tv Bloomberg Surveillance Bloomberg January 9, 2015 6:00am-8:01am EST
brothers. the job market in america is improved. will your paycheck improve in 2015? good morning, everyone. this is "bloomberg surveillance." it is job stay, january 9. i'm tom keene. as always, scarlet fu and brendan greeley. front and center, the drama in france. >> special forces are closing in on the suspects in the paris massacre. it is taking place not far from charles de gaulle airport. here is the interior minister. >> at this moment, there is an operation underway. we are mobilizing all forces present in the area. due to yesterday's operations there is an important presence of forces that allowed a quick response. >> two brothers were the main suspects and are supposedly hold up in a printing company.
our other big story is the december jobs report. the u.s. economy created 240,000 jobs in december according to a survey of bloomberg economists. that would mark the biggest gain in 15 years. >> oil is extending its rally today. prices are up for the third day in a row. for the 10th time in 3.5 years the house will take up the keystone pipeline today. the result will likely be the same. it is going to pass. the republican-controlled senate is probably going to pass a similar measure later. the gop say the keystone pipeline will improve the nation's energy standing.
the president wants to make the first two years of community college tuition free. he wants to unveil a plan that would cost the tens of billions of dollars. for now, republicans in congress are skeptical. >> the city of boston wants to add to their legendary sports history. boston will bid for the 2024 summer olympics. boston beat out los angeles, san francisco, and washington. the international olympic committee will make its decision in september 2017. they will put all of the athletes out on the d line to wait for two hours. >> they're going to decide that fenway is nowhere near big enough. >> are you kidding? >> they don't have anywhere near
enough bathrooms at fenway park. >> they could mably hold the javelin events. [laughter] >> tom, did you want to offer up fenway park? >> i'm going to get in so much trouble. you better move right along. [laughter] futures are negative three. euro dollar, 1.1813. on to the next screen. the ruble does better in the last three days. for those of you on the continent euro sterling actually gets your attention breaking through 0.78. that bears some close watching. particularly for those in london
and across the continent. job stay is not talked about enough. -- jobs day is not talked about enough. here is normal. here is the boom in our employment. here is the carnage we have all been through. this is the measly recovery. is this normal or is this normal? >> one way to look at this trend upwards -- this is women entering the workforce. >> this is scarlet fu right here. >> men have been leaving the workforce in unbelievable numbers. look at these peaks. some of this is cyclical. the peaks, the movement you see is that women are not in the workforce in the same proportion entering the workforce in the
same proportion that they were. >> my basic idea is a level here and a level here. on job stay, this is good optimism. this is a little esoteric, but you don't hear enough about it. >> the trajectory we have seen in the last four years is nothing like what we had prior. >> this is the baby boom. maybe this is natural. >> this is women coming into the workforce. the dominant form. we have a great set of guests. including a special 7:00 a.m. our guest. we need to look at the news that is unfolding in the north of france and to the east of paris. this is eight miles from charles de gaulle, for those of you who have flown in. the beautiful countryside it north and east of paris. it is surrounded by low industrial buildings. it looks a little bit like a
less congested o'hare. hans nichols is in paris and he joins us this morning. is there any speculation that these two brothers were trying to get to the airport? >> there has been lots of speculation all morning long on a variety of subjects and that is where you have to be so careful and reporting on this and wait for official confirmation. we don't have anything official of there being a nexus between dammartin and charles de gaulle airport. police are surrounding the areas. helicopters have been grounded. there is one report that negotiations are ongoing and there may be hostages. we are going to get a briefing from police on the ground sometime soon. >> i'm trying to imagine
president going over to the pentagon to monitor an affair like this. what is the import the president along -- francois hollande has decided to stay at the interior ministry offices? >> think of it like this. if president obama went over to the pentagon during an ongoing mission and was briefing reporters about congressional negotiations. that is basically what we had earlier an hour ago. francois hollande was briefing on his meeting with marine le p ens and how he has prevented numerous terrorist attacks. this was well this operation was going on. the initial reports were that francois hollande left of the interior ministry, then it was reported that he is indeed staying there to help monitor.
