on this issue in some tweets, in which he basically said that he had been working on the issue of cutting off financing for terrorism and seemed to imply he believed that qatar was a force behind this. Today, it was a bit of a toning down of those remarks when the secretary of state said, you coalition should ease up on the sanctions. They are starting to impact our ability to fight isis. There are 11,000 u. S. Military personnel in qatar thomas so it is not a minor issue for the white house or the pentagon. Julia is this a misstep by donald trump . In terms of foreign policy, he has been given a lot of credit, whether it is china or concerns in the dealings with the followup potentially from north korea. He is seen as doing a good job so far. Is this somewhere where he has overstepped the mark in the middle east and given confidence to countries that perhaps end up hurting the policy out there and tax in tackling i. S. . Less thans like perfect communication. When the president put out his position at that point, secretary of state tillerson and pentagon chief james mattis were somewhere in the air between zealand andd new the United States. It is not clear whether they all consulted on what the state policy should be. That said, the initial reaction from the u. S. Is now the reaction that we are seeing now. There seems to be an attempt to want to moderate or mediate, in this dispute, to try to find a way to resolve it. The secretary of state said in his remarks today that the emir of qatar has made progress in fighting terrorism, and says he has more work to do on that front. Might this come up as a topic at all between the president and the romanian leader . Not sure. There are a lot of topics we are expecting. Certainly, the comey testimony is likely to come up. One thing to remember, romania is a member of nato, and President Trump will be happy that romania is one of five countries that is meeting the 2 threshold for spending on the fence. That is something the president will be able to praise. I would be surprised if he doesnt start off with that. Scarlet we do expect the president to give props to romania for doing that. Lets bring in our National Political correspondent on capitol hill. Were james comey testify. Esterday Jeff Sessions will testify as well on capitol hill. Can you give us detail on what we can expect to hear and how forthcoming the attorney general will be, given that he has recused himself from any investigation in the connection between the Trump Campaign manager russian interference . Walks one of the most important moments in james comeys testimony before the senate yesterday was, with regards to Jeff Sessions. Tosaid he knew enough conclude that it would be problematic, his words, for attorney general sessions to continue participating in the russia probe. He didnt get into what that was. He said something like, he couldnt discuss that publicly. There is a good chance that the senators asked him about the privately, because sessions has been caught up in this. It is reported he had meetings with russian officials, several that he didnt disclose. I that Democratic Senators in particular will want answers. Aftere to Kamala Harris she engaged in the questioning of comey, and she said this raised a lot of questions as to whether attorney general without and do his job conflict of interest. I suspect that will be a major theme. Julia i wanted to point out, we are waiting for President Trump to hope that press conference with the romanian president , which is why we are showing you pictures. You have been looking on into the tax bill. Rumors are swirling this may not come from the white house until september at the earliest. Can you give us more details on that . There is no bill yet. There is no bill, only a blueprint from House Republican leaders that has more opposition than support at the moment. What Republican Leaders are working on right now is trying to find some sort of content consensus on a concept to move forward before they start moving this in the house, where they this is supposed to originate. The taxwriting committee other people meet regularly. We have a piece discussing this, republicans are shifting away from the idea of offsetting tax cuts with new revenues, offsetting tax cuts with tax increases, to a place where they offset tax cuts with spending cuts on the mandatory side, safety net things like Unemployment Benefits and food stamps and potentially a slice of the budget that includes popular things like veterans benefits. We see the debate shifting a little bit because republicans are so divided on how to raise revenues, things like the border adjustment tax has been battered in congress and it doesnt have much support. The proposal to eliminate the state and local tax to duction, which some republican support, is unlikely to get to a place where they get consensus. The debate is shifting. There are more questions than answers. Looking at the article you wrote, people should have a look. Senator pat toomey says, i hope well not hold ourselves to something that is rebel new revenue neutral, because then we will never get tax reform. The dissension is very high. It is revealing. Some people want to do revenue neutral, some people want to offset it with spending cuts, and some say, lets change the rules so we dont have to worry about revenue neutrality. Senator toomey has said he would not want the republicans to hold themselves to revenue neutrality. He said yesterday that he doubts that republicans can agree on sick ethic and spending cuts so he wants to extend the window from 10 years to 20 or 30 years. Julia President Trump is just taking the podium with the room any him president. As you know, the people of romania and america share much in common. A love of freedom, proud cultures, rich traditions, and a vast and