Transcripts For BLOOMBERG Whatd You Miss 20240714 : comparem

Faces its first right with the packers deciding how much to uaw in years. Admit the next investment caroline abigail, what are you vehicle after a bet on we work sours. Watching . Abigail crude oil, today, that romaine todays top story. Saudi aramco growing a little the best that surge, bit less optimistic that there will be a rapid recovery since day in about a decade. There have technical difficulty the weekends attacks. Says itretarygeneral so i will pass to you, renita. Renita is huge jump in crude is too early to consider a oil today. Possible production increase. Oil, corn,ing crude he spoke exclusively earlier today with bloomberg. A collective, as well as sugar. Raw sugar futures climbed more than 1 . Decision of not only opec but corn since 95 g. He opec plus of it is ethanol produced by corn. Index is as energy a template on what would be done and when. More than 3 on the day. Romaine joining us now for more thesefluencing analysis is Cornerstone Macro Agricultural Commodities depends on how long the will last. Will analyst. We know that the saudis and 2 lor Mgm International their clients have commercial reserves. Ports that blackstone a on how much of a cushioned we have . It depends on what is out and for how long. Reports that blackstone may be outs say 5 million stays looking to purchase two properties. Back in january that vegas based for about 20 days, there go the commercial reserves. Form an independent goe, china, europe, you can committee to look at ways to extract value from real estate. 15 months and you have nothing left. If you want to look at a chart that i am showing on the critical is to know how much is out, how long it will be out for terminal, it is interesting because Mgm Resorts International does get about 77 . Joe besides the buffers and of the revenue from the u. S. Strategic reserves, how fast can macau gaining revenue that has production, especially of prices stay elevated . Been taking off much more so jan than vegas gaming revenue. Enough, macau casino, they do get about 15 of their total revenue from that. Maybe a good strategy to be focusing in on that as macau makes up the biggest portion of their overall revenue. Us, bloombergs Sarah Ponczek and brian levitt, fair what is spare. American shale. Are we going to grow that . Big question that you should be able, over nine to 18 months, to the big winner in the stock, ramp up whatever growth you had plans for, purchase another Million Barrels a day or so energy. In that 1. 5, two year it had been a big winner for reasons prior to the events of timeframe. This weekend simply because of caroline is this a positive for this rotation. Now it has this additional the United States in particular . Jan is positive from united geopolitical catalyst. Going back to that rotation, it states industry, geopolitical, would have been the big topic on and not so much if you use oil. Everyones mind. Workmost americans dont do you think that move from growth toward value is something in the oil industry but that is sustainable . Electioneering aian no, i think it is cyclical move. Perspective, this is not a good here is what ended up happening. Idea, especially if you are not the economy was dealing with what i cali policy mistake forced to retaliate. Multiple rate hikes last year. If you look at what what i call a policy mistake, multiple rate hikes last year. Prices do today, you are seeing the administration sounding a. 8 on brent crude little bit less tough on trade and the yield curve starts to normalize some. Are we looking at that level that turn. Rforms and network is there more . That level now or is there growthgoing to recover, more . 9 in aoure up 8, almost will be better than people think. In order for this value rotation to be sustainable, you need to single day. You went limit up at the open. Be either going into a recession or going to a new, higher that strange thing, the american sustained level of growth. Etf is up. Caroline sarah, within the there is a significant market reaction, and this is day one, rotation in stocks, a tumultuous before we really know what is move in bonds last week. Going on. Caroline how painful was this that has all reversed on the search for a haven. For the positioning in the market, because it was will the trend continue . Inherently bearish . Jan there was some significant thought it would wrong footing that whomever did be yields lower rather than this did. Higher. Andpositioning was bearish week, bonds were that proved to be the wrong position going into the weekend. Overbought. This week, oversold. Joe lets say they can get the there is no question about the fact that wednesday, the fed production or facility fixed in will be very key for what is some reasonable amount of time. Are we going to be looking at a going on with the bond market. Permanent premium in the price. Jan that is a very good people are having a tough time question. Grappling with where the economy the shortest answer would be actually stands. Yes, how. How foreign demand are driving if you are a big importer, you probably one more inventory on the rate market, and where we go hand. From here. We are completely trampled. A whole piece of capacity just went down, big time down. Now, people are talking about going back up to two again. Your capacity in the future is brian, how do you fold therefore most likely going to you bargained for. In the fomc and how it addresses the oil shock . Romaine what about the risk of we know that when it comes to some sort of military conflict inflation, it sees past things involving iran . Like the oil prices. How does that affect prices if setting policy based on we are going down that road . Jan we are down the road. Oil prices going higher