he is joined by his interior minister and prime minister and they are all hold up there monitoring the situation. >> this is across all of france, interconnected violence including on a mosque south of paris. this is not just about what we see. >> things are moving so fast in france it is hard to keep up. francois hollande had record low approval numbers before this happened, around 17%. we have had about 48 hours to think about the consequences long-term. what is your sense of how good he has been doing? >> anecdotally from industry leaders and business leaders and normal parisians there is a rallying around the flag.
there is a rallying around the government trying to support him. there have been isolated criticisms. the former partner of one of the journalists slain said that the government did not do an adequate job protecting him. that was in a local tv interview. for the most part, there's a sense that this could be a chance to band together in france. people are trying to keep the world safe. >> i'm intrigued that you say that francois hollande met with marine le pens, they head of the opposition populist national front. help us understand what that means in an american context. >> ok. well, there is not really a significant context. i don't want to say -- she is on the outside of mainstream political discourse.
initial reports were that she was going to take place in a unity march on sunday and that was walked back today. she harshly and fiercely criticized that after she and other political leaders met with francois hollande at the palace. coming out of that meeting is one francois hollande decided to brief again and again during the ongoing military operation with helicopters that were swirling around these two suspects. >> thank you so much. a map here of what we are witnessing. it is a heathrow alternative. dammartin this year. this is a world war i. >> it is 26 miles northeast of paris. >> this is an industrial area
where the town itself is. around it is largely agricultural and dairy. >> it is gorgeous. >> the suspect that had surrendered himself was far further north toward the belgian border. >> there is a little bit of a map. two major stories today we have going on. france and jobs day. >> we will continue to follow the manhunt for the french terror suspects. we will be joined by tony roman coming up next. ♪
this is "bloomberg surveillance." a most eventful start for the year. markets found a modicum of stability. robert dahl considers what to do given the new new of volatility. given the volatility, do you change your a? do you rebalance more often? -- our location? do you rebalance more often? >> you have more opportunities when markets are volatile. when markets are volatile, you can take money off and then put it back in. >> the human emotion takes over and we make him decisions. >> dollar cost averaging looks great in volatile markets.
that is a time tested, hasn't worked so well recently, but a great way. >> scarlet is too young. [laughter] >> i know well enough. in this era of strong jobs growth is a good jobs report going to be superseded by the continued decline in oil prices? >> the assumption is that jobs are going to be just fine. oil is the story in the short run. when oil goes up, a sigh of relief and markets go up. when it goes down, we have a credit problem, etc., etc. it is not that oil has gone down, it is the rapidity with which it has gone down. you have to be concerned about liquidity in europe. you look at real growth in europe and it is near zero.
that is not healthy. >> you said it is jobs day today and we are in a transition period when unemployment drops and wages start to pick up. how long do we have until that bleeds into inflation? >> headline inflation is going to fall. core inflation is likely to be flat. >> is there a generation making economic policy that is not worried enough about deflation? >> i think the ecb and germans are the perfect example. we have a deflation problem. >> people frame guys like you as looking out six months or a year. you guys get pilloried.
you have a longer timeline than the media thinks you have. >> inflation is so key for all kinds of things. >> over a longer term of time scarlet. >> thank you for that. what would it take for the fed to say we are not going to move in 2015? >> gdp is moving this way unemployment is moving this way. the only thing that has not done what they want is inflation. >> can i rip up the script? how cold is it in chicago this week? >> [laughter] school is closed in chicago. >> school is closed in chicago? >> how often does that happen? >> not very often. >> boston, it was closed. [laughter] >> you brought the cold with you
here. >> does this come in and the first quarter effect? >> it is compared to the prior year. >> it has got to be a boom. >> if the weather is less cold this winter than it was last winter, that is an uptick and it is going to be hard to be colder than last winter. >> when he wrote "the jungle" they did not get out of school. [laughter] >> we have a new weather pattern in the american midwest and northeast. your new new. christine lagarde talked about this. >> for those of you that want to send hate mail to brendan greeley on that comment -- brendan greeley on the climate. >> we have terrific guests. jeffrey rosenberg of blackrock. i will announce right now our
two suspects who remain at large are reportedly holed up. >> one witness says he took hands -- shiooook hands with one of the kouachi brothers. he posed as a police man and then told the witness to leave when they took over the printing factory saying, we don't shoot civilians. >> the shades of this -- we have a great guest for you today. >> they headed into a printing building and reportedly taking a hostage as well. what are your thoughts on what is next? >> clearly, these two terrorists did not have a well-planned escape route. nor have they had the funding necessary to effect a proper escape from the paris area.