storied landscape to call home. The relationship between our two countries stretches back well over a century, but today, we especially reaffirm and celebrate our strategic ownership that began more that our Strategic Partnership that began more than 20 years ago. That partnership covers many dimensions, including economic, military, and cultural ties. Today, we are making those ties even stronger. Mr. President , your visit comes at an important moment, not just in this partnership, but among all of the responsible nations of the world. I have just returned from a historic trip to europe and the middle east, where i worked to strengthen our alliances, forge allfriendships, and unite civilized people in the fight against terrorism. No civilized nation can tolerate this violence, or allow this wicked ideology to spread on its shores. I addressed a summit of more leaders,rab and muslim a unique meeting in the history of nations, where key players in the region agreed to stop supporting terrorism. Whether it be financial,. Ilitary, or even moral support the nation of qatar, unfortunately, has historically been a funder of terrorism, and at a very high level. In the wake of that conference, nations came together and spoke qatarabout confronting over its behavior. So we had a decision to make. Do we take the easy road, or do we finally take a hard but necessary action . We have to stop the funding of terrorism. With secretaryg , ourate Rex Tillerson great generals and military come tothe time had call on qatar to end its funding. They have to and that funding that funding,nd and its extremist ideology in terms of funding. I want to call on all other ,ations to stop it immediately supporting terrorism. Stop teaching people to kill other people. Stop filling their minds with hate and intolerance. I wont name other countries, but we are not done solving the problem. But we will solve that problem. We have no choice. This is my great priority, because it is my first duty as president to keep our people isis and defeating other terror organizations is something i have emphasized all during my campaign and right up until the present. Funding, stopop teaching hate, and stop the killing. For qatar, we want you back among the unity of responsible nations. We ask qatar, and other nations in the region, to do more and do it faster. I want to thank saudi arabia and my friend king solomon king and all the countries that participated in that very historic summit. It was truly historic. There has never been anything like it before, and perhaps there never will be again. Hopefully, it will be the beginning of the end of funding terrorism. It will therefore be the beginning of the end to terrorism. No more funding. Thank thet to [inaudible]ple terrorism. Enace of they have their own difficulties with it. They have come a long way, and they are doing a lot. Romania has been a valuable member of the coalition to defeat isis, and it is the fourthlargest contributor of troops in afghanistan. There, 23 of your citizens have paid the ultimate price, and america honors their sacrifices. Recognize the president of romania for his leadership in committing romania to increase its defense spending from 1. 4 of gdp to over 2 . Allies our other nato will follow romanias lead on meeting their financial obligations and paying their fair share for the cost of defense. But i will say this. , money is our actions starting to pour into nato. The money is starting to pour in. Other countries are starting to realize is time to pay up and they are doing that you are anud of that i have been advocate for strengthening our Nato Alliance through greater responsibility and burden. Haring among member nations and that is what is happening. Because together, we can confront the Common Security challenges facing the world. Mr. President , i want to applaud your courage and your courageous efforts in romania, to fight corruption and defend the rule of law. This work is necessary to create an environment where trade and commerce can flourish, and where citizens can prosper. I look forward to working with you to deepen the ties of both commerce and culture between our two countries. Romanians have made contributions to the United States and to the world. Was notable among them nobel prize laureate elie w romania, andn sadly passed away almost one year ago. I understand that earlier this week, the American Jewish committee presented president iohannis with his very prestigious light unto the nations award, for his work to further holocaust remembrance and education in romania. I joined the aga see in joining your leadership for this vital cause. The people of romania have endured many, many hardships, but they have made it truly remarkable a truly remarkable, historic journey. Romanias relationship with the United States is very, very bright. I thank you for your leadership and i thank you for being here today. I look forward to strengthening our alliance with your country and our bonds with your people. The relationship has been good, but now it is stronger than ever. Thank you very much. President trump, thank you so words you found for romania, for the romanian people, and for me. Thank you very much for the invitation to be here today with , and thank you so much for arranging this nice weather in this place. Mr. President , i am very glad that we had such a good meeting. Wrong ue to yours youre strong leadership and also due to our partnership. Weiously, the fact that celebrate 20 years of Strategic Partnership this year is important for both our nations, thatt is important to know this partnership with the United States of america shapes romania. S it is today , witha, a solid democracy a solid, sustainable economic growth. Romania, which stands together with the u. S. Troops in. Fghanistan we stand together