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tv   Bloomberg Markets Balance of Power  Bloomberg  April 17, 2018 12:00pm-1:00pm EDT

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the economy. ahn: a challenge for getting republicans in the house. president trump meets with japanese prime minister abe this afternoon and we will look at the key issue. trumppublicans make the tax cut permanent before the .idterm elections ? ♪ david: white house reversal. sunday, nikki haley said the trump administration would be imposing more this time in response to alleged russian support for the capital program.
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sarah huckabee sanders backed off on that saying more sanctions may be under consideration, but no final decision has been made. , congressman joaquin castro. how do you feel about more russian sanctions right now related to syrian attacks? iaquin: they are supported enlarge in congress and among the american people. there has to be a way to get the point across in russia that we disapprove of actions. they go in and kill in the u.k., there has got to be a way to punish for that and a strong
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message. be stronger sanctions in russia. consistent with what answers on any controversial topic and we saw it happen again. joaquin: i am not sure if the president backtracks or of nikki haley was out over but a front -- are you really taking issue with the trump administration with its approach to russia? -- thanaul ryan say president obama was. joaquin: i'm glad the president has taken the actions he has and the legislation that was passed last year. i parted legislation with congressman turner republican from ohio to do that. it would sanction not only the attackolved in
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but also several russian financial institutions and it would start to limit the purchasing of russian debt by americans. shery ahn: the nominee has been harsher than president trump but in theacing issues senate confirmation. do you expect him to come through? >> it is an interesting question. the senate is evenly split between the two parties and senators from both parties have expressed concerns about mike's track record and his prospect for the required independence from any kind of political influence. willnk whatever happens obviously be pretty close. it would not surprise me if he does not make it. >> if he does not quite make it, who can take his place? kenny think of a replacement and
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who do we listen to when it comes to foreign policy? >> the second question is one that the world has been asking since president trump took office. who reliably speaks for the president? you are right there are major pieces of the infrastructure for diplomacy missing from the state department including a confirmed secretary of state. who could be nominated after that? that is a great question. i am sure the president will probably not take my advice but we will see what happens with mike's's nomination. >> we know the missile strikes against syria late into saturday morning, you said you were in favor of those strikes are there is an issue of what role congress should play. is there any prospect of bipartisan support for congress to reinsert itself? because this has been going on for some time. right and itare has happened on both sides of
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the ministration, republicans and democrats. the american people should not have 535 spectators when it comes to a matter of armed conflict or war, congress needs to get off the sideline and have an active role. the president should demand that in the event people should demand that you are was a proponent in 2013 coming up with a umf, my first year in congress. congress needs to step up. i know it is a tough vote. if you vote yes and then things go downhill years later, your name is attached to it. many people and that the hard way with iraq. these are things we need to do with a congress that has a big role to play with foreign policy. >> you do not have to wait for a white house to come up with a bill here? congress could enact its own legislation with syria and say it is an attack authorized in these situations and that and those are is there any likelihood that could get done with this congress?
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>> it is something that should be pursued. if you're asking me about the likelihood, i have not seen overwhelming momentum for it to occur. >> think you for joining us today. and member of the house intelligence and foreign affairs committees. let's get a check on the markets. here is julie hyman. julie: thank you. we are seeing a rally stretching into its second session. we are seeing stocks hover around the highs of the day. it continues to appear to be the earnings we have gotten thus far and continuing optimism about concerns that we will get. front, technology is leading today and that is a group we have not heard from yet with one notable exception that we will get to in a second. if we look at bloomberg, we have the one day moving averages. and 1% threshold to the up and down side, and then 2%, and we obviously see the swing increasing and this would be the
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second time in a week that we have got a gain of at least 1%, third time if you are looking at two out of the three major averages. i mentioned technology and the strength we are seeing. let's look at whether you put amazon and apple in here, both of them are trading higher. coming with earnings, netflix describes numbers, we are seeing most of its growth overseas. estimatesomestic beat as well. perhaps it is that helping expand the flames of optimism for the rest of the technology sector. what is interesting is facebook has already been outpacing its so-called saying colleagues at as well. colleagues as well. the runner up is amazon, which has seen a healthy gain to date nec alphabet apple and facebook muddle along, flirting with the unchanged level at various times
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this year. westill have tech movers and are looking at notable analyst calls today. ryaner is up 11% after over at morgan stanley upgraded to two equal weight from under -- from underweight, saying he has had more positive conversations with advertisers and there is improving user growth. drop off, the lockup time for those who helped with the ipo, has now expired. stock is neutral, jpmorgan and overall, analysts are saying the company is well positioned. inbhub is getting coverage the analyst says the company is winning this game, a clear leader in domestic space, and finally, bold economy out
