Benchmark Interest Rate. Thelive and well around world. Economic data in the u. S. 2 00, the Monthly Budget statement sometime today from a friend in washington. We will do more dislike whimsies and the mortgage. Monday. Ts up a quiet an amazing week of Economic Data coming up. Retail sales tomorrow. Ppi on wednesday, cpi, consumer inflation. And then housing data on friday. We will know a lot more about the American Economy as we go to through friday, which will be a good thing. What else do you have . The guys that give you internet when you fly around in the air will be before the bell. Will be after. With a great fiscal chart for you. , the euroeld, 2. 64 is mario draghi weaker or the press conference. Crude oil has done nothing since time began. Frothiness inthe the market. Russian ruble stronger. The russian 10year about nine percent. Hour twoyear yield still under after the yellen comments a week ago. Backis the budget deficit of the 1970s. There is the clinton surplus. Down we go, the world is going to end. This is a huge surprise. We have come all the way back at you put the flat line at zero and you realize how few years would you go back, 50 years . How few times we have actually run a surplus. We got close in the early 1970s. There is your budget deficit compared to gdp. We will talk about that here in the hour. What a weekend. We scour the papers of the web. We start with ukraine . Ukraine vote for self role. Progress and supporters say a large majority voted in favor of secession. Ukrainian government calls them illegitimate votes, and so does the u. S. And the you. Donetsk, 90 , and another region, 94 to 98 in favor. Saw ao not believe i ever election like this. Moreecdotes about how some kabul or stapled together by paper. Violence. And some of the ballots were actually xeroxed pieces of paper. There is Nothing Official about this. And kiev pointed out in one addictive the town, only four of the 100 voting stations open. Criminal farce was the language out of kiev. We will address this through bloomberg surveillance this morning. Nick burns here in a little bit. Our second from page story is about Rupert Murdoch, in a european showdown with his longtime paytv rival john malone. Get british deal to Sky Broadcasting group troll over the german and italian tv unit. Fox owns 39 of bskyb and he had the opportunity to came game control but the abandonment with the news corp. Got embroiled in a hacking scandal. The question. I dissociate sky tv with mr. Murdoch. Am i wrong their i associates guide to be with mr. Murdoch. It is not above the majority. Perception versus reality. What he is saying is i am wrong. What is interesting, though, is there is Growth Potential in europe because only 41 of europeans have the tv subscriptions rather than 90 of americans. It is a mature market here but in the european, confident it is a growth market. [tom keene speaking in a french accent] if you are making jokes about france on a monday morning. Quick you can buy Rosetta Stone surveillance package. And the new Global Investor poll, 40 of those saying economy is improving, down from 59 in a poll taken in january. Closed a two thirds they the u. S. Economy is improving close to two thirds say the u. S. Economy is improving. Europe is number two. What i found interesting is that the very end, some three quarters surveyed see the fed raising Interest Rates by the end of next year. We know the fed tapering will probably end by the end of this year. But raising Interest Rates by the end of next year. I thought the pollsters adjusted weighted by geography i thought the pollsters were way out in front. A lot of people are extending their view on qe. I did not get that on the bloomberg poll. Not the impression with that certainly. But interesting discussion points as we check in with our guest host. Those are our front page stories. Our guest host, chief washington correspondent, peter cook, has darkened the door this morning we will talk with him through the hour. As well joining us to talk about that i missed, Deutsche Bank economist, extremely optimistic, na pushing against the gloom crew. You made a huge splash with your call on optimism. Toant used to want you say what the gloom crew got wrong. A lot of conditioning from the last several years, the whole new normal phenomenon. I disagree. I think we are back to an old normal economy. A lot of things have changed. Households have stopped deleveraging. The workforce has been stretched so far that now we are at the coin that if businesses want to expand production they have to add new workers. Isa broad sense because it tv and radio do i get back to the middle of 2015, it is morning in america again . It is going to have that feeling to it, without a doubt. I think we will have that feeling for we even get to the second half of this year actually. Hours worked an average Hourly Earnings are still relatively low. You are saying we are in an inflection about to turn up . Definitely. Has stalled. We saw big productivity gains early in the cycle and it is slowed down. If the economy as a accelerating you see faster job creation. I am fascinated by this great use of the jobs report. Good news. A lot of people in your racket says nobody wants good news in washington. Isody wants what carl talking about . The Participation Rate this is a number whenever talked about in washington and not everybody in washington knows the Participation Rate. These are numbers that do not normally to talk about. But the dashboard is expanding. And theut her dashboard other side like numbers like participation ray . Are we starting to see those turn out so the rest of the country comes along with this as well . . Bigt has this physics expanded dashboard with participant Participation Rates on all these. All is going in the right direction of job creation is going in the right direction. A compelling reason why we see a harris faster rate forward rather than the last 12 months. The structural cyclical, a lot more that will prove to be cyclical. I am in the yellen camp on that front. If we are printing you will see participation turn the corner. One way to start the week. Guard against a bullish read in the Second Quarter because it is payback from the too bearish read. We had this very weather depressed first quarter. Gdp will probably be in negative print. Very quickly, peter, what does this mean for washington . They dont want good news, do they . This is a Midterm Election year and one big question is whether this good news early enough in the election cycle that it helps democrats . If it were to play out it will be a big help for the molding onto the senate. Peter cook and Carl Riccadonna as we look at optimism in the American Economy. Company news this monday morning. Harder foraking it fired workers to allege discrimination based on age. No longer give them job titles and ages of workers let go. It is required of federal law if they want the person to agree not to sue. They are offering the workers and option of arbitration. Pfizer trying to ease british concerns about the takeover of astrazeneca. Tozer says it is committed investing in science and the u. K. And any commitment would be binding under u. K. Law. Pfizer says the combined company will be stronger financially. Japans