We know it is absolutely face. Al given what we simply put, the trump budget takes a sledgehammer to the middleclass and working americans and lavishes tax breaks on the wealthy and imagines all of the ask a new deadline increase for hoax of the breakthrough greeks has to receive the next batch of bailout loans this summer. A broad settlement could be reached when finance ministers south africas ruling National Moving jacob zuma this week and according to people familiar with the matter, his march filing of the finance minister and the nations ensuing credit downgrades as increased opposition to the president. This due to step down december and as president in 2019. Global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. I am mark crumpton. This is bloomberg. Live from bloombergs World Headquarters in new york, i am julia. Scarlet i am scarlet fu. Joe im joe weisenthal. Stocks to alltime highs. The question is, what did you miss . Calledcratic lawmakers trumps spending budget. Away, thosemonth negotiations. Strong as markets hoped. It is time to be skeptical with third rate increases here. Lets look at where the major averages stand as we head toward the close. Abigail doolittle is standing by. Lot happened. Small games for the dow, s p 500, and the nasdaq. If the down the s p 500 can hang onto the gains, it will be the fourth day in a row, the first time that happened since february. Not a lot happening. Lets look at the big movers. A stock just took a leg lower right around 3 00 at a report. It is set to be interested in offering to buy the company. Not in, so wes have the shares down. P multiple days in a row they said they were kind of perplexed about this speculation in the shares giving some back right now. Heading in the other direction on potential deals, we have trading up by 15 . Said to make a takeover offer. And the head of glencores operations last month in an interview did say that the company is interested in expanding in the u. S. Shares on their best day since 2009. Some strength of their. Interestingly, the strength of these companies comes against the backdrop of weakness with the rain itself today. We have the bloomberg commodity andrading down largely responsible for this. It should be soybeans, down about 4 . Corn and wheat, all down sharply. Bloombergs commodity strategist just recently told me on the phone he thinks this is a little bit of a gate a kickback, that commodities have been higher on weaker planting expectations, delays for planting, a little bit of a give back. In the second half of the year, he thinks it could be the strongest within the commodity thatnt taste on the idea there is a pretty strong interest there. Talking about the reflation trade, and we take a btv 7182. , 12 percents p 500 in yellow, the bloomberg commodity index, up about 1 . We see up in about february, there is this path. It will be interesting to see whether stocks or commodities preview right. Something else interesting is the fact that you have the commodity complex down sharply. Weakness,e dollar that would typically help the commodities, as you know. Did you miss . The Trump White House calling its first budget a new for american greatness. It calls for steep cuts for supplemental a trip nutrition program. Low income housings death assistance and meals on wheels. Hurt. An, he says will not we have plenty of money in the country to take care of the people who need help. We heard a comment there from Mick Mulvaney saying we will not kickoff anyone who needs help who needs it. Obviously, to square that circle, so to speak, reconciling and claiming they are not going to get hurt. That is right. You have to put the emphasis on the words who needs it at the end of the sentence. Director mulvaney is saying he believes there are people who leaders receiving the benefits who dont need them and are basically takers and they are taking from the federal government benefits they do not deserve. Now we see it in dollars and cents from the president s budget. They are shipped shifting the taxpayers paying for those various programs. The director saying there may be people kicking off the programs but the people who need the programs and the people who are ber are not going to negatively affected. They believe this budget takes a hard strike of people who are poor and people who need the program and who rely on the federal government. Thegovernment assumptions present and not long ago. In a way that does not necessarily make sense. The budget indicates revenue collected will not drop even as the tax plan indicates there will be tax cuts and people paying less. What other assumptions are being built into this poser . The white house is getting called out including double counting how much benefit they will get from the tax reform, how much growth and how much. Evenue will come from that a lot of economists say it is unrealistic in the white house is based can reject the idea they cannot grow the economy at a rate of 3 to get the budget to balance on paper p or do saying a lot of that is basically budget gimmicks and smoke and mirrors to get a ance where it actually Social Security and medicare. Assumes a 3 growth rate, that is the latest they get to a balanced budget. We can give them some points , the defenders here would argue. Headwinds, because on so many copies i have read here, people are saying it is dead on arrival budget, why . That is right. It is basically dead on arrival budget. Both democrats and republicans