Transcripts For BLOOMBERG Whatd You Miss 20170425

Pushed the arab worlds poorest nation to the brink of famine. U. S. Fighter jets arrived in estonia today to take part in nato drills. It is the aircrafts first operation of deployment in Continental Europe your earlier this month u. S. Air force deployed a fleet of f35s, its newest and most powerful fighters to britain, to reassure u. S. Allies in the face of russian aggression. They will remain for a period of time in estonia to conduct air drills in a realistic training environment. President trump will sign an executive order on the Antiquities Act tomorrow to review National Monument designations is three predecessors have made over the last 24 years. Trump the authority to great match National Monuments from federal land. Republicans have criticized two designations by president obama and clinton. Dayal news 24 hours a powered by more than 2600 journalists and analysts in more than 120 countries. Im mark crumpton. This is bloomberg. Scarlet live from bloombergs World Headquarters in new york, im scarlet fu peered scarlet fu. Joe and im joe weisenthal. Scarlet the nasdaq past success appeared s p 500 trying to closing on 2400. Joe whatd you miss . Scarlet President Trump intends to lay out tomorrow. Well hear from the Goldman Sachs chief economist on what this means for the economy. Where going to a live shot of President Trump speaking to the press. Lets listen. I want to welcome you very much to the white house special place, americas farmers and ranchers. I especially want to congratulate now i can say heretary sonny purdue for was just sworn in as the secretary of agriculture. [applause] sworn in by justice thomas. It was a beautiful ceremony and were going to celebrate a little later and that is great. And you had a good vote. You didnt have one of those 5149. He had a very big vote. [laughter] great man, great person. Americas firming tradition stretches back to its earliest days. Farmers led the way across the great plains and put down roots from coast to coast. Today, americas farmers feed not only our nation, but millions around the world. Were going to open that up much more oil folks because as you know, it is not totally open, to put it mildly. We learned that yesterday with canada and the Dairy Farmers in wisconsin come upstate new york, border states are now able to sell the Dairy Products into canada. This has been going on for a while and we are not going to put up with it. Wetely, we put a very will not be putting a very big tax on lumber coming into this country. People dont realize canada has been very rough on the United States. Evelyn things of canada has been wonderful, and so do i, but they have outsmarted our politicians for many years. We instituted a very big tariffs. Oure going to take care of Dairy Farmers in wisconsin and upstate new york and other places. I think you all probably agree with that, right . You Better Believe it. Our farmers deserve a government that serves their interests and empowers them to do the hard work that they love to do so much. That is what todays executive order is all about. Directingorder i am secretary purdue to work with other members of my cabinet to identify and eliminate unnecessary regulations that hurt our nations farmers and rural communities. I have signed a lot of regulations and terminations that really helped the farmer a lot. You know what im talking about. But we have some left and we will identify them. But we have really gotten rid of some of the biggest ones. That was a big help, right . They wont tell you about it, but they are big numbers and it will mean a lot to the farmers. This order also establishes the Interagency Task force on agriculture and rural prosperity to be led by secretary purdue. I just want to tell you that it is an honor to be with you because, among many other things with this order, we continue a very relentless effort to make for hardworking americans, and that includes the farmers and all the people gathered around the stable, including our ranchers, Rural Community folks. Were having a very big impact, it is our restarted. Sonny is now going to identify additional areas where we can get rid of additional regulations and you people are going to be so prosperous and higher so many more people to work for you, and that is going to make me very happy, ok . I want to thank you very much. Do we had the executive order, please . This is promoting agricultural and rural prosperity in america. There are a lot of words i wont bother reading everything. Agriculture and rural prosperity in america. And we dont want to be taken advantage of by other countries and that is stopping and it is stopping fast. Thank you. Perhaps i should give this pen the sonny purdue, what do you think . [laughter] [applause] thank you very much, everybody. Is there a trade war with canada . No. They have a tremendous surplus with the United States. Whenever they have a surplus by the way, virtually every country has a surplus with the United States. We have massive trade deficits. When we are the country with the deficits, we have no fear. [inaudible] the wall is going to get built, folks. The wall is going to get built and the wall is going to stop drugs and stop a lot of people from coming in that should not be here and it will have a huge effect on human trafficking, which is a tremendous problem in this world, a problem no one talks about. But it is a problem that is probably worse than any time in the history of the world. Wall is going to get built and we are sending record numbers in terms of stopping people from coming in and stopping drugs from coming in. You see the numbers down, 74 . I will say, secretary kelly is doing an incredible job. I was just with him a little while ago and he said, we definitely, desperately need the wall. In were going to have the wall built. I watch the shows and the pundits in the morning, they dont know what they are talking about. The wall gets built. 