secondbiggest automaker has forecast fullyear profit that missed analyst estimates. Nissan having to spend more on incentives to boost sales in the u. S. That is this Morning Company news. Cars, they are expensive. They are expensive. I saw a new bmw 635 or Something Like this is that what you are doing on your day off . I was mountain climbing in the city not Mountain Biking in the city, not that there are any mountains but it is what you do when it is 80 degrees. I am the guy tearing of the green grass. I saw a new bmw and it was absolutely gorgeous. I went home and googled it and it was like, 75 grand. What are you coming kidding me . Just about everything in that car. Bluetooth and this and that. We are just Getting Started here on bloomberg surveillance. Former natons, ambassador, talked about the escalating tensions in ukraine following the vote. This is bloomberg surveillance. He is a Beautiful Mind. Ron howard i believe doing a Beautiful Mind years ago and i believe now doing 24. Grazer talking about the state of hollywood movies. Today at 11 00 a. M. He got married recently. Only you would know this. This is bloomberg surveillance. Me, adameene did with johnson, hollywood gossip queen scarlet fu. He get married to . What i think someone in the industry. Im pretty sure i read he got married. Do you go home and read in style magazine . This is more hollywood reporter. So much better informed this morning. I dont know how you keep up. That in ukraine as well. All in a days work. Business, economics, finance, and all of it wrapped around politics. He have called a referendum in two eastern provinces of ukraine a political farce. As ukraine disintegrates, how can brussels, how can 80, and for that matter, how can washington adapt and adjust . Nicholas burns, Harvard University professor and former nato ambassador. I am fascinating fascinated what the script is for you as we move forward out of the farce of the referendum. What should washington do . The u. S. Has done what it should do along with the rest of the world has condemned this referendum yesterday. This referendum held by armed separatist at gunpoint did not meet any standard of a free and Fair Election. There was no independent verification. The first thing is to rally the rest of the world, which is what you see happening. Just today, reaction from europe and other capitals. That. Gree that we see what is the true coalition of the west. How attached are we and policy to germany and france matter, the United Kingdom . A greatnk there is uniformity of views between the europeans and americans. We are in lockstep in condemning armed separatist. Where we are not together is in deciding what to do about it in a meaningful way, i. E. , sanctions. The u. S. In favor of harsher sanctions and germany and other european economies are more tied to russia, energy rural gas. So they have been much more reluctant to step up to major sanctions. And sanctions is the only leverage the United States and the west has, that is the major drawback here it drawback. Any precedent to help us understand how to move forward . Effectively a country disintegrating from within before the eyes of the world . Vote sunday, may 25. It will be the Ukrainian National elections to vote in a new president. That is critical. Obviously the ukrainian people have to decide what they are going to do, who they are going to vote for. We have to hope for a free and Fair Election but i think based on what happened in Eastern Ukraine over the weekend you can expect many russian speaking speakers russian speakers will stay away. The economy back, those are critical elections the u. S. Could be involved in the you said you hope its free and Fair Elections may 25. To what extent did the hastily organized referendum be a preview for the may 25 election . Had manyrainians have elections since 1991 when they became independent. There is an election structure. There will be lots of international oversight. I think it will be possible in most of the country to have what a legitimate as election except for Eastern Ukraine, because you might see the kind of violence that we saw yesterday. Some of the cities of Eastern Ukraine. And people with guns on the street threatening people. That would fall into question perhaps some of it in Eastern Ukraine. But nonetheless, an election is the right way to go. It is a divided country between ethnic russians and ukrainians. The only way it can be is the ballot box. Burns, cant the Russian Point of the ballot box . No, it was not a perfect election but they can certainly point to significant turnout. What do you think russias next move is . How far will Vladimir Putin go to advance this vote from the weekend . The russians are saying today they do respect the results of the separatist elections yesterday. They call for dialogue between the russians in Eastern Ukraine and ukrainians. I think putin is playing a very difficult game here. He said last week, you remember, i am going to blow my troops back. I dont want this referendum to go forward. He did not pull his troops back. Trying andly insiders game. Comfortable with his kgb past. Try to hollow out the Ukrainian Government within. He isinternal moves not invading the country like in crimea but playing a more subtle game. Nicholas burns, our former nato ambassador. Will go away. Is it is here with us for months, if not years. It was amazing seeing the news flow saturday and sunday, including gun shooting and a cacophony really. Saw the poll by the hsu Research Center was effectively said that looking at Eastern Ukraine, 70 of even the russian speaking people still want to maintain association with kiev. What do you believe . We will continue this discussion certainly in the next hour. Former nebraska senator bob kerrey will be joining us for the entire hour. Good morning, everyone. Im tom keene. With me, scarlet fu and adam johnson. Adam johnson has our top headlines. Diplomats starting the u. S. And europe offering to lift oil and banking sanctions in return for limits on Irans Nuclear program and the goal is to have a final deal by july. A report that the nasdaq as a leading candidate for replacing the current ceo. Friedman returning to the exchange. The current ceo still has two years left in his con contract. The new york yang new york rangers and pittsburgh penguins, game six in the eastern conference semifinal. The winner takes all, game seven tomorrow in pittsburgh. Will you be there, scarlet fu . It is in pittsburgh and i have to be back, so, no. Really should be 41 but chris carters goal was disallowed. They called goalie disappear goalie interference. Raising his stick in triumph. All about martin st. Louis. His mother passed away right before the friday night game of the whole team came roaring back. Morning mustread right now. Three in every show. I will get you started this morning. This is on vaccines. Uncool to refuse vaccines. Lisa from Bloomberg View read forust, must anybody on this terrific debate. Likee refusal movement, the name. A lot of people thought it was linked to autism and there have been studies that suggested is not. I just read history about the diphtheria and smallpox underestimate him the whole thing is absolutely insane. Francis collins in the washington bureau, the head of nih, just rolls his eyes. We will be back with more on Tim Geithners new memoir. Good morning, everyone. Bloomberg surveillance. The dow sits at a record high. He talked about that this weekend . Nobody. We just take it for granted. 