in important positions on capitol hill in congress, the president s budget is more a statement and not necessarily piece of legislation to get around. Negotiators will sit down and try to crack the budget that will likely take some of it deciding how to spend the taxpayers dollars. They will probably reject cuts to programs, things Like Research funding, medicaid cuts the white house is proposing, probably will not make it into the final budget. Congress will have the final say on this. Thewhite house will have proposals, but overall, the the power ofsays the personalize with the congress and they are planning to use that in not necessarily and not necessarily take the president s ideas a starting point for those negotiations. Coming up, whatever happened to the inflation trade . The Federal Reserve is off course potentially it we will discuss that. This is bloomberg. Bloombergs chief washington correspondent literally just landed in rome were President Trump arrived hours ago for the third stop on his first foreign. Great to have you on as always and thank you for literally just stepping off the plane and calling us. The most interesting thing for me is the pope. Immigration and climate and islam in particular, what can we expect to come out of the next few days . We are literally sitting on the runway, waiting to go to rome were President Trump will have a series of meetings in withwhere he will meet pope francis. They have a storied history, putting it mildly in what was known as the summer of trump and the summer of 2015. This is when the president , candidate donald trump first arrived on the political scene taking it by storm, his stance on immigration, saying he would build a wall. Francis have followed up with walls were not the best way to build community in terms of relationships to worldwide citizens. It is a surprise so to speak that allows for candidate trump to get attention ahead of the other candidates and a maple tim to win the primary to finish strong there. To be all about immigration but are going to seek to find Common Ground for in asfeat extremism well as extremism within the christians base. This fora portion of many will have meetings with italian leaders including on bilateral trade agreements. Him want to pick out what you are saying about extremism in light of the attack in manchester. What tone do you think president back will take toward the of the meeting and the nato meetings in light of what happened yesterday . It is so important talk about that tone . I was told earlier today, by white house officials that the president was being briefed on the attack on manchester, the horrific tragedy. We heard the president when he made his public remarks, when he called the perpetrator of the attack evil and total losers who must be obliterated. This was the first unscripted moment. This was the first time where global events have directly impacted the president ss first trip abroad. I think he carried with him and leaders. Up to 10 00ing p. M. , so get some dinner and get some sleep. There was conviction that inflation would pick up following trumps election victory tightening the policy. Questioning that earlier optimism coming here to discuss that the fed is now off course is the professor of economics and senior professor of economics reform forum. Great to speak with you. In your latest column, you write that inflation is not cooperating with the fed. What does the fed do . Does it change course as a the fed is faced with a persistent lowinflation environment. Expected inflation to rise, it has not happened. One is to basically declare victory and say 1. 6 , and that is close to our target as long as we can credibly believe inflation is heading to 2 . We are thick we can see that they are heading along those lines. Basically you start to think, mainly unemployment can be lower, at the rate of unemployment is too high and overtime, we will have to bring it down further. That is another avenue fed officials will think about more aggressively over the second half of the year if indeed inflation stays low. Terminal,ooking at my basically a chart breaking down inflation and a bunch of different ways. The fed index, headline inflation down at the bottom, housing, shockingly weak, showing how much housing has really had upward pressure on this. The bottom line is they all headed lower. What is the bottom underlying story . Thing for the fed to say we have confidence inflation is up. But what is going on . All of these lines are pointing down right now. One thing going on is that Inflation Expectations are wellmaintained. Some estimates they are following, maybe this is putting downward pressure on the overall inflation. Fairly large of flat folding out holding down inflation as well. Effects, that maybe we are not doing adjustment on inflation rate. The lowinflation environment, extra pricing at the beginning of the year because firms are only changing pricing it the end of the year. There are a number of reasons we can think of and i think fundamentally, what is happening is it is remaining contained and that is something the fed will have to address. Is a weak have seen patch in the First Quarter of every year. Do we presume, that is what happens and that it is something we can dismiss once we are past the First Quarter . Will have ahe fed tendency to think a couple of the recent inflation reports were dominated by special events and maybe seasonal effects. At least for the next meeting, i will say