Transcripts For BLOOMBERG Whatd You Miss 20171212

In his name with handwriting that included one particularly chilling note. Ie in youramerica, d rage. Mark Authorities Say he had been inspired by islamic state. Donald trump, jr. Will return to capitol hill wednesday to talk to the Senate Intelligence committee as part of its probe into russian interference in the 2016 election. That closeddoor meeting with senate staff will come after one week after he spoke to lawmakers on the house intelligence committee. It is his third interview as part of a congressional probe after he spoke to the Senate Judiciary committee in september. Both panels are investigating the metal meddling in president trumps campaign. London breed has become the citys acting mayor following the sudden death of the current mayor. He became the she had been considered likely to run for mayor after she will remain mayor until the june 2018 election. News. Im mark crumpton. This is bloomberg. Live from bloombergs World Headquarters in new york. We are 30 minutes from the close of trading here in the u. S. With stock mix and treasury the client. Joe the question is whatd you miss . Secret tax talks. With fewer than 10 working days remaining before the selfimposed deadline to win or lose the white house and fellow republicans will be dealing with the consequences of todays Senate Election in alabama. And 25 billion says a u. S. Shopping mall is not dead yet. We look at the conundrum facing mall owners around the world. Whatd you miss . Compromises behind closed doors. Republicans raising to get a tax bill on the president s desk before the christmas deadline. Fewer than 10 working days until that date. Are being closely guarded by congressional leaders. When asked what decisions have been made, the number three republican said nothing. We are on capitol hill with the latest. 10 minus 10. Can we glean any details on whether or not and at what point we will hear something official . Some details, not a lot. One thing i have heard from one source familiar with negotiations is there working fromds a 750,000 cap down 1 million. Senate bill did not affect the 1 million in the house bill cut it to 500,000. This is only for new homes, not existing ones that are grandfathered in. Theyre also working on it passed through deduction on how the senate worked with different approaches. They are trying for something simple like the senate deduction but with fewer limitations. Beyond that they are working on a state and local tax compromise peace. Most notably the california House Republican delegation wanted to include income taxes as well. The members are upset about amt being restored to much. Theyre keeping details closely guarded. It makes sense they wanted the want to keep details quiet. Is there any reason to think it is not going smoothly were do they still have momentum . They seem to have the momentum. It is hard to imagine is falling apart right now. It would take a total catastrophe for that to happen. They are at the 1yard line with the house and senate having passing the bills. I cant imagine it gets derailed. There is a desperation among members, republicans, to get this done. Its hard to imagine a scenario where there is a Sticking Point that collapses the effort. They still have some major points to resolve. I see on that list, Corporate Tax rate. Is he going to be 20 , 22 . Wheres the red line . We dont know. The issue is that nobody is going to want to kill the bill if there is one or two points on the Corporate Tax point. They are turning the dials come as a like to call it, to figure out how much money they need and whether they can keep it under the 1. 5 trillion. Issues file that under that are contentious issues that would not collapse the effort. The president is set to make a Closing Argument speech on taxes tomorrow. What did he personally achieve at this stage to bring the sides together . Not much other than a pep talk. That has pretty much been the president s role throughout this, to be a cheerleader, to make the case to get the Republican Base energized about this, which they have not been. The main impetus for this bill is coming from the business community. Corporate america in particular is excited about getting this tax cut. Think wellt i continue to play the same role basically is trying to bulk up the members, get this done as soon as possible and it will be wonderful. We talked about the perception problem that the gop has around this tax overhaul. According to some polls come over 40 of people think the taxes are going to go up. He said look back at the reagan era. It was the same perception problem going into those tax cuts. Then what happened after . What did happen afterwards . Did people afterwards actually say it was ok, this was great . The reagan tax cuts were a very different situation. Marginal tax rates were much higher. Into the 70s. Compared to now. The reagan tax cuts were dealing with a problem more specific to the 1980s. This is a different situation in a think the historical analogy i would get is 2009. Breaks that the stimulus provided for one year are very incomes ofwhat 40,000 to 100,000 would be gaining in the initial year or two. Americans didnt really notice that tax cut. The question is if they are going to notice this one. What mr. Scully and others would argue is that in the you to follow it will be economic willh that in their view complacent to assume, yes or no . Yes. Thank you. There going to be another scoring effort on the final tax bill . Once they reconcile the versions, to someone else take another does someone else take another look . They will have to do that. It is an ongoing process. They wont release the bill until they have heard from the joint committee on taxation it is under the 1. 5 trillion deficit parameter. They cant pass it if it doesnt. As we have seen previously, we will see a final score of this conference report as they release it. Not that the score is changing. It doesnt do anything. It has always been around 1. 49 trillion, Something Like that. Thank you. Ourng up, our current conversation with california governor jerry brown. This is bloomberg. Whatd you miss . Emmanuel macron hosting a summit in paris where political and Business Leaders come together to review progress for the goals in agreements of two years ago. Among the dignitaries attending, governor jerry brown of california set down specifically, what else can be accomplished without the support of president trump. The economic effect of california taking the most aggressive climate actions, both in the way of cap and trade, by way of regulation, appliances and buildings, low carbon fuel standard, 50 renewable or photo standard portfolio standard. We are doing all of that. We have become the sixth largest economy in the world. 