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performing, and wells fargo expects investiture us which could unlock value. shery ahn: thank you. coming up, the japanese prime marked by rounds of golf and lavish meals -- lavish meals. the encounter will be a different story and we will tell you why next. this is bloomberg. ♪
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shery ahn: this is bloomberg markets. david: we turn now to mark crumpton. thrown out a law used seriousreigners of
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crimes. a crime of violence was so they guess to be unconstitutional. the government doesn't have the discretion to let them stay. president trump criticizing california governor jerry brown for rejecting proposed border duties for the national guard. on twitter today, the president claimed the climate in california will worsen because of governor brown's actions. the trumpet missed ration says the governor refused terms of the initial deployment to the mexican border. nothinge official says is been decided. the leader of britain passes opposition is slamming theresa may for ordering british forces to take part in airstrikes in syria without getting parliamentary approval. today, theparliament former prime minister david cameron was said to have never handled important issues this way. tothe prime minister came
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house the reaction in libya in 2007, syria 2015, and in 2013, sought authorization for the .ilitary action in syria i am sorry to say that the decision not to recall parliament and engage in further action in syria showed a flagrant disregard for this convention. >> premised or may responded saying the law states the will of parliamentary convention should be observed except in the case of an emergency. will be inrt justice a sling for a few weeks. authorities say she broke her right shoulder and plans to continue her schedule as usual. global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries.
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>> threaten the future of japanese prime minister of a -- prime minister abe here to prove his relationship with president trump remains robust. here with the latest is the state department reporter from washington. proving this will be challenging. the environment is completely different whether it is on that stands on north korea or aluminum tariffs. >> that is right. there is a lot to discuss in the meeting. the big question japan has, it is really two questions. one is why was japan not given a waiver on the tariffs the administration put forward? several other countries were brazil, european nations, and japan substance a boy a great ally for the united states, would not give it away. the other is north korea.
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japanese government was totally blindsided by president trump's decision to meet with kim jong-un, a spur of the moment decision meeting with a south korean envoy, and caught completely on guard -- on guard. he has staked so much of his relationship the united states on a personal relationship with and then president donald trump goes ahead and does these things that would seem to suggest he doesn't hold shinzo abe in as high a regard as shinzo abe was banking on. a lot to discuss. i wonder if the answer to your question lies in president trump's tweets? on friday, he specifically said we need essentially a free trade agreement with japan. that seems to be what mr. trump wants, to address trade issues. how likely is he to get that?
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>> it is a great question because they will not a meeting for very long. ground iny is on the mar-a-lago for about a day and a half and they have pressing issues to discuss. the big one will be north korea and the issue of tariffs. to a lot of observers particularly in japan, they were befuddled by president trump's's announcement that the u.s. might reedit -- reevaluate the decision to pull out of ttp and look at whether to go back in. shinzo abe and particular state so much on negotiations for the deal and on support for the deal . for the u.s. under president trump to back out and reverse itself again and say that we want in, i think their heads are essentially spinning in took io. >> when his approval ratings were falling in the past, the north korean nuclear test helped boost his approval ratings and
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also to further his changing the constitution. is north korea becoming less of an excuse for japan passes prime minister when it comes to dealing with his handling of --theast asia and his guns his dealings with the united states? >> the issue that is really important is the scandals back home. domestic scandals are gathering steam. a lot more evidence to suggest the premised or or perhaps his wife were involved in the sort of deal to give preferential treatment to some employees of andrnment educational conservative educational recitation. the prime minister's prop you just popularity rating is dropping pretty fast, you know, in the mid 30's right now. it leaves him weakened at home and when you come back and say, well a lot of your popularity was based on the fact that you had a good relationship with mr. trump, you were in lockstep with
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north korea and on trade, that has been blown up. wait a minute, japan is not being given preferential treatment on trade. it may be giving disadvantageous treatment and we were completely blindsided on the decision to had the meeting where japan set for so long, we do not believe talks just to have talks is a good idea. of people to a lot question their own support for the prime minister back home. neck --n: thank you, nick. let's get insight into what is on the agenda. a chief global strategist, great to have you with us. what is the significance of the summit for prime minister abe? head is spinning -- i think it has been
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prearranged. they are seeing each other cap -- done -- abe has done tremendously well with economy. gdp is going quickly. could be trump will congratulate him on that and i'm sure they will reaffirmed the joint believes about north korea. there is a pretty good sense that for president trump, it is about trade. >> making progress on the north korean issue. >> japan is planning to appeal and he feels pretty confident
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when he needs that japanese deal. similarly on these exemptions. >> ok. he will be staying with us and next, we are talking that the changing relationship of the united states to asia, not just japan but also china and north korea. this is bloomberg. ♪
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shery ahn: this is bloomberg markets balance of power. we were talking about japan and i want to extend it out a little bit. let's first include china.