that unemployment is low and we want to make sure we stay ahead of the inflation curve. We know there have been issues and it looks like growth has accelerated in the second quarter. Lets go ahead and tighten up policy more. As a situation persists, they have to rethink the likely path of interest rates. You are saying maybe in the that italf of the year, is not ok anymore to assume that the weakness is transitory, and we have to do a turn here. At what point do they make that decision and at what point is that sometime closer to september. I that means them thinking either about delaying the reduction of the balance sheet, and they are planning to do it later this year if everything works out, or taking down rate hikes for the year, and next year. One thing we have seen is at the cost of Wireless Services have flash quite a bit, so much that it is influencing the aggregate number but there is no particular reason any of us should be nervous power cell phone bills are getting cheaper . E is no reason on the surface, no, right. However, in the aggregate, we need inflation to be running around 2 . Essentially, if inflation is falling, what were seeing is there is room for the economy for faster growth and room for lower unemployment. Of whether that is coming for good reasons or not, the fed will have an incentive here, to offset that. The fed will want to make sure expectation stay entrenched closer to 2 . Even if you have positive developments, the fed does not want Inflation Expectations to drift downward, especially in an environment with the next recession seeing it zero bound again. We do not want to see it with 1. 5 percent expectations. Thank you. And we get the fed minutes tomorrow at 2 00 p. M. , European Data painting a rosy picture of remaining on firm footing. This is bloomberg. I will look at the euro dollar and im looking at a general chart. Looking at hey where is it training right now given the dollar weakness we ares in . Before this chart november 2016. Norv elements, the weakness seeing the dollar, the u. S. Or the u. K. As well reporting this has actually come off here. Unwinding of the euro carry trade has taken place and has lifted the euro here, it might look premature. They see fair value, more like 108. At the same time, backup pmi data overnight indicated things are pretty good in france and when you talk about eurozone, they need to be on top. Joe we see all kinds of good including 200. S they say we love it with when the chart stuff combined with the fundamental stuff, for a lot of reasons, it is why. That takes you back to the fair value. As we look at the market close, tickets look at the major indexes. The dow is up by 42 points, the s p now up by four. This is bloomberg. Whatd you miss . Now, s p 500, and nasdaq fourth straight day things. Scarlet im scarlet fu. Im joe weisenthal. We want to looking you to our closing bell coverage of your joining us on twitter. Julie we begin with her market minutes court straight e the s p 500 it is things we havent in a while. If you look inside sectors, moves are more advisable there. Financials a big winner of todays section of 8 10 of 1 , 10 year yield higher treasury bonds. This includes homebuilders, automakers as well as retail. Consider forming down theres theres a takeover bid from consolation brand. Autozone one of those retailers, discretionary Companies Offer a 12 . Fiat chrysler off by 4 after the department of justice sued it for cheating on an admissions test. Lets bring up this up by 17 on the day. Instead horse that is. Esterday it was down Chris Stapleton video. That shows you how little i know about these video games. Nevertheless, in the end it was a big day for take two. Turnaround from yesterdays delay, lots of people wondering whats next. Phones 10rnment year yield up to 1. 3 , 10 year yield up to 2. 29 . Fairly low by recent history. Articles there are concerns, they dont want to sign on. If in the debt is unsustainably high. Julia you can see this dragging the euro down as well just 2023the full strength higher. Significantly lower than that now. Concerned about the election. The one i want to point out is dollar around and focusing biggest movers of the day. The South African really party will discuss moving the of may. T to the 28th the states back to the summa zumaion on march 31 decision on march 31. Rumblings in the part that could the end of that. Scarlet and updates. Joe reminds me of when a companys ceo stock goes up, theres a negative vote of confidence. Commodity oil skimming at a onemonth high, gaining at a onemonth high. 51 a barrel. Loss. Utures less than 1 sugar and soybeans come soft commodities, bucket last week. There were fears of more exports. Those are todays market minutes. Whatd you miss . Of one of the biggest bull markets, some Money Managers are still cautious. So what are they doing with their money . Oliver renick is here. Isnt this part of the story of the bull market number he really believes that . Oliver its between a rock and a hard place. If yound of what it is look on relative basis. Theres obviously great deal of people buying stock market us that 22 times an alltime high. This clearly no hesitation to be involved. If you actually look at different parts of the market, theres a fair amount of trepidation that remains, people concerned. People think, everybodys throwing money away, thats not the case. But check it was going on in terms of Asset Managers and hedge funds. Joe we have a chart here. Oliver