Johns hopkins universitys big moments ago we have now hit 3 million in the u. S. That is reflected in the sector composition. We see it is technology outperforming, up 1 . It is those more cyclical growth sensitive sectors, industrials, energy, materials, a very hard in todays session. David which takes us back to the coronavirus, which makes sense. Gold has been climbing. Where is the dollar . Kailey the dollar is weaker. We are getting mixed messages from each of the asset classes. A weaker dollar indicates more risk appetite, more confidence about growth. Youre not seeing that reflected in gold. Gold is at its highest since 2000 10 since 2010. Clearly there is appetite on the part of investors to hedge some kind of rest if the markets are moving higher. At the same time, the fixed is relatively modest. The vix is relatively modest. Kailey we are right around 29. It is all relative when we talk about volatility. We are not where we were in march, but we are still elevated relative to history. Right now the vix would indicate we are expecting swings for nearly a month. Swinging 5 was not out of the question. Today the market is not seen as swinging that month that much , but relative to history that is still elevated, a lot higher than it has been historically. David thank you very much for that report on the markets. That is kailey leinz, one of our colleagues. Lets go back to the subject of the coronavirus and how states are fighting against it. We are welcome to welcome back lamont,berg ned governor of the state of connecticut. It is a good day for you to go on. Last time i saw you you reported zero fatalities for the first time in march. But you opposed phase three opening. Why the caution when the numbers seem to be doing so well for connecticut . Have about 95 of our economy open. When it came to bars and nightclubs and bake entertainment venues, i listen to the governors from florida and texas and they said they did whent they open their bars they did. That was an opportunity for super spreading. An abundance of caution, we will not open them yet. How concerned are you about outside connecticut, certainly in the south and southwest, there are concerns about people coming from those locations into the state in the northeast. How concerned are you about that . I know you have a quarantine in place. Is it advisory, or can you enforce that . Gov. Lamont i am very concerned. Thankfully we have good neighbors. Massachusetts, new york, rhode island, they have low infection rates. If people are flying up from miami and houston, coming in unchecked, that is a problem. You need one or two people infected. If you have a quarantine in place, it is voluntary, that is. Rue david some people are going mandatory masks. Where are you as governor of connecticut . Gov. Lamont we have said for indoor use, you have to wear the mask spirit i am interested reading that the Retail Association says i am tired of having 50 different rules when it comes to the masks. Say masks are required inside stores, that make our lives much easier. David most Public Health officials agree that is one of the things we could do to save lives. What is the hesitancy . He talked with federal officials about a federal standard on this. Reluctantt they are to have federal guidance on things like that. You have to ask them. We has governors in the northeast like to speak with one voice so we can have a consistent message. Doid i saw report having to with connecticut that says you could retest 95 of people infected but only 40 would agree to participate in Contact Tracing. Is that a problem for the Contact Tracing to be effective . Gov. Lamont that is a problem. We now have the infrastructure in place to reach out to everybody. We do it by telephone, we do it by text. You care about the people we have been in contact with, please let us know who they are. There is some hesitancy. Wrong people at the party do not want other people to know who was at the party. We are working with communities to impress upon people how important it is you share this information. What is your policy at this point on schools reopening. Yesterday President Trump said he would urge governors like you to open your schools. We had again today. We had mayor de blasio new york city saying if we do this it will be about two days a week kids will go to school. Where are you in connecticut . Gov. Lamont because we have an infection rate less percent less than 1 , because we are beating all of the metrics, we are planning on opening our school on time in late august and september. A Normal School day. Not some days on, some days off. It is better for the kids and better for employers. Are you going to test employees, if not students, before they go back . Is. Lamont right now that not the cdc guidance. Testing Centers Available free of charge. For those teachers that want to be tested, we want to make sure they have that opportunity. David we all hope this goes smoothly for connecticut and the rest of us. At the same time, you have contingency plans that you could cut back in some schools if there are problems and go to Remote Learning . Gov. Lamont i am afraid we do. We have seen how fast this flareup can spread. K12 make sure thinking hard about having to move back to Online Learning if there is a flareup in the residence hall. I think it is terrible you