even the dow transports, big gains. the dow is up 1.5%, up for its best day since march. on pace for the best day of the year. record highs for the dow and s&p 500. 1% -- up tenths of .8%. the dow is on pace for the best week since 2011, so investors seem to have confidence that tax reform may happen. they may be encouraged by opec reaching a deal to extend the supply cuts. we take a look at the s&p 500 in the bloomberg, it is having its best three days of the year. this is g #btv -- the 1% move up, move down. we see that yesterday, a tiny move down. today, a 1% move. the first time we've seen that since september 11. looking at the best two days for the s&p 500 of the entire year. let's break down what is happening the -- what is helping the s&p 500. trading higher as yields rise. apple bouncing back from yesterday's selloff. microsoft doing the same, impressive there. as for the dow, having its best day since march. above 24,000, more record highs. these are the top performers -- goldman sachs, up nearly 4%, being held by rising deals and optimism. united technology is up 2.6%, and intel is up 2.6%. if you had any question as to whether it was risk on or risk off, this would suggest that it is a risk on day. but there is one small piece that does not fit. take a look at the 10 year yield, up cointreau basis points . haven bond is selling off, as is the yen against the dollar. gold is down nearly 1%. is up 7%. we were looking at the major averages -- one wouldn't think that there is too much concern, but in the options market, there are some investors who think there is a little of the ahead. thanks so much. you certainly don't see much fear in the market at the moment. more reshuffling in president trump's administration --er repeated clashes with considering casting off rex tillerson in favor of the current cia director, mike pompeo. that is according to two white house sources. this comes as international sources ramp-up and congressional republicans try to keep the conversation on tax reform. we are joined by marty schenker and kevin cirilli on capitol hill. marty, let me start with you. we are not there he surprised that rex tillerson could be out. what are your thoughts on his potential replacement? marty: the rumors about rex tillerson's tenure have been going on for months. he has been in favor, out of favor. mike pompeo, the cia director, who was well regarded in the trump administration, he is at the white house a lot. rumors have been around for a while. they seem to be heating up, and the white house is doing nothing to calm them down. notd: as marty says, it is a big surprise. this is one of the worst kept secrets in washington. i'm curious about the timing. the president looks like he might be on the brink of a major legislative success. his first. why now? , earlieresident trump this afternoon, said "rex is here." not really putting to rest rumors that his current secretary of state would be out by the end of the year. but marty is correct, these rumors have been circulating for months. the secretary of state has received criticism for his lack of involvement and lack of presence in washington, d.c.. nikki haley received a lot of praise for what she had done with regards to north korea, representing the world on the u.n. stage. mike pompeo seamlessly made that transition from congress to does havee cia, and that close, personal relationship with president seen, att we have times, the president and secretary of state have tension. who deals insident personal relationships and loyalty. there is no question that mike pompeo has earned that trust and personal relationship with the president. shery: the new york times reporting that senator tom cotton from arkansas could replace mike pompeo as cia .irector with the senate or be more valuable in the senate or the cia? -- will the senator be more cia?ble in the senate or kevin: -- that is something that looking republicans are at the midterms and special elections, and they are on the cusp of the first major policy victory. republicans in the senate behind mcconnell and president trump, it will be interesting to see how that dynamic plays out. david: we may be on the cusp, but we are not there yet. markets are going crazy over the possibility, apparently, of tax overhaul. what are the chances it won't happen? marty: it's looking increasingly like it will happen, at least getting a bill out of the senate. then it goes into conference next week, where it could get ugly again. each time we think it is a perilous path to tax reform bill , they are seemingly able to pass that hurdle. i suspect they would be able to do it here again. question,on is, a key will the house except the senate bill? will there be no conference and just pass that? which would be a huge victory and which would assure tax reform getting past. we have to get through the senate bill first, but the deficit trigger is a key issue here. where are we on that? kevin: just within the last hour and a half, senator john mccain, republican from arizona, who had concerns about this legislation, coming out to support it. he said "i take seriously the concerns some of my senate colleagues