early indications are that these two terrorists failed to do the proper surveillance for the initial attack on the charlie hebdo magazine. they proceeded to the wrong building. although it appears that they had terrorist training and knew how to operate automatic weapons, tactically they have been stumbling since the beginning of this terrorist attack. what we believe now is that they are acting from moment to moment, which makes them extremely dangerous. they are now held up effectively surrounded by military trained tactical french police. they have both aircraft conducting surveillance, they have snipers surrounding the area. they are effectively being held in quarantine. the big problem right here,
right now are the safety of the hostages. that is primary at this point. time is on the side of the police. >> from what you know about these two suspects you say they are stumbling from moment to moment. do they fit the profile of two people working with a larger organization or working on their own? you can't just pick up an ak-47 off the street, right? >> no. we don't believe that they did. we know that they had an affiliation with al qaeda in the arabian peninsula and that they may have actually thought either in syria or in iraq for a period of time. one of the terror suspects actually did prison time for attempting to transfer some civilians who had become radicalized in iraq and attempted to go themselves. clearly, they have had some training.
it does not appear that they have been well prepared for this attack. >> very quickly. these are industrial buildings. what is the best practice for the special forces? if they go into an industrial building? >> i would rather not talk about specific tactics at this time. we do not want to help the terrorist suspects. we do not want to let them know what the tactics are. >> thank you so much. anthony roman on what we have seen. stay with us from new york city this jobs day. it is "bloomberg surveillance." ♪
>> good morning. job stay across the -- across america. >> we begin with the latest on paris. special forces closing in on the suspects from the charlie hebdo massacre. shots have been reportedly fired. at least one hostage has been taken. two brothers are believed to be hold up -- holed up in a printing company.
in investor sets the stage for the breakup of the u.s. chemical maker. they have nominated nelson pulse as a director. dupont has $4 billion of excess corporate costs. the oregon ducks and buckeyes will face off. they are getting -- the big winner here is espn. they are getting a jump 20 percent to 30% above what espn charged last year. >> the xl pipeline continues to be reviewed. the house will vote on a bill. i want to talk about keystone but what is happening in paris right now?
this is something a city cannot be prepared for. >> of they are capable here they have a great intelligent system. they have an excellent military. they are capable. they are tough. they will handle it well. it will leave memories and scars . >> let's turn to the politics of oil. the keystone, the bill that would approve the keystone pipeline review right now, the state department is running, the house chose to make that house bill number one of this session. why number one? >> it's a problem that has been lingering.
and is probably the most studied pipeline in the history of the planet. it is important to get done. it is important diplomatically. the canadians are some of our best friends. there are diplomatic reasons for, but largely it is a symbolic issue where the two sides have lined up. if you look at the arguments rationally, it is a no-brainer. it has been held hostage for political reasons. >> it seems like the price of oil has not change the economics of what is online in canada. >> i will let the people in the market make that decision. the reality is it is not canadian oil. there would be 100,000 oil -- 100,000 barrels of oil from --.
apart from oklahoma to the gulf coast is up and operational. the only reason the president is involved is because it crosses an international border. what we are doing leaves local jurisdiction intact. >> i want to bring him bob. to white house cites environmental concerns and costs. is there an economic cost to not building it? >> absolutely. this could have been done a long time ago. we would have had a better economy as a result. i believe the economic benefits more than offset the environmental cost. >> this is being shipped by train right now.
i am more skeptical of the economic benefits. it is a limited project. sometimes i wonder -- are we being honest with ourselves about what the debate is? the white house is talking about the court case that needs to be decided in nebraska. the issue behind this pipeline is global warming. >> i think so. the state department study shows this will not add to that. the alternative means of transportation we use, truck and train is much more dangerous in terms of potential spills and accidents. >> you are a modest guy from oklahoma. people do not know you. you have lectured at the university of london. arguably the smartest guy on the block. i would love your thoughts on the american distinction over religion and ethnicity.