100 . When will the wall get built . We will start soon. We are already the already preparing. We are a lot of work on the wall. The wall gets built. The wall is very, very important. In your first term . Yeah, sure. Got a lot of time. Thank you. Scarlet that was President Trump moments ago speaking at a meeting with farmers at the white house where he introduced and congratulated sonny purdue as the new agricultural secretary. He made comments thing he is promoting agriculture and rural prosperity in america. He also commented on the tariff against canadian lumber, not worrying about a trade war with canada. Said the wall will be built. Joe policies remained number one question. Look atke a closer potential tax reform and what kind of impact it might have on the economy and markets. With us now, jan, chief economist at Goldman Sachs. Great to have you back on the show. First of all, from your perspective, are we going to get even that is not clear that anything gets passed. Jan it is not totally clear but we are assuming there will be a tax cut both on the personal side and on the corporate side. And a fiscal package worth Something Like 1 of gdp in terms of the total impact on the deficit in 2018, 2019. I think the impact on growth will be quite a bit smaller than that. Stretched out over time. There are also probably not high multipliers. But we are still assuming a tax cut. Scarlet is that enough to get the administration to the 3 gdp they are looking at . Jan we are not expecting 3 . We are about 2. 25 this year and next year. This year is not fiscally related. Next year, probably be a quarterpoint lawyer lower. Was in theory it expectations that in part drove that initial postelection surge and market optimism. We have a chart here on the bloomberg. It actually uses the Goldman Sachs high tax basket of stocks. This white line are the stocks in the s p 500 that have a high tax rate and theoretically would have the most to benefit of a lowering of them. You can see how much it outperformed the broader index. However it has closed quite a bit lately. Is this just simply a function of diminishing optimism about a building past . Jan yes, at least at the micro level that is what it looks like. In the equity market people have pulled back their optimism a lot and dont seem to be expecting very much. Of course, there is still some optimism i think in terms of the overall level of the equity markets. Feels like there is maybe a little disconnect between what you see at the micro level and what you see at the macro level. It is a little hard to know exactly where we are in terms of expectations. But it does seem to be that if you get something that probably should be a positive relative to where people are at the moment. Scarlet and we get gdp, the first estimate of the First Quarter gdp number on friday. If you look at it now, it is not looking so great. We know the First Quarter tends to be sluggish. I have it here on my bloomberg. We will pull it up later on. Nevertheless, when you look ahead to where we are with the do you Pay Attention to the gdp now forecast or do you pin everything on the expected policies, prescriptions the Trump Administration is handing out and the optimism they have to get something done . Jan we do our own tracking, as many forecasters do. We have been a little higher for this quarter. We will find out friday wages. Our estimate at the moment is 1. 4 . We will find out friday what it is. I think you do have to take into account that the First Quarter has had seasonal adjustment issues. Willie simply take the governments supposedly seasonally adjusted gdp numbers and put them through a Seasonal Adjustment Program we get about a 1 point. This is a fairly wellknown issue. The Commerce Department has looked at it. They might look at it for their. I would certainly add something to whatever number prints at 8 30 friday. Maybe as much as 1 . Joe we talk about tax reform as if it is just this thing that is either on or off. But there are different ways they could play out and there are also questions about whether the ultimate package would be deficit neutral or create some sort of positive fiscal impossible blowing out the deficit now, tax cuts with no offset. That obviously has a different hurdle in terms of what do we take a pass, all kinds of technicalities. When you look at the gdp and you look at the expected economic ramifications from a tax bill, does it matter whether it is a reform that tries to be deficit neutral, or just a cut that ignores the deficit . Jan it does matter, but what matters from the yeartoyear or quarter to quarter perspective is what the fiscal impulse is in the shortterm, whereas the political discussion terms to be in terms of the 10year impact. Those things are not necessarily the same. At the end of the day we expect something if not as it neutral, it increases the deficit relative to what it would have been. That probably increases disposable income if taxes goes maybend delivers worth. 