have raised about the impact of this bill on the cleart; however, it is the net effect on our economy would be positive." bob corker, an outspoken critic of this administration, working with mitch mcconnell on developing a so-called trigger. to marty's point, when this does get to conference next week, there are many house members that will not go for that. -- asking him what he thought of this so-called trigger policy. listen to what he had to say. >> those of us in the house are not that thrilled with the tax triggered. i, personally, find it to be a uniquely bad idea. i think it is bad public policy. we need to tell corporate america and our small businesses, this is your tax rate. something you can count on. -- bad policy, as he is describing it. the conference is where all the action is heading. david: the trigger issue is an accommodation -- at this point, is this the tax bill or a quest to get to 200 18 votes in the house and 50 in the senate? seems like they will throw anything just to get votes. >> donald trump himself, in his speech out west, said i will sign anything you send me. mark: i think the issue -- marty: i think the issue on what exactly is in this bill is not as big as getting the bill itself. they are hell-bent on getting a major victory before the year is out. i think chances are better than 50%. course, passing the bill is one thing. selling it to the public before the midterm elections is another. marty: that is absolutely true. one thing to november, though, is if this bill does get signed into law, a lot of people will not feel the effects of it immediately. so, businesses will be able to plan, but the question of how much is permanent and how much a real issue.s people's behavior will not this early, necessarily, feel the effects. the midterms may not be affected so much by whether or not he can sell a tax bill. it may boil down to the character of the president, which a lot of people think will be the issue. shery: marty schenker, thank you. also, kevin cirilli. accu. david: president trump is selling that tax plan as a boost to business. why investors should be mindful of pitfalls that could delay the bill. --public policy, libby cantrill will be with us next. take a look at those numbers right now. record highs for all major indices. the dow gaining more than 350 points. this is the best day for the dow. the s&p 500 also gaining. will be the ninth time the average has moved 1%. the nasdaq being led by the fangs, amazon, apple. nasdaq is up .8%. we will be back with plenty more coming up. this is bloomberg. ♪ david: this is bloomberg markets: balance of power. shery: markets continue to move higher. we are seeing the dow gained 1.5%, the s&p 500 also up 1%. we are seeing the best day for the doubt this year. the s&p 500 gaining 19%, a 14 day -- the nasdaq is also gaining, .9%. let's get a check of the bloomberg first word news. shery, david, a lawyer for john conyers is rejecting calls from nancy pelosi. the houses top democrat calls for him to resign. him ofs -- have accused sexual harassment. he is currently hospitalized in detroit, denying the accusations. his attorney is arnold read. not up to nancy pelosi. nancy pelosi did not elect the congressman, and she sure as hell won't be the one to tell the congressman to leave. that decision will be completely up to the congressman. he has not thought about that. he is thinking about his health, getting well. >> he says conyers was specialized -- was hospitalized after feeling lightheaded late wednesday. britain's ambassador to the united states has said that he has complained that about president trump's retweets of a far right -- -- the far right, which seek to divide communities and erode decency, tolerance, and respect. dmitry medvedev called the condition of relationships between washington and moscow "disgusting." he says the atmosphere in the relationship is the worst in his memory, despite president trump's desire to improve them. he says the president is a victim of washington's hostility to russia. another woman has come forward with accusations against al franklin. thatmy veteran tells cnn he touched her inappropriately while taking a photo with him during a uso tour in 2003. a spokesperson for franken says the senator has never intentionally engaged in this kind of conduct. global news, 24 hours a day. powered by more than 2700 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. be workingsenate may through much of the night to come up with the tax message that at least 50 members can agree on. we have a good sense already of what will be in it, as well is what issues remain. we welcome libby cantrill, pimco head of public policy. i have to start with the markets and where they are going. i've talked to so many people in the past months, it is already baked in. already priced. obviously, it wasn't. >> i think insert and sectors, it wasn't. there is some optimism here that is being reflected in equity prices. in this income market, where pimco participates, they haven't moved much. you, in termshows of the reflection of growth and concerns about how this bill will actually lead to economic growth. i