with the percolation in ottawa sydney i would like for you to state the american distinction on religion. >> i think our founders recognized from the beginning that freedom of worship was essential governments should not be involved in limiting it, but should protected. this country has had its share of challenges over religion and race. it has moved in the right direction. our friends in france have similar traditions and similar points of view. we have been more successful at absorbing more diverse peoples than anyone else. it is unique to the united states. france has the same set of
values that we do. the same point of view. >> thank you. we greatly appreciate it. this comes back to what you commented on. absolutely unique american difference. >> the difference in france, you can may -- remain what you are and be american. you come to france, you have to become french and always. >> at what is interesting is the lack of headlines out of france in the last 20 minutes. >> it is a standoff. >> it is jobs day. we take a look at some of the
+++ job. >> we are talking about job security, how stressful it is. that is the ultimate challenge in job security. >> there are all kinds of stress. where's the cancer nurse and hospice nurse? that is a whole different level. i get attached to my patient and my patient does not make it. that is hard. >> i think about this. people who work in hospitals, my best friend is an er doctor. the worst thing that could have been this organization gets sued.
we have seen what is happening in the middle east. it is a completely different ground. >> we begin in the u.s. in d.c.. present obama visited the french embassy. he signed a book in honor of the victims of the charlie hebdo attacks. ideals light the world. number two, to show solidarity with french citizens marshals the head of the european parliament started a moment of silence.
they are holding the black signs we have seen anywhere and everywhere. it was continued outside the parliament building. >> after the shot, they have to do something. >> the problem with european parliament, it is largely content -- considered --. i have read interesting points. friends who have made this for the last day or so, you can say jes suis charlie, but you cannot unless you mean it. >> the policeman have protection. they knew this was coming. >> there are policeman in the
office. >> in france, as this continues, this is our number one photo. the lights were gradually turned back on as thousands gathered for a second night. >> run that again if you can. this is going to change politics all over europe. thank you for putting together a great setup. here is one from a second grader. let's see if we can bring that up. all of this with the drama still unfolding. >> police are still in front of the printing factory.
the company will submit to stricter oversight. they will examine operations to improve quality and safety standards. borrowers who took out auto loans are missing payments at the highest levels since the recession. more than 2.6% of car loan borrowers had missed at least one monthly payment by november. a lot of people calling this the new subprime. a follow-up story from earlier this week. harold hamm has cast and alimony check that she sent him for almost $1 billion. the attorney is not saying. hamm sought a reduction in the amount. a judge said it was not enough. >> i am speechless over that check.
>> the fact that it was written personally. >> to you think someone at morgan stanley, there stamp is it. let's try to get some clarity on asia. the stock market will fluctuate, but most interesting, there is china but more importantly, maybe it is a china of stability. i thought it was a great insight about northern asia and all of asia adapting to the new china. why did you put this in your predictions? >> i believe china is going to run away with it. they have contributed more global gdp growth than the united states. that is going to change this
year. the u.s. is doing better and china is slowing. it has been so investment focused and that is not sustainable. >> one of the hallmarks is dollar dynamics. there is an element of a breakout. >> absolutely right. think about it. improving economy, inflation that is not going lower. unemployment continues to fall. compare that to the euro. the policy is to loosen some more. it argues for a stronger dollar. >> the dollar is strengthening without a rise in yields. how much longer can that hold? >> it is hard to see higher interest.
one of the blessings for the united states is if this was just about the u.s., we would be fine. we have an added tailwind from the rest of the globe in commodity prices. if it worked close borders, our rates would be moving up. as we said earlier, we had inflation after world war ii. do not do what you want to do ecb. the impact from the russian sanctions to slow down the near recession is taking place. so many countries should stay on it. >> the weak spots, exports are weak and could get weaker. >> no question about it. exports will contribute minus
one half. remember only 12% of our economy is exports. germany, 48. we are relatively insulated. >> it is so hard to get good numbers. everyone has their own indicator. what to you watch -- what do you watch to get that conclusion? >> it continues to slow. freight, how much is moving around the country, that is in a negative territory. >> you are so good at indicating what is going on and what we are going to see. you have australia doing this.
