tv Bloomberg Markets The Trump Economy Bloomberg May 1, 2017 1:00pm-2:01pm EDT
new administration. in an interview with bloomberg news, president trump says that he's willing to meet with the leader of north korea and president trump says that he's considering breaking up the big banks. more headlines from the conversation, which just can did -- which just concluded. what can officials learn from tax reform? put together in 1986, bill bradley will join me. interviews with steve mnuchin and the nasdaq ceo from the milken institute in california. ♪ a lot of headlines coming out of the conversation between the president and the united states and my colleagues at the white house, which concluded just moments ago. one of the big ones here, president trump stressing
willingness to break up the big banks. let's get a check on where the markets stand now with abigail doolittle. abigail: we're looking at a continuation of what we have been seen for much of the day, mixed trading relative to the dow and the s&p, and the nasdaq, which have been higher all day. look at the nasdaq, up about 6/10 of 1%, really being helped by technology putting in new record highs. let's hop into the bloomberg and take a look at the s&p 500 map to take a look at what's happening. the top sector here, technology, not surprising that it is helping that huge outperformance on the date in the year, continuation of what we haven't being on the year. right below that, financials are the second-best sector, up 4/10 of 1% on those highs, but interestingly it appears that that bloomberg interview with margaret tao has moved the banking sector. it had been higher before, with president trump telling
bloomberg that he is considering moves to break up the wall street tanks and he is calling for a "21st century version of the 1933 glass-steagall," separating consumer investing and banking. taking a look at the banks here, this is an intraday chart of goldman sachs and we have seen that volatility around the interview, but closer to the highs. this is in fact true for morgan stanley as well, initially taking a step lower, now recovering. a tail wind for the banks today is the fact that yields or treat -- trading higher. at last check it was up 4/10 of one percent, which is considered to help the banks with lending activities. despite the possible breakup of between thenks consumer lending portion and the investment banking side, we do seem to have them recovering off of those initial losses, though not so much for citigroup, bank of america still of 1%. david: thank you some much,
abigail doolittle, on the heels of that interview with the president of the united states. let's get more insight into those comments from the president with kevin cirilli. what do we know about the president's thinking on this issue? how is it changed in light of the conversation he had with our colleagues today? kevin: this is an incredible interview from my colleagues, who just interviewed president trump inside the oval office. these headlines already having a market impact. look, this is what candidate donald trump said on the campaign trail that really roiled the more moderate wing of the republican party back during the campaign, because there are several folks, including those within the u.s. chamber of commerce wing of the republican party, who vehemently oppose the rhetoric surrounding the reintroduction of glass-steagall . but when you look at the geopolitical landscape, particularly here in the united states, both the grassroots ace of the republican and democratic arteries have both advocated for
glass-steagall. . like elizabeth warren, bernie sanders. the way that the rhetoric that shifted in terms of implementing policy is night and day. when you talk to people like jeb hensarling, he would advocate that the best way to break up the banks would be to provide an offramp for regulatory policies that could provide him some cover and is really, truly, what president trump's policies, when implemented, would shape up. in order to provide that offramp for deregulatory policies as advocated, they have argued that that would eliminate the issue of systemically important financial institutions, or the too big to fail banks, that would as a result and all quarterly liquidation or government takeovers, or put simply, taxpayer bailout. were burning the
midnight oil last night. we got a partisan agreement funding the government through september 30. this interview the jennifer the presidenth was an opportunity for us to hear from the president about that piece of legislation. he said he was happy with the bipartisan spending bill. where do things go from here? look, mark your calendar for the end of september. this will get them through september, a $1.1 trillion spending bill. clearly they are taking the medical calculation that they don't want the government shut down on the evil the 100th day in office. that said, we will be hitting the debt ceiling at the end of september, right around the time that all of this could come to a standstill. privately, i can tell you that right now on capitol hill lawmakers are meeting behind closed doors to hash out details on tax policy and tax reform. i can tell you that i spoke with a senior aide in the republican
leadership earlier today who told me that they don't have the votes right now to pass health care policy, but they are looking at and feeling pressure, frankly, from the white house, to get something done this week. i can tell you that the top legislative priorities include health care and tax policy, which is still top of the list. he talked about the gasoline tax as well, saying that he would be open to raising the gas tax. how controversial the statement is that going to be? will be controversial for folks, like democrats, who have advocated against it, but it sends a signal, market wide, president trump is telling margaret and jennifer that about the gas tax? he's also weighing -- waiting aso murky political waters lawmakers are meeting right now to try to get more, as he was criticized last week for not providing enough details on tax