think there are some hesitation about what that means. shery: the dollar is also losing ground. >> well, -- [laughter] they've been constructing messages from the various markets. i guess the problem is even if you get the senate tax bill, the conference is an issue. get think even before we the conference, there are still issues that need to be resolved. former contributors had pointed out -- the issue about the so-called trigger. senator corker, flake, langford want. that the joint committee on taxation will come up with a score later today, the dynamic effects of this tax bill. it may show that this tax bill will not pay for itself, and that might cause concerns. even though we are closer to 50, senator mccain's endorsement was significant, we are not quite there yet. if it does pass the senate, there are some meaty issues that need to be reconciled. there is so much political will but it'smething done, not necessarily going to be a smooth ride. this game is far from over. they have made it a lot farther a lot faster than most people would have anticipated at this point. >> including me. david: let's assume they do get from that do get through conference. do we know what is in it? it could potentially transform a good part of the american economy and we're not sure what is in there. >> it is curious why the market is reacting so much. brush strokeader of what is in it, the details remain to be seen. and i think the details could lead to unintended consequences. it is curious that senator mccain even talked about the regular order process. changing a huge piece of legislation is not necessarily regular order. at least not when i was on the hill. there could be some unintended consequences, that i don't think investors are appreciating. shery: if there is such a fallout, how you fix it after a bill becomes law? like most big pieces of legislation, there are efforts to make technical corrections legislatively. it will probably need 60 votes, not 50. we will see if the democrats want to play ball. they don't want this to be passed in the first place. there may be a technical correction in 2018 if this passes. david: your first answer suggests that it may be possible for investors to do well, but the economy may not benefit as much. there may be a divergence. republicans say, no, it will really create more investment and productivity. are they wrong? fixed income investors are probably more skeptical by nature anyway. ofyou look at the details this bill, at least for 2018, the corporate tax cut is not implemented until 2019. some of the big tailwinds that corporations might get from having the statutory corporate rate reduced will not reveal itself until 2019. provisions expensing are not such a divergence from current law. while this may be -- certainly somewhat of a tailwind for certain sectors of the corporate market, it is not necessarily a wholesale bonanza for growth. projecting 10-20 basis points of real economic growth from this package in 2018. shery: how dangerous is the deficit trigger of automatic tax hikes if recession hits? most economists will not say, this is not necessarily a good provision in terms of raising taxes when you are having a recession. another trigger that is being contemplated is reducing federal spending, economic growth. a good probably not idea, either. you probably want fiscal stimulus to be happening during a recession. i think for those reasons, a trigger like that will probably not get into this bill. it begs the question, will senators corker and flake still vote for it? david: should we take it that seriously? is this really just a political device to say, i really took care of you in the deficit. who's going to know whether the growth came from tax cuts are not? by the way, congress can take the trigger away. >> technically, this is just the cover for the deficit hawks to vote for the bill. so, yes. that's a pretty good read. david: thank you for being with us. colleague, tom keene, is sitting with the u.s. treasury undersecretary for international affairs at the council on foreign relations. he has said that the u.s. economy is in a welcome upstream -- upswing. the major currencies are relatively stable. also, he has talked about -- going to bang far, and that it is urgent that there needs to be a refocus. he also talks about brexit posing major challenges. you can watch that event live. using the bloomberg function, life go. -- 20 more coming up. this is bloomberg. -- plenty more coming up. this is bloomberg. ♪ >> this is bloomberg markets: balance of power. let's get a quick check of the major average of u.s. stocks -- the dow is up 1.4%, its best day of the year. the s&p 500 also up .9%. --are seeing both indices passed 70, which would put it in -- territory. the nasdaq is getting .7%. we know the nasdaq has been gaining around all year, up 28% apple,ar, being led by amazon, the fang stocks making a come back. of course, a lot having to do with the tax reform gaining momentum in the senate. david, that momentum is very strong in congress. david: we heard -- this is already priced in. shery: not in equity markets. david: this looks like good news, but if it