in iraq. This partnership contributed greatly to what , and this today partnership was and is very important. And i think this partnership not only has to continue, this partnership has to become stronger. This partnership has to define our bilateral relations, and this partnership has to contribute to solve so many problems. , i am very glad the duty are strong leadership, nato very glad that due to your strong leadership, nato decided to go against terrorism. Your involvement made to so many nations conscious of the fact that we have to share the burden and this is why romania also decided if i am right, i think this is the first country under your mandate to step up to 2 of gdp for defense spending. A significant part of this defense spending is going into acquisitions, and i hope we find good ways together. O make good use of this money romania is very conscious of the fact that we stand on the eastern flank and we heavily ,ely on your partnership President Trump, because we cannot stand there without the u. S. We cannot stand there alone. , oure other Hand Partnership has opportunity to step up not only in security matters, but also in commercial and economic matters, and this is very important. Romania is a member of the European Union, and i think it is the best interest of year, mr. President , to have a Strong European Union as a partner. This is vital for all of us. Our relationship, the transatlantic link is vital. Its not about diplomacy, its about policy. Its at the basis of our western civilization, and together, we will make it stronger together. We will make it better. Doo and the European Union not have to compete against each other. They have to work together. They have to work in such a synergetico produce effects. Make nato stronger. Make europe stronger. Make the United States of america stronger. And this is what we decided, President Trump and i, to make our partnership ,tronger, better, more enduring and this will lead, very soon, to an enhanced Economic Exchange , to better commerce, and this is what we all decide and what , because we are responsible, President Trump and i, not only for the security, but for the wellbeing of our is what wend this decide to do. Thank you so much, President Trump. Boyer,mp Dave Washington times. Days . Dave. Come on, dave. President. U, mr. Apologies. I wonder if you could tell us tell us innd person why you feel james comeys testimony vindicated you when it really boils down to his word against your word, and do tapes exist of your conversation . Well, i will tell you about that sometime in the very near future. In the meantime, no collusion, no obstruction, he is a leaker, but we want to get back to running our great country, jobs, trade deficits, we want them to disappear fast. North korea, big problem. Middle east, big problem. So thats what ive been focused on. Yesterday showed no collusion, no obstruction. We are doing really well. That was an excuse by the democrats who lost an election that some people think they shouldnt have lost because its almost impossible for the democrats to lose the electoral college, as you know. You have to run up the whole east coast and win everything is a republican, and thats just what we did. So, it was just an excuse. But we were very, very happy. And frankly, james comey confirmed a lot of what i said, and some of the things he said just werent true. Thank you very much. Do you have a question . Mr. President , if you could ago,us, a couple of weeks President Trump was in brussels at the nato meeting and not only was he encouraging nato to pay 2 of gdp for defense, he also said that countries, including yours, who had not paid 2 in the past, should make up for that difference. Do you think thats fair . Was in brussels and i met mr. Trump and i listened to his speech, and i liked it. Nato is based on values. It is ultimately military alliance. Military spending czar complicated spendings are obligated, and you need a lot of money. Is the strongest alliance the earth ever saw, and we want to keep it that way, so we have to spend money for defense purposes. That means securing alliances. Everybody has to spend money. This is called burden sharing,. Nd i fully agree to that of course, some people like this better, and some didnt like it so much, but its the simple fact that we have to do this, not as a purpose in itself, but to stay strong, to be strong, and to defend our nations. 100 correct. One of the things i was referring to was yes, they havent paid what they should be paying now, but for many years they havent paid. Do we ever go back and say how about paying the money from questiony years past mark i know no president has ever asked that question, but i do. We are going to make nato strong. You need the money to make it strong. You cant just do what we have been doing in the past. So i did say yes, you havent paid this year. But what about the past years, the many past years you havent paid . Perhaps you should pay some or all of that money back. You have a question. I have a question for President Trump. On the matter of security, sir, many countries on the eastern flank of nato, including romania, see russia as a threat to the security and peace in the region. Do you share this vision, and do you think that the United States under article five if any of these countries will be under military aggression . Thank you very much. I am committing the United States and have committed but i am committing the United States to article five. Certainly, we are there to protect. Thats one of the reasons i want people to make sure we have a very strong force by paying the kind of money necessary to have that force. But yes, absolutely, i would be committed to article five. Mr. President , was there any waiverion about the visa program for romania and the timeframe for including