>> you went to strategist school? >> no, i went to new orleans. this is the yield curve. >> my father was a pilot. >> save us. >> it is pretty simple. >> employment improves. confidence improves. it is not perfect. >> thank you for being with us. a forex report right now. we are distracted the serious drama north of cdg in paris.
>> a manhunt north of charles de gaulle airport. french special forces close in. a job market improved. will your paycheck improve? brad delong of berkeley. this is "bloomberg surveillance." it is jobs day. i am tom keene. joining me is scarlet fu and brendan greeley. >> the story already. special forces have cornered the two suspects. authorities say hostages have been taken and there is one report that officials have talked on the phone with the suspects. francois hollande is monitoring the situation. he expressed concern about copycat attacks. >> we need strong -- to stop
repetition. we know the possibility that certain people use disarray to provoke new disasters. >> the suspects are brothers. one had traveled to yemen and received terrorist training from al qaeda. according to the media forecasts, the economy created 240,000 jobs last month. that would be smaller than november, but it would mean almost 3 million jobs were created in 2014. >> oil extending a rally today. prices up a third day in a row. for the 10th time in 3.5 years the house will take up the keystone pipeline. the result is likely to be the same. the senate is expected to pass a similar measure.
president obama is promising a veto. republicans do not have enough votes to override. democrats say it is an environmental risk without much benefit. free community college for all is what president obama will propose today in knoxville. he wants to make the first two year of community college tuition free. republicans are skeptical. >> this will be interesting. boston wants to add another event. 2024 summer olympics. boston beat out l.a., san francisco and washington. the committee will make its decision in december 2017. they will not take down the citgo sign past left field. those are the headlines.
the usual turn. bill gross and jim glassman joining me on bloomberg radio. euro 1.1813. crude oil catching a bid through the week. special forces cornered two suspects north of paris. about eight miles north of charles de gaulle airport, in they martin on goal -- in dammartin-en-goele. what do you focus on in paris? >> i'm focused on the dynamic.
it looks like we are going to have an operation. it is ongoing right now. they have the two brothers in a mousetrap. if and when this operation has rolled off and they have everyone apprehended, it will be at home cash there will be a long -- there will be a long conversation. >> we are seeing some maneuvering. >> all of them were there, trying to take credit and monitor this. it is a remarkable moment.
francois hollande is trying to sound resolute. a man in charge and in control. when he was saying was the same thing he said two days ago. security forces have already prevented some attacks. he reiterated that message while a military police operation was taking place. >> the disagreement on immigration of form policy that france holds. how much discussion is there on those specific politics? >> there is no pause before this conversation turns political. not just with the muslim population, but this is something that has been happening across europe. we talked about the protest in
eastern germany. this will be a conversation. you saw in the european elections. you will see it throughout the year. there are parliamentarian elections. immigration politics will feature prominently in those elections. >> thank you. on this jobs day, this is what is going on in france. we are bringing in an economic historian. bradley delong is that berkeley. it is the best hallway on economic history in the world. there is the single best one volume on france. you are our expert here. is the underpinning of what we see in france, what we see in
ottawa and sydney a lousy economy. it is from a lack of animal spirits, not just about this crisis and decades of bad policy? >> they come from a perception of a lack of opportunity. the fact it takes this immigrant form is strange. europeans think their nations and their great-grandparents were always there but an englishman is a german pretending his grandmother was not welsh. >> you don't agree of a lot of economics, the effect of parity for the euro could threaten the european union.