25 or something similar. Elected fans on what the details are, who gets the tax cuts, how big the tax cut is. In our forecast we are incorporating scarlet the new have the Monetary Policy side of the equation. Look at financial conditions. They have come down even as the fed has begun normalizing interest rates. You addressed this in one of your recent notes that additions have eased despite fed rate hikes. Why is that . Jan mechanically it is because the equity market has generally gone up rather than down. The dollar has not really done very much, certainly hasnt appreciated the way it did around the time of the first rate hike in december 2015. Credit markets on in there pretty well. Perspective,ical we just have not gotten the many changes. If you look at it economically, what it means is that the markets are seeing the autonomy can cope with somewhat higher thinkand the markets i are an to the fed if they think that ultimately you need some deceleration of growth, you need to get back to trend growth, that they should keep going. I think that is the way the message is being heard, that i think the key reason they followed up the december rate hike with another hike in march, and our expectation is that there will be another one in june. Joe does the fed like seeing conditions even despite the hike . Jan i think it depends on where you are in the cycle. At this point it is still not a big problem. I mean, after all, inflation is still below the feds target. There are at least some indicators that would still say that there is some labor market slack. Other labor markets with a you are not at a point yet where the economy sends a message that it is overheating. If that were the case then they would feel much more strongly about a tightening of conditions. Joe im glad you brought that up about labor market slack. Unemployment dropped to 4. 5 in less time. We are still not getting blistering wage growth or anything like that. Is there any reason to think that perhaps full employment or the point at which the fed really needs to tap the brakes, the Unemployment Rate might be a lot lower than we thought it was . Jan i think we are basically at full employment again. Some indicators say there is still a little bit of slack. If you take a very broad measure of employment to population like, other indicators Unemployment Rate, or you take household surveys on whether drops or plentiful whether jobs or plentiful or hard to get to me it seems like we are basically there. But you are right that wage growth is still a touch below what you would expect in a full employment economy. If we average across the different week indicators, we are fairly close to 3 , despite the fact that some of the headline indicators have been softer. As we try to cut through the different indicators, we do see an acceleration to something that is not too far away from what you expect. Joe and we have the employment cost index this friday. Scarlet before that we had the ecb policy meeting thursday. When it comes to labor slack, what can the ecb learn from the fed . , if i had tomainly really summarize, the ecb is where the fed was several years ago, five or six years ago. Things are Getting Better in europe. The economy is actually growing pretty strongly, clearly above trend. The Unemployment Rate is coming down. But were still far away from full employment. A percentte is european Unemployment Rate, the actual rate is 9. 5 . I think that is also confirmed by what you would see in the inflation numbers. Core inflation is below 1 . When hundred basis points below the ecbs mandate. That says they are on the right track, but the job is not yet done and they should keep going. Scarlet chief economist for Goldman Sachs, you will be sticking with us. We will talk more about what markets are underestimating the comes to the feds pace of rate increases. This is bloomberg. With goldmane back sachs chief economist. We want to take a look at the erad of Central Banks in an of geopolitical issues. The fed every one is looking for to begin shrieking the Balance Sheet. Whatever it says, people hang onto. Is it as politically loaded, the idea of shrieking Balance Sheets . Jan shrinking balance each sheets . Jan no. Monetary policy is probably at the point where we should take before off the gas. Aree were huge divisions that come especially when people did not really know what qe meant and what it was going to do. When you think now pretty much across the spectrum, there is a general sense that we should probably start to move back. That there is a huge amount of suspense left in terms of at least when they start. Late this year is a pretty good bet based on the minutes. Of course there is the big question, how big an impact will it have . How much of a substitute will it be for rate hikes . Directionally it is a substitute but i dont think the impact will be big. Joe you basically anticipated my question. There was talk about how the commencement of the Balance Sheet winds down, would perhaps coincide with it pause in the pace of rate hikes. The market interpreted that devilishly. Does that mean it is pretty minor from a monetary conditions impact . Jan thats my expectation. My expectation would be they hike in september, then they dont hike in december, but start the Balance Sheet run down than basically see what happens. If we dont get a very large impact because the very, very slow and will signaled have, then they get back to rate hikes in early 2018 within march. Joe historically speaking, many recessions they say are caused by the fed. It has been a long time since we have had a recession in this country. Is there anything out there that concerns you, and what do you think could be a proximate cause we do have a short downturn . 2018,017, even probably the risk of recession to me seems quite low. When i look at the momentum in the economy, when i look at the impulses from financial conditions that we can already at, and when i also look things that preceded the price of the 2001 recession and even in early 1990s recession, all of that makes me optimistic that Recession Risk in the near term is pretty low. As you look out further, a lot depends on how much more labor market tightening we get. If we are really at full employment at the moment and were seeing above trend growth, then we will see to some degree and overheating of the labor market. Maybe only a little bit, maybe quite a bit more. Its just if it is a lot more than you need to worry because you need to get back to a sustainable employment rate from the low and historically that has been very difficult to do without a recession. There has never been an increase in the Us Employment rate that was not associated with the recession. If you look at the evidence since world war ii it has been very clear. Scarlet what is likely to be the big headline from the fed when it meets next week . Jan i dont think there are going to be large headlines. It is not a press conference meeting. At the margin theyre going to recognize the further decline in the Unemployment Rate and the weaker inflation number. Scarlet thank you so much for joining us. The market closes next. Take a look at the major indexes. 