doesn't happen, because there is still a chance, i wonder how the markets react. quite a disappointment if they are reacting this way. shery: we are seeing the small caps that could gain the most gaining .3%, a record high. so what happened to the small caps if this tax bill doesn't come through? david: and financials are really ramped up because of this. shery: we will talk to congressman tim ryan of ohio about where the democratic already is heading and where it needs to go. fly from new york, this is bloomberg. ♪ retail. under pressure like never before. and it's connected technology that's moving companies forward fast. e-commerce. real time inventory. virtual changing rooms. that's why retailers rely on comcast business to deliver consistent network speed across multiple locations. every corporate office, warehouse and store near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver. ♪ shery: this is "bloomberg markets: balance of power." i'm shery ahn. david: i'm david westin. first word news with mark crumpton. u.k. lawmakers are urging the theresa may government to formally cancel the state visit that was extended president trump. this is in the wake of the ongoing fall out over his reach weeding videos from the u.k.'s far right group britain first. and another one lashing out at prime minister may for criticizing him. she was the first world leader to visit the trump white house. u.k. says the visit still stands, although the u.s. has delayed the trip because of concerns about the potential scale of protests. the house of representatives' -- is the latest lawmaker to express discomfort over including a fiscal trigger in the gop tax plan. the texas congressman spoke to bloomberg tv today. >> those of us in the house are not that thrilled with the text trigger. i personally find it to be a bad idea, and i think it is bad public policy. we need to be able to tell corporate america and our small businesses, this is your tax rate, this is something you can count on. mark: senate lawmakers voted along party lines to begin debating the bill, but are still scrambling to secure the necessary 50 votes. if they pass the tax bill, republicans still need to work out differences with the house version. joe barton says he will not seek reelection next year. congressman was rocked when the photo was posted of him on social media. image toed sending the a woman with him he was having after marital relationship. the man credited with co-creating the ice bucket challenge in 2014, with the ceos getting in on the action, has died. he died last week and after a long battle with als. the challenge was designed to raise money and awareness of als, also known as lou gehrig's disease. he was 46 years old. globald. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. i'm mark crumpton. this is bloomberg. shery: we are getting a check of the major averages. u.s. stocks continuing to surge. we are seeing the dow above 24,000, gaining more than 340 points. closes up 1% and if it 1% higher it will be the ninth highest this year. and, in fact we continue to say volatility rising this week my the vix at 1078. and it has a lot to do with what is happening in the senate with tax reform just coming into place, or gaining momentum. david: we certainly no one person paying attention, the president of the united states, who is taking credit for the performance of the stock market. the dow just broke 24,000 for the first time. if the democrats had won the presidential election, the market would be down 50%, he says come and consumer confidence would be low and glum. our next guest is also sometimes critical of democrats, saying the party have to build a new system, a system that puts people first. democratic caucus meant tim ryan of ohio ran unsuccessfully for minority leader and he joins us now from the capital. good to have a. rep. ryan: thank you. david: let's focus on taxes. there is so much to talk about on capitol hill. i know basically with the republicans want to do and i know that the democrats are against it, i generally do not know what the democrats would propose as an alternative? why am i not hearing from the democratic leadership, this is the way to make it work with taxes, as opposed to, we do not want backed? -- that? rep. ryan: i agree with you. i've offered a proposal with one senator where we do a trillion dollars where the of tax cuts for the working-class people, so if you have a family of two or three kids, you would get maybe $5,000 back in your tax cut. by expanding the earned income tax credit, earned income which means you are working come i think that should be a centerpiece of what we are doing. and frankly, i know that we should not be preferring capital over labor and that means we probably could use an increase in the capital gains tax. i do agree that the tax system is overly complicated and it needs to be simple five and encourage entrepreneurship and innovation in places like where i represent in youngstown and akron, ohio, we need to stimulate growth and we need to create wealth and we need a system that rewards that. the big issue for me is that this -- and it should be for a lot of your