does a full on the line the blue line there is looking at Asset Managers, white line looking at hedge funds. This gutless short in terms of s p 500 futures position. Thats in the wilan. Can see that look at the blue line. Here you haveis to keep perspective. There has been a change in the most recent right of market its been the noncomplex and thats good for markets obviously, but you look relative to the 500 Asset Managers, was being tech lead, and the case but you look at how the indexes maybe a little busy technology. Oliver as soon as you leave the earnings window things get rough year in the market. Tech is the second chart we have, this is putting in perspective the move we have seen in the infotech sector in the s p 500 versus the s p 500 itself. Youre looking at is a spread between devaluations of the tech index and s p 500 index. The spread has gone very high. You can take my word for it if you look at the flows on the bottom, there have been flows out. Three weeks people have moved money out of tech. What you are looking at there has been a knife nice little run in tech. Whether not its stable, rotational, is yet to be determined. These runs the past couple weeks, thats interesting. Wouldve up, demand for those . Oliver this is my favorite. I have a soft spot or bond proxies. [laughter] im not sure why, theyre the underdog. Are looking at the y line, positioning on treasuries. My colleague on the bond team has a great story today but how bond investors. Theres a move in speculative bets on the bond market. Youscreen the bottom have a commence or move in the these are just bets on treasuries. They dont test have a correlation, people could be wrong. Eel auto bullish as best not equivalent amount in the in stock market. Joe one thing that is striking about the postelection time was we had several charts on it, those were popular last year. Anything, reits, safety, people were so desperate to hong kong hang on to. It got clobbered because of the election. Oliver cash, the Fund Managers i look at bank of america state of. Theres a late big cash pile of early 2015 2016. Everybody got obliterated in the first two months of last year. Investors kept cash close to their vast. After the election that moved down substantially. However, they pretty much plateaued since then. If you look at the 10 year average based on bank of americas number, we are above that still. And that doesnt mean people havent been putting cash to work, definitely have, but the Wider Perspective relative to the bowl market theires more bullish points in this. Scarlet we have already seen volatility died down completely, and these cliches get preemptively activated. Oliver i think for a minute, it may, but now its selling may because of trump. Just from the calls regardless of Everything Else thats happening, after earnings it is a focus on d. C. A few more games like last wednesday, going to cause people to secondguest their bets, given these second guess their bets. This, if youer want to sell stocks, dont tell it to the politics will political people. News. Aking into its coming out with numbers here. Fourthquarter adjusted earnings commend midpoint. It gave a range of the First Quarter adjusted eps. Thats higher than the consensus estimate. It has built on previous gains, 6 . Ce up by this allows you to file your tax returns on time. Julia lets look at whats coming up. Goolsbee to former big difference governor about how often this text could affect brexit negotiations in europe. This is bloomberg. Mark the president of Manchester England held a vigil for last night terror attacks. A 22yearold local resident was identified as the suspect in the attack, which left 22 people dead, scores were injured a pop concert by Ariana Grande it. These are mixed it claimed responsibility for the attack, but u. S. Intelligence Officials Say they are not sure that his case. Today defended President Trumps proposed 3. 6 trillion spending cut for the 2018 budget. Democrats have expressed concern that helps balance the books. Are not taking anybody of any program. With plenty of money in this country to take your people who need help. Khamenei says its a Taxpayer First budget. Joseph is this helps unemployed recipients rejoin the workforce. Had meetings today to discuss the countrys labor market. The meetings were aimed at opening a dialogue and the dean understand the need for changing times. Thelans to make reform of labor market top priority. Ominous news from the pentagon unmanned tested may 14 means north korea is one step closer to develop a nuclear arms rocket that targets the United States directly. The head of the Defense Intelligence agency tells the Senate Committee that pyongyang remains a critical security challenge. Global news 24 hours a day, powered by more than 2400 journalists and analysts, in more than 120 countries. Im mark crumpton, this is bloomberg. Whatd you miss . You can Prime Minister theresa may has suspended her campaign, but the attack has the potential to affect the general election. Want to show you the bloomberg as a barometer. The impact of separation process and the u. K. Economy, employment, unemployment, inflation growth, uncertainty. When it tied the u. K. Economy is healthy, negative is unhealthy. Re has been an erosion theres been a shift certain sentiment related to brexit negotiations. It is something that we need to Pay Attention to, specially since this is really bloomberg brings a barometer was at. Fascinating to