21,000 plus for the dow jones. Joe round numbers all around. Scarlet whatd you miss . U. S. Stocks rising to a record high. Bolstering optimism on the economy. Im scarlet fu. Joe im joe weisenthal. If you are tuning in life on twitter, we want to welcome you to the closing bell coverage of every weekday from 4 00 to 5 00 eastern. Scarlet we begin with market market minutes. Extending gains from yesterday. The dow closing below 21,000. It did get below that level above that level during the session. The nasdaq, above 6000, at a record high. Certainly some new milestones for the major indexes. As you look at the breakdown of industry groups, nine out of 11 groups were higher. The only declined there are utilities and telecom. The defensive spirit in terms of individual names, lets bring you caterpillar, raising the demanding aorecast change in energy increases. Mcdonalds, the best day since 2016. End, scripts expects to lose its biggest insurer, anthem. Of course, the trade news of the day which is the white house slapping a tariff on canadian lumber. Waysee warehouse, a u. S. Eyehaeuser down. Te homeshomes pul down as well. Rising lumber crisis may mean we price increases. Joe we have had this extraordinary risk on rally. The twoyear yields up. 10year up. What i think is interesting is this is still at the low end of the range. We have clearly bounced off the bottom. It is interesting to see these two days of markets absolutely going to the moon, and yet 10 year yield diminished. Meanwhile, 10year gilts in france picking up a bit today. Still very deep. A lot of those spreads closing in the wake of round one of elections this weekend. Scarlet of course we have round to in two weeks. Up anywhere between 10 to 20 . And testing was toantagonistic tone negotiate nafta. The line going up indicates u. S. Dollar strength versus the canadian currency. In terms of the other pairs, the euro moving as well, gaining on a report that the ecb could change language in june now that you have a pro euro candidate in the French Election in two weeks time. The yen declining at a twoweek low versus the dollar. Joe finally, lets take a look at commodities. Oil gaining a bit today. Gold, down a little bit, very gold, down a little bit, very much in keeping. As scarlet mentioned, during the stoxx component of the market minutes, actually, the tariffs may not be as big as the market was expecting. Beatrice all lumber prices all over. Scarlet we have some breaking news on at t, coming out with firstquarter results. Adjusted earnings per share, matching estimates and the fullyear view. No change to the outlook for 2017. When it comes to Wireless Network editions, the company adding for the First Quarter. Im looking at how that compares to analysts estimates. Do we have that number here . Im not finding it. It is supposed to increase by 5000 but that is not comparing here. In any case, the outlook does not change although at t does cite the and predictability of sales unpredictability of sales. Tmobile is picking up market shares from at t and verizon. Joe we see a postpaid turn a little bit lower than expectations. As you said, no longer providing revenue. We will be watching at t. It is down half a percent after hours. Posted we will keep you on further earnings. In the meantime, lets take a deep dive into the bloomberg. I would start with the s p 500 which, as we mentioned, is approaching record highs once again. It is blue light because it is going up on the chart. The white line is the etf that tracks the s p 500. Betting against the s p 500 has fallen out of favor. Short interest dropped in march to the lowest in a decade, going all the way back to may 2017 2007. People might rotate, they might have hedges, but no one wants to get in the way of this market. That i puthart together for the fun of it. It shows the number of things that tracks the 10 year yield. The white line is the 10 year yield. The yellow line is dollaryen. The purple line is s p 500 construction index. The magenta line is the kbw index. The orange line is the nikkei. The ratio of is copper to gold. All of these things all around the world are proxies basically for the u. S. 10 year or put it the other way. Of the the future 10year is a huge question. Lets talk about with our guest. Are we seeing a positive the reflation trade . Insight. Get more everything hinges on this on this question. It is not booming, but it is booming. We expect it will it will rise, but there is no huge rally in the yields. Scarlet we see oil prices struggling. Commodities is a mixed bag. Already paved. S onhink the key element inflation is wage growth. We know that everywhere you look there is no risk if there is no acceleration in wage inflation. The u. S. Is still stuck between 2. 