our country in this program . Mr. Trump we didnt discuss it, but certainly, it would be something we will discuss. I mentioned this issue. I also mentioned it during other , because this is important for us. It is important for romanians one, to come to the United States. More and more people come, beca, President Trump, from romania to the United States. Some come as tourists. Some come for business. Those who come for business should be encouraged. The matter of visa waiver would be probably important to discuss, and we all hope that we will advance on this. Mr. Trump i look at those hands. Do you have this in romania, too . Only sell that. If i could only sell it. Who would like to ask . Should i take one of the Killer Networks that treat me so badly as fake news . Go ahead, john. Be fair, john. How nice you to be before iran . Such a nice man. Always there. Getting back to james comeys testimony. You suggested he did not tell the truth and everything he said. He said under oath that you said you hope to the Flynn Investigation i didnt say that. So he lied about that. Mr. Trump well, i didnt say that. And there would be nothing wrong if i did say it according to everybody i read today, but i did not say that. Did he ask for a pledge of loyalty from you . No, he did not. He said those things under oath. Would you be willing to speak under oath to give your version 100 . Know the man. Im not going to say i want you to pledge allegiance. Who would do that . Who would ask a man to pledge allegiance under oath. I didnt say that and i didnt say the other. So if Robert Mueller wanted to speak with you about that i would be glad to tell him what i just told you. You seem to be hinting that there are recordings of those conversations im not hinting. Awill tell you about that in short time. When . In a short time. Are their tapes, sir . Youre going to be very disappointed when you hear the answer, dont worry. Mr. President , you are no stranger to russian aggression. You recently suggested romania could be in russias crosshairs. How concerned should the world be about russian aggression in your region, and how concerned should we be in the United States about what russia tried to do in our election . Concerned, but you see, being concerned should lead you to being prepare. In my opinion, we have to be very clear, very simple, very straight forward if we talk about russia and with russia. In my opinion, we need dialogue. On the other hand, we need what we all together decide about nato. A strong deterrence. This combination, strong deterrence and dialogue should lead toward the solution that is feasible for every part. Mr. Trump, you mentioned earlier the anticorruption fight in romania. It is a matter of high importance in our country. You ee now the anticorruption and the rule of law are sometimes undermined by some politicians. Part of what you could call the bucharest swarm. Is your Organization Going to support the anticorruption fight in romania and how will you do it . We support very strongly, romania, and the fight on anticorruption. We will always support that, and we support your president. We think he has done an outstanding job, very popular, very solid, working very hard. We know everything thats going on. Battle. Ng to win that but he has our support. Corruption in romania is a problem for the u. S. Romania partnership and for the american investor because we still have corruption despite this anticorruption fight. Mr. Trump you do, but i can tell you there are Many American investors right now going to romania and investing. I was given a chart before our meeting. We have people going to romania and investing, and they were not doing that a number of years ago, so that shows very, very big progress. A lot of congratulations and store, people investing from our country two years, and people love, from romania, to the United States. They come here a lot, and we are very proud of them. Thank you all very much. Thank you. That was President Donald Trump speaking with the romanian president in the rose garden. Of course, several headlines crossing, the most notable of which had to do with questions regarding james comeys testimony yesterday in front of the Senate Intelligence committee. The president said comeys testimony showed no collusion and no obstruction, and in fact showed james comey to be a leaker. When it came to other issues specifically regarding security in europe, he said he is committing to the United States to article five and we are there to protect, but he did mention that nato members need to start paying more when it comes to defense. And when he was asked about whether or not james comey lied, he confirmed that he did. He said he never asked him for allegiance, why would he ask allegiance of a man he barely knew . He was asked if he would swear to that under oath and he said he would. And speak to Robert Mueller about it. Absolutely. Significant developments. Trump was heated in his response. He was asked again if there were recordings of the conversation. He said he will discuss that later. He did not confirm when. He said the press would be disappointed. Wow. A lot to discuss. Joining us from our washington bureau, our National Political reporters. Toin, i want to go straight you on this. Some quite shocking developments. Again, the most stringent of which is that donald trump alleged again that james comey lied and that he would be willing to testify to that. We are live in the rose garden where the treads and where the president on his assertion that he feels vindicated by the testimony of james comey. He said there is no collusion, no obstruction, and he is a leaker. But he declined to say if he would release tapes of audio recording, if there are any, he would not confirm their existence or whether they would be released. He also