2. 6 trillion. Our Municipal Bonds are the envy of investors everywhere. Were making progress. Yes, Climate Change in the fires, the drought, the better it is devastation, costing real money and will continue to cost money. We have to try to combat it and do combat it as we are. The lesson is you can take Environmental Action come it improves your economy, but yes, im a change through the fires, droughts and soontobe floods come have cost us many billions of dollars. Make no mistake about that. As you suggest, telephone is on a firm footing economically. It was not california is on a firm footing economically. It was not always so. Affect one economic the engine you have created in california if this bill goes through the way it is written now . This is another one of these 500 pays bills, and they keep changing it, they are trying to make their deals. We are not clear if some republican congressman are working for changes. It isginally drafted, meant to punish california for voting for hillary clinton. It is meant to punish new york, illinois, and other states that have taken the effort to raise a state income tax. Remember, what is that for . Half of it is going to education, public health, combating disease. This is a terrible war on california and new york. Remember, the states that have income tax are the engines. Not the entire engine, but a very critical part of americas prosperity. Were going to live through this. Higher income taxpayers are going to pay a hell of a bill. But what they are doing with that tax by giving more money to corporations who dont need it, more money to the richest ryan and, then already mcconnell are saying they will not have to pay for it by taking away health care for the poor, shorting medicare. What are they doing . This is class warfare at its worst and they are feeding the economy when it is running at full tilt. It makes no economic sense, no political sense, not even for the republicans. This wont help them. If anything will help the it isats win the houses, this stupid bill which punishes all americans, the bottom 80 . It is an insane idea driven by a herd of sheep who are moving in response to an irrational call from those were leading them. This is bad stuff, but were going to make the best of it. Is creating his own demise by the extreme behavior he is exhibiting and republicans in congress are following him. But its not the end of the story. We are mobilizing for the 2018 election. And this economy will hurt millions of taxpayers. It might make it harder to raise income in the future. Its a very bad sign when States Committee state action to do good for their citizens, and then for pure politics and no economic good reason, we get punished. We wont forget it and we are going to take out those republican congressman if they vote for this tax monstrosity that almost no economist believe in or support. That was governor jerry brown speaking earlier. Its now time for the Bloomberg Business flash. Exnfl executives and players have been suspended on claims of Sexual Harassment from a former stylist. The nfl network a suspended hall of fame running back marshall faulk, heath evans, and ike taylor. And espn has suspended Donovan Mcnabb and eric davies from appearing on its network during the investigation. Accusations include groping, sexually explicit comments, and sending nude photos. The lawsuit was filed in a los angeles superior court. The u. S. Fda is proposing glutenfree labeling for medications. Pushes s fda commissioner said the consumer uncertainty because in patients to avoid medication that would otherwise be beneficial. Thats your Bloomberg Business flash. Now we turn to our stock of the hour. One that may have flown under your radar. This is not a chipmaker. Its a bank, imagine that. A commercial bank. It caters to businesses. I have to credit our producer for bringing this to my attention. Its one that doesnt have bitcoin or block chain in the name. It is not a tech company of any kind. Its it it is a company that recently came public earlier in november, only about a month. Metropolitan bank or metropolitan commercial bank. It is based in new york, only has about six branches. It caters to various startup businesses, entrepreneurs, small and midsize businesses. It also has a bitcoin connection. Of course. It has something called the shift card. Spend bitcoin anywhere that accepts visa. Its a debit card. So essentially if you have bitcoin in your account you can use the bit card to use the card for actual money. It gives metropolitan this bitcoin connection that doesnt actually have to hold the bitcoin. Is not exposed to the volatility of bitcoin. So you obviously have been looking at a lot of these companies that have a tertiary connection to bitcoin in recent weeks. New ones keep popping up. Have you found any where people or actually using or selling whether their business is anything more than a pressure release . If you look at a press release. If you look at Something Like square, yes. You could argue the chipmakers. Notemselves have met been touting their connection to bitcoin. Thats more something that people are drawing conclusions on. There are definitely real connection to bitcoin and block chain. Then there is just trying to capitalize on this trend, which you could argue thats a smart move considering how much we have been talking about it and how much people have been buying it. While we are talking about it, i should mention as well, the company had net income of 3. 