policy, on international tax policy. that's a detail that was left out of that blueprint last week that our own colleagues were able to get out of him. david: margaret and jennifer go into this print interview in the oval office. we are getting headlines as they come across. the first big one was about north korea. they asked the president if he would be willing to meet with the leader of north korea and the president said yes. what more color or context do we have about the circumstances that would have to be in place for the president to do that? be a: well, it would remarkable interview, remarkable meeting, should that come to fruition area i would note that last week president trump said on,ad respect for kim jong the north korean dictator. he has said that military options are on the table when dealing with the north korean dictator as they continue to proceed with their nuclear
weapons program, but he has taken the opinion that he wants to pressure the chinese president through bilateral agreements to pressure north their nuclearntle weapons program. either way, again, signaling that he could meet these leaders is somewhat of a reversal, because he criticized former president barack obama on the campaign trail for being, perhaps, more talkative to some international counterparts, including iran, which has had disagreements to say the least on national security with the united states. all right, kevin cirilli, stay with us, if you would, i capitol hill. i want to bring in eric, who covers congress for bloomberg news. in that interview president said he is happy with the bipartisan spending bill. walk us through those headlines. the president had insisted for a long while that the initial in building a wall on the southern border but that is not in this final agreement. what else do we know about
what's inside of this spending bill? meat of the interview is an increase in defense spending. president obama had proposed. also, $1.5 billion in border security money. democrats were careful to negotiate that the money can't be used for additional deportation agents or the wall. those are the two main victories he can point to. but overall, democrats scoring a big victory here. 160 poison pill writers, like things about the fiduciary rule from the department of labor, there is to the sec funding, basically it is a big win for chuck schumer and nancy and president trump is saying that he is going to sign it, meaning that this thing is all but done and government shutdown is off the table. did this comeow together question mark what was the negotiation process like?
>> initially there was a deal that was very similar to this on the table in december. appropriated into a bipartisan committee that works secretively. as you saw, they dropped the bill at 2 a.m.. they have their own way of doing things on the sly. but they had a deal like this when president-elect trump said to the negotiators, hold on, i want to influence this and it was delayed until this time of year. trump asked for the delay in victories, but he got very little in terms of additional victories in the bill. kevin, back to you. people here wondering what happens next -- david: kevin, what happens next, back to you, what happens over the weekend, the spending bill that we now have in hand, tell us how that may or may not unfold. is that thereline
will be no talks of a government shutdown until the end of december, but that gives more coverage for things like health care. that, kevin,iate eric, joining us there. we are now joined by our senior white house correspondent, margaret taliban. , it was at month -- wide ranging interview. what struck you about that, about his willingness to meet the north korean leader? thanks, we had half an hour with president trump and he knew , exactly as he told us what he told us, that he was making news. he said -- i'm breaking news, right? the president had said that if it was appropriate, he would be willing to meet with the north korean leader. what this seems to be part of his his personal belief that his personal negotiating style and personal relationships with world leaders can have an
impact. in a sense, he likened it to the meeting coming up later this ,eek with mahmoud abbas acknowledging at the same time that he understood that it was a different kind of calculus and figure. not saying that he is poised to do that immediately, but it is certainly on the table as something he has been thinking about and if it were appropriate, he would do that. as you know he plans to meet with the leader of the philippines and has invited him to the white house. somewhere along that spectrum we see a pattern where the president believes that things that had been previously out of bounds in terms of controversial world leaders, giving them an audience, he seems to thinking about offending those rules in the interest of seeing if he can personally affect policy change. comments made a lot of about the potential for breaking up the big banks. can you talk about the context in which he discussed that? is that something that he
brought up or that you brought 1 i brought it up -- margaret: i brought it up late in the interview but jen and i thought it was important to get the question on the record. he said that as we speak, right now, this is something i am in the middle of thinking about. he gave us a sense that there was some sort of decision or announcement imminent in terms of the handling of wall street, whether to break up the big banks or changing dodd-frank, all things he is thinking about now. wish i could tell you more, but he didn't show us a whole lot more on that question. david: margaret, the president told you on the gas tax, you and jennifer, did he offer more? what did he say about it more broadly? one, the margaret:
interest from the business themselves, saying they would like to see better infrastructure. on that track in the notion that this is an area where he believes he can compromise with democrats, we begin to see the outlines of possibly his thinking on this question, which is like -- a, some of the businesses in the transportation my benefit and be interested in this is something the democrats want. we see how he might try to negotiate with republicans on the front. one real potential for partisan compromise in a decidedly not bipartisan start to this presidency. dave in: -- david: kim jong-un , great to talkv to you. the big headlines from that interview crossing the bloomberg a few minutes ago. the president, willing to consider breaking up the big banks.