will not let foreign students into our great universities in connecticut if it involves distancelearning. That is sending the wrong message. That is coming out of washington. David as you suggest, pretty big import universities in the state of connecticut. What are they doing . You both increase cost and perhaps reduce revenue. Gov. Lamont they are losing money in Residence Halls in particular. Some distancing. Right now i believe all of our oncologist all of our colleges are going in august. They will start with distancelearning to get people up to speed, move people into the dorm slowly overdosed go to three weeks so there is not a mad rush going on. They plan to have a mix of online as well as in person knowing that may have to take a turn if there was a flare up. You said you thought perhaps the days of the routine five days a week commute from connecticut to manhattan may be over. What patterns have you seen since then . Has it reinforced your view or you have a different view . Gov. Lamont it has reinforced our view, especially in southern connecticut are a lot of people would get on the train to get on the subway. There is a lot of reluctance about getting on the subway. People have found you can have a suburban lifestyle or maybe live does go to three days a week, and if you have to get into the big apple to take care of business, you can do that, but you do not have to. David what longerterm changes besides the commuting issue are you taking a look at . There are a lot of reports of people in manhattan looking for housing in greenwich and southern connecticut. What is going on with the Real Estate Market . Gov. Lamont the Real Estate Market is very busy. People coming from york, people coming from boston. If you have a house with little backyard it can get a couple of extra rooms at less cost, it is a good place to be. I think you will see a dynamic change. For the last 20 years young people wanted to be in the major metro centers. Now there will be balancing out. David adam smith would say when there is increased demand prices will go up. Are you seeing home prices go up in connecticut . Gov. Lamont i think you are seeing some of that. We have been pretty flat for the last 15 years. Forl a deep discount connecticut compared to new york city, but you are right. Theres a lot of demand and you can see that reflected in the prices. David lets talk about what, if anything, the state of connecticut needs from the federal government. There is talk of another phase of stimulus or investment. Thinkve said you do not that 600 dollars supplemental unemployment claim why is that . Trying to doi am everything i can to get people back to work. That is how we will get our economy going, that is how i will stabilize finances in our state. I thought there other ways you can use those federal dollars. Example, we have lost hundreds of millions of dollars from not just our income tax revenue but our sales tax revenue is down a lot due to covid restrictions. We have to be prepared for that. Thankfully we have a big Rainy Day Fund, so we can power on for the near term. If this lingers on for another year, we are in big trouble. If the federal government to step up and help out the state local governments and give us more guidance on education as well. David is great you have a Rainy Day Fund that will tide you over. If you do not get direct support from the federal government or the connecticut budget, when you start having to cut cost, that is often laying off people . Gov. Lamont we are already trimming. There is no question about that. Connecticut is in good shape through this calendar year, may be beyond that depending on what the balance is. We are assuming as our economy gets back towards normal or close to normal by the end of , if there isyear another big flareup in november, we will see what happens. , this pandemic in the economic problems that have followed our big crisis. We have also had a crisis of having to do with systemic racism following on the heels of the killing of george floyd. Tell us what is going on in connecticut cured i understand you may be calling the General Assembly to address at least the policing issues. Gov. Lamont we are definitely going to do a Police Accountability bill as part of our special session in the next couple of weeks. We try to lead by example in our state police and make sure when it came to community policing, take out the militarization, focus on community policing. That duringd important protest in and around the george floyd mortar the george floyd murder, our state police were often arm in arm with the protesters. Very little arrests, very little violence. The police and protesters were aligned in terms of goals. David what about the more fundamental underlying issues, economic inequality, income and wealth we have across the country. You have a version of it in connecticut. What can we do to address some of those that perhaps set up the police for failure . Gov. Lamont two big focuses for we have one of the biggest achievement gaps. Extraordinary suburban schools and some of our city schools that we have to make investments and more social workers, more social support as well as coding. We are making a big update to update the opportunities for those kids, especially in the cities. We put a lot of money into new business startups, especially for