12. 92. The visx is this is bloomberg surveillance. Im tom keene. Lets do a data check. Equities, bonds, currencies, commodities. Continued weaker euro off the draghi comments. We will talk to bob kerrey from nebraska about the Keystone Pipeline coming up here in the next halfhour. If they are not talking about the book they are trying to rewrite it or clarify what happened after Henry Paulsons volume, Timothy Geithner, secretary of treasury out with stress test. Us, chief joins washington correspondent, and lived what the secretary writes about. Is this the business revisionist history . Whenever you see able, to washington, do you know somebodys tried to adjust their reality . It isont know if revisionist history because we know Timothy Geithners history so well. As a First Responder they had to fight the fires with all the tools they had and i think he makes the justification. We heard that when he was the secretary. A few more details. I have not read the whole thing but i read excerpts. Littler maybe he was a more aggressive about helping out lehman brothers. Maybe there was an opportunity but at the end of the day they didnt do it. Not too many news nuggets but you will hear his direct perspective. The arch question, including reviews in the journal lowes quote and the New York Times lowes quote is was Timothy Geithner qualified to be new york fed president . He did not study a lot of economics and the policy. His professors were bob rubin and Larry Summers when he was at the Treasury Department onthejob training. Person is a very bright who could learn onthejob, to be sure. I dont know the fact that he had not worked on wall street was a disqualifier. He did deal with a range of crises when he was in the Treasury Department. But he took on that job and he used that experience when he was onthejob to fight the fires in much the same way. The question will be, did they make the right moves . His notion that they had to respond and help out wall street to help mainstreet will remain controversial and i think even in the interview on cbs sunday morning, even he acknowledged there are a lot of people that the end of the day believe you made the wrong call. Hes got to live with that. We have a clip from this conversation with cbss anthony mason. I am saying, in a financial panic that is enormous collateral damage. They are deeply unfair and tragic in that context. The first imperative is you make the system safer. Not because you care about the bags or you want to the tech but if you let the lights go out, the system will collapse around them. The system will collapse around them. What i found interesting in the excerpts ive read is he was really reluctant to be named treasury secretary. He pushed back every which way. He had a whole laundry list of excuses and president obama would not hear any of it. The biggest from covering him in the sense i got from his family this was a hard move for his family. I think it was hard on his wife. I think she would admit that now, that this was a tough time for him to take this job. But at the end of the day, this was a job that a lot of people wanted. And to suggest that tim geithner wasnt real excited to be treasury secretary, did not want the responsibility at the end of the day, he took a. He served in the position and it was hard for him to go, as you saw in the end. A senior economist at Deutsche Bank do you have a sense working inside a bank that we are past the notion that it would happen again, the point of no return . Certainly on the current cycle, yes. Well there be banking crises in the future . Absolutely. But when we look at his legacy, the track record peaks for itself. Whether he have the proper qualifications or not, he did a pretty phenomenal job that i think what is important here is he explains that the priority was not to be fair in a moment of crisis. The priority was to preserve the system. If you want to deal with fairness and income inequality in the types of issues, that is a Peacetime Program and not admit crisis here what is the angle of this book out of washington . Insiders like you, when you read it, what youre looking for . I was there. I covered him closely. I am looking for any discrepancy of what he was telling me publicly at the time. I have not found it yet. Talks talking about about the nationalization of banks, which will be interesting. One area of candor is tim geithner admits he is not a great communicator. He does not like public speaking. I was there when he delivered the first egg speech on how he was going to deal with the crisis of the toxic assets, and he was a deer in the headlights. He did an interview with me afterwards and it was not a great moment of communication in the stock market reflected that. There is nothing like getting firsthand experience. What else do we have . What spring is memoir season washington because Hillary Clinton, former secretary of state, will release her book. Al hunt writes about this. Another book . Clinton backers say the bookstore may be like good preparation like spring training, linsky, of course, was featured in vanity fair. Peter cook. It is unprecedented to have two former cabinet members released in their memoirs while the president is still in office. This is a cabinet member who might have eyes on the president s office. So this book is arguably a lot more important than Tim Geithners at this point. This is not the first time we have heard from Hillary Clinton. But the tone of this book in her out on the book tour will give a sense of where she is going. What is thennew new . What will we hear out of her that we have not heard before . I do not think we will get much news, except in the Foreign Policy front. Inside baseball things, what was happening there. The defense of benghazi, that sort of thing. What is more important is when she is out of the book tour, issue leaning forward toward running . Who reads these books . 95 read inside the washington beltway . She will sell a ton of these books. She will have her face on the cover and you will walk into barnes noble or go to amazon and you will see it right there, front and center. Hot are going to sell like cakes because Hillary Clinton is popular. She is interesting. And even people who dont like it will read it because they will be looking for the inside research. Which book would you like to read from the Obama Administration . Book i am actually still most interested in is bernankes book. Because he spoke more than anyone else. He has more behind the scenes conversations that, if he is frank about what was happening and who really take them off, that will be a fascinating read. And that book is coming soon. This is someone who served in an incredibly difficult job at the public service, did not have a little background and it has to to do with politics. You are on volume two of game of thrones and i am on volume three of you guys are reading these hoitytoity washington books. That is crazy talk. Our twitter question of the day can political memoirs . Ctually change voters minds a great question. Who reads this stuff . I would never read cover to cover with black cover to cover. Book i thought had more of a life to it. Some of these are not better than others. Staying relevant without peaking too soon. We went to starbucks, we ordered pizza. I have not driven a car in 17 years . Coming up, we are also going to talk about Corporate America and how it is on the hunt for lower taxes. Our single best chart is up next. Breaking news. Hell shyer brands buying Pinnacle Foods for 6. 