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this is a complicated trade relationship and we will put out a chart showing the comparison between the yellow bars at the top and the trade relationship between the u.s. and japan. of onelmost the reverse another. >> it is true, japan has a close relationship economically with china. they put a lot of critical components with china but it of dvdports a lot players, audio equipment, that sort of thing with china. the last thing japan wants is protectionism anywhere in the world. and they are very frightened with the u.s. and china stat. >> we have seen japan and china hold their first high-level economic dialogue in eight years. will these political and economic rivals have to running -- run intor's arms each other's arms because of trump's policies? >> it would be a nightmare for this istrump if that happened. japan and china are improving relationships. diplomaticallym
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for at least a year, quite a new development for the two countries. want to become enemies i don't think. it would be rough if the trade war forced japan and china to be enemies in some way. >> i remember i was in japan and to beminister abe's push part of the tpp talks, i remember how much political capital he had to spend on that. trump one ofdent the u.s. to get back into those negotiations, with the prime minister have the political capital to renegotiate a huge deal it is already a done deal for the other 11 members? >> it would be a great achievement if the u.s. decided to seriously reenter the negotiations. he has been pushing for this for quite some time. trump, i am surprised he has actually mentioned this.
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partly to the farmers who tended and haveor trump tended to be scared of the china trade conflict and in a way, this is reassuring to them. >> when it comes to north korea, are our interests perfectly aligned with japan? we tend to focus on nuclear weapons. the japanese are also concerned about missiles. >> yes, that is true. nuclear weapons can be put on short-range missiles. the u.s. military bases are in japan scattered throughout it. short --worried a short-range nuclear missile will be with them. the missiles would be tremendously damaging as well. and i think they should be concerned about trump's concentration only an icbm's. only concern about
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these relationships between korea anda and north that relationship. >> esp or i am sure that is an issue for them. about thevernight south and the north potentially ending the war could be a and whatdevelopment happens with the new clear. >> for more than half a century. thank you for that, chief global strategist at nikko asset management. coming up next, a taxing day for the u.s.. americans only have so many hours while the supreme court remain divided. we discuss it all with congressman jim -- ramy: -- coniston jim renacci. this is bloomberg. ♪ ♪
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♪ this is "bloomberg markets balance of power. 1%,y ahn: the dow was up erasing this year'losses.
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heavyweights just boozing stocks today. the s&p 500 also gaining. most sectors are higher except for consumer staples. we are seeing tech and consumer discretionary leading the gains. financials up of course. goldman sachs continuing a strong run of earnings for large lenders. take a look at treasury yields p 10 year yield is about 2.8%. the 210 spread narrowing for the third session and below the 10 year, 45 basis points. the dollar index is rebounding from a two-month while the chinese new one is weakening against the dollar. using funding. here nowrk crumpton is with first word news. mark: north korea and trade will be on the agenda today one president trump and japan's prime minister abe meet in florida. eight asked for the meeting last month after president trump's
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surprise decision to meet with north korean leader kim jong-il and. in while, the president has her nude complaints about japan, saying the country has "hit us hard on trade for years. house speaker paul ryan is defending the trump administration's's handling of the relationship between the united states and russia. "we have moveds miles in the right direction on our russia policy." >> not only did we have a reset, not only are we sanctioning russian citizens and oligarchs, we're sanctioning russia itself. we have so improve our policy with respect to russia, far more hawkish, far more realistic. mark: ryan also said the president "do the right thing when he authorized a strike against syria for the alleged use of chemical weapons. russia'chief prosecutor said today that law enforcement agencies have spoiled an alleged plot by right-wing soccer fans
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to derail event at the world cup. the suspects were working with members of a radical soccer fan with charges of promoting extremist sentiments. least 30 people were arrested today as demonstrators once again fought with police. opposition groups were protesting a vote in parliament that gave the former president a prime minister. several thousand people camping out on the streets to fight a change in government they see as an attempt by the x government to stay in power. global news 24 hours a day on air and on tick tock on twitter, powered by more than 2600 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. you. ahn: thank it is tax day and republicans are betting on a future windfall to motivate voters on the polls. will they be able to make it a winning issue? we welcome republican of ohio
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and member of the house ways and means tax policy committee joining us from capitol hill. congressman, great to have you back. we are seeing the latest polls. , still belowrating 50%. will you be able to sell it by november? >> i think as americans get more in their paychecks, absolutely. people are thanking me and thanking us for giving more money back into the pockets. if they can spend it on what they want it for p are look at the jobs creators and the business is also giving back these are all positive things that will continue to happen over the next year. will you be able to do this ?efore making the tax cuts
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we do need to get it permanent. this tax cut will be sustaining. but we also have sustained growth long-term. the tax cuts are there and available to continue to help push sustained growth. you said that people come and think you when you travel to ohio. is that the first thing out of your mouth, the tax cuts, when you one for the election in november? getting rid of some of the regulations are a big issue. the president was able to eliminate many regulations. but we are also talking about growing the economy. people in ohio are looking for job and in economy growth. these are going to be important things we talk about.