people of color, making sure they get that opportunity. We have a 45 million fund, i think 38 went right to people of color making sure they can power through the start of their business. Ask youinally, let me about photo you november. We have a big election. About voting in november. What is the situation in connecticut on absentee voting, mailin voting . Gov. Lamont why is it so controversial . A majority of states do it. Red states, blue states, it is not particular partisan. In this environment it is getting partisan. In our state, im telling people over the age of 60, im telling people to stay safe, stay home. That means we have a primary and august, that means we have an election in november, i want to make sure they exercise their right through absentee ballot. We have push and pull on that. David you need something through the General Assembly to get that done and when will it get connected . Enacted . Ill it get gov. Lamont i have Emergency Powers so i can do it for august, but in the november election i would need the legislature to step up and say if you have some health risk you do not have to wait a long line in a voting booth, we will do absentee balloting, no questions asked. Says the same. Dc we have a question from a viewer i want to ask you. The viewers that house the Financial System doing it connecticut how is the Financial System doing in connecticut . Gov. Lamont we need some work. Politicians make big promises and do not put money into the pension for 40 years. That said we are pushing through reforms. We have a number of people retiring in a year or so and we are managing. The thing im trying to do is. Old down the increase in cost david is a great pleasure to talk with you. Thank you for your time. Ned lamont, governor of connecticut. This is bloomberg. David this is balance of power on Bloomberg Television and radio. Time for first word news. Go to mark crumpton. Mark a grim milestone in the United States. According to data compiled by Johns Hopkins university, and the number of confirmed coronavirus cases in the United States has top 3 million. More than 131,000 americans have died. The u. S. Accounts for more than a quarter of all covid19 cases globally. President trump is speaking out against the cdc. Saystweet, the president he disagrees with the centers for Disease Control and prevention very tough and expensive guidelines for opening schools. Askingd the cdc is schools to do very impractical things. He is threatening to cut funding to schools if they do not reopen before the november election. Brazils president says he is confident he will quickly recover from the coronavirus thanks to treatment with hydroxychloroquine. President bolsonaro says he tested positive for the virus on tuesday. He has been downplaying the severity of the illness while deaths in brazil sword. He said today his fever had subsided, something he attributed to hydroxychloroquine. The drug has not been proven effective against covid19. Global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. I am mark crumpton. Is bloomberg. David this is balance of power on Bloomberg Television and radio. Time for a market check. We go to scarlet fu. Tack is on a tear today. Scarlet you look at the nasdaq 100 and the nasdaq composite, they are at session highs. The s p 500 has pulled back as well. That is the bright spot in markets across different asset classes. When you look at the different asset classes, it feels like there is a note of caution in the air. The dollar is lower versus g10 currencies. We see gold prices above 1800 an ounce. A showcase there is a lot of demand for safe haven. I want to focus on technology. The make a cap tech names have been driving the advances and we are seeing names like amazon, like apple, like facebook all at record highs. That has been the trend for a a while. David the interesting thing to me is there was a time not long ago where the tech names went up or down based on relations with china. Those have gone by the way. Now it feels like lets bet on tack because even if the coronavirus comes back we will still need tech. Scarlet tack has become a safe haven because of their catchword in the undiminished demand for their product and services that has held up so well during the pandemic and during the lockdown. 24n i look at the s p 500s index groups there are three tech subsectors above the best performers. You have software, hardware, and semiconductors. I bring this up because nvidia is now the biggest you have is now the biggest u. S. Chipmaker. It has soared past intel. There is no specific catalyst today but we know there has been growing demand for intels graphics chips in data center and ai, whereas intel has been more reliant on pc as its main source of business. Now with nvidias recent advanced, it is the third biggest chipmaker and the world after tsmc of taiwan and samsung of korea. David i did not know that about nvidia. That is fascinating. Scarlet fu reporting on the market. Coming up, we will talk to rufus yerxa about the usmca, trade with china, and a need for a new head of the wto, somewhere roof is used to work. Can they get it done by august . That is coming up on balance of power on Bloomberg Television and radio. David this is balance of power on Bloomberg Television and radio. Im david westin. The president of mexico is arriving at the