do you agree if we get a weaker euro that the experiment that has been written about will fall apart? >> it is good news for germany, that the euro falls. germany booms. the german government and the german people, the decisive voice in europe, say there is no problem. a weaker euro means there are problems elsewhere and they get even bigger. there is going to be more pressure for breakup. german ministers and germany cb members say structural reform is the solution. it does seem like, in france, they are right. >> structural reform is always the solution. there's not a single country that could not do with a huge
dose of structural reform. people who live in new york have incredible productivity, yet the population is not growing. >> we talked about the weaker euro. it means a stronger dollar. what does it mean for labor economy? the export engine in the u.s. is small, but it has been performing mightily over the last several years. it will be a shift in the underlying dynamics of the economy. it is possible. the data mastech economy is improving. -- the data economy is
improving. i think it is possible to make the transition. >> how important is the job report? >> each report is getting more important. we have between three and eight more job reports. today could be a little bit of a confusing report given the november blowout. >> coming up, one of the big risks. china is going to behind on the list. we will discuss. ♪
regulatory powers. the one place obama has not moved has been in reconfiguring housing finance. >> i watched a debate earlier this week between two people in boston. was the profession of economics always this political? >> yes. and it's a very start. >> about those who think the key thing to do is to control trade through clever policies or boost agriculture are wrong and that we need to have the government step back. >> what would be your advice to secretary clinton as she considers candidacy? >> find a way to address the
>> we're monitoring the situation in the city northeast of paris and what we can here right now, what we know right now, french police are trying to establish contact with the suspects of the charlie hebdo massacre. they are in a printing company. officers are trying to make contact with them to negotiate.
tom you are looking at headlines about french school children being is actuated. >> this is an ancient village. >> we are looking at pastureland. it is industrial, but there are great economic problems with this area. the farming industry is not making money. >> our friends predicted politics in europe would be -- we are enjoined from our washington newsroom. we will get to your number nine risk in the moment, but i want to start with your number three risk. the effects of a slowing chinese
economy. you think china will be fine. the trading partners are suffering. >> it is clearly becoming more accepted and tolerant of slower economic growth. that is positive for what they're trying to do with reform. in our view, the big risk is much less than china and more about these emerging markets that are reliant on commodity exports. even australia has a huge commodity exports story. those countries are vulnerable. >> we look at australia and it is reliant on chinese exports. just under 36%. that is a huge increase from about 10%, if even that in 2000. what does this mean for the governments in places like thailand?
>> i think thailand is the number one concern. there is the story of the military that has been a big market story for the past year. the attention has gotten away from that. thailand is explode -- is exposed to the china slowdown. they are trying to draft a new constitution and the slowdown will make it that much more complicated. >> historically, we have been skeptical of the idea that the risk could have become bigger on the economic side. longer-term, that might be a concern.
>> there are two schools of thought. which which you prescribed to? >> the chinese government belongs to -- and they will not let china slowdown. they will not tolerate slow growth because it threatens their stability. >> a huge amount of assets will have to be rewritten and revalued. people will be unhappy when that happens.
>> there is a debate on the economic outlook in china. i want to get your thoughts on china and taiwan. >> this is going to be a big story. hong kong was a game changer in taiwan. we are looking at a government antiwar and where there was a victory for the progressive party in november of last year. you have the politics and taiwan moving against the relationship with the mainland. >> the united states afraid to step in. thank you for joining us. we are covering the top geopolitical risks all week
>> good morning. jobs day we will get to in a moment. in france, the situation is north of charles de gaulle airport. >> action is taking place northeast of paris. we have some reports of a hostagetaking situation in paris itself. we will keep our eye on it. special forces have corner of the two brothers. it is unfolding not far from charles de gaulle. at least one hostage has been taken. officials are trying to
establish contact with the suspects. francois hollande is monitoring the situation. in dupont has nominated cofounder and ceo as the director. dupont as $4 billion excess corporate costs and should be broken up. we have a follow-up -- i am getting ahead of myself. the winner here is espn. they are getting 800,000 to $1 million for 30 seconds of airtime during the game. that is a jump around 30% above what they charged last year. >> jobs day and the quality of
jobs in america. where are the quality jobs? we want to bring you jeffrey rosenberg. a good perspective of what the fed can do. brad delong joins us. let's start with you and the immediacy of the moment. are these quality jobs he created? -- jobs being created? >> some low-end, some high-end, some middle but what we are going to see and what we started to see at the end of 2014, is one piece of the quality of jobs story that has been missing. are the jobs leading to higher wages? we started to see a turn in wage inflation. i think you will start to see that. i do not think you will see it in today's report but you will
see it. >> it is a subpar economy. others allude to stimulus and other say you are nuts. bring us up to date. >> we do not know. two out of every hundred american working age adults have disappeared from the labor force over and above those we thought would retire due to changing demographic trends over the past seven years. we do not know whether we are half a percentage point of the adult population away from full employment or 2.5 percentage points. >> it is ugly. it is not where was. >> we look at the labor force per dissipation rate.