also considering the possibility of meeting with the leader of north korea, the president expressing some willingness as well to raise the gas tax. the milken global conference in beverly hills where jason kelly is sitting down with wilbur ross, secretary of commerce. jason: great to be with you. it is buzzing in beverly hills with a familiar face the many at a conference, wilbur ross. secretary of commerce. good to be with you. as weof familiar faces, said. there was an interview with president trump and north korea, his willingness to meet with the president there. secretary mnuchin said that north korea was the biggest issue for him as well. how does that figure into what you are doing on trade? well, north korea is obviously not much of a trading partner for anyone. it has no direct impact. the president is hoping to get help.
as a result of the strategic economic love, we started at mar-a-lago. they have been dealing with the chinese on trade with financial issues at the same time. secretary tillerson in the president have been dealing with that on north korea. jason: how much do you worry tot the geopolitical issues slow down the progress with the chinese directly and throughout asia. wilbur: the chinese know that we need to change some things in the relationship. as did the others in southeast asia.
china is one of the most protectionist countries in the world. those cannot continue to coexist. are you planning on going to the trade ministers meeting? i rememberhanoi, if correctly. sometimes at the end of the month. aipac is a fine group. i met with their ministers in washington a week ago. those sessions are not really negotiated. it's broad brushes. our country will leave well -- will be well represented. china,looking beyond what are the key issues for you as you think about asia, a place you spend a lot of time as an investor. what are the things that need to happen beyond china to get trade
going between the u.s. and those key countries? wilbur: sure. they are -- markets in asia for us are china and japan. vice president pence and i began a strategic dialogue with japan when we were over about a week and a half ago. think we will make some progress on that score. those have to be corrected. to homeoming closer here, give us an update on where you are thinking about nafta, how you are thinking about nafta right now. wilbur: well, it really hasn't changed from before. it's an old agreement, obsolete doesn't reflect the current status of the mexican economy or the american, or the canadian. second, it has a particular origin.
mainly how much abrupt material can be brought in from outside nafta. automotive, for example, they did it part by part in some of those on even used anymore. has changed. there are a lot of changes like that, a lot of things that weren't even thought about. digital economies that really dealt with the service economy, not really dealt with very much. some of the liberalization in mexico has to deal with natural resource laws. so, there's a whole lot of stuff to do. day thend of the objective will be to hold. increase total trade and reduce with bothdeficit mexico and, to a lesser degree, canada. this: help us understand timeline.
the president spoke to the leaders of both countries last week, but what do we do next? wilbur: what we are waiting on is the contrast -- congress to authorize the tpa, the so-called fast turn. what is required there is permission for tomorrow -- two more consultations and the acceptance of a formal, very stylized letter, sitting out -- setting out the negotiation objectives. that's the key ingredient. really the only reason negotiations haven't begun. mexico is ready, canada is ready. the u.s. congress has been holding it back. how -- jason: how soon do you think they will act there? wilbur: we think it will be pretty soon. reported out of committee last week, there is no real reason he
couldn't be voted on very quickly. , think that is just an excuse he could get confirmed very quickly and that should take care of that. meon: there was talk last that's last week about ditching nafta altogether. what about the possibility of really just getting rid of the whole thing right now? what's unfortunate is that some of the leaks change what had begun as assessable -- sensible discussion of alternatives into something else. it's very bad, all the leaks, but they seem to be a fact of life in washington. told me that there is no such thing as an off the record conversation. but the fact remains that the president has made the decision to try to negotiate nafta all over again. he has also made it clear that if we can't do that, his
inclination would be to withdraw. one of the things that investors seem to be especially interested in, it seems, is infrastructure and manufacturing to a large tent. a big tease of that, you have said, are the regulations and regulatory burdens that people feel in moving towards that. how much progress are you making towards that effort to get things going in that regard? wilbur: the president has cast of the department of commerce with polling manufacturing industries to find out what permitting rules and regulatory problems concern them the most. they've been analyzing the results that came from that and very shortly be will be submitting our report to the president, with our recommendation on what to do. thee separately, infrastructure sales study team has been working on the ones just peculiar to infrastructure.