said he would be glad to speak to mr. Mueller regarding an investigation. But clearly, this was a defiant President Trump trying to bust through these allegations, but the questions will continue to surround him regarding the russia probe. He tried again, we should note, of state rextary tillerson weighing in on the cutting of diplomatic ties between saudi arabia and qatar, but again, he said he feels vindicated, but no word yet on whether he is willing to show if audio recordings exist between himself and the former fbi director that he fired last month, james comey. He did say the press would be disappointed with the answer. Julia good characterization, a defiant President Trump. Scarlet lets bring in bill. Im going to switch gears and ask you about europe. Several questions on this front regarding nato and article five. The question was asked whether the u. S. Would act under article five if there is a threat from flank to the eastern of europe . Was his answer what nato members are looking for . Or was there a nuance of language . It definitely was something the european allies were looking for and did not feel they got out of the summit President Trump attended in europe about two weeks ago now. Were reports trump was supposed to address that summit, discussing the article five commitment, which basically says an attack on one is were reports an attack onddress all. The president did not mention hit it in his speech at the time. Europeans particularly who deal with defense issues are breathing a sigh of relief that they heard it from the president today. Scarlett final question. When it comes to what next on capitol hill, what an attack on all. The president did not mention can we expect by way of the next chapter in terms of the investigation into ties between a Trump Campaign and russia . Its really remarkable. One day, the former fbi director calls the president of the United States a liar. Today, the president firing back saying im not the liar, youre the liar. Thats a paraphrase. Now the investigators have to decide what to do with this. They have contradictory information from comey and President Trump. They have to decide, including the investigators on capitol mueller, the special counsel who has been appointed to look into this. They have to decide what is more credible and which way to take this. Tapes, iere are suspect the investigators will want to get their hands on those and use those to make a decision on where things go from here. The cloud the president supposedly told comey about does not seem to be going anywhere in the near future. Julia when asked about the tapes, trump said he would speak later and the press would be disappointed. Never a dull moment. Guys, thank you so much. Now, during all the politics, we were seeing quite some selloff in tech today. Julie hyman has all the details. Onie big selloff in tech very heavy volumes. Nasdaq composite now 75 above the 20 day average as we head toward the close. Its sort of anyway you slice it today. First, we are looking at the xl k, and etf that tracks the technology. A twochnology index with point 7 drop, the biggest since june of last year. And the nasdaq down 2. 3 . Its early that its worth mentioning that these were highs earlier today, so its a big reversal over the course of the session. It seems to be a matter of rotation into financials and energy and out of technology. Take a look at some of the big movers we have been watching today. These, of course, i the companies that have been contributing the most. If you look at the nasdaq 100 gains on the year and the big tech stocks, five of them account for about 49 of the gains. Apple, nvidia, facebook. Nvidia today was continuing a surge it had been on that had led it to a 55 gain this year. It is still up, but it has paired the gains over the course of the session today. In terms of other ways of interpreting this, or perhaps signs that this was coming because a lot of investors sounded cautionary alarms here is a look at the xl k. On the top, we have a ratio of valuations within technology to valuations within the s p 500. On a relative basis, tech has andn that been getting more more expensive. On the bottom are inflows and outflows. Just at the beginning of the month, we saw the guest outflow we have seen in more than a year. Investors were all ready lightning up, perhaps, some of their positions. Finally, what does all of this mean for the broader market. If you look at the weighting of technology, its more than 20 . And then you have Energy Around 6 7 . Some investors and strategists have been saying thats too wide a gap. Theres too much discrepancy between the heavy weighting and the light. Perspective. Tastic we will keep an i on that selloff on the nasdaq. Still ahead, theresa may put a gain a plan of place after her snap election backfired in a big way. Erik nielsen will be joining us to break down what the surprise outcome of the election will mean for global market. This is bloomberg. Mark i am mark crumpton. It is time for first word news. President trump said he feels vindicated by james comeys congressional testimony yesterday. In the president s words, no collusion, no obstruction, hes a leader, but we want to get back to running our country. When asked if tapes exist of his conversation, the president told reporters he would answer sometime in the near future. Mr. Trumps soninlaw and it buys or Jared Kushner is scheduled to meet with staff from the Senate Advisor Jared Kushner is a elected to meet with staff from the Senate Intelligence committee in the coming days and be asked about his meetings with ambassador sleak. Y act ky confirms five top cabinet positions are staying the same. The chancellor of the at checker as does the home secretary. Boris johnson and Michael Fallon remain on as orin and defense secretaries