8 million last quarters a relatively small. But still it is a more than doubling of the company net income. It is a bank that appears to be growing. We should check on that coin while we are taught to it bitcoin while youre talking about it. Bitcoin futures are above 18,000 right now. The volume today is lower than it was on the first day at about 1481. This is the cryptocurrency monitor. You see the various exchanges on the left. The right is the futures. The lefty see cash bitcoin. The right ec futures again. The still see a gap between them. We still see bitcoin the underlying trade above 17,000 while futures trade above 18,000. The gap is persisting between the underlying and the future. I didnt know we had this page. Its a cool page because it gives you to various prices, futures. And hopefully it will have the cme futures as well and the nasdaq futures when they launch. The bottom is the news. Its a good landing page for the cryptoobsessed, as we all are, apparently. Some because they have to be. Exactly. Thank you so much. Coming up, as the fed decision nears, how are investors in markets reacting . A deeper look at the chart that you cannot miss. This is bloomberg. Whatd you miss . Final fed decision of 2017 tomorrow at 2 00 p. M. Willodds the federal bank raise wages. The third hike this year which has been pushing up shortterm. Two year yield is at the highest since 2008. Five year yield is at a six year high. The long look at the yellow line, the 10 year yield. Slow inflation. All of this when you put it together is flattening the yield curve which is concerning to investors because typically a flattening yield curve that aentually inverts and signals recession or economic weakness. Its at the flattest since 2007. Uncomfortable parallels because that was right before the financial crisis. We dont want to mention those words. But this very much ties to what scarlet was talking about. H the fed has been doing the rate hikes since the election, we believe there will be another tomorrow it has not been contributing to a tightening of Financial Market conditions. What im looking at here is bloombergs Financial Commission index. Created from combining yield spreads across money, bonds and equity markets. Weve seen since the election is this yellow band is financial conditions easing. I made the point last time the fed hiked it was a freeze hike and i will make the point once again. Even know we have seen the curve flattening, actually the fed is managing to tighten as far as Monetary Policy is concerned. As far as financial conditions are concerned they continue to loosen. The best of both worlds in a way. This morning we got Nfib Small Business optimism. That is this blue line. It is surging. Small businesses say they are doing really good. It is at its highest level since 1983. But what really drives a Small Business optimism . It might have to do something to do with politics. I was looking at the white line in the Bloomberg Consumer comfort survey. The difference with the how republicans to the economy and democrats. That too is surging. Republicans feeling better about things these days. Before upside of the obama years. Bottom line, maybe things are getting better. But maybe a lot of Small Business owners are republicans. 22 believe tax breaks the market closes next. The dow and s p at record highs. Cannot live without it. So if you cant live without it. Why arent you using this guy . It makes your wifi awesomely fast. No. Still nope. Now were talking it gets you wifi here, here, and here. It even lets you take a time out. No no yes yes, indeed. Amazing speed, coverage and control. All with an xfi gateway. Find your awesome, and change the way you wifi. Whatd you miss . U. S. Stocks closing mixed. High00 pushing to a new but it didnt manage to hold. If you are tuning in live on twitter want to welcome you to our closing bell coverage every weekday from 4 00 to 5 00 p. M. Eastern. We begin with our market minutes. Looks like a mixed market in that the nasdaq is lower raw the dow and s p 500 hit yet another record high. Telecom and financials leading the way. Pretty big day. Looks like a very familiar day based on the recent past. Something else in anything related to bitcoin getting a lot of attention. Were looking at overstock. Com and another company. A day after the successful start a Bitcoin Futures trading, companies are often seen companies linked to bitcoin are often seen as an alternative. They have it in their name. Fame by association. 6. 5 after they struck a deal to why australias lets take a look at the Government Bond market starting with u. S. 10 year yield. A little higher across the board. Not a lot going on. Two year yield up to 1. 8 1, 10 year up to 2. 40. I want to look at the five year yield. We dont talk about that one as much. Lets look at the longterm chart. Levels at its highest since 2011 breaking above 2. 10. We are seeing all kinds of breakouts along the curve. You you can see happening in the middle range at the fiveyear. Lets look at the currency for the dollar index. We saw a bit of a rebound versus a majority as he got above u. S. Inflation readings. Decisionthe fed tomorrow come obviously priced for a hike. We also saw sterling down 2 10 of a percent. That despite an estimate requiring a letter to the u. K. Chancellor. Also the argentinian peso. Lookd to give you a quick at that, german like a tenths of 1 , less than one hour after reports that here it agreement with the opposition party. We had to talk about bitcoin but want to mention this one. G btv 3682. Taking a look once again as we were talking about yesterday the forward price, the white line. Bitcoin is the blue price. The bottom is the spread between them. It is infinitesimal but you can see the spread narrowing. We continue to see that and we will continue to show you to give you a sense of whats going on. Lets look at commodities starting with oil. Down today. Brent crude oil down 1. 7 . Brent outperformed yesterday because they was this cracked sound in a pipeline in the north seas which buoyed the price of brent. That is giving back a bit today. Gold not doing anything. The huge mover, u. K. Natural gas prices. There was an explosion in a pipeline in austria. Nearly 11 gains for u. K. Natural gas prices on this news. Nowof the big themes right is the interior rating infrastructure in european energy. And those are todays market. The Federal Reserve began its today meeting today twoday meeting today. All within an 18 hour window. Economists are telling investors to break for the biggest tightening of Monetary Policy in more than a decade. Lets get more insight into what we might expect from Janet Yellens second to last meeting as chairman of the u. S. Central bank. We have a senior economist with us from north carolina. Thisll be Janet Yellens final press conference as well. One critical question you see the fed needs to address is how much should they raise rates by if inflation sticks by the 2 level. I think thats one of the things people