there is simple. one, the way the rules are enforced. number two, the complexity of the process. , more thanl, federal one dozen federal agencies. often the federal in the state have a slightly different objective. it takes a ridiculous amount of time to get a program approved. eight years, 10 years. that's not the way that you do infrastructure. china built 20 brand-new airports last year. we haven't built an airport in 20 years. that's night -- not the right way to be the united states of america. one of the most recent actions coming out of your department was investigation into the aluminum and steel industry around national security. are there other pieces, other sectors that i'm thinking about, semi conductors, other pieces of technology that you may be
investigating in the future as a part of that? are looking at all the big sectors. the national security interests are real, they are being threatened. you can argue that the real reason that we won world war ii was american industry, even more than the valiant men and women who were fighting. with the army, the navy, and the air force, with low capital expenditures and calculations, obviously the military budget is going up. even in a peacetime environment, let alone if we get into some sort of horrible conflagration. we need to be very mindful of defense interests. while it may sound like a small portion of steel or aluminum, the fact is that there are only two aluminum smelters in this country that are fully operational. only one company in this country qualityes a high
aluminum that you need for aerospace applications. similarly, in steel, there are only two that make high quality alloyed steel that you need to reinforce battleships and vehicles used in combat. those are owned by foreign companies. there are lots of issues around national defense that have a direct result on what happened to our manufacturing base. mentioned at the top that you are here among a lot of your old friends here in beverly hills. what are you hearing from them? what are they saying about the administration so far? what are they saying that the president and you need to do next? well, a lot of them didn't vote for the president, but they all seem very enthusiastic about the direction in which he is trying to take the country. some of them are very frustrated, as we are, by the slow walking we have been
getting. even take my own confirmation. reported out of the committee with an anonymous vote and i and it up hitting 72 votes in the senate. obviously was not controversial, but it was delayed two months. for ustwo months longer to fix the trade arrangement and that's sad. -- jason: right. wilbur, safe travels as you continue your work. david, back to you in new york. coming up, more of "bloomberg markets." this is bloomberg.
trump's most urgent foreign-policy challenge and national security threat in his first 100 days. in it -- in an exclusive interview with numbered news, the president didn't rule out a face-to-face with kim jong --margaret talev -- with kim jong-un. >> under the right circumstances, i would. most the little people wouldn't tell you that, but under the right circumstances, i would. mark: the last top official to meet with a north korean leader was madeleine albright in 2000. they are considering a range of options with north korea. testfired a blistered missile with h.r. mcmaster, who said that that wasn't open defiance of the international community and will not be tolerated. mcmaster said that the u.s. and its allies are considering expanded sanctions and would not
rule out a military option. the israeli prime minister, benjamin netanyahu, criticizing the planned meeting between and president trump. speaking at a memorial ceremony for victims of militant attacks "how canny yahoo! said you talk about peace with israel while simultaneously you fund murderers that shed the blood of "?nocent israelis everywhere thousands of cubans, led by castro,astro, -- raul marching through havana square today in celebration of international workers day, or mayday. today's observance marked the end of an era, castro said he would step down in february, making this his last mayday parade is head of state. one protester with the u.s. flag briefly disrupted the start of
the parade after a struggle with security officers. the man was led away. global news, 24 hours per day, powered by 2400 journalists and in 120 countries. i'm mark crumpton, this is bloomberg. recapping what the president said to our colleagues, margaret talev and jennifer jacobs, saying he would be doing to meet with north korean leaders if the conditions were right and that he has been looking at raising the gas tax as well. let's hear what he had to say about the prospect for breaking up the big banks. >> some people want to go back to the old system, right? we are looking at it right now as we speak. dodd-frank is going to be very, very seriously change so that the banks can go back to loaning money. president trump talking to our colleagues just a few
moments ago. we have seen the banks moving on that news, looking at morgan stanley, citibank, bank of america as well, seeing a movement in the markets as a result of those headlines. at one point, 3%, also talking about the gasoline tax. let's see what he had to say about the prospect for raising trump: the truckers have said that they wanted to do something as long as that money is earmarked to highways. david: we want to head to capitol hill now for our tax reform -- had to capitol hill. how is this likely to go over on the hill? hike is an old chestnut that has been around for a long time and it keeps coming up periodically every few years, when someone or the other is looking for a way to fund infrastructure. go anywhere.ally it's a supported by the vast