6 billion including debt hillshire brands. Hillshire farms cabin syrup, duncan hines, jimmy dean sausage. Come on . I sat at a table with a jimmy he sold it eight times. Sold it and bought it back. Just about brands. Hillshire says the deal will add immediately ballpark franks. I am encyclopedic on junk food. It is if it is not good for me, i know it. Cheese. t own phil vida birdseye account for 45 . A lot of frozen food involved here. Breaking News Headlines from right now. Adam, you got our other top stories. We will go overseas. Chinas president xi jinping says the country needs to adapt to a new normal of slower expansion. China must take measures to reduce what he potential negative effects. Annual forecast is that china is heading for its weakest expansions of 1990. Surprisingly Strong Language from south korea, the Defense Ministry says north korea is not a real country and the government of kim jong un must disappear soon. They criticize the north for developing Nuclear Power and testing new testing missiles. Willard try to revise revive the Net Neutrality rules. Internet providers to charge companies for faster access to their home. Those are the top headlines. Peter, by the way, there is a vote on thursday. A big story in washington. Its got political drama, a lot of business interest. Google, a lot of the giant Internet Companies opposed to what he first put out and he is trying to tweak it to win the two democratic votes. This is a big deal. It matters to the u. S. Economy. What happens to these rules going forward, if there are rules at all. People should be paying attention. It is a lot of mumbojumbo technical jargon but the biggest decision from tom wheeler of the fcc. I see no interest at all among viewers i talk to. Tell me why i care . If they care about having their netflix delivered in the fastest possible way without having to spend that much more for it, they care. Net neutrality, if you want to stream the netflix . It depends how these rules are corrected. You will hear two composing sides. There are compelling arguments. If netflix is clogging comcasts pipes, shouldnt comcast be able to charge them a little bit more for taking up a third of their pipes . That is the comcast argument. On the other side, google and the other players in the young startups who want to be the young next google, they wanted able to go out and compete toe to toe and not have their content slowed down. This just puts it out for proposal. Watch to see. Anythingare you doing in your forecast account for this . No indications for the forecast now. This is effectively what we do on the interstate highway system. You charge more for heavier vehicles with more axles. There will be microeconomic ramifications. But eventually a capex build as a result as they try to alleviate alleviate the bottlenecks but in the near term the way back. Dow futures up 55. Lets get to the monday single best chart. Done with our guest host in Corporate Tax rates by region and how the u. S. Has become less embedded. The u. S. Corporate tax rate has stayed pretty stable since the midtolate 1980s. Excludee oecd, when you the United States, have continued falling. This is the catalyst for pfizer and ge looking for those transnational mergers and acquisitions to take advantage of a lower tax rate. According to dan clifton from ategas, companies betting that tax reform will not happen in the u. S. For the next one half years so what will happen what is happening now will stay the status quo, so that is why they are making moves. Said. Ely within this conversation, peter, is this the only conversation washington where republicans and democrats agree . Actually totally agree than what is the problem . Some agreement that some of them money parked overseas should come back for infrastructure but they cannot correct the Corporate Tax code without also taking on the individual tax code or do you have to do the two together. Does a boil down to entitlements . What it boils down to raising taxes and entitlements at having the larger conversation. You will not one off anything on the Corporate Tax side in washington right now unless you be a with the individual site that is not enough votes. And it makes it too complicated. Monday Multiplier Effect. Donna, what is the Multiplier Effect . When i look at that chart, one thing comes to mind, malarkey. Bring up the malarkey chart. [laughter] not my chart. It is a little misleading because with a look at effective bass tax rate. That is like looking at the baseline rate in the past 50 years in the u. S. If you look at effective rate by households if you look at this chart you see 33 , 37 tax rate, but the effective Corporate Tax rate is about 12 to 13 and what we compared to the other economy the economies it is difficult to make a comparison. You are saying apples to oranges . Potatoes. Les, which is the problem with the deficit and debt spending. Corporate america paying much lower tax rate than american citizens. This is what we love about bloomberg surveillance, we do a chart and the guest host says, malarkey. Donna calling it malarkey. I do believe Corporate Tax rate should be lower but it is a little misleading. I will actually talk about well tax rate as base as well. It is shrinking. This is bloomberg surveillance. Keenearlet fu, with tom in adam johnson. Company news. Rupert murdoch is setting up a showdown in europe with cable tv rival john malone. Rupert murdoch is working on a deal to give british Sky Broadcasting group troll over foxborough to german and italian satellitetv units. One of the key elements driving the deal between apple and electronics is Music Executive he was also friends with steve jobs in a big supporter of apples african music. Apples music. Center opened a data yesterday in a file for ipo in the u. S. Americas fiscal house may finally be getting back in order, and that is thanks to a higher tax rates and a strengthening economy. Whether thestion is deficit turnaround will actually continue to whether it may be, a surplus did what a concept . Our guest host ,carl riccandonna from Deutsche Bank is very optimistic. Howain the linkage between reducing the deficit for the government actually impacts gdp and all the rest of us and why we care. Lower deficit means lower Interest Rates. Longterm it is positive. What we are seeing right now is the strengthening in the economy is leading to stronger revenue gains. Last year it was higher tax rates, which is the story. The story this year is the economy is accelerating, boosting revenue. About 90 of the federal revenue, whether Interest Income tax rates, Social Security payments, or Corporate Tax rates, 90 of the revenue is economic gdp is accelerating. Lets go to the chart. We showed this