see this around july then suddenly that spikes higher again. From on the ongoing brexit negotiations and other issues come bringing christian go yeah, with the brink of think of france. He is known of frances grexit negotiators. Give us an update on how europe. Tands with brexit theravance of talks in germany, messages of understanding. Theres the fact that the [no audio] we remember that britain was a tough economy and sending us messages of friendship when we had numerous attacks. We did the same with germany. Its really something that the europeans are very much brothers together, sisters together, when it comes to resisting attacks, building the defense of the western world. Think its natural that we delayed things somewhat. In any case cant stop for the elections in britain. If this postpone session on the for the eu, European Commission everything is better now, it will stop after the british elections. This permits people to walk over the next days, where we can get some trade data on this support the attack and the shock that resulted from that. So youre the negotiator for brexit and france. If you have to to begin fresh in a few weeks time with a new government, will that significantly delay progress authorities in maine progress being made . Helpshink in our case, it considerably. , when all the major banks, Insurance CompaniesAsset Managers that infrastructure were already reflecting on these plans. So the reality location of forces between london other places. General the feeling i had financial place to london. Much smaller, but still it has all branch of financial activities. Its a big city, has a lot of activities. The staff your partners, spouses need to find a job another area. But something thats offered. Uncertainties in the Incoming French elections most things could not be decided before coming out much easier. Joe you think you see i pick up an announcement about moving personnel, offices, perhaps headquarters . This is obviously the expectation some people have expected in the wake of the brexit vote, you see that exit from the city of london. So for it seems marginal. Our you suggesting that now some of the uncertainty in europe, france in particular, has leared away prepare to assess the different options. Should we go there, there, or their or should they share what they have to relocate to two different locations . How to organize that exactly, how much we will need to take out of london, and what makes from aor them business point of view. All those things could be made quickly. So they are much advanced in that process. More clarityo have in the fiscal process, especially in france. Now they have probably most of the day need. Whether it will be sideway shortly or in the coming months, i dont know. Its likely to be during the course of this year, yes. Scarlet thanks for sticking with us, what went to discuss european Monetary Policy following the latest eta. This is bloomberg. Julia were back with the former think of france governor and current brexit negotiator for france. Money managers say the perspective of the regulations thats why frankfurt would you agree or disagree . Agree. As a big misconception. After it made a number of instrumental changes, reform to last year, by the way france now there are a few differences but it is very low. Now that we are going to make big reform next summer as macron announced,ed has it will be much better in terms of labor market with talk more about the european economies. Scarlet we had a bunch of data out from your overnight. The data on pmi was decent from a factory and services for germany and france in the eurozone. Charts. N this line of basically all of them trending upward nicely, thats the overall takeaway. Little volatility. They are holding your recent ties. So it would argue for the Senate EuropeanCentral Banks to begin talking about them. Joe is this the real deal . We seen a couple times over the last years, fears of the economy starting to get traction and accelerating after disappointment. Is a supper trend . My own view is that it is. The european economy is heavy really picking up. Think thats good news. With a new development in france, confidence given by the elections, hopefully this is very soon the elections will have a Strong Program of reforms that will increase the potential generally good at working the european economy, really could be a good year. The question how much is the concern of exhortation . Inflation . Isthe recovery in europe late from the u. S. Thatd a secretary delayed the recovery. Will we seeking out do have sizable it could take some time before inflation picks thend moves and so reference of the central bank. A little bit like the fed has waited you should wait in the prudent it will come at some point, but i dont see the ecb i dont know, i dont see it rushing with policy. This takes all the delays needed and possible. Joe thank you very much. Of course its one of the main reasons are still bullish on your reasons for the tv remaining, christian million, former think of france governor, brexit negotiator, thank you very much for joining us. Julia coming up we sit down with wells fargo ceo about the bank is recovering from the bank account scandal. This is bloomberg. Proposedsident trumps 2018 budget has arrived on capitol hill. Reaction to the 4. 