need to think about because a lot of folks are calling for fortified rate hikes next year. That is an awful for four to five rate hikes next year. Thats an awful lot. With the stock market booming right now people are thinking theres too much liquidity. I dont think you want to choke the exhaust when we dont have any building inflationary pressers or any credible sign. A chart thatwed looked at financial conditions and it showed that despite the fact that we have seen three fed rate rises since the election in fact, financial conditions continue to ease rather than tighten. Even if inflation remains below 2 in 2018, isnt this an argument to say buildup some arsenal, continue to raise rates in the face of what looks to be three hikes if you can. Certainly a thing conditions are fairly loose, which is a reason stocks are going up. The problem is if you push too far, you will undo would all. It is kind of all or not. I dont know if you can turn the dial, finetune the dial that precisely. We think they are going to raise rates at least twice next year, possibly three times. Thats probably the more likely income outcome. Three rate hikes is a lot of tightening into years. In two years. Monetary policy works with a long invariable lag. So what they are going to do will really show up late in the last late next year into 2019. Tofar tookes far . Yes and i am not sold on three either. I think that would push things too far and i think that would really put the economy in jeopardy in 2019. D. C. Tension building up between the two themes . On the one hand, still not much on the inflation front. On the other hand they loose financial conditions which many people see signs of continued Financial Market access and rising asset prices and concerns about financial stability. I know the fed doesnt have a third mandate where it has to worry about asset prices but people think it might. Did the fed think were not getting there on the inflation front road want to tap down on accesses we see in the markets . Is if thehat comes in fed raises rates and the market gives us a correction, that you make it clear that we are not stopping just because the markets finally had a correction. When you take that step. Right now the economy is strengthening into way that should not add to inflation much. If you look at what is happening in california, for the longest all the time was in the San Francisco bay area, l. A. , and a little of san diego. Now it is finally spreading to the interior of the state. We are seeing that all over the country. Would you take into account the economy is not just strengthening, it is broadening, there is more slack, probably a lot more slack than people are taking into account right now. I want to get your thoughts on the flattening yield curve. Does the signal to you all are . Well be talking about how the 2 10 spread is as flat as 2007 and of course we know what happened after that. Is this an indication of tough times ahead or is this just the late stage of the Economic Cycle in we could see it flat for a long time . I am not so sure. What i feel very certain about is that on the short end there seems to be a great degree of confidence that the fed is going to raise rates in december and two to three times next year, possibly more. That has given us a flat curve by itself. End, there and are still doubts about things. This is a bit of a mystery that we have 2 inflation this far out in the Business Cycle with the Unemployment Rate looking like it is set to break through 4 . Great to hear some diversity as well in terms of viewpoints for the fed. Mark bittner, wells fargo senior economist. Coming up, special election showdown. What should have been an easy win to the republicans have turned into a dead heat. We will go to alabama live next. This is bloomberg. Voters in alabama are heading to the polls in a contentious special election. Republican nominee roy moore his wife arrived at their polling place on horseback. Moores campaign has been dawned by explosive allegations that he sexually assaulted teenage girls. He has denied the allegations but that has not stopped some republicans from saying if he wins he will not be welcome in washington. That their cory gardner says as soon as you get to the committee he wants to expelled. I think you want to vote your conscience. We have a tremendous turnout. The nation is watching this. We have so Many International people from overseas, different nations here today. This is a very important race for our country, our state, and for the future. Late in the race president sayingupported moore, doug jones would be a puppet of Chuck Schumer and nancy pelosi. The president today signed a National Defense authorization act for the next fiscal year. Become a mise differs in reached by senate and house negotiators to authorize over 624 billion for the base Defense Budget and about 66 billion for a war fund known as overseas contingency operations. Here in new york city that would be suicide a wouldbe suicide bomber is facing charges including providing Material Support to terrorists and using weapons of mass destruction. He wrote on his facebook account quote, trump failed to protect your nation. He is still hospitalized with burns. Global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. I am mark crumpton. This is bloomberg. Whatd you miss . An unlikely tossup. Democraticnt sent a senator to washington in over 20 years but as voters head to the polls today, it is anyones race. Our chief washington correspondent is on the ground in montgomery with the latest. Talk to us about what kind of turnout you seen. We were talking yesterday that this will be critical and also the amount of people who are simply undecided, not knowing who to vote for inlet of allegations that have been tossed around in the runup to this event. I am literally standing right outside the Roy Moore Campaign celebration, or almost party that will happen later this evening. I spoke with an official at a Polling Center here in montgomery. Divided, politically diverse part of the region. What this official told me is that turnout is up, especially in comparison to other special elections. It is still shy of a president ial year. Whether that is good news or bad news for the candidate well have to wait and see. There is no doubt that democrats are hoping to bolster turnout. Charles barkley out in full force for support of doug jones, saying it is time for alabama