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how important will these issues be in ohio? still has a 50% approval rating in ohio. this has to do with the growth and the economy and what is going on in ohio. it will be positive. we saw these technical difficulties with the irs. nowe are a lot of questions that we have this in the tax system. what is going on at the irs and what needs to change? rep. renacci: we need to get isk to where -- our irs looking at ways to become more efficient. they say they need more money, but i am a business guide. -- business guy. you have to make better use of the money you have. they are going to have to
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prioritize, which i think is key. we don't do enough of that in the government world. shery: will all of these changes be enough when we are seeing more gop congressman retire from the house? when it comes to the simple issue of numbers, can you still keep majority? rep. renacci: the american people make that decision. at the end, they are going to judge this congress. what this president is getting done with this congress. issue right now is the senate. they are not passing bills. that is the big issue. that is why we need to change to -- the senate. david: a big tax case is being whether individual states can impose their sales
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.ax on internet transactions do you favor states being able to charge for that? ohio already has something called a useage tax. i have been in ohio for almost three decades. -- already a tax from outsideuired of ohio, but there is no mechanism to collect that tax. make sure states are able to collect the tax already due., up, asian markets get a little boost from china's robust gdp.
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plus, new comments on trade from larry kudlow. ♪
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david: this is "bloomberg markets: balance of power." shery: shares of gw pharmaceuticals are up as much as 13% after a thumbs up was given to the british company's experimental medication, derived from a cannabis plant. thatis the first time marijuana is used in prescription drugs.
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>> correct. they have improved synthetic versions, but this is the first time an actual marijuana derivative will be used in a drug. significanto treat forms of epilepsy in children. memo everything is pointing toward approval. issues, but liver nothing that couldn't be managed. cannbidoil is the derivative of the plant put into this drug. david: are we going to see a series of marijuana-based drugs? ley: it could be the first of its kind. synthetic derivatives already are in place. medical use of marijuana is allowed in 2019 at this point.
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we have seen the marijuana market itself boom. it could be $47.3 billion. this area has seen a lot of growth. will make a difference in terms of prescription drugs and they will make a final decision on june 27. david: thanks so much. bank's central bank's -- this morning freed up capital for more loans. there was a gdp overhaul by 3.8%. economic council director larry kudlow said the united states is in the early preliminary stages of gdp talks talks and trade with china has nothing to do with it. nick, good to have you.