majority of republicans or the conservative base that powers the party. paul ryan said as early as -- recently as 2015 that they would not be doing that and it's not clear that anything has changed. unless the president and the white house make an -- make a grid -- make a vigorous, aggressive push, i don't see the change and it's not clear that the president will. david: you have been studying that one page coming up from the white house let -- last week about tax reform. ,hat we heard from gary cohn these reforms were geared towards the middle class. how truthful is that? the more you look into it, the less clear it is what it would do for the middle class. it's ambiguity. we don't know the income brackets that that kicks in. he talked about an unspecified childcare tax break. we don't know exactly what that
will entail, that's another? question mark.er middle-class families in new york, new jersey, california, because right now they are able to deduct their state and local taxes from their federal tax bill. we don't know one thing -- we are one thing that is clear for the middle class, there would be a direct benefit for the plan having a lot of significant tax rate benefiting upper income people, including repeal of the estate tax, cutting the top rate from 39.6 to 35%. david: what about the carried interest tax rate? it was not enumerated on the piece of paper handed out to reporters last week. what do we know about the administration's thinking on that? no mention of that in this tax one pager. interesting, because
trump is a candidate called for limiting the loopholes that democrats have wanted to get rid of for a very long time. a candidate he use that as a sort of example of how he was a populist guy, an unusual republican candidate taking on the big banks and wall street. seems like as president he is less committed to the idea, if he is at all committed to it. two of his chief advisers who helped to write the tax plan our former goldman sachs executives and have different views on that matter. david: sahil kapur, thank you very much for joining us from capitol hill. well, what is past is prologue, or it can be. the last time there was come grants of tax reform was 1986. bill bradley was integral to that. he has run for president and is now a managing director at allen and company. good to have you with us. bill: good to be with you. this took a long
time to coalesce. when you look at the timetable for tax reform now, how optimistic are you the this can happen quickly? bill: i'm not optimistic at all. i think that the first point is that until an administration puts a detailed, specific proposal to the congress, it's just talk. it's just, you know, stimulating, this talk that talk . you have to have a specific proposal. you have to have principles that guide the proposal. you have to not increase the deficit. don't increase the gap between rich and poor. principals that if you had them out there, you could begin to do it, but until you get a specific proposal, it doesn't mean anything. a specific proposal is not one page. you have to put it out there and all of the interest will attack it and then we will see what you are made of. david: looking back at 1986, i
wonder if there was a potential -- conversation about potential growth, like the one we are having here. the white house saying that this would do away with deficit concerns, was that same conversation happening in the yeah, but thell: conversation now is about genetic growth and not increasing the deficit, but that's just pie in the sky. you have to have revenue neutrality. what happened in 1986 is paul volcker came to me and said -- i like what you are doing and tax reform, trying to end these real estate tax shelters. the high interests are there. the chairman of the fed tells me to keep going, eliminate these loopholes for tax shelters, and that meant something to me. you wrote about this for a piece in "the new york times." yes, there was bipartisanship. working in back rooms. but you also had the development
of the -- involvement of the administration. paul volcker, the treasury secretary. when you look at it today, where's the breakdown? why does it seem like there are so many parallels? bill: it's a function of the port -- polarization of our political system, but you also have to have something in it for each party. democrats wanted to get rid of loopholes. republicans wanted lower rates. if you put those together, you had an opportunity to make a difference. there was the calling and of chips back then. why does that not happen now? having to do with the media cycle? worries about the campaign trail? or is it something greater than that? reality is -- and i'm not there, i can't speak for my experience, but it looks to me hampers theation discussion. there are some issues of mother and apple pie, and so forth,
that you can get agreement on, but in the big issues related to economics, taxes, trade, relating to any number of big issues affecting the future of this country, you don't seem to be able to have that. reachequire somebody to across the aisle, somebody to take the extra step. you know? we were at a tough point in the 1986 act and a republican gave up a big thing that he wanted so they would be revenue neutral, because he thought the overall approach was the proper approach. remember, that was a tax bill that reduced the top rate. we are not talking about doing that here. we're also talking about making sure that the wealthy couldn't avoid paying taxes by using loopholes. so, we ended up with a system where, cut the rate from 50 to 28, eliminate $100 billion loopholes.