white house today is the usmca goes into effect. We welcome now rufus yerxa, president of the National Foreign trade council. He served as the Deputy Director general of the world trade organization. It is great to have you. Lets talk about the usmca, will it make much of a real difference as a practical matter . Rufus it is good to be with you. As a practical matter, it is important because it reduces uncertainty about whether this agreement, this north American Trading relationship, which has been in existence for 25 years, will change dramatically or continue. There are some marginal improvements in it, but the most important aspect is it increases at the degree of certainty that we will keep an open north american economy. There is less risk now of a president or congress turning its back on this agreement, although there are still threats, as you know even today on aluminum from the Trump Administration to impose new restrictions, but it does create certainty and we are hopeful it settles the situation. It will not make a dramatic difference in imports or exports, immediately, but over time it will strengthen trade. David its it really going to create much more certainty, because as you said that Trump Administration has continued to threaten tariffs on aluminum, and at the same time you have the minority leader of the senate saying this does not take care of the agricultural problems either. President trump has shown he is willing to impose tariffs, no matter what the agreement say. Rufus that is the biggest concern, how much will the Trump Administration, you know, abide by an agreement they just negotiated. The president hasnt shown a pension in the past for imposing has shown a penchant in the past for imposing rejections on deals he is making. That becomes a question of trust become partners, but i think there are limits to how much you can do that sort of thing if you want to tout this agreement as something good and new, which the Trump Administration wants to do, they want the political benefits. So they cannot really turn their back on the agreement. David talk about your old wto. Ization, the you also worked as a trade representative. But you also worked 11 years at the wto. It is about to be leaderless, with the current leader stepping down. There was contention even before he announced stepping down. What is the prospects of getting somebody into leadership in time . Rufus it will be a challenge. A number of candidates have come forward. I think today is the last day for candidates announcing. I see that the u. K. Is putting their former trade secretary liam fox up, with three candidates from africa, a korean and others around the world. It will be a challenge. Inhink that the process Roberto Azevedo had stayed, the process wouldve taken 11 months. But now it is an abbreviated process to september. You have to carry consultations and narrow it down to two finalists, then get a consensus on the final candidate. But the bigger challenges the politics, how to get the u. S. , china, the European Union and other big players not to disagree with each others choices. And in better has put strict conditions down, saying they type of candidate he will accept with a fundamental commitment to china changing chinas practices, it will be hard for the chinese to accept his candidate, and vice versa. So i think may be looking to see if they want to delay this past of the u. S. Election. David that is the question, particularly for china dont they want to slow walk this . There could be a different president. Although it is not clear that whoever occupies at the white house will go soft on china. Guy i do not think it is a question on whether they will go soft on china. Rufus i think that the europeans, as you know have had points of friction with donald trump, they might say lets wait to see how the election turns out. If donald trump gets reelected, i think they will think, we have to make peace with him and reaching agreement on somebody. But if joe biden is elected, why would we want to be saddled with someone that we had to make a compromise with, maybe we will get a better deal. I do not know what they are thinking, but this could be part of their calculation. And we will see. There have been periods in the past where there was not a sitting director general. There is a process for enacting one. That might be the case now. The wto is not just the general director, the director general is actually not that strong of a role in terms of powers. There is a chairman of the council appointed by the members, there are chairmens of the various committees. So it will keep operating without a sitting director general. David that raises the question in my mind, is the wto, no matter who you get, are they up to it . When you come down to it, the two largest economies in the world have a different view on how to run their economies, so is there any wto that can take on that issue . Rufus i have said before that the wto system is essentially a contractual relationship among Major Trading countries. And if the partners in that contract are not agreeing with each other about things, there is little a director general can a to alter the realities of major bridge between the partners. So the main role of the director general is to try to figure out how to bring them together and create grounds for