would be a double whammy to the u. S. Negotiation. Ike i would expect the fed to continue, another straight cut. The 10 year rate will be a Something Else fell out of the sky, magically, a drone that reflection of where we think they were not supposed to be real gdp will be. Able to hit. There were four holes blown in a year ago, people thinking we tankers on the way. This is already a spiral of are at this new magical level of growth, that wasnt sustainable. Conflict. Face will hit qinetiq in the summer at 150, it wasnt as bad as everybody thought. Phase, whattic rates should be close to 2 . Move over the weekend would washington calls it, when should that when people are shooting it will get to a bottom each other, i dont know, but you could have other things with saudi protecting its borders. And start to move and that romaine thank you for your should cause rates to move higher. Insight today. Caroline when you have such a substantial move in oil, i expected the u. S. Dollar to move in the opposite direction. The u. S. Dollar was resilient and a lot of people geeking out your insight today. Some breaking news. The seaworld ceo has resigned. About the repo market and the company putting out a statement saying that in the interim, elizabeth castro, who is currently the chief accounting officer, will serve technical things. Brian the u. S. Dollar, the best as ceo of the company. The company is embarking on a way i know to think about it, search for a more permanent what is the u. S. Growth rate successor. Joe coming up, a lesson on compared to the rest of the world . Going public and its impact on as long as u. S. Growth rates softbank and why backers of the compared to expectation look vision fund may be having second better than the rest of the world, the dollar continues to thoughts. This is bloomberg. Get a bid. We think of energy price disruption but what ends up happening is a little bit more of a flight to quality. Stubbornlyhas been high. When we run some pretty big deficits, you would expect the dollar to stabilize. We would need to see the rest of the worlds growth pick up some. China is doing that, the ecb to some extent. Sarah, do you think that decision, ited feels like maybe it is not quite thought aal as people few weeks ago. The general tenor, maybe they are a little less under the gun here. Sarah when you look at the numbers for october, they are now pricing in at 24. That is the first time we are seeing that in a while. If you have the fed not cut rates, you are going to see much disappointment in the market. It may not be about this wednesday because people are so much expecting the fed to cut rates, but how many times Going Forward . It is expected that they will continue to use that language but you were to see a change, that would be an issue. Scarlet how the fed puts together the response would say a lot about appetite for risk. I am thinking of saudi aramco. Those issuesabout brian we definitely need clarity. I expect we will continue to see the path they are on a week ago, joe the biggest backers of we were talking about trade. For business investment, that is Softbanks Vision Fund are what you need to see. Having second thoughts. Bloomberg has learned that the protectionism isnt a good wealth fund at abu dhabi have but they just need to been thinking about how much they want to commit in the wake know the rules of the game. Of the we work fiasco. That is what businesses are looking for to bring forward investment. You cant blame them. I think that investors should it is not just we work. Probably try this has been a it is all their Business Models. Year of policy uncertainty. Doordash,lking thing, what happened over the weekend i think we are in a secular none of it too great right now. Bull market. Stocks are still cheaper than i guess we are seeing a bonds. Growth is ok. To me, it doesnt feel like the couple of them go public and now everyone is looking at wework end of the cycle. And kind of using that as a thank yourian levitt, market test at looking into softbanks underlying portfolio. So much. Of course, our own sarah to be fair, their numbers have ponczek, who covers cross assets and softbank, the for us. Coming up next, Romaine Bostick steps in for whatd you miss . Vision fund, didnt go all in. This is bloomberg. Retributionsome about going into wework. What does it really mean in , how bigsaudi arabia of a chunk changes that . Obviously, he said that he intended to invest 45 billion in Division Fund 2, which is the amount he pledged Division Fund 1. Everything is fluctuating at the moment. Paper games, at the end of the that couldows what be. One thatgroup is the invested because they pressure the vision fund not to do that larger investment. Romaine i am a little confused about the criticism. They pitched themselves as basically a venture fund. If 20 of that comes out profitable, you dont need to worry about the 80 . Why is there so much focus solely on wework when they have had other hits . I guess it is a dramatic mess. Compare that with the valuation on friday, that is less than a third of that number they invested at. Maybe investors are not so comfortable and how softbank is going about throwing their money around. Maybe they hoped they dont do the same thing in fund 2. Joe maybe some of the criticism is a little bit unfair. Big picture, there have been a number of big messes at the gigantic uniform level where thee huge, big misses at gigantic unicorn level. Does that raise the question, does a Second Vision Fund makes sense given the Business Models of these companies . That is something being discussed in Silicon Valley and beyond. The Vision Company is not only investing in the u. S. It is investing in asia, europe, south america. Feeling i have had the through some of your amazing reporting that they kind of knew this was coming in terms of the lack of appetite for some of their key backers, because they are offering some of their own employees. He said he would commit more than the previous time. Gillian we should point out that fund 2 have different investors that i dont think were in fund 1. Apple, foxconn, a suite of japanese institutions. It is a different lineup will be interesting to see some of the key backers from fund 1 come into fund 2 in a big way. Caroline i think we should all be asking microsoft and apple. Bloombergs gillian tan, thank you. A quick check on the latest business flash headlines. Goldman sachs leading the way when it comes to shrieking paychecks on wall street. Since 2007, employees lost . 