to stop being an embarrassment to the country. On the flipside, lest my eye was at judge roy moores final Campaign Rally in which president trumps former top strategist steve bannon spoke for more than 30 minutes, arguing that this special election has become much more than just about the candidates. Really a defensive president trumps policy agenda. How did voters in alabama feel about all the national interest, all the celebrities and media coming . They dont like it. Was speaking in a Small Business in downtown montgomery with a local Business Leader and a coffee shop. What she told me is she cannot wait for all the media to leave, all the ads to stop and for folks to just get on with their lives. This is a deeply conservative state. Should they vote for doug jones it will be the first time in more than 20 years that a governor or senator is elected to the seat. It is interesting because the pitch is being made for mulligan someoneparticularly for who has been accused of such distressing allegations. They are suggesting perhaps a vote for him with the hope that the senate ultimately expel him and they get another republican in net seat. The timetable is interesting. The secretary of state in alabama saying they are going to send over formal paperwork by the end of the year. That puts pressure on tax reform as well. You broke news on donald trump, jr. And his testimony to the house intelligence committee. Yes. I can exclusive report the donald trump, jr. s attorneys are requesting there be an investigation into lease coming out of the house select intelligence committee. That it ise same day reported some a president trumps attorneys are calling for a special counsel to investigate bob muellers probe as well. Another day in alabama. We will check back in with you throughout. Were joined now by a veteran of republican politics. Former press secretary for john boehner. He is currently managing director in joins us from washington. I believe the phrase of the day is deal with. Julie and i spoke with Steve Scalise and he was saying if roy moore is elected, the senate will have to deal with him. The people of alabama will have to deal with that. What does that mean in your mind, that they have to deal with a senator roy moore . Peoplebottom line is the of alabama deserved a better choice than the one they are presented with today. I think the senate, should he be elected, should the people of alabama make that choice obviously he will be seeded but equally as obviously there will be an Ethics Committee beginning immediately looking at these explosive charges. If they are proven true, would be completely unbecoming and unacceptable for a u. S. Senator. It goes beyond alabama and this is a problem. Dot kind of perception hit you think the gop takes as we head into the midterms next year if there is a senator roy moore and if there is a subsequent investigation going on . It sends a terrible message to voters. Is importantime it to note the Republican Party is not united in support of roy moore. The president is supportive but the senate leadership, speaker of the house, and republicans across the country and about want a better option. What matters more for the Republican Base . Support or the opposition by Senate Republicans in mainstream republicans . Thats one of the many complicated questions voters today will be sorting through. The previous segment was exactly right. This is now about turnout. Army going to see enough africanamerican voters turn up, collegeeducated republicans, particularly those in affluent suburbs around birmingham choose to vote against moore or just stay home . Will we see a massive turnout by white educated white rural voters that trump saw and roy moore needs to get over the top . You mentioned the effectiveness it could have on the midterms in 2018. It reminded me of the marks for lease candy in 2006. Scandal in 2006. His scandal involved sexual overtures to congressional pages. Ld this what it was crushing. Were going to have a couple different this year. One, that scandal was the culmination of a series of financial and otherwise scandals that have dogged republicans in the years leading up to 2006. It allowed the nate see allow the democrats to tag them. It was much later in the year. Have the opportunity to recover from the debacle that would be roy moore and the u. S. Senate. What about the tobacco that is not roy moore in the senate . What happens here if he does what about the debacle that is not roy moore in the senate . It would make it much more difficult to govern the senate from a partyline point of view. It would make it much easier for democrats to potentially when the senate next year. I think just because the senate is so closely divided, just one vote basic huge difference, which is why it would have a greater have a write in candidate or another special election. Some mechanism to give the people of alabama a better choice than a democrat or roy moore. What is the greater evil Going Forward here for the gop . I dont honestly know. There are terrible options down both paths. I think the hope, the jury andaps that moore could win swiftly be replaced with another republican is a faint hope, but probably the best help. Hope. Thank you for your honesty. That was appreciated. Coming up, our exclusive interview and how business is responding to Climate Change. This is bloomberg. Whatd you miss . Accordhe paris climate vowed to reduce greenhouse emissions, businesses and investors are going above and beyond to respond to Climate Change on their own. The first are a series of policies that are put in place in some countries its a carbon tax, some countries it is regulation, others is a combination. That changed the opportunities set for companies and the risks they have to manage. There is a second set of incentives around how does a and howmanage risks does it manage opportunities for creating longterm value. Today is theesting climate is coming into the mainstream in those conversations. Let me give you a couple facts as of today. Eight of the 10 largest Asset Managers in the world signed up to support these recommendations. 