53 percent. You need to see an acceleration in wages to expect a big rise from here. Joe ok. We have this idea of the Global Economy doing fine. Rates trending up. Cleanest expression of how you take advantage of these trends . Major trends. Wo the best way for us to play this trend is to be exposed to the economy and markets that have the biggest exposures. I think it is korea, potentially japan now more than the u. S. Be second point, you have to overweight in emerging markets. You see a lot of value in mexican bonds. This is i think the main way for us to benefit. Scarlet as you look to make this shift, how concerned are you that a comment out of the white house could trip everything up . That is something i think we have to accept. You see Political Risk is pretty much everywhere. In the past, we have learned that Political Risks are there, but equities tend to go where bonds go. Pay too much attention to Political Risks . They never seem to matter one another. Do people overweight their significance . I think in the shortterm, probably guess. Us tok the best thing for do is to reduce risk when we get into an election. Again, if the main trends are , political unchanged risk will stay with us for some time. We have to focus on the fundamentals. Overweighting, putting too much emphasis on Political Risk and events, what is the reaction to the French Elections this weekend . Will be sustained gain . The election in france is a particular importance. There was this concerned to invest in europe because of that. Risk is much lower than before that is why there was this 4 rise in equity markets in europe. Scarlet all right. Thank you for joining us. Joe we have some breaking news. President trump has lost his century city fight with San Francisco. We will be watching for more details on this judgment. This is bloomberg. Joe we have breaking earnings out. Lets take a look at aaa. That stock doing very well surging 30 in afterhours trading. Comparable store sales up 17. 8 versus estimates of 50. 5 . Good nights good news for chipotle. I went to chipotle for the first time in a year and a half this quarter. Scarlet anecdotal. Wynn resorts also reporting. For 1. 4were looking billion. And, one quarter adjustments to youllar 40 we will keep posted on further development. Electedrgo has meeting today in florida. For the latest, we want to head over to footer where laura was at the meeting. This was not your typical Shareholders Meeting for wells fargo. Tell us about some of the controversy that was generated there. Right. This is a very long meeting, very different. Three hours about long. That gave opportunity for smart small shareholders to break in and say, this is what i would like to talk about, and you need to hear it. That is what they did. For three hours, we had people breaking and out of turn, out of order, and speaking their minds. We started off with this gentleman who is an advocate. He said sort of, i want to hear from these Board Members about what they knew about this scandal and when. Taken out and looked a little haggard with his hands behind his back with security officers. That is what happened to him. Some of the speakers did speak howr in the meeting about accountable they would like the Board Members to be. Joe all of the Board Members got reelected. What is the perspective on how ultimately the buck does not stop with them, the fault of someone below them. They did not necessarily address that directly. The way they look at these results, some for members got less than 60 on a guess vote. They looked at that and said, we see shareholders wanting to make a message, but we do not see this as anything that we need to be that concerned about in terms going. E we see this there are a lot of open questions. Scarlet a lot of open questions, so what is the path forward for wells fargo . What do they need to focus on when they are amending their relationship with customers and investors . There are certainly investors the we need to rectify the issues with here. This is going back to where it was at the beginning of the scandal. You have all of these actions, all of the things that have happened, and shareholders are taking actions. They are seeing they are not doing enough. Some of them who voted against members. Rd bloombergs banks reporter. Thank you so much. Joe for more on todays wells fargo Shareholders Meeting, lets bring in jerome dodson, the chairman and ceo for nasas investment. He joins us from San Francisco. About the board result vote today . I have very mixed emotions about the board result. I think the board has done a very good job in their report, trying to follow up on it. Is it tookn we had years for them to get to that point. It seems as though the board and the Risk Community should have up. Proactive on following although we support wells fargo, we think they are a good organization, we certainly think they were negligent on the boards part and following up on the account scandal. Scarlet as a result, you voted against directors on the Risk Community. Seeing as there is no risk on changing board, what followup action we take, if any . Joe as a shareholder, you have two ways to vote. One is to literally cast your vote in the board election. Another one, theoretically, if you were disappointed enough, you could sell your shares, which is a kind of vote. Is there any level or would there be anything that you would see in terms of governments or or changesgovernance in terms of this not being that with fast enough were at this point you think theyre not too many issues left . I think the board has got the message from us and shareholders in conversations with the chairman and the president of wells fargo. I dont think this will happen again. Certainly not anytime in the near future. I think they have learned a lesson and they are contrite. I think they have handled it the right way. Going forward, i think they will be much more careful. Im pretty happy with where we stand now. Joe bigger picture, so, this issue they set performance targets and basically found ways to hit the targets which are not exactly kosher. Terms of Corporate America over, do you think there is stuff like this going on with other companies and boards in general are not doing enough to combat toxic things that may happen in toxic coulters . Cultures . I hate to say it, by think there is a lot of truth in what you said. For some other banks and corporations, they are doing certain things they would not do if their actions were exposed to daylight. I cannot put my finger on anyone in particular, but i suspect that there is something going on. I hope this