listeners -- this tax cut will borrow up to $2.3 trillion, primarily from the chinese, to come back and give two primary -- to primarily the wealthiest people. china will make interest, we will be making interest payments on the money that we borrow and the china will put into cyber and submarines, they are expanding into the south china sea and we need their help in korea. usiously, this does not put in good negotiating power. they are putting bases in africa. so we are feeding the beast and so many ways to give a tax cut to the wealthiest people in the country and i do not think it is good geopolitics or good economics. shery: to follow up on that point, is the democratic leadership doing enough to push back on the gop tax plan? and what else should you be doing? rep. ryan: it is tough when you do not have the numbers. we lost the election. and we are in a weaker position. and through the positions -- procedures of this bill, the republicans will be able to get it through the senate with a simple majority, not needing 60 votes, so it is tough. but we are raving arguments, and some arguments we need to continue to make is things coming out of the tax bill, things that lead to development in akron, ohio or youngstown, that new market tax credit, gone, and new income tax credit, which leads to benefits for developers, which means people can actually live in those neighborhoods, you look at the historic tax credit and a private activity bonds -- these will all be gone. these are tools that communities used to grow businesses and expand businesses in places like the industrial midwest, these are all gone and they are gone because you need the money to pay for the corporate tax cut that will go to primarily the biggest corporations in the country who are already doing extremely well. it is not that i hate business, i want business to hire my people, but this does not make sense between the borrowing of the money from china and getting rid of economic development tools, it does not make any sense in it will not grow the economy and places that need investment. david: you just put your finger on it. there is a perception, democrats basically do not understand the bio businesses who are the people that employed people. talk about youngstown and akron. when you talk to the people who hire people there, what do they say? what do we do with this? if we are investing in workers and equipment, a lot of people would be happy. rep. ryan: corporate profits are as high as they've ever been. if a corporation believes they can make an investment and higher people and make more profit, they have the cash to do it right now. they do not need the tax cut in order to be able to do it. what we need, i believe, is the public and private partnerships. we need tools like the new market tax credit, like the historic tax credit, that have kept companies in places like akron, ohio, like a good year. these tools were used to keep goodyear in akron and they were used for other companies as well in our region. those are the things that really helped. the corporations have the cash and if they want to invest and make more, they have it readily available. where i think the democrats are wrong, we cannot be the party that is hostile to business. just because i have a little bit of a different view, it does not mean i do not appreciate the free market system, i do not appreciate the free enterprise system, i just want to figure out, how do we plug the communities into the global economy, the wealth created around the globe, hideaway plug them in. it is not through a corporate tax cut. shery: i want to talk about the democratic party, because we are getting the perception of a divide, especially when we look at sexual abuse. today, the minority leader nancy pelosi said that the representative john conyers should resign. >> the allegations against congressman conyers, as we have learned more since sunday come are serious and disappointing is very credible. the brave women are owed a justice. i pray for congressman conyers and his family and i wish them well, however covers men conyers should resign. shery: just quickly, how well are the democrats right now? in your opinion, how well is the leadership handling these cases? associate i would myself with those remarks, i think it is appropriate that and i think it is appropriate for him to resign and get this behind us. i think women should not have to come to a workplace where it is hostile, where they will be treated inappropriately, so i think this was appropriate and hopefully we can get this behind us. my goal, i sit on the legislative branch appropriations subcommittee that oversees investments into these kinds of programs, we need to put more money behind training congressional staff, making sure that members get training, we need to make sure the staff is there and the transparency is there, so we need to put a little bit of money behind this. also, people to investigate. women should not be afraid to come to work at the nation's capital or any other business across the u.s. and it is something that happens all over the country and hopefully this can be an awakening, and a lot of