there is a debate over what we are looking at. are we looking at a simple demographic change? are we looking at cultural changes in the male and female participation rates? >> there is the aging in america, the downward trend that you extend out further. there are additional cultural changes that may be happening that may accelerate it. there is the fact that once people have spent seven years without a job they give up. >> i do not think this is a debate anymore. the persistence of the decline in the race is cyclical.
it is with the federal reserve believes. >> we have a point of disagreement. >> futures low. the 10 year yield at 10% even -- at 2% even. >> the house will likely vote yes. president obama will change it to a no. phil mattingly joins us from tennessee. we will talk keystone in a minute. what have you heard in the last 24 hours about our participation , the work we are doing with french security services? >> intense participation. what is most concerning is the two suspects surrounded in
france. the idea that u.s. and france knew about these terrorists and they are still able to pull off what they pulled off a few days ago is the biggest concern. >> we are seeing headlines that an armed man has taken a hostage in a grocery store in paris. there is one wounded because of gunfire. this is not confirmed by anyone else. i just wanted to bring that in. >> you are in knoxville. the president will have his pre-state of the union event. the president is on the road. what is he running from? >> he is trying to run towards getting people to pay attention
to him. >> white house decided to try to flip the script and get him out of town. what you are seeing is a sneak peek at what the state of the union is going to be. yesterday executive action. three-pronged of what we will here in a couple of weeks. >> is he rolling the dice on a good jobs number? >> that is a good question. they find out yesterday, what is interesting, going on the education aspect today, moving
towards education and trying to make it a big issue. it is almost like he is taunting congressional republicans. they have been focused on the economy the last couple of days and now we're going to challenge republicans. >> the house bill one is keystone. the more i look into this, it feels like it has little consequence. this is a political issue. >> even republicans acknowledge it is nowhere near as big as it has gotten in terms of the debate. >> this should be his first
>> 15 minutes from now, the first jobs report of 2015. economists expect jobs added to the u.s. economy. an all-star lineup to break down the jobs report. >> what i love about jobs day coverage is how many angles you can take on the jobs were work. to give you an example, the big focus is the inflation rate has been stock. what is the issue here? we have a generational shift. why aren't more younger folks coming back into the market. wage gains -- the rise in
november is not going to stick. mohamed el-erian is looking overseas. >> i have bill gross. what does this mean? >> are we putting up a dual here? >> it is not a dual. -- duel. mohammed just said it was unusual for the fed to recognize the crisis point of what is going on overseas. he says that will underscore this idea that we are diverting the u.s. versus europe and the rest of the world. >> do you buy the argument that we are diverting quickly? >> you believe americans can
stay apart from the rest of the world? >> the export sector is powerful and not terribly cost sensitive. unless financial contagion comes sweeping over. >> the export said -- the export sector is small. >> a european crisis exported into the u.s. >> does this mean that the federal reserve wants to raise interest rates? >> asset markets would fall a lot.