it gave low income people one of the biggest tax cuts in their lives. that doesn't happen with partisanship. with comedy, understanding, mutual respect and trust. that, ultimately, is what you have to do if you are going to legislate effectively. it was true now and it was true then. if you don't have that you will continue to have people standing in a circle shooting at each other. david: what would you say to lawmakers now about the lessons learned from what was called gucci gulch? the lesson i learned is to remind people that the value of loopholes is over $1 trillion. how low could you get the tax rate if you eliminated most of those loopholes? it would be surprising, how low, and raise the same amount of money. the interests now are even more
entrenched, because the money lubricates the process and you can't make a distinction between the power of the special interests and the money of the special interests that they use to contribute to political campaigns. in, as ahey call it committee chair of the house now, you have to agrees to -- agree to raise $1.3 million. there's a price and that's unheard of. bradley,nator bill thank you for joining us here in new york. coming up, the nasdaq president eo will join us live from beverly hills, california. what she has to say about bringing capital back to the entry market. this is bloomberg. mark: -- bloomberg. ♪
where the markets stand this afternoon with abigail doolittle. abigail: talking about the diversions between the dow being slightly lower in the nasdaq seeing it session highs, up more than 7/10 of 1%, really being helped out by the technology shares. interesting, as we have these gains for the s&p 500 and nasdaq , the vix is down near session lows. let's take a look at an intraday chart on the dow, very small we see that ity, opened higher, than was lower, higher, and then right around 1:00 on that bloomberg news interview with jennifer jacobs , thatrk --margaret talev idea that president trump is breaking up the big banks, we saw the dow take a dip down. that's pretty interesting from the standpoint that financials are the third-biggest sector for the dow, now about even.
we have seen something similar here for jpmorgan, right about the time of that interview, the trump could introduce what he is calling a 21st-century glass-steagall act, jpmorgan went negative but is recovering nicely. very interesting is the fact that this will not affect the regional banks, they have been higher all day. they took an initial -- initial up more than 1% now, again this potential breakup is less likely to have much of an effect here, david. interesting actions here for the financials. very much.k you let's continue our coverage of the milken institute global conference in california. erik schatzker is with edina adena friedman, nasdaq president and ceo. erik: thank you very much, david. you and i were just on the panel together and we began talking about something that i think we should actually finish here.
which is -- there is so much capital trapped in private markets, backing companies that have become name brands now -- , but it isn't finding its way to the public market. why? and presuming you would like to see it come to the public market, what can be done about that? very: first, i have a balanced view of the private and public capital markets and nicer -- think that they serve an important role in the economy, allowing companies early in their lives to grow and expand. we would like to see more of that get into the hands of investors over time. two ways. one of them, liquidity in the private market. we're basically announced our launch, which allowed for more liquidity to occur in the private markets, including private equity security and funds. but we would also love to see them come into the public markets over time with what i
would call sustainable liquidity as these companies continue to grow. comef job growth has through public security in the united states. we want public companies to find an inviting environment. there are a lot of impediments to a company going public because of the litigation or tax environment. erik: wasn't the jobs act supposed to fix that? in theit was a good step right direction and a couple of ways. one, it allows companies to stay private longer by allowing 2000 shareholders and set of 500. it gives the companies a choice of one to go public instead of being forced to. confidential front -- filings allow them to understand. but that's just a first step, in my opinion.