is a lesson to them that they follow straight and narrow. Scarlet you are a pioneer in socially responsible investing, do you think that wells fargo is a socially responsible company . I do. There were moments during the scandal when i doubted it. There are a lot of good things about wells fargo that did not come about. Branch managers are women, which we like, the opportunities given to women. They are the Third Largest charitable donor in the United States. Theselly like all of things. In many ways, we are very socially responsible. We saw the pressure brought on to do these accounts, as something as an anomaly. I hope this does not mean this is there coulter. It is certainly a black mark for wells fargo. Joe great to get your perspective. Thank you very much. Thank you. A pleasure being here. Reporting. S. Steel net sales. Analysts were looking for something around 3 billion. United steel says they change the accounting method on property as well. The effect of the accounting changes is included in the 2017 guidance. It now sees one dollar 50 for the share as previously its all about three dollars and eight cents. That accounts for the big slide hours stock for after trading. Again, United States steel said the change accounting method on one line and as a result that hit the outlook. Joe this stock was just 20 per share before the election and climbed to 40 per share in february. This rocketed on a lot of the trump optimism. We can see with the following dollars,nother four falling. Scarlet this is bloomberg. Scarlet im scarlet. Whatd you miss . Currencies. Ket you can see how they moved together, emerging market currencies and bloomberg Commodity Index in blue. There has been a convergence in performance so far this month, becoming a lot more stark this year. As a result, the currencies could be poised for a correction because commodities are already conspiring against them. If you have other inputs, start moving sour. That could trigger a reversal. Chart,at is a very great one that we will be watching. The big plunger today, express scripts on the news that they will lose one of their big insurance customers. Here is a chart that i made. It overlays express scripts, inch is blue, over valeant white. They sort of track each other. There are similar themes that work in terms of people being skeptical about the high cost of prescription drugs and wanting to crackdown on all of that stuff. Sellers have taken aim. Scarlet i know one person who would like this chart. Joe they both peaked within weeks of each other and then plunged. Some interesting similarities with those charged scarlet . Scarlet as if the news was not bad enough for all of these companies, the white house talking about ridiculous pricing may be concerns about held valid some of their business is. Coming up next, Steve Mnuchin and President Trump top economic adviser gary cohn heading to capitol hill. This is bloomberg. [ beep ] show me top new artist. [ applause ] [ laughing ] show me top male artist. My whole belieber fan group. Its not a competition, but if it was i won. Xfinity x1 lets you access the greatest library of Billboard Music awards moments simply by using your voice. And thank you so much. The Billboard Music awards. Sunday, may 21st. 8, 7 central. Only on abc. Mark this is first word news. A judge issued a temporary ruling today in the lawsuit over an executive order on so called thing to a cities. The decision will stay in place while the lawsuit moves through court. The federal government may ask the court of appeals in San Francisco to overturn the ruling. United nations secretary general Antonio Guterres said International Donors at a geneva conference have pledged 1. 1 billion to help wartorn yemen this year. The funding target was 2. 1 billion. We have been able to achieve more than half of the amount. Account the fact and we are only in april, encouraging symbol that we will indeed be able to achieve our targets. Mark coleman the war in yemen has killed over 10,000 civilians and pushed the arab worlds poorest nation to the brink of famine. In france, and men will met con macronn hit emanuel cyberattacks. Y havesecurity experts directed to moscow, but there is no definitive proof of russian involvement. Won the option to the marlins with jeb bush. Global news, 24 hours a day, powered by more than 2600 journalists in more than 120 countries. I am mark crumpton. This is bloomberg. Scarlet lets get a recap of market action. The nasdaq to a record high,. Opping 6000 in the last few minutes, we had Texas Instruments reporting results for the outlook. Quarter revenue pretty much in line with what analysts were looking for. They anticipated three point 5 billion. Texas instruments giving an outlook that is pretty much in line with the consensus estimate. Chipotle finally seeing a sales rebound from the e. Coli crisis. Resorts has been bouncing around all over the place. Net revenue topping estimates as eps. Joe some more Corporate News after hours. U. S. Steel plunging 16 now down to just under 26 per share. Dekkers, the company reviewing strategic options. The maker of boots could. Heoretically sell also pursuing additional margin and enhancing opportunities. They will be giving more updates on the Earnings Call on makes way six. Finally, Edward Lifesciences surging 9 . That boosted the fiscal year view, exceeding estimates. The previous range had been 332 to 360. A very nice rally there. Scarlet some blistering gains. We just need to make a correction from earlier. Once again First Quarter missingd the top estimates. The forecast lower than what was anticipated. Joe whatd you miss . Saturday will mark President Trumps hundreds they 100 they in congress. More on this, lets bring in kevin cirilli, bloombergs chief White House Correspondent and laura davidson, reporter from bloomberg dna. Gary cohn and Steve Mnuchin headed to capitol hill to discuss tax reform. Tell