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square of two things for me. up two things for me. i thought the gdp number was pretty good. nick: they are moving on independent tracks. the central bank has been gradually cutting reserve requirements for a number of years. it will add a little bit of liquidity, but not that much. the gdp number came in a little bit stronger than most people had anticipated, at 6.8%. is other thing i would note that export growth was relatively weak compared to imports. the external sector was actually a modest drag on china's economic growth, which makes the 6.8 figure for ttp a much stronger domestic demand than
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you would anticipate. demand was big enough to offsent the -- offset the drag from the external sector. external consumption more than made up for some shortfall. they have said they wanted to do this for a long time. there is definitely more progress on that front. we have been seeing a shift toward more consumption led growth. i believe this is the strongest quarter, and that contribution of the increased consumption to the overall expansion of output was about 75%. the whole year, last year, contributedgrowth
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to about 60% with the expansion of gdp. this quarter is outstanding, with the contribution of consumption demand and investment demand is weakening. output -- whenal you see the longer term, it has been relatively stable. go --art on the gtv audiences can see retail sales have been stable, but not so much for fixed asset investments. will we be seeing a further slowdown, given the campaign to control debt is ongoing? rep. renacci: that is a factor -- nicholas: that is a factor. slowdown, given the campaign to control debt isthe deleveragingy slow down. the key thing to keep in mind is that industrial value has
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softened. the service sector is growing very strongly. it is growing significantly more continuationgdp, a of the rendered that has been underway for a couple of years. that reflects the fact it is related to consumption. bond of consumption expenditures are on services. we see stronger consumption. from the production side, we see a strong growth of services offsetting weakness on the industrial side. online retail sales are searching. -- surging. will they pick up the slack from trade tensions? nicholas: the new economy, other aspects of high technology are playing an increasingly important role. output of these
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things is in the service sector. it is not traditional manufacturing activity. from china, on the one hand, we had a substantial imposition of tariffs on sorghum. on the other hand, they say they the do away from restrictions that require auto companies to do 50% of joint ventures there. sorghum: the requirement has not been implemented yet. it is a relatively small import in the overall scheme of things, a few billion dollars, there is small compared to soybeans. we would've had a substantial effect on domestic price levels with soybeans. -- requirement or
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eliminating the requirement overtime for joint ventures in the auto sector is something they have talked about for quite some time. they are finally moving ahead on it and it is a positive step. moving in the direction of more generally opening up their markets to investment? nicholas: china has been relatively open to foreign investments, particularly in manufacturing. the share produced by foreign affiliates in china is much higher than in the united states or anywhere in europe. in japan, it is 1% at the most. they have been very open on investment, particularly in manufacturing. they only have three important sectors where they require joint ventures. most investment coming into
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china these days requires no domestic partner. shery: are they ready to open up their markets? just in the automakers move, we suffer inbrands competition with foreign names. foreign brands already have more of a headway in the market in china. -- china is though now the biggest producer of automobiles in the world, in terms of scale and quality, urging nearly out of the joint ventures with general motors and audi, very high quality. the indigenous producers have already been competing with the top quality, essentially foreign-made automobiles. they are ready to open up and reduce the tariffs on the import
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of automobiles. ofwill allow some discussion high-end cars coming into china more easily, but that will be a relatively small section of the market. i think the domestic industry is strongly enough now to do quite tariffs areen the reduced. shery: thank you so much for your insights. david: coming up, the french --sident mixes for stress makes his first address to the european union parliament. we are live in paris, next. this is bloomberg. ♪
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david: this is "bloomberg markets: balance of power." emmanuel macron delivered
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his first address to the european parliament after taking office last year. our reporter is live in paris. what is he trying to achieve through his speech? you have to remember with the election one year ago he campaigned on a pro-european platform, saying the european union was the solution, not the problem. he ran against the far right lepen.ndidate, marine populism hasction, been spreading in europe, with the reelection of the leader in hungary. , and themath of brexit
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austrian chancellor elected. he is trying to position himself as the defender of european democratic values. about the risk of the civil war within the italian , which is how the european union was born. macron: i don't want to allow this deadly illusion, which we never forget, the illusion of strong power, of nationalism, the giving up of freedom. i reject this idea that european democracy is condemned. macron is trying to between 500trust
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million europeans and their institutions, and asking young people who did not experience world war ii to engage with the european union. that is why you also saw democratic debate across europe. he managed to convince 26 out of members.maining david: where is he getting support in all these countries he is addressing? chancellor angela merkel, but she is very busy with domestic policies. and theresa may is very busy with brexit. also, you cannot look towards the united states anymore. he even cited donald trump as a threat to democracy and naturalism when it comes to trade or the climate.
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but he can rely on the canadian prime minister. today, he addressed the lower house of parliament in france. it was great to see these two young leaders share a common vision. david: caroline, thank you. shery: coming up, jason goldber g of barclays capital will talk about whether goldman sachs can continue its momentum. is a new function where you can find our charts. this is bloomberg. ♪ mark: i am mark crumpton with
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first word news. has apologized to her caribbean counterparts for the treatment of long-term u.k. residence web been asked to
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prove their right to stay in the country or faced deportation. she spoke at a summit in london. [indiscernible] i take these issues very seriously. i want to apologize to you today. the home secretary of the u.k. said she was setting up a task force to sort out the caribbean immigrant paperwork, and promised no one would be deported. the european union wants to make data feeder -- fingerprints mandatory for id cards in country as part of measures it says will help fight crime and prevent extremist attacks. the u.n. believes


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