1 trillion spending plan has fallen along party lines. What are you like about it clearly focusing focuses on increasing the ones spending is critical given the threats we face. Simply put, the trumpet budget takes a sledgehammer to the middle class and working americans, lavishes tax breaks on the very wealthy, and imagines all of the deficit problems away with fantasy math. Mark the proposed budget includes 3. 6 trillion in spending cuts. Former cia director john brennan says refund for the House Intelligence Committee today, saying he was concerned overwork the President Trump classified information with the russian during an Oval Office Meeting on may 10. Do not know what was shared at the oval office, but if the reports and press are true that mr. Trump decided to spontaneously share some intelligence with the russians, he wouldve violated two particles. Mark brennan also told the panel he warned russia against the meddling in the u. S. President ial election. World leaders expect President Trump to announce whether the u. S. Will remain in the paris climate agreement. Germanys environment minister says the president will come out with his decision at the g7 meeting of this week in italy. Mr. Trump has called global warming, a hoax. Global news 24 hours a day, powered by more than 2400 journalists and analysts, in more than 120 countries. Im mark crumpton, this is bloomberg. Lets get a recap of todays Market Action forget gasquet gains from s p 500. Nasdaq lagging for a change, not often you see a tech heavy nasdaq behind the snp and the doubt. Joe nasdaq overall has been obliterated a little breather there for tech. Scarlet financials rising in tandem with 10year gilts. Speaking of rising, we will look at shares of intellect, building on their record high. Up now by better than 7 after it fourthquarter outlook. In my consensus to have estimates coming stocks getting a nice left. Julia especially energy sector, given with seeing gains here trading now 51 just something to keep an eye on. Whatd you miss . Wells fargo is how a month into its efforts to rebound from an account scandal. Theyre making progress. Down exclusively with bloomberg stash today in san francisco. They talk about for the lending is faring. Clearly, as you mentioned we had some issues. Rebuilder one job is to trust with all of our stakeholders. We think about that is building a better bank. Many of theng lights the issues behind us. Having said that, we are looking all across the company, and there will be issues we find and deal with, things like that. Of the progress the team has made. We have made management changes, taken accountability, changed our incentive plan, reorganized how the bank is and have been very focused on customers over the next last nine months. So im the progress. Cap quantified percentage terms . Youre are how many percent of the way there . Again, you have to fight define what the way it is. Measure it would to be to look at Customer Loyalty and experience in our community banks. When you look at those measures which we have been providing updates on in our effort to be transparent, the Customer Experience measures are now where they were are highs about a year ago. Those of the two measures. Another made from an investor standpoint is to look at the fact that in the First Quarter limited dollar and share, five and have billion dollars. Thats our 18th consecutive quarter of earning more than 5 billion. Theres too companies in this country that can say that. The are two good measures. Theres more to do. Is it better or worse than where you expected it to be at this point . This is the second grade shaaban the world, the first is to be a grandfather of charlotte injects loan. But this is the greatest job in the world. I am so pleased to be and proud to lead this company. Everydays a challenge, a big opportunity as well. Its great. I get to lay 3000 of the best team members in the industry. Thats an honor and i look forward to it every day. As you can tell, im trying to get a sense of a much more work you believe needs to be got to get the scandal behind you. As with both established, thats her biggest challenge. It took Brian Moynihan six years to get be a fan of the subprime ditch. How long do you think it will take to undo all of the damage that was done that you inherited . Sure. Well so first, all of our stakeholders will decide. By the way i think ryan is done a great job of being ceo of bank of america. If i can perform as well as he did, thats going to be great. We are going to move through this fasters my guess. It will be a plus to rebuild trust with our stakeholders. Its in our hands. Again, were making great progress. What he still need to do . You establish you still need to rebuild trust. The customers, with employees, your shareholders. Youve also got municipalities, some of which blacklist you. What are some of the other points that you need to kick off to again, put wells fargo in the clear . As it relates to municipalities on all them have blacklisted us. We love doing business with wells fargo, where such every municipality and state whose business weve lost or have put on hold, we want to win that back over time. My measures are the six expiration or goals that weve introduced to our team in march. We want to have the best Customer Service in the industry, we want to have the highest team member engagement, being the employer of choice. We want to be the most Innovative Bank its very exciting. We want to be the best we want the best management, the best longterm shareholder returns. When we achieve those goals they would we will be done. Julia that was wells fargo t