20 of the globally systemic banks. And manyajor insurers of the major pension funds. Trillion more than 50 dollars of assets in management and more than 80 trillion of Financial Sector Balance Sheets that are looking for this kind of disclosure. We saw overnight one example with exxon mobils announcement on enhanced disclosure. You are seeing it across the board. The capital chain is looking for this information, including the two major shareholder proxy voting services, which are responsible for 90 of that market. They are looking for this information and now they have a framework to get it. It tells the providers of capital who is thinking about risk, looking at opportunity, and who is looking managing and well. Up next, a major deal in the retail space. What made westfield an attractive acquisition target in the age of amazon. Will discuss. This is bloomberg. Mark White House Press secretary Sarah Huckabee sanders is defending president trumps tweets attacking democrat Kirsten Gillibrand today after the new york senator demanded he step down over allegations of Sexual Misconduct. Sanders spoke at the white house after gillibrand called the president tweet a sexist smear. He is not alleging anything. He is talking about the way the system functions as it is, that politicians repeatedly beg for money. That is not something new. That comment is not something new. If you look back at past comments the president has made, he has used the same terminology many times in reference to that. There is no way this is sexist that all. Mark democrats accused the president of making crude insinuations with Elizabeth Warren sweeting are are you trying to bully and intimidate senator gillibrand . Mark davis is expected to replace eight Al Frankens Senate seat. Franken resigned last week in the wake of Sexual Misconduct allegations but did not give a final date for when he would step down. French president Emmanuel Macron is hosting 164 world and Business Leaders and prominent business figures in global warming. The main goal is the find financing for countries that industries to reduce their Greenhouse Gas emissions. Antonio guterres says of those who refuse to bet on a Green Economy are living in a grave future. We are in a war with very existence of life in our planet as we know it. Would have an important ally science and technology. What is happening is exactly as science has predicted. Tohnology has responded Climate Change as a threat to the world. Mark calling on World Leaders and Business Leaders to further their involvement in the fight against Climate Change throug h financial pledges, green legislation and Climate Friendly projects. President an union said it would be a furious race against time for the eu and britain to finish brexit negotiations by next fall. Eu leaders will be asked in a summit starting thursday to endorse proposals to move on to the second phase of negotiations which include trade relations. If they do, he warned most of the work is still ahead in britain were to make an orderly departure. Global news 24 hours a day powered by more than 2700 journalists and analysts in over 120 countries. Im mark crumpton. This is bloomberg. Scarlet thank you. Lets get a recap of todays market action. We have a mixed read in stocks. The s p 500 climbed to record highs again. The nasdaq finishing lower, chipmakers down by quite a bit. Joe very similar you see it at the bottom, record highs again. Kind of a broken record. Scarlet we are pushing ahead to tomorrows decision as well. Lower, chipmakers down by quite a bit. Joe veryjulia some news crossn bitcoin. Interactive Brokers Group let bitcoin bears bet against the futures contract. More. Hyman is here with we were just talking about this. Julie this is news we have exclusively here. The Interactive Brokers will allow this. What is interesting is we talked to the chairman yesterday. He was really struggling with this, whether to allow this. His big concern is eventually there could be a short to the upside which could put at risk the clearing organizations, whether it be the cme or nasdaq down the road. Joe obviously, there are clients of Interactive Brokers who want Bitcoin Futures. Do we have any sense they are interested in taking a directional bet on bitcoin or whether these are spread traders looking at that massive gap and they cant do that if they cant short the futures . Julie we dont know. We just know it is in response to client demand. That is what Interactive Brokers set initially, as to why they were offering the futures trading in the first place even with reservations about the affected could have. There are some requirements but on this by Interactive Brokers to mitigate the effect by some degree. They also have more onerous margin requirements than do th see both himself. Interactive brokers are 50 . If you want to sort Bitcoin Futures, they also have touirements in place mitigate the effects. Julia this is quite fascinating to me because after you did the interview yesterday, we had a discussion on how they can get around not providing this when you have others that will. It feels ultimately it was a case if we dont offer this, someone else will and we will lose clients. Julie there was the sense they would offer this, or someone would offer this at some point. I did not necessarily think it would happen this quickly. It is not necessarily happening at this moment. It will be sometime this week they will start allowing this to happen. Reflectiveit is just of this world of bitcoin that the more traditional players are grappling with. We really got a sense, just trying to grapple with this type of asset and figure out what is the best course of action. We know traditional players, which have still said they are not getting into this as of yet, are also still grappling with bitcoin and cryptocurrencies and how to trade them and make markets. We know Goldman Sachs is making market minimums but does not appear to be trading on its own account. Other players, other banks have either not commented or said they are definitely not prop at this point and not trading on behalf of clients. Julia it goes back to the question on whether it was cme o it seems like there is a Snowball Effect on taking action. Julie they cannot afford to not offer that. Scarlet what is also interesting is Interactive Brokers yesterday were accounting for half of the volume we were seeing. The order flow was going through Interactive Brokers even with those more onerous requirements perhaps because of the accessibility. Julie you were telling us earlier the volume of bitcoin features has come down. Scarlet do you have any sense based on your conversations with folks in the market, Interactive Brokers, that once bailout the shorting to happen, that the volume will start picking up . Julie that is not necessarily been the case. It could happen. It is also going to be very interesting to see when the product launches on the 18th. If that is going to siphon some of the volume or if people will see that as an additional venue for them to trade this. We know the product is a little different because it draws from more than one exchange, where the other product draws its pricing from the gemini exchange. It is different because every cme contract is five been going, while cbo is one bitcoin. That will be quite different. Scarlet julie hyman, thank you so much. Coming up next, will Shopping Malls make a comeback . Why your commercial landlord is making a bet on one type of highend mall from westfield. This is bloomberg. Scarlet a big takeover in the Shopping Mall business. Unibailrodamco has agreed to buy australias westfield for 15. 