us about the nature of those come positions. They will be laying out trumps tax plan. A couple of things expected are 15 tax rate for thanration, a deeper cut expected from the house. Thirdly, trump would like to link tax reform with funding for infrastructure. Carrots too things, get democrats on board with the plan. Scarlet how much are they likely to diebold tomorrow when the present the policy plan . Kevin not much. In fact, there is some confusion, to say the least on the timing of this tax plan. You have to remember that while the meeting will be underway, just across the hall, behind me , housecretary mnuchin Freedom Caucus members are also scheduled to meet tonight. The meeting is about whether or not this Party Unified will continue. This is an administration that wants to have a legislative win before President Trump 100 take in congress. Dont forget the on friday they have to pass the partial government funding bill in order to keep the government open. Er in the day, we spoke about tax reform. Lets take a listen. We expect something that is not , that delivers not a modest boost to growth. Joe what are the deficit ramifications from the most likely text bill that the white house and Republican Congress will coalesce around . Trillion. D add 2 it could mean that the tax cuts are only temporary. If they do not have offsets and dont want to use democrats, just pass it through with republicans, the cuts can only be there for 10 years. They could perhaps extend them permanently, but there is a lot of concern for republicans. They want a system that is permanent, so that companies can rely on it, and they are concerned about adding it to the deficit. That is not part of their joe core values. Neutralcomes to revenue for the deficit, doesnt matter as much for the white house . Tevin coleman it is a Sticking Point whether or not they can unify as they head into the 100 day mark. The americanwith voter. I want to read through some of the promises that he said he would get through on his first 100 days in all of this in office beer he said he would end illegal immigration, clean up corruption in washington, or during the swamp. I want to keep going through the list. Middleclass tax relief, simplifying the tax code. School choice. I mean, this was an ambitious agenda that then candidate trump said he would embark on for his first 100 days. The legislative officials i talked with said they are being able to kick off a series of executive orders that they say will set the groundwork and foundation for them to carry out with these promises. The Health Care Debacle several muchs ago is still very serving as a political ghost of sorts hunting over this administration. Scarlet kevin cirilli, bloombergs chief White House Correspondents and little peterson, thank you so much. Coming up, the commerce raisingy says u. S. Is tariffs on canadian lumber. We will explore next. This is bloomberg. Scarlet im scarlet fu. Whatd you miss . Releaseexpected to earnings on thursday before the closing bell. Lets look at twitter in todays the numbers dont lie. Twitter stock which is the white line has been on a pretty steady decline. The blue, revenue, has staggered to a 1 gain last quarter. So far things have not improved since jack dorsey took over as ceo. Analysts expect a 14 drop in the First Quarter, or should say the Fourth Quarter of 2017 but the First Quarter of the fiscal year. Dorsey said 2017 as the year went twitter would stop raising money, but they dont expect to be profitable anytime soon. They are making progress on goals this year. Twitter visitors have stopped rising, falling in fact, december through february. The question is to what extent the numbers reflect this stagnation. An absolute decline could further risk advertiser fell. Ence when ads you have competition from and snapchat. Marketers plan to decrease their in twitter and 2017. That has wall street worried. Twitter has the lowest percentage by rating. Disney backed away from a deal with twitter. The problem is prospective buyers may not see a return on investment since twitter has not been able to revive user growth. Whatd you miss . Commerce secretary wilbur ross spoke a few hours ago saying ont they would lift tariffs software lumber from canada. Ally, ande a good generally a Good Neighbor, but that does not mean they dont have to play by the rules. What do you mean generally a Good Neighbor . Things like this i do not consider being a Good Neighbor, dumping lumber. Bloomberg bring in news reported in ottawa. Generally a Good Neighbor. That is kind of harsh. I thought you guys were Good Neighbors. Generally qualifies it. What did you do that to stuff the administration so much . I guess we will take it. Journaling is better than not generally. This has been a longrunning saga. Won the presidency, people in ottawa expected to get here also. What is different is they are combining trump, lumber, and more. Canada is the number one buyer of u. S. Goods. Why canadaod reasons can go to the u. S. And say you are not my problem. I think the cage has been rattled this week to some extent by design. Canada taking notice. Longis the first step in a trade saga between washington and ottawa. Joe i have a chart showing the increase in canadian exports. You can see how much it has risen since 2011. Scarlet it has been a steady increase. What is driving that . Since the initial deal expired, canadian lumber had one year where the u. S. Could not impose more duties. It took some time to actually impose them. Canadiens took advantage of that say,ay or another, you can by expanding exports. That was no secret. They have a point. That was a function of the deal expiring. Knowing that canadians tried to get a deal with obama. But, the obama and misdirection said they were referees of this and it was not the and it was not the misdirection that could get you a deal, the industry had to agree with it. Joe