early. Here is the deficit to gdp. Heres the clinton surplus of the late 1990s the good news. Down we go pick crisis. We come back. , with thendonna Deutsche Bank optimism on the economy can we get above the light blue line . We cant get above that line without major changes in washington but we will continue trending in the right direction. Entitlement spending . You are missing the out years and the cbo chart and all of a sudden you are heading down. Can we get optimistic like such a bang, we will get a better economy and finally get the policy of the out years . We are not heading into surplus having thatt entitlement discussion, we are not having that conversation about taxes that we talked about earlier. We are not having this Midterm Election year. You have to look at the future and what will be the impetus for some sort of deal. Inlet me ask you this if fact you were able to see a change in the senate and you have a republican senate. It is possible. Could you actually have a conversation conceivably . You could have the conversation, but you do you see this president doing this in his final years in office . Do you see this as the legacy for president obama with republicans in control of the senate and the house . The Congressional Budget Office work of peter orszag. , ifknow, carl riccandonna you plug in the gdb guesses forward things change. As i plugged in the optimism, doesnt all the math change for washington . Its morning in america. Not necessarily change. The deficit would be smaller than initially projected this year and will continue to narrow next year in 2015 but right around when he 16, 2017, that we start to widen back out and retired baby boomer issues. Fiscaling like a good conversation on monday morning. Also good news is fleeting. Enjoy it while you can. It is fleeting. One thing not fleeting, but again, tourists will be able to visit the top of the washington monument. It is reopening almost 1000 days after an earthquake in 2011 forced it to close. Repair projects included 2. 7 between the ceiling stones. 53 stainless steel anchors to anothersafe from earthquake. Is it part of sequestration it was a great the nation and even more important for those in washington the light that lit up this baffling, it was beautiful it night, thanks to daniel rubenstein. I was in my car when the earthquake hit and i did not feel it. We were waiting for this moment and another sign of mourning in america, tom. Literally. Top with climb to the your children on a field trip . Of the first time i was at the top i was driving back from a hockey game at the age of eight. Me and three teammates full gear hockey full hockey gear on the top of the monument. , thank you. Andonna looks fabulous but hockey gear. Everyone here has played hockey. Very quickly now. A quiet front. 101. 94. A little weaker japanese yen. We have much, much more for you this morning, including a conversation with bob kerrey from nebraska. Stay with us here at stay with us. It is a criminal farce. Eastern ukraine of for south rule. For selfrule. Kerrey on theb great distortion, the political primaries leading up to november 2016. This is bloomberg surveillance. It is monday, may 12. Scarlet fu and adam johnson are joining me. Our guest host is the former senator and governor of nebraska, bob kerrey. Also managing director at allen and company. Good morning. Good morning. Overnight thanks soon as fewer loans than anticipated. Analysts forecast china is heading for its weakest expansion since 1990. Poland, theye and are not going to raise the benchmark Interest Rate this year. Quantitative easing virtually everywhere you turn. At 2 00 we get the Monthly Budget statement. Sometime today we will get the mortgage for closing numbers. With cpi andg week ppi. Retail sales are tomorrow. 50 of gdp comes from consumer spending. Then housing on friday. Huge week. We are starting to taper a bit. After the bell we will get mckesson. Thee have a big takeover in Food Industry could hill shire brands industry. Hill shire brands agreed to buy Pinnacle Foods. About 6 billion. Harder to firet workers and claim discrimination fired workers to claim discrimination by age. That information is required by federal law if the Company Wants the person not to sue. Ibm is offering the option of using arbitration. And pfizer is trying to ease british concerns about the proposed takeover of astrazeneca. Pfizer says the company would be stronger financially. The ceo agreed to testify about the proposed takeover. We were talking about a quiet Drug Pharmaceutical morning. Forget about that. Valiant acts a daily and a valeant proposal. With their view. For 2015 they see growth of 20 to 25 . Just simply push back. Theres the beginning of the pharmaceutical cell hold. Ackman put up bill ackman built up a position in allergan. There are some problems with pfizer trying to bright as her zeneca in the ukp at all of these merger deals to talk about. We will see more from pfizer and astrazeneca as the week goes on. Lets move to the ukraine. A criminal farce was held in chaos. Now some semblance of legitimacy after some sort of referendum. How Vladimir Putin adapt and adjust his message. She is author of the limits of partnership, u. S. Russian relationships in the 21st century. Good morning. What has changed over the weekend for Vladimir Putin . Think Vladimir Putin can say they voted for selfrule or independence. He said we have to have a civilized implementation of the vote. What changes for him as he can go back to the u. S. And europeans and current Ukrainian Government and sale you guys have to sit down, you have to include these people in roundtable talks. We have to move forward to a federal solution in the ukraine. It has given him a little time. Not to intervene anymore. We saw emerge three over the weekend of mr. Putin and Defense Forces celebrating a world war ii victory. Then we saw a walk by in crimea. That got a lot of media play. Putin signaledir when he looked at their army and navy . He signaled we are a great power again. We have taken over crimea, which belongs to us. Our troops are doing better than they did in the russia georgia war. It is a triumphant moment and it looks like all the cards are in his hand. Cacophony seems to be the word of the moment. They say voter turnout was Something Like 90 to 95 who do we believe . You cant believe the separatists. They said 70 of Eastern Ukraine wants to remain part of ukraine. I would take these numbers with extreme suspicion. Out toeople who showed vote to yes, there were clear plastic Voting Policy clear clear plastic voting boxes. Did we learn from the referendum that helps us prepare for those may 25 president ial elections . People in the east can vote. Vote to be ass a legitimate as possible. If it is not possible to vote in you can havehen russia saying we do not accept the result of this vote. The real challenge is to create conditions where as many of the people who want to vote can vote on may 25. Thank you so much. This off the coast of crimea. Vladimir putin was in attendance. Our guest host was robert kerry guest host is robert kerry from nebraska. He served on the u. S. Navy land air team. Of the the symbolism leader of russia looking at his navy off the shores . It is a significant