71 adjusted for nominal wage growth. Traders have seen the wages fall industrywide as they added more lowwage staff. This is bloomberg. President trump says it looks like iran was behind this weekends attacks on Saudi Arabian oil facilities. Iran has denied responsibility. Speaking at the white house where he was meeting with bahrains crown prince, President Trump said he did to have he did not want to have more with anybody but the u. S. Military was prepared. Heleit unacceptable when he addressed a conference at the International Atomic Energy Agency in vienna. Make no mistake about it. This was a deliberate attack on the global economy. And the Global Energy market. Authorizedrump has the release of oil from the Strategic Petroleum reserve. If that is needed in my department stands ready to respond. Mark an iranian government Spokesman Says there was no chance for a meeting between president romney and trump president rouhani and trump at the u. N. Meeting next week. Asking Boris Johnson to make written proposals if he wants to offer his company a way out of the impasse. Need writtenwe proposals. I hear a lot but i do not read a lot. Said minister johnson also that he remains optimistic. Mr. Johnson yes, everyone can see roughly what could be done, but it would require movement and it will require the system by which the eu can control the u. K. After we leave, the socalled backstop, to go from that treaty. That needs to happen. Mark Prime Minister johnsons on camera statement was made outside of the embassy and luxembourg after a News Conference was canceled because of noisy antibrexit protesters. A United Nations Factfinding Mission once myanmar to be held responsible for genocide against its muslim role injure its Muslim Rohingya minority. The group says Myanmar Security forces killed thousands and fleed more than 740,000 to to bangladesh. Global news 24 hours a day on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. Im mark crumpton. This is bloomberg. Caroline the United Auto Workers union is leaving its first strike against General Motors in 12 years with nearly today. Workers workers walking out today. The union knows that the proposal fall short in key areas including health care, temporary workers, and the length of time it takes for workers to get to top scale pay. Is a Labor Relations professor at uc berkeley. You say the ways and means that gm is going about this, to publicize some of the battle, is quite unheardof. Very much unprecedented. General motors sent a direct message in effect on their last offer to uaw members and the general public. That really is unprecedented and doesnt sit well with the uaw. What is most important right now is there appears to be some movement at the bargaining table. See some signs that perhaps there is a middle ground that the both may be able to accept . For sure, there is a middle ground that they both will accept. The question is how long that will take. The 100 million in lost earnings that gm could be experiencing is enough to very much focus the mind on the bargaining table. Of the uaw, it is lost wages its workers on the pickup line. There are two positive signs. They began bargaining at 10 00 a. M. This morning. They didnt want to wait, they are bargaining. Uawsecond good news, the General Motors Vice President sent a note to his counterpart this saying, why didnt offer come earlier, it could have been the basis for a settlement. That indicates a shorter rather than longer strike. The bad news is that word has come out that they still remain far apart on the details. Details ise of those this idea of providing the workers a little bit job security, workers up to eight a 30 wage ap to little bit faster than what is in place. Does gm really have the Financial Capacity thinking longterm. Gm clearly has challenges ahead. That said, in earned close to 12 billion in its most profitable region in the world for it said it wants to hold a hardline on the labor costs. Itis losing in earnings, lose as much as 10 of Third Quarter profits by friday. There may be a meeting of the mind of job security, health care, and wages more rapidly. Caroline what implications does this have for other carmakers . Harley it has a lot of implications. The detroit automakers, this is a pattern that will come to them. Pattern bargaining doesnt mean that they will accept the same thing but it does mean the general principles of the g. M. Agreement will be applied. The other International Automakers in the u. S. Are watching this closely. They are nonunion to stay that way, they have to match to some degree what the union gets. The to what degree does corruption investigation into leadership affect the Leadership Strategy and does not put pressure on them to take stronger actions . Twoey i think these are very different issues. The bargaining is allconsuming. The stakes are very high uaw workers Going Forward. The investigations fly very much in the face of what has stood for for so long. There is not a direct link to bargaining. Becauseougher right now