im thrilled we get to talk about lumber here. Enough ontalk lumber the show. Others say it was not as punitive as it could have been. Absolutely. There are positive things. Canadian lumber Companies Sell their stocks go up. There was a sigh of relief from investors. One concern was paul ryans border tax. It looks like that will not happen. That is a huge relief. It is not all doom and gloom and canada. Justin trudeau strategy is to play the course. Withies to play nice donald trump. I think we will see that more and more. I think that anyone who worries about this should buckle up for a long winter. Much. Hank you very great stuff. Up next, the worlds number seven chess player is also an avid options trader. We will hear how the two are similar in a conversation next. This is bloomberg. Joe whatd you miss . Chess the worlds best players, number seven right now. He uses the same approach playing chest to trading options, which he does avidly. I sat down with him and asked what it takes to be a professional chess player. The main thing is there is meritocracy, there is a ranking system. The top 20 or 30 players in the world make a good living. Below that, they struggle. Im in the very elite group that makes a living playing chess. Hopefully i can play for the world champs. That is the ultimate goal. Joe in addition, you are an avid options player. You tweet about your options trade regularly. I have been fascinated in general. In the last two years i have done more than equities. I look for patterns and strategies as well. I have just done a lot of research and tried to make good decisions and investments with some Risk Management involved as well. Joe there are certainly a lot of people in finance who are. Vid chess players from your perspective, what is the sort of intellectual overlap between being good at chess and trading . I think a lot of it is the analytical aspect. You try to make good decisions, the best decision, i should say. I think with trading, it is the same thing. You try to figure out what could happen, the possible event, what happens if it goes this way or that way, the best and worst case scenarios. Think ahead and planning. Joe one huge difference between Financial Markets and chest is with chest, if you see an outcome, you can calculate it out. If you have done the captivation properly, there is no chance element or randomness on a chessboard. Markets can be very different. You can you lose huge amounts of money, a big psychological element too. What you think about bridging the gap between those two things . A badchess, if you make decision, good things happen no matter what. Another thing that is very similar is if something goes wrong in chess, you try to cut your loss, find a way to salvage whatever is happening. You try to do everything you can do to not lose. I think the same principle applies to training as well. You can still cut the loss and make the best of a bad situation. I find that to be very useful. Joe principles of Risk Management apply to both. Absolutely. That is critical. That makes the difference between a weak chess player and strong chess player. It applies 100 to trading as well. Joe another big way in which chess and markets are similar is a huge role that computers have come to play in cap galatian and how they both operate over recent decades. Similaritiesed or differences do see there in the way that ai in computers have impacted chess . I think it is very similar. At the same time you can use this to your advantage to improve ideas. In the market you want to give up a lot of times. Certainly, there are certain situations where you see fall to is too high or too low. Sometimes i think there are still some inefficiencies. Of course, it is difficult. Of apps you play a game chess, if you win or lose, you may run the game through a computer to see if there were positions or ideas you may have missed. You see do you do similar steps with trading, after trading, go through and calculate things and see if there were mistakes you may have made from the get go . Absolutely. It is the same thing. Mistake, if you make that things dont happen, in the market, that things can cap and happen. Possible, butnot i like to think i can try to make all of the right decisions to the best of my human abilities in trading as well. Joe that was my conversation earlier today with professional akamura,ayer, hikaru n currently ranked seventh in the world. Myhear more of conversation, sign up for the podcast. You dont want to miss it. Coming up, what you need to know for tomorrows trading day. This is bloomberg. Scarlet a lot coming up tonight and tomorrow. Dont miss this. President trump tweeted this weekend that we should expect a tax reform plan to come out on wednesday. We will be looking out for that tomorrow. Joe i will be looking at mba mortgage data. That comes out at 7 00 eastern. Scarlet dont miss this. A big day in earnings. Whatds it for you miss . Alisa im alisa parenti. You are watching bloomberg technology. A judge has blocked a President Trump order to withhold funding from socalled sanctuary cities are community that limit cooperation with immigration authorities. The government may ask the court of appeal of San Francisco to overturn the ruling. Former National Security adviser Michael Flynn could be prosecuted for failing to report payments from russia. The chairman of the House Oversight Committee Says theres a trip ore he cleared payment the secretary of state army. Former attorney general sally yates will testify before a committee on russian interference in the 2016 election. The senate says ea is scheduled for may 8 with former National Director james clyburn. Will sign anmp executive order on the Antiquities Act to review National Monument designations by his predecessors. The law gives the Executives Authority to designate National Monuments. Derek jeter is one person who to buy theoption miami