challenge this has been a contentious area for a long time. I agree with the previous commentator. What putin is doing is stirring up nationalism. We are going back to the good old days where russia was strong. I think we have given him an opening. What form of soviet union is this new russia . Somewhere between dictatorship and democracy. Sexually it making it exceptionally difficult. It is very difficult to describe his government as democratic today. You are the former vice chairman of the Senate Intelligence committee. What is the role of u. S. Intelligence in what is happening right now . Clocks my own view is it is possible for con for congress to do oversight. The way the American People have a right to expect. Point in fact is it is more likely you are going to get Accurate Information about what is going on today in crimea or Eastern Ukraine going to open sources. Twitter . Clocks one possibility. There are blogs and websites out there. There is open source intel. Im not discounting the value of human intelligence. I am not discounting the value of signals and other kinds of intelligence. It is a brandnew year from what it was 10 years ago. Secretary kerrys mission be . He can only do what the president asks him to do. He is trying to get a solution to the middle east problem and that failed. You certainly cannot fault him for the energy. I think it is a significant moment and relevant to this conversation when it looks like the United States drew a red line with syria and looked like we were going to go in. The next thing the United States was not going to and kerry was way out there. He needs a twoweek vacation in the sandhills of nebraska. John kerry from the commonwealth of massachusetts. Lets do a Commonwealth Data check. We look at equities, bonds, currencies. 10 year yield, 2. 64 . Coming up on bloomberg surveillance, on television and radio this is 180 two aisles and then you go west to the grass cutter on high to nebraska on highway two. The debate continues over the Keystone Pipeline. I think it can be built safely. The problem is the way it started, the company was using Eminent Domain before it even had a permit to build it. It wasnt until late in the process that the governor finally agreed to do evaluation. I think it can be built safely. The bigger issue here is climate change. We dont seem to be persuading Political Leadership we need to make adjustments. This is a substantial amount of carbon. I think it can be built. You have been in and list meetings in washington over Energy Policy. An Energy Policy what should be our federal tatement on hydrocarbons . A lot of the problems we have with energy go back to the 1970s. Three mile island killed the nuclear industry. Theres no question we can build Nuclear Plants safely. I think you have to look for a regulatory way to get americans to americans to reduce their carbon consumption. Is role america losing its substance . There is no question the numbers are showing shrinkage. You have 640 acres. Today the average farm is over 900 acres. Getting more efficient, more productive. A a consequence you do have depopulating effect because the farms and rancho your primary employer. That revenue produces more jobs than anything else in rural america. Is nebraska a republican or democrat state . Republican. How close is that Tipping Point . Rest of america the Fastest Growing party is the independent party. That party tends to be more conservative and in favor of producing the size of government. Size ofducing the government. Easing u. K. Fears on astrazeneca, well cover that for you in a moment. Futures up seven after a good market close on friday. We will get to our twitter question of the day, can political memoirs change a voters mind . Mr. Geithner are coming out with his. Memoirs change voters minds . This is bloomberg surveillance. I am tom keene. With me are scarlet fu and adam johnson. We are honored to bring you former center of nebraska, ought kerry. Adam has our top headlines. In vienna to the mets start drafting a final agreement. Are offeringeurope to lift oil and banking sanctions in returns for limits on Irans Nuclear program. There is a report that the nasdaq is now looking for bydidates to succeed ceo up felt. Adina friedman is returning to the exchange as copresident. Yearsent the last three as ceo of Carlyle Group as cfo of Carlyle Group. The Universal Pictures company neighbors, it took in 51 million. The movie stars seth rogen and zac efron. The amazing spiderman to follow. Those are the top headlines. We do this every monday morning and it is like the movies are drifting away compared to television. When you say television it is no longer the networks. Do you see that . I do. Do the movies, we do the box office. Im not sure anyone cares. Speaking of game of thrones, occupysian troops Eastern Ukraine. Geopolitics, what is old is new again. Jamie mezzo served on the National Security council during the clinton administration. He is a senior fellow at asian society. Geopolitics, to this fits in nicely, we just heard you got back from a trip to north korea. I know you cannot talk specifically whether you went with dennis robin or not. Dennis rodman or not. Can you give us your impression . An incredibly is fascinating place. We all know of the tragic elements of the north korean story. I was there with a small delegation hosted by their government visiting their special economic zones. They had a law calling for the establishment of these zones. It will be a huge job for them. I think there is a bit of an opening. It is very challenging environment. A little bit of an opening. That is what russia and china are capitalizing on. Postware how there is a International Order under intense strain and russia and china are making a little bit of an opening into a big gaping hole. There is a big problem. In the past 70 years, as the senator knows, the United States and our allies and partners created a very stable very secure postwar order. It is a war an order that allows everyone else to rise. It has facilitated the greatest time of Economic Growth and innovation in world history. And now china and russia are challenging that through their actions in Eastern Europe and ukraine. Russia and china are reenacting the norms of the china of the 19th century. It is a system of rail politics. After the Second World War the United States and our allies came to believe that that , conflicting nationalisms, is what led to the first world war. To a system of fools nationalisms. Saying torussia are heck with you and going back to the old rules. Goes back to 1651 on the leviathan, not to turn us into a history course. Was assumingerrey this idea of a hobbesian world. What canan these these International Institutions due to provide a, or common force and stew fractures world we are in . This do fractures world we live in . A decision to invade grenada, we made a decision to invade panama, to get rid of people we didnt like. We made a decision in cozumel as well. In kosovo as well. Councild a security imposed requirements upon a rack. At least theyre there is an appearance of unilateral action. How should it engage other countries beside china and russia . You just came back with the president tripped it came you from the president