compromise between them. But that depends on the goodwill and the willingness of those countries. My sense of the u. S. China relationship is that at this point there is little chance of of them crafting a path Forward Together in the wto, it is more likely they will have a number of disputes. So we are looking to the future over the next several years, can we get back to doing business with each other that will be the challenge. David as always, a treat to have you. Thank you rufus yerxa, president of the National Foreign trade council. Here is first word news. Mark new york city still plans to open Public Schools in september. The mayor said today he anticipates a blended learning program. Students would be in class for two or three days a week, and families will have the option to choose Remote Learning over in school programming. The german chancellor Angela Merkel calling on the European Union to pull together to tackle the challenges estimated from the coronavirus pandemic and climate change. She took over the sixmonth rotating eu presidency this month. The eu Member States are grappling with a proposed 845 billion recovery fund. It has been met with resistance from a handful of Member States concerned about the cost. Candidates from Great Britain and saudi arabia have entered the contest to become the next director general of the wto, as david was just discussing. They join six others aspiring to lead the trade body that has faced pressure from the Trump Administration. Chief made arent surprise announcement in may that he would be leaving the job one year early. At the u. N. Supreme court, two rulings involving religion. Justices upheld a Trump Administration rle that lets employers use religious grounds to opt out of offering free Birth Control in their health plans. The court also gave a victory to religious schools, justices saying that the constitution gives faithbased groups the power to hire and fire employees who carry out important religious functions. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im mark crumpton. This is bloomberg. David thanks. With the, we will talk former South Carolina senator jim demint on his new book. That is next. This is balance of power. David this is balance of power on Bloomberg Television and radio. Im david westin. Jim demint served as a senator from South Carolina and went on to be ceo of the conservative institute. He is author is also the author of a new book, saving america from socialism how to stop progressive attacks on freedom. It is great to have you. I plan to start with the title, because words make a difference. Socialism is one thing. I think of a particular definition, controlling the means of production by the state. Social welfare is different. Do you draw a distinction between those things . Mr. Demint i do. I i think that social work welfare includes the safety nets for folks for various reasons, who could fall through the cracks. But what we have seen through history is the free market system ahs done more to pull people out of poverty than any social welfare system we have ever created. So, david, i think the dynamic we need to consider is if you are killing capitalism in order to provide more social welfare, those things work in opposite ends. So, um, it is not one or the other. Thatf you want prosperity can take care of everyone, including the poor, then we need to make sure that our freemarket economic systems work. David in reading your book, one of the important points i took away is it is not just a matter of economics, it goes back to personal freedom. Lets apply urinalysis to here and now, where we have an unusual situation, the pandemic leading to the situation leading to the shutting down of the economy. Do you take issue with some actions taken by the fed or congress to support the economy right now, at least for the time being . Mr. Demint my issue is shutting down in the first place. Dataed worstcase scenario to shut down the largest economy in the world. It was supposed to be for only two weeks, to level the curve, which turned into three months and we still have a number of states trying to stay closed. The more you listen, the more you realize that healthy working age americans are at little risk from this. We have good data now, so my issue is we cannot lock down the economy again. We can argue about what was done right or wrong in the first place, but to create worstcase scenarios as an excuse to shut down our government was a big problem. And i think what we have seen here is a glimpse of what happens when people who are in power use crisis as an excuse to to control of our lives. If you sit down and think about we for the last few months have had governors and mayors telling us whether we can open our business, which businesses are essential, who we can meet with, whether we can go to church, whether the schools can open. This is a glimpse of what it is like when we give the government too much power. I think what we have seen is when folks, particularly those on the left who have this excuse to take power, are more than willing to do it. Dovid certainly all of us not want an overburdening government, which i interpret as being socialism, but when you have a virus that crosses between people and goes around, dont you have to have rules . What you do in exercising your liberties might affect my