it should be allowed to go much further up the chain. we should also address the fact that being a public company today has come with a huge responsibility and the question how productive is that responsibility? is it an important element of being a public company, or did we just put the burden on them inadvertently? you areou are -- erik: trying to promote transparency and the pricing. you have talked about selective disclosure of short positions. go into more detail about that. adena: i think that disclosure is a hallmark of the public market, transparency and disclosure. although we get right now is aggregate short interest. adena: it's an attorney today, but at least it's there. companies who have long positions in stocks have to disclose this position. but even shorting that security, you are never obligated to disclose it.
and you think that should change. adena: that should change. the company should be aware of the -- who holds the long and short positions. today they only have one side of the picture and investors have an advantage over the company. erik: can you do anything about that, unilaterally? or does that require the fcc to workaction? adena: it does are the fcc to take action, to make that decision to require disclosure, but it really is a matter of getting them to focus on the assignment. erik: do you have any sense as to whether the incoming sec chairman would do anything about --t specific issue? erik: adena: we haven't had any specific conversations about that at this point, but see him as a successful corporate lawyer who has brought a lot of companies into the public market and he will hopefully have a perspective on his role as
promoting efficient and effective markets on capital formation, as well as industrial protection. i would argue that he comes from a background that will hopefully understand this, being a major impediment for companies in a public market. erik: do you think the balance has gone too far in the way of investor section? looking at the recent sec chairs in that role, they come more from an enforcement background and investor protection has become the hallmark. i would argue that the balance needs to be there, between creating productive and effective capital markets and allowing companies to be -- to have a good environment. a more balanced approach is welcome. erik: there are things that you would like jay clayton to do as sec chairman. there are things that others would like him to do that concern nasdaq. some of your customers concert -- something exchange fees.
bloombergomers, included, i should add, complain about what you charge for fees, a to b. will they be doing anything about either of those issues? erik: i think what you are -- adena: i think you're talking about the overall regulatory framework. that regulation was put in place in 2006 and it has been over 10 years and really hasn't changed. our view is that it is time for a comprehensive review. but you can't look at one and two and pulled the thread. once you pull it, it unravels a whole system that has been created around the public security. our view is that is, would be happy to do comprehensive review, but don't touch -- don't try to kind of backdoor it with one issue. try to look at the overall framework and say -- what's the harm? who is being harmed by the current structure and, therefore, what are the changes that we should all focus on in
order to make sure that we have the efficient and effective capital markets. erik: where is that being done? adena: that's the big question we have to ask ourselves. investors are getting access to capital at low rates, there's a lot of liquidities. at the same time, i think we see that wer set of issues would like to see the sec look at as well. probably not, and if it is only slightly, a functional regulation, but are you worried about the lack of volatility in ie equity market? adena: think that right now i have concerns that investors don't have conviction. there's a lot of volume -- sorry, there's a lot of purity's, -- movement insecurities, a lot of speculation in the market right now, but not a lot of what i
would call conviction purchases. i would like to see investors, because of the fact that volatility is low, is it that volatility is low or is there ambiguity in the market, uncertainty as to which direction the company or country is going? we would like to make it so that we see more fundamental convictions rising from the market in the investing public. would pointeople the finger at high speed traders. how does that change things? i look at the markets is resilient in terms of seeing a balance in terms of professional traders and fundamental investors, always coming together into our markets and finding efficient ways to transact. as we look at the changes in composition among the professional players, we often
find other firms coming in and filling a niche for fundamental traders come in to fill the need as well. for: does anything change nasdaq now that the deutsche efforts are to merge with [indiscernible] and are dead? adena: nasdaq is a global business. we were the last successful cross order exchange that occurred back in 2008. we understand how to navigate those waters, but we are what we believe is a very global technology company today as a result of that and our ability to bring harmonization of technology globally with our exchange client today. adena, thank you so much for taking the time today. david, that was adena freeman. -- friedman. absolutely, erik schatzker, from the milken
julia: we are live at bloomberg world headquarters in new york. everlyg stories out of hills, washington and london. here are the top stories we are covering on bloomberg and around the world. president trump's with bloomberg, telling us he is actively considering breaking up wall street's biggest banks. then a rare and exclusive the milk, live from and political conference. asking where he would be put his money right now. in the fed's plan for rate hikes coming into question after consumer spending and gdp data.