8 billion. With field owns and operates 35 u. K. In the u. S. And Shopping Centers struggle to stay afloat. Joining us to discuss ais lindsay. You cover Retail Companies in the u. S. , not so much the real estate, but its interesting because whenever you talk about a valuable part of retail, it is always the real estate rather than the actual operations. Lindsay absolutely. There has never been a more exciting time to look at the relationship between a mall operator and retailer. Retailers want to get a deal mall operators because they know foot traffic is falling. The mall offerings. I think we will see more consolidation like this happening. Joe with respect to this bid, what is the main thrust . What is the appeal . Lindsey westfield tends to have pretty nice properties. Y want to get crappy retailers out of there and bring more excitingthese are good prot will probably continue to thrive. They have good tenants. They are in locations where demographics play in their favor. If you are in a highend mall, the business has been really good. The problem is at the lower end mall in america has a ton of lower end models. You see people trying to capitalize on the idea that people want to continue spending in a social way. So far, that theory has proven correct. Question is will westfield continue to innovate in the way westfield has . Julia for westfield shareholders, if we are looking at the price paid, not far away from last julys fiveyear high, westfield shareholders here i assume skitting a way to the bank on this. One about the purchases . You point out pretty aggressive on the anticipated synergy. Lindsey i think a lot has to go right for this deal to pay off. If you are going to buy a u. S. Small company, this is the kind of mall company to buy. Said pulling a greater efficiencies here and monitod monetizing it further is a challenge. Lindsey absolutely. One question a lot of people have been asking is why with his company choose to sell right now if there is such a great prospects in the future . There is no great answer to that. Scarlet so, when it comes to what kind of malls work, you mentioned how demographic ally those properties were you have an affluent Customer Base does better. What about the mix of stores . Operators want to kick out really taylors that are not doing retailers that are not of time itbut a lot seems like it is too much apparel. Lindsey i am talking about the Westfield Property here around the World Trade Center. It does not have a lot of appeal. It has apple store, shoe companies. It has a lot of interesting food offerings. That is what mall opeartorators are looking at right now. Apparel is not a healthy sector right now generally. They dont want to weigh themselves to heavily towards apparel and that has been the driver for so long. The Department Stores are the anchors and then they trickle over to the specialty retailers or foodcourt. Now you have your foodcourt, tach stores, grocery coming into the malls. There are a lot of different draws to a mall now than traditionally. Joe which is the one by the World Trade Center . Lindsey the one in the transit hub. Joe i didnt realize. Julia have you been there . Lindsey no. Julia i have. Lets move on. Break it down for us in terms of where the revenue is generated within the United States versus outside. Westfieldamiliar with in the u k but the bulk of revenues are u. S. Based. Lindsey this is a play for the European Company to get more in the United States and make it that on the consumer. A bet on the consumer. The American Consumer should be spending and in theory they are going to be soon. Julia u. S. Diversification talking about retail and the cerns in this space Goldman Sachs was talking earlier this week about getting into it. Scarlet i wonder how amazon fits into this because amazon has been making this push into brickandmortar. They have their own amazon store, hold the. Whole foods. If this year taught us anything is there is still physical value in retail. Maybe looking at it as a marketing sense, drawing in customers and get them to buy into your brand. If this year taught us anything is there is still so many ecommerce players have opened stores. Maybe not in traditional locations but there is clearly a place for that in the way americans shop. Scarlet they still need a way to interact with the customers. Lindsey you cannot replace that relationship online. Scarlet thank you for joining us. Still ahead, highlights from her conversation with Robert Pollock about why educators believe the gop tax plan will make a College Degree more expensive. Is higher ed being targeted by republicans . This is bloomberg. Scarlet a potential loser in the gop tax plan could be Higher Education. Both the senate and house bills in include a tax on endowment and students by vince. We spoke with martha pollack about the impact the proposed tax overhaul could have on the sector. Full disclosure, cornell received a 100 million gift from bloomberg philanthropy in new york. Take a listen. Martha i am very concerned about this bill. This is not a bill that will increase access for students or drive down costs. It is not a bill that will reward or incentivize philanthropists. It is the opposite in all of those categories. I think you see this with moodys having downgraded the outlook for Higher Education last week from stable to negative because of these impacts. It is a bill that were hurt higher ed without any clear policy purpose. Julia there are a number of different angles whether it is changing tax structures for student loans, tax on endowments. Lets talk about that specifically. If you do you see a change on taxes for endowments, what impact will that have in a Financial Aid perspective . What portion of that money used for directly Financial Aid . Martha in cornell, we spend about 70 million per year for the endowment institution towards the total Financial Aid bill. If the excise tax were to impact cornell, it would cast us about 10 point finally dollars a year, which 10. 