men need to think about their own workplace and how things are handled ther and these women should not be subjected to these environments, whether you are at a restaurant, or working on capitol hill. shery: thank you for your time. representative tim ryan of ohio. david: theresa may fires back at president trump slamming him for re-tweeting a far right political figure in britain. that is next. this is bloomberg. ♪ ♪ shery: this is "bloomberg markets: balance of power." i'm shery ahn. david: i'm david westin. we thought there was going to be a deal between nokia and juniper -- what is going on? >> there was a report that nokia was in talks to buy juniper in a $60 billion deal, and take a look at the terminal and you can see that we have a three-day chart of juniper. it really tells the story. the stock was rising yesterday, rising 5% before we get reports. then it popped up 25% in late trading before nokia came out and denied any talks were taking place for any deal, and then we saw it selloff this morning. shery: so the market taking nokia at its word. emma: that seems to be the case. there is a note out reiterating this. saying that the denial of true,ition talks was not making the deal unlikely. he also made the point that this is not proved to be successful, and if there was going to be a deal it could face competition issues. however, he did say if there was going to be a deal with nokia and juniper, it would help them get some good scale and takes on the likes -- and take on the likes of cisco. but not happening. david: at least for now. thank you. -- is after the president for retweeting videos. theresa may criticizing the president. he said, do not focus on may, focus on the terrorism taken place in the united kingdom. theresa may responded, we are doing fine. >> the fact that we work not mean that we are not afraid to say when we think the united states has gotten it wrong. i am very clear, that reach --ting from britain first re-tweeting from britain first was the wrong thing to do. shery: what does it mean for the future of british and u.s. relations? for more, we have david. great to have you. this is coming at a time when theresa may is on a three-day tour of the middle east, how awkward is the situation? isid: that is right, share trying to project the image of great britain being a big player on the world stage and she finds herself being undermined by this spat with mr. trump. back home in britain, things seem to be standing up the d mr. trump. she is known for some timid responses to attacks that mr. , and she went on to lose her majority and the election, so right now she has nothing to lose in standing up to him. as with everything going on in britain, brexit is lurking in the background and she really does need the relationship with the u.s. to be strong and be fruitful, because she needs that traded deal after brexit that has been -- by mr. trump. she is pinning her reputation on it. she has a difficult line to trend. she is not a pushover, but she does not want to lessen the relationship. david: it appears theresa may's approach to president trump is evolving. we go other way back to when he was tweeting about the ambassador and she was somewhat muted then. how is she perceived as an international leader within great britain and how does that relate to the political situation? david: i think she has struggled to achieve the stature she has aspired to, and perhaps she is seen as being a little bit unfortunate. her conference speech went awry with the set falling to pieces and it seems like things do not go right for her. she is criticized as being straight out of the gate which was the first foreign leader coming to the white house when president trump was elected. she was quick to offer a state visit and she got the clean to invite him to great britain -- queen to invite him to great britain and that caused controversy. some said he was not welcome in london and there would be demonstrations if he tries to come. so i think she really is that between a rock and a hard place. she is trying to look strong, but at the same time the relationship is too important for her to jeopardize. shery: you talk about the trade relationship with the u.s. being why this is so important. how far along are we on that? david: legally, the president cannot start negotiations until they leave the european union, which is still scheduled to be 18 months away, but there are polymeric discussions taking place and even that itself is controversial in britain. there are talks about what impact it will have on agriculture, will we open the floodgates to genetically modified crops, some of the things that are fine in the u.s., but not good in the european union. the idea is, i think mr. trump tweeted about a broader trade deal with the u.s., but it will not happen overnight. they have talked for a long time, but are putting it off. it is doubtful that great britain will get special treatment. shery: david: david, thank you. coming up, president trump has nominated marvin goodfriend for the federal reserve board of governors. that is coming up next. this is bloomberg. ♪ ♪ shery: this is "bloomberg markets: balance of power." i'm shery ahn. david: i'm david westin. the president moving to fill another slot on the board yesterday when he nominated marvin goodfriend to be a fed governor. we spoke with bob center earlier one of his classmates at brown when they were getting their phd's in economics together. this is what bob said about goodfriend and what he contributes to the fed. bob: you are getting a very accomplished, academic my monetary theorist -- very accomplished, academic, monetary theorist. whether it is intentional or not, it is good to have not necessarily but he the same the board. david: you may not have got to brown, but he does know the fed, it is a correspondent mike mckee joining us from washington. mica, there is a lot of speculation about what marvin goodfriend will or will not do on the fed. a lot of talk about how rules oriented he has been. how will that affect how or what he does? mike: he is more rule-based, but he is not doctrinaire about it. adopt -- he fed to wants policymakers to compare what they have done to what the rules for just to see if there on the right track. some of the you that is what we already do, we look at rules before we make a decision and we see how they come out, so it is not clear how that discussion would go, but he does want to take the inflation target of the fed and we do not know if he still thinks 2% is the right number, but he wanted to be enshrined in law, that congress should drop the second part of the dual mandate and just have the fed focus on inflation and trying to reach a target, which would be a ceiling, not symmetrical. he could push for something like that. shery: if you adopt the taylor rule, this chart will show you that you have to even as just it -and- adjust it and even then he would have to move the rate. he has been more critical of the fed in that he has said that the qe was questionable. where does he stand on monetary policy? mike: the important point to make is he has criticized the fed for methods rather than analysis. his economic analysis is in line with what most people think on the fed these days, the economy is growing, unemployment is low, so interest rates must go up. i would not expect a lot of change from him or push back to a fed decision to raise rates, unless inflation goes down or up significantly. oni said, he is focused inflation and he is focused on both ends, inflation and deflation and it would cause and they want to do something different. as you mentioned, he does not like qe, all that much, he does not think it is effective. he did not like the fact that they bought mortgage bonds. he does not think the fed should be doing that. he does not have another prescription other than, if you get to the zero bound, consider negative interest rates. david: at the same time, he was on surveillance in march on bloomberg and he said flat out, interest rates are too low. mike: that was in march and we have had three rate increases since then, so i would hesitate to say he is against a rate increase and to we have heard from him. maybe he thinks we are closer to the neutral rate now. also inflation at that point was 1.9%, now 1.6%. so it is not clear exactly whether he would support a rate increase in december, or how many he was support for 2018. but in general, he is not far off from the consensus thinking on the fed. shery: so janet yellen is leaving next year and bill dudley is retiring, talk to us about the influence of the president now he can nominate somebody people to the fed board. instance of the influence that he can have and for people on wall street this is a good sign, because it shows that the trump administration is at least to this point looking to mainstream figures to fill the fed with people like marvin goodfriend who may have some ideas outside the mainstream, but basically is well-respected and not somebody who will rock the boat. and jerome powell who comes from the board and assumes the chairmanship, neither one is going to upset the view on wall street that the fed is going to be slow and gradual. david: mike mckee, thank you for being with us. shery: and this is our sign off. you can see us on bloomberg .com. coming up, an interview with the cleveland fed president. this is bloomberg. ♪ ♪ scarlet: it is 2:00 p.m. in new york, and a 7 p.m. in london, i'm julie hyman and for scarlet fu. julia: i'm julia chatterley. welcome to "bloomberg markets." >> we i live from bloomberg world headquarters in new york it over the next hour, here are the top stories we are covering around the world. a big boost for the gop tax overhaul as arizona senator john mccain announces his support for the upper chamber's tax bill. and chris van hollen will be joining us with the democratic perspective on the ongoing tax debate. the north korean nuclear crisis, and plenty more. and david matas, the treasury undersecretary will be joining us to discuss global growth to synchronicity and the donald trump agenda. u.s. markets close in two hours. let's get a check of where the markets are trading. abigail: we have a big rally. the dow, and s&p 500 and nasdaq are all h

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