ceo, tim sloan. Joe whatd you miss . I want to bring in a staggering chart was put together by mike mcdonough. This is about the university of Michigan Sentiment data. This is a percentage of respondents receiving on unsolicited positive comments you are just having a conversation that showed an hour, by the way, in government is doing or feeling. This linus come up like a rocket. Julie and i both noticed this chart today, we are stunned by this. This is in the immediate wake of the trump victory. Nearly 30 of respondents saying, ive heard the economy is good. Ofpite some kerry ration trumps approval ratings, which we know about, have talked about on the show policy agendas fall, there is an extraordinarily high number of eople, and scarlet even more amazing when you go back to the chart and consider, the average between 19812016 was 2 . They go from 2 thomas joe shows you how great washington, d. C. Is doing with the economy. Scarlet between what was saying in terms of pauls and being asked about the polls very clouded by listing the drama. You would think they be more berelated, think thered trumps approve all, confidence numbers of rollover. Fortell us very good the most part there seems to be a declaration. This all depends on where you get your news from. If you get a certain outlets where things are shaded a certain way others go somewhere else. All depends. Perhaps, perhaps. One particular handle. The topic coming up well take a closer look at President Trump budget proposal, how is ignores Campaign Promises tackle high drug prices. This is bloomberg. Julia theresa may is currently giving a speech. Hes discussing the latest goack were going to go to straight to it. To the plane of reforms military personnel. This request is part of a wellestablished planet known as operation tempora, in which officers involved are welltrained and wellprepared to work in this kind of environment. State istary of approved this request. Operation tempora is now in force. Peaceeans that armed officers responsible for duties byh as bernanke sites members of the armed forces, which allowed us to significantly increase the number of armed officers on patrol in key locations. You might also see military personnel does life such as concerts and sports matches, helping to keep the public safe. Circumstances, members of the armed forces will be under the command of peace officers. The military and armed peace officers will be deployed is an operational decision for peace commanders. This is also decision assistant commissioner will be making a statement giving further details to new Scotland Yard later this evening. Weeks,coming days and there will be many events hosted up and the country. The police will work with organizers and hosts of these events to come to a judgment about how they can go ahead, make sure the attend them are safe and secure. Feelnot want the public to unduly alarmed. When faced a serious terrorist threat in our country for many. The Operational Response ive just outlined is a proportionate insensible response to the threat that our Security Experts we face. And everybody to help to quiet bridge with and support the police as they go about their important work. And by repeating the Important Message i gave in my statement earlier today. Will take every measure available to us and to provide every additional resolve we can to the police and security services, as they work to protect the public. Mix ashmoree in the and the victims of last nights attack, we stand to find. The spirit of manchester and the sick lots of depraved terrorists. As for the terrorists will never win. We will prevail. That was Prime Minister theresa may speaking life there at downing street. She told people that the threat level in the u. K. Has been raised. It was severe, it is not critical. They believe a further attack could be imminent. She was measured there. Clear that there will be an increased level of protection, military there to guard Sports Events trying to stop and unlike estrogen matt this atl raise raise questions the back end of march. The tech level wasnt race white is taken so long. I could see a whole number of questions but to answer that, the Prime Minister 22 dead, 59 injured in the attacks of manchester yesterday. The manchester terror attack or was born and raised in the u. K. Scarlet certainly something to keep in mind as well as we had towards the u. K. General elections. The further tax means i belittled much higher. We know theresa may extended suspended her campaigning because of this terrorist attack. Well see what they do as far as that is served. With the proximity you make of great point with the proximity so close to the election, it will be concerning. Just to reiterate, the threat level in the u. K. Has been raised from severe to critical. That was Prime Minister theresa mays this is bloomberg. Scarlet whatd you miss . Kenneth trump had tough words for the drug industry candidate trump had tough works for the drug industry. But now there are proposals that would rein in their federal practices. Here is more details is a reporter who covers the Health Care Industry washington. I think back to hell donald trump met with Corporate Leaders in the months following his inauguration, the first few weeks of his ministration, including leaders from the Health Care Industry. Do we know if the administrations priorities shifted after that meeting . Enough they discussed drug pricing . Certainly that seems to be a case. One