>> coming up, five years on from the devastating haiti quake. how the country is recovering and whether or not it is open for business. that is coming up on monday. i am scarlet, here with tom keene. we are keeping and i on the situation. >> hans nichols in paris. it is a sense of stability north of cdg. what is the government doing this morning? >> right now francois hollande
has dispatched his interior minister to a town on the ring road where there has been a report of a second round of shooting. it is believed the shooter is related to the case in the south of paris. the shooter from the south of paris does have a connection with the two brothers the koach uachi brothers. he is hold up in a shopping mall that is right on the ring road. >> i'm going to ask you a broad question. we are looking at these pictures all day long. looking into the agriculture of the economy, they make brie. france went through this long
postwar expansion where it brought in all of this labor, but it is trying to be the country it used to be agricultural. right now, it is france, trying to figure out what kind of country is going to be. >> that is the longer term question. it is a fair question. they are trying to digest it here. you see people gathering in front of this vigil. the focus is on apprehending the two suspects and now it appears an additional suspect. this is the shooter that may have been involved in the killing of a 25-year-old police officer yesterday. we have two and potentially a hostage situation as well. there is a report that the individual is heavily armed. until we get more on the situation, there will be a bit of a pause to have this
conversation on till they have a resolution to the dangerous situation on the ground. >> hans nichols, thank you for the update. >> we have jeffrey rosenberg and brad delong. what a great pair to have. i go back to your piece on opt men -- on optimal control. almost involving the dynamics and the belief in those dynamics is going to help america. explain the raging debate over our models working right now. >> there is policy advice. this policy advice factors into how policy monetary policy is conducted. we read what the policy advice
is as it is broadcasted or published. it informs market expectations about what the fed is going to do. >> doesn't work? >> the proof is in the pudding. you have not had the results that the models predict. >> there is a school across the bay from berkeley. there is a guy named taylor there who has an advisable rule of working within the guidelines. should we worry about rosenberg's optimal control or do we need to go more ad hoc? >> we need to worry about optimal control because janet yellen believes in it. she believes in rules and expectations. the problem with the taylor role is that the specifications of
the rule would have produced a good policy had they been followed in the past have been telling us the fund rate should be numbers like minus three, which it cannot get to. the question is whether it is lifting off from zero to something like one or whether it is in a little bit of territory, it depends on where you think the employment is. >> you can get the taylor rule. >> one subject that has been popping at the surface is the decline in labor force participation. is it bad? people choose not to work. >> if they choose not to work and they are happy doing so, it is wonderful.
if you do not belong to a yard -- of people are quitting their jobs because they get affordable health insurance and not coming back, that is a good thing. if people are taking longer to get in touch with themselves or going on around the world trips that is a good thing. the question is are the extra two percentage points of labor force decline since 2007 is that a good thing or says people getting depressed, giving up -- >> can we have two hours of rosenberg and along? >>'s labor participation rate good, bad? >> it is about slack in the
labor market. there is unused capacity and the markets care about that because that informs monetary policy. the debate has moved along. we have evolved from so much slack. >> muska to the disagreement. do we need a policy prescription from washington to assist us to move the unemployment rate lower? >> there are two policies that come out of washington. we have done as much as we can with monetary policy. fiscal policy could help but it requires policy. >> to an even infrastructure build? -- do we need an infrastructure build? >> if you think the fed is going to hit the 2% for the inflation target over the next 10 years, people the u.s. government can
borrow money at zero. >> is the keystone pipeline and infrastructure program? >> it does not produce a zero real return unless oil prices go back up. we should focus on infrastructure projects that produce significant returns. things like human capital for 12-year-olds or more mass transit for san francisco. >> the school across the bay the university of san francisco. >> let's get to the agenda. you are focused on the 8:30 number. >> how we have shifted, going back seven years. you almost greeted it with trepidation. i go back to the heart of it. what is the quality of these jobs?
>> the house is going to vote yes. the president will veto it. i want to see when they will be honest about what this is about which is global warming. >> we have a lot of headlines coming up. the standoff in northeastern france dammartin-en-goele, a hostage situation in paris. a grocery store in paris with at least five hostages. >> bittersweet news this morning. scarlet fu has been promoted out of "bloomberg surveillance." she is moving on to projects she is excited about. >> i am sad to go and not see you every morning from 4:00 until 8:00. >> i have written a cartoon. there is me sad and scarlet happy because of all of the sleep she is getting.
we have a luge lineup for you on this job day where we get the final reading from 2014. december 2014. i'll be joined after the numbers, along with tim cane, the former chief labor economist on the joint economic committee with the hoover institution. he's focused on the labor participation rate and why that hasn't budged. plus the view from the white house as the u.s. economic counsel chairman and also the view, the way fair c.e.o., the e congress company that has been a huge employer in boston. in fact in 2013, was annointed the biggest and fastest growing company in boston. the fastest growing company in boston. but first here's a look at our top stories this morning. breaking news moments ago on the situation in france. special forces have cornered the two suspects in