s just came back from the president s trip to asia. I think the United States needs to do two things. We need to rally behind these International Institutions and international grouping we have 70 years. Er the last these institutions do not support themselves. The 19th century and beginning of the 20th century were rough times in terms of international affairs. We recognize we needed to be tough in support of our values. I think it is terribly important you set this up as a hard power soft power . It hard power is definitely connected to soft power. Or economic capacity and openness creates a tremendous amount of capacity to make a decision. Thank the senior fellow at we will talk about the odd couple next. There are 18 warm days in new york up to the middle of may. Yesterday was spectacular. New york city is just gorgeous. Good morning. El nino is coming. That was a great exchange. Mean . Oes it quick, get the futures up. And the rangers are going to win the stanley cup. Are going to win . Scarlet is an expert on the new york rangers. They better win. Here is scarlet long quist. If only. Switzerlands secondbiggest politicalparlay party is calling upon dugan to resign. The case could cost the bank 1. 6 billion. The race to replace Bob Benmosche narrows. Peter hancock and j went trough. Ben lachaise says he plans to step down next year. Bob benmosche says he plans to step down next year. Did did at 47. 5 billion in it substantially undervalued the company. Grow. An says revenue will on the pharmaceutical front, it is back and forth across the atlantic ocean. Support from the government of the United Kingdom. She joins us this morning from london. Caroline, what is Prime Minister camerons goal . Goal is to show that the doors are open in the United Kingdom for business but to know that he can protect jobs in the United Kingdom as well. This is why pfizer is basically giving lessons in public relations. They released a series of videos trying to document what is in the interest of pfizer and astrazeneca joining together. There is a cultural tapestry going over this back to fleming and penicillin. Are the United Kingdom people engaged in this debate or is it just a debate of business in the city . I believe it is engaged. That is the bbcs political viewpoints. Millions of to millions to and then. A key topic was David Cameron having to come forward and saying he will protect jobs. He has got to show he can somehow square that circle of inviting businesses into the u. K. But also trying to play heavy. Very much in the front and foremost of peoples viewpoints. Listed some key promises. Be of rmb in the u. K. Will protected. England losing the pride and joy of their pharmaceutical business. In london we are really building on pharmaceuticals, china to build a tech hub and marry that with pharmaceuticals. It is an area we feel is a string to our bow. It is always about jobs and always about politics. I think pfizer is playing the pr game very well here. Think you so much. Bob kerrey with us. Merger mania is upon us. Is it different with the 80s . Is there a different feeling to this . Money is practically free. Its relatively easy to raise the debt to finance these things. Anytime i can borrow for nothing i am going to be out there buying things. As for this conversation about buying the does that mean i have to shut up . We have to get a data check. Lets tell you how futures are trading higher right now. Tom, over to you. Onbloomberg surveillance Bloomberg Television and also streaming on our tablet. We are on digital on Bloomberg Radio plus. Our guest host this hour is former nebraska senator, the governor and former Navy Seal Bob kerrey. He is a managing director at allen and company. Is apple early in the game or is it just playing catch up . Investors are looking at this deal potentially. 3. 2 billion for beats electronics. It will be the companys biggest acquisition by far. Adam klein is the former ceo of e music. Apples innovation or is it just buying up the competition to circle the wagons . It has to be at the party. They have to have a forceful streaming presence. It is the dominant format. It is the labels point of view. For them to build it would take too long. We went from buying albums to downloading songs streaming. What is the future . We saw a dip in Digital Sales iich was a real wakeup call ofthink streaming is now one the accepted formats of the younger generation. A question of my paying . Is it free like youtube . Some advertising. I expect more sponsorship dollars and programming and things of that nature. Streaming. Define ofan buy products off itunes. That is not what this debate is about. You would be buying a track or album that would shift into your metairie into your memory bank. Spotify, pandora, whatever. Pandora is a radio product and a program and put out what they think is a good playlist, a good selection. This is what you want to listen to, what you put together. Streaming services have a discovery component. You can look for a genre. I like this artist, what else is like that . What else is like that . In the middle of this story i forgot what the song was about. I listen to two or three other songs listening other songs off of youtube as opposed to buying it. Can i be as hip as bob kerrey . There is only one bob kerrey. We are squeezing the artists. Artists are getting paid less and less. You have seen commercializations, advertising. There are some streaming services that specialize another john or special interest of that nature. Growth ofeen the huge alive, the huge growth of concerts. That is where they will make money. It is also an opportunity. I went to marcella says program. They introduced a 10yearold kid who played the canopy. He got introduced to the world as a consequence of streaming, not as a consequence of going to a record or digital label. Dr. Dre comes out pretty well. Here is how dr. Dre, who the selfproclaimed billionaire artist, is spending his money. It has been featured in architectural digest for its familyfriendly features. Dr. Dre put in an offer us and as it came onto the market. When tom and gisele go when tom and gisele have a fight they each go to the opposite wing of the house . Clocks north side versus southside. Thank you so much. Tension escalate in Eastern Ukraine. How will putin respond . This is surveillance on television and radio. I am tom keene. That with me is scarlet fu. Adam johnson decided to show up for work. He has our top headlines. Taking a twoday weekend was luxurious. Xi jinping says the country needs to adopt a new normal of who lower of lower expansion. Headings say china is for its weakest expansion since 1990. And some surprisingly Strong Language from south korea. The Defense Ministry says north korea is not a real country. The government of kim jong on must does appear soon, again Strong Language. Must disappear soon, again Strong Language. Sec chairman tom wheeler is trying to salvage Net Neutrality rules and will present a revised draft of the rules. The plan will allow internet providers to charge companies for fast access in your homes. You had a problem like that this weekend. I tried watching gladiator off of netflix saturday night. Up in the given up. Streaming. Azon what is mr. Wheeler going to do . Clocks hbo on demand. I am reading the script of game of thrones season one, it is very scary. Ned stark is phenomenal. I need to get on the bandwagon. My morning must reads. It comes out of the wall street journal. While we are talking about net rality, bob kerrey, vice chairman of the committee. Of where is the leadership in this administration . You cant prevent things like that from happening, that is the problem. China has been doing it for years. Russia is just following chinas lead. The problem they have is you can actually see it in north korea. If you close that government down you eliminate the accommodation that is going to be generating wealth. At some point if create real economic problems. Why would the Obama Administration effectively say we are no longer going to be the why would the u. S. Give up that role . Moredont have much capacity to some like him informed. I think the web addresses are the least of our problems. The more difficult problem is continuing to support innovative environment necessary to generate wealth. The former senator of nebraska, bob kerrey to my joining us. We also want to thank a former ceo of e music. BookTimothy Geithners new , can political memoirs change peoples minds . Good morning everyone. James lockhart joins us. He has years of public service, particularly in the housing area. Looking forward to that one. I am scarlet fu here with tom keene and adam johnson. Our guest host is former senator of nebraska bob kerrey. Lets get some company news from the files of bloomberg west. Rupert murdoch is setting up a showdown in europe with rival john malone. He is working on a deal that would give reddish Sky Broadcasting control over the tv units. One of the key elements driving that deal between apple and is dean hiding. Jean i mean. Buyingon the verge of beads. And alibaba is moving to expand its Cloud Computing business outside mainland china. The Commerce Company opened a data center in hong kong today. File for alibaba longawaited ipo in the u. S. That is from the files of bloomberg west. Cooks i wonder alibaba is going. Just really wondering. If conditions get a little more there is significant tension in the deal. Start all happy happy to with and is an interesting mix as we go to the end of may. Where you a company have almost complete transparency doing an ipo. We have a pretty good idea how they are going to use it. They dont have it. Was alibaba going to do with the money . , you wonder about the accounting once they get the money. Bob kerrey with us. The former nebraska senator and governor of nebraska. He is also managing director at allen and company as well. We are talking about the and the politics that can move forward in 2014 and 2016. There is no one better to speak to them bob kerrey. I think we see the tension in nebraska right now. Republican primary. It that a precursor to what we see in 2014 or 2016 . It is likely to be. It certainly is on the republican side. What you have is a battle for the soul of the republican party. The tea party is going to be a dominant force. Not that 98 of our audiences in the Upper West Side of new york but can you define the Nebraska Tea Party for us . It is an old movement. The 2008 it during the bush 43 presidency. It is small government, lower taxes. It gets married up. At that point they compromise. Him it is internally inconsistent. It is the internal that not some a people other have not so many pay not so many other people have. It comes from a movement that says loss government says less government, lower taxes. Do you sees that within the burgeoning independent category of voters . Independent voters say they are giving up on the democrats because they have gone too far to the middle. Republicans say they are giving up on the republican party. Thetend to have 30 of audience that finds themselves either extreme right or extreme left. Theres a tendency as a consequence when they see a member of their own party compromise, to heck with them im going independent. Democratepublican or has most crossover appeal . The problem is it is 90 personality. I have to like you before i vote for you. Take somebody like jed bush. Att people are going to look him and say, i like him. Crossover appeal has an awful lot to do with personality. Ronald reagan had tremendous crossover appeal. How personal is it . Its personal. Some of it is an exit to issues. A lot of it isnt. To the conventions matter . I say that with respect to the democrat party. A sickly secretary clinton has been anointed the frontrunner of the democrats. Here we have no incumbents. They matter for whoever it is going to be. It is not an open convention. In the context where independents are the most rapidly growing party, i think you have to look at the rules to determine how both parties nominate. We need to make it easier for thirdparty to get organized. Nate silver had the language of the platforms of the parties and was fascinating to see how one way to republican and even democrats are a little extended. It is exceptionally difficult. They make it exceptionally difficult for third parties to organize. That needs to change. Hillary clinton is the presumed democratic nominee for the next president ial election. Releasing a book called hard choices. It will set the tone for the president ial campaign. We asked everyone if political memoirs like Hillary Clintons book change voters minds. It gives pretext for lackeys to defend their masters. It is mean tweets going on. Who reads these put a call memoirs . These political memoirs. It is a relatively small number. What happens is inside of these memoirs can be things that are provocative. A youd think this entire book was criticizing obama. It is a terrific book. Thatfore to be useful is 35yearold wants to know how washington, d. C. Works they read geithners read my guess is lets get to our agenda. Kick us off. My agenda would be and how Vladimir Putin response to a we saw over the weekend. My only advice is look at a lot of different news sources. There is such a jumble of information that the idea of going to one new source is out. You have the pew institution. Anderved eastern ukrainians eastern once. Saying who do you believe . Deflationlars see risk in europe. Some three quarters of respondents see the fed raising in his raising Interest Rates. Feds on futures predict the rates are going up by the end of 2015. That is consistent. Here is what is on my agenda. Fore reportedly in talks 3. 2 billion. The deal is not done. Of these sources close to the matter. The guy who runs beast is paid 50 million for tom bradys place. Trucks thank you so much. Its official. Its an official bob kerrey chart. We will send it out on Bloomberg Radio. We will tweeted out. Bloomberg surveillance continues in the loop on Bloomberg Television is up next. Good morning. Is monday, may 12. Youre watching in the loop. I am betty liu. Allergan says the 46 billion offer is in the interest of shareholders. They did manage to come together. Has agreed tond buy Pinnacle Foods for 6. 60 in dollars. In the work between rupert moment Rupert Murdoch and the paytv market. Murdoch competes directly with bskyb. Agreement n shares of pandora rose from that news. Believe this will pick up a slate of new deals. Cristina alesci h