5 million the yea. We would be included in the house bill, but anyway you are opening the floodgates to taxing something that helps make college more affordable, not less. Julia this is not targeting the top 1 . Those thatgeting financially probably would not be able to afford college and you will be able to provide support for those graduates. Martha that is right. Our endowment pays for a number of different things, are primarily Financial Aid and faculty salaries and academic programs. It would lessen our ability to provide Financial Aid and weaken our academic standing. Scarlet and affect operations at the school. What about taxing the provisions to graduate students, having to pay taxes on their stipends and tuition waivers . Is that fair . Martha not only do i think it is not fair but it is incredibly harmful for this nation. A lot the advances in this nation come from students in the sciences, the business, in law. These students are receiving a tuition waiver. They are fulltime students and they dont have money to pay. We are simply saying to them you are a good student, you can come to school to free. Where they are supposed to get the money to pay for taxes, i dont know. It will seriously increased decrease interest in graduate education. Scarlet according to the American Enterprise institute, they say very few Americans Care as much about graduate students because so many of those graduate students come from abroad. These are not americans. It does not place a main street, which of the heart of it is struggling to gain access to college let alone grad school. Martha while there are a lot of international student, there are also a lot of domestic students. Secondly, it is the case many of these international students, particularly in the sciences and engineering stay in this country and contribute to this country through the development of new all kinds of innovations. We are going to make it much harder for the students to do this. I do think it will hurt the economy. Julia that raises the critical question what is the policy that is trying to be achieved . What do you make of it . What do you think the government is trying to achieve here . You agreed in the sense targeting Higher Education. Martha i wish i had an answer. In the past, there have been proposals for bills where we might have disagreed with the mechanisms, but we all agree on the policy. The policy was more access and affordability. To me, this seems like a mechanism to scrape up more money to provide a fillin for places in which taxes are being produced. Im not seeing any clear policy. Julia collateral damage. Scarlet there could be in argument this could be backlash against years of rising tuition costs as well as a lot of scrutiny over cultural issues on campus is like free speech and other issues that have raised a lot of concern. It might even look like a culture war on the Higher Education system. Martha you may be right. It is hard for me to get into the minds of the people that are pulling this through. We talked about this before many universities have worked very hard to drive down costs. At cornell, it costs less to be a student that it was 20 years ago if you have financial needs. We are trying to be more affordable. I think the culture wars issue is an important one. I think many of us recognize we need to have a greater diversity of voices on campus, but i dont think it is quite the story that you would hear from the press. We frequently have conservatives and liberals coming to campus. Do we need more . Yes. Does punishing us financially make this happen, i dont see how it does. Julia it is now time for the Bloomberg Business flash to look at the many business stories in the news. Canadas Prime Minister makes a plan to buy 18 boeing jets in favor of used f18 fighters from australia. He warned canada will start doing stop doing business with boeing. And gets subsidies to get an international advantage. Is that management is returning all money. Fund said the past three years has not been favorable to their investment approach. 100 million and Capital Management is an investor. Tesla getting a big semi truck order from pepsico. It is for 100 vehicles worth an estimated 2 million. Anheuserbusch placed orders earlier. Production will start in 2019. That is your business flash update. Joe coming up, what you need to know for tomorrows trading day. This is bloomberg. Scarlet the dow and s p 500 closing at record highs. Tech stocks missing the mark. Coming up, the fed decision tomorrow at 2 p. M. Join us for our fed special starting at 2 p. M. Eastern. Joe economic data, i will be looking at cpi numbers coming up tomorrow. Generaleputy attorney rosenstein testifying in congress as he faces questions about the special counsels investigation into Russian Election interference. Bloomberg technology is up next. Joe have a great evening. This is bloomberg. Retail. Under pressure like never before. And its connected technology thats moving companies forward fast. Ecommerce. Real time inventory. Virtual changing rooms. Thats why retailers rely on comcast business to deliver consistent Network Speed across multiple locations. Every corporate office, warehouse and store near or far covered. Leaving every competitor, threat and challenge outmaneuvered. Comcast business outmaneuver. Or a little internet machine . [ phone rings ] it makes you wonder. Shouldnt we get our phones and internet from the same company . Thats why Xfinity Mobile comes with your internet. 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Todays winner will take the seat previously held by Jeff Sessions who became u. S. Attorney general. President trump is again urging alabama voters to support moore. The president tweeted moores opponent is a puppet of nancy pelosi and Chuck Schumer. Vice president mike pence has been silent on the election. He has not commented publicly since november 9 when a spokesman called the allegations against moore disturbing. In new york, a