of the things the pharmaceutical ceos have pushed thats they say would help with drug pricing, but doesnt exactly make the dramatic effect of things trump had previously proposed would be to make deals with Insurance Companies so that they would pay for the drugs in hell well they work, rather than just volume, amount. Upt is something that ended in some but proposals. We consider that there was certainly in those had when they visited. Joe the rubber other evidence besides through which the Administration May see drug pricing say perhaps generic pharmaceutical reform things like that that might be separate from his vehicle . Anna does other ways they can go about this. One primary way weve heard about is c new fda commissioner trying to find ways to get them to market faster. The more the come to market the lower the price tends to go. Dealing with particularly stille Things Considered expensive, complex drugs that combine a drug and company like that depend trying to deal there with generics to get to market. Scarlet what is the Health Care Budget tell us if anything, about the white house is a subject for health care reform, replacing obamacare . A lot of thely, cuts focused on medicaid, the the goodhat within health care coverage, helps a justf low income will disabled as well. That looks to cut significant amount over 600 billion. At the top of an 800 billion cut that would come as part of act,ffordable health care the bill that republicans in the health severity past. Thanks for you for giving us recap here. Brieflye just heard from u. K. Prime minister theresa may. I want to reiterate, bring you up to speed with what she said. The Terror Threat in the u. K. Has been raised from severe to critical. They were warning that further text could be imminent. Maybe trying stake in measured at home, sending they dont want people to panic but there will be greater cards and military, particularly at concerts and Sports Events. This is a promise on manchester yesterday she is confirmed that the results of the terror attack, 22 people died, 59 injured. Crime wasrator of the a u. K. Born citizen. This overall emphasis here on her speech was, to remain calm, also but the threat level have an raised from severe to critical. Joe breaking headlines on , president s former National Security advisor. This is in the form of electricity North Carolina senator, richard burr, interest North Carolina senator richard burr wrote a letter. He said theres no immunity offer for flynn. As an aside bursting that the fifth amendment doesnt apply to comes to this type of case. Flynn e church for not a preference. Him would prefer to have tell his own story. Theres still no immunity offer for the former National Security adviser. Scarlet meantime, lets get to Bloomberg Business flash in the look at some of the biggest business stories in the news right now. The Justice Department has filed a complaint and Fiat Chrysler parties or omissions after a lastminute effort by the automaker to propose the cap fails to satisfy environment to regulators. Epa says that here chris later violated omission close more than 100,000 peoples vehicles. Bunkley bungee could be acquired soon. Glencore has been a takeover bid for the u. S. Company, which has a market value of over 11 billion. German the chairman of the rig up the is a glencore. Morgan stanley said more cut back on using recruitment bonuses to establish Financial Advisors today, after bank of america expressed similar moods. This will honor existing criminal deals but in 16, and include by september 1. Morgan stanley is developing new policies for recruiting and will roll out digital to support advisors. Thats your business flash update. Julia interesting story, isnt it . Lower tier banks have artie abandoned efforts to provide a signon bonus for recruiting traders or brokers. Joe of course, the big technological changes affecting this industry, you see the news that they want to build on existing brokers clicking keep some of his other julia vix will do it. It, levelill all do the playing field. Its Still Nuclear for the big guys, but it makes sense financially. Joe definitely an interesting element. Coming up, what you need to know for tomorrows trading day. This is bloomberg. \ w scarlet coming up, President Trump continues his european tour, meeting with pope francis in the vatican tomorrow. Joe looking at fed minutes for those main meeting we will see any talks about the balance sheet. Julia dont miss the Congressional Budget Office an assessment that the American Health care act. Cant wait. Scarlet alisa im Alisa Parenti from washington and you are watching bloomberg technology. Lets start with a check of your first word news. British Prime Minister theresa may raise donations that level saying another attack may be imminent after the suicide bombing last night in manchester. May spoke today in downing street. The terror level was raised from severe to critical. Manchester residents held a vigil today for victims of the attack. Authorities also identified a 22yearold local resident as the suspect. 22 people died with more than 50 wounded. Islamic state claimed responsibility, but the u. S. Has not verify the claim. President trump is in rome and will meet with pope francis tomorrow at the vatican. This is the first meeting between the leaders and the third stop on the president s trip overseas. Trump hasf criticized Trumps Campaign plan to build a wall. The president responded by calling the pontiff