wellbeing. Mr. Demint exactly. It is something that we have to weigh, but there is little question now that we did overreact. We did not know all the data in the beginning. But we have the data now, particularly about kids, kids in college, who have little risk of getting it or being hospitalized. And certainly a very little risk of death. And we are not responding properly on an economic perspective. What we are not doing is balancing the risk. There could very well be, with all the spending and printing of economic failure point that we are not anticipating. And i do not think we can completely ignore the downside economy indown an putting of people out of work. And we have had thousands, if not millions of Small Businesses that have closed probably permanently. And so the damage has got to be weighed. We know the risk is primarily in those folks over 80, who have serious other health conditions. Most of those who have died have been in nursing care. We need to take care of those, but we do not need to apply the same, you know, restrictions on at the cost of the elderly. Young people do visit older folks, but nobody yet in the medical community has said come if we stay home we will not get it. They said from the beginning that you are likely to get it, if you can get it, but we are trying to delay it. We have plenty of Hospital Capacity now, we know how to treat it better. The death rate is plummeting, although you do not hear about that. You only hear about infection rates. I think there has been a lot of alarmists here and i am afraid most of it is directed at the election. David fascinating. It is a very provocative book. I am delighted to say that he will be staying with us to talk about it some more and apply it to different situations we have now in the u. S. Coming up, the editorinchief met weekly for his take on the trump economy. That is coming up on balance of power. Trump came tont office promising a robust economy, but than the pandemic came along, making it almost impossible for the economy to get back on its feet by this november, requiring him to have a second term to deliver what you promised thi. S is balance. Promised now we have a report card on why we are in trouble. It is great to have the with us, matt. As i took it from your piece come if we have a bad economy the president has some responsibility for that. T he does. Weause from the moment that knew that this was a global pandemic, which you could say was the beginning of the year, the Trump Administration, led by the president himself, dismissed it out of hand and is that it would go away. In any waydvocate any of the prerequisites for controlling or containing the coronavirus, such as masks, for example, Contact Tracing, social distancing. You know, all these things are very important to making sure that we contain the virus. Instead what happened, he left it up to the states. Some states did everything you should do, like new york, for example, and massachusetts. But other states didnt. This created havoc, confusion, and now we are left to six months into the year, starting the second half of the year with uncertainty and a resurgence of the virus. And we probably could have, like other countries, contained it by april had we followed a regime that was coordinated and led from the top, which is the federal government. Acd o, excepting cepting that analysis go ahead. Matt so we have massive unemployment that dwarfs unemployment anywhere else in the world and there is no likelihood we will recover to anything close to what we had know, january. It just as impossible to get there. Get back toyears to the low level of unemployment that we had. David taking everything that you laid out, do you find some deep irony here, because the present was motivated in part to encourage people to come back in order to save the economy, because i think he may have been worried about the economy suffering and maybe that will hurt him in his reelection . Matt i suppose there is an irony, but in the middle of that is his massive defiance of science. Scientists tell us that we have to figure out a way to control the virus first, before we canto the point where make the economy as robust as we would like it to be. They are inextricably linked. Those are the doctors, those who know the most about the subject, talking to us and then donald trump and his enablers doing just the opposite. They ignore the signs and the scientists. David one of the things that President Trump says is, look, the economy was in good shape before this, it is the pandemic. Nobody could anticipate the pandemic, so it is not my fault. That theave a point, economy was in solid condition going into this . Matt hong kong was going through all kinds of political convulsions and hong kong has a lot more experience dealing with pandemics, going all the way back to sars at the beginning of the century, his century. And there economy, for all the political turmoil that it has been put through, has performed so much better to the point where the virus is insignificant. Why use hong kong . It is a densely populated part of the world. And the people there know how to deal with this. They all know that masks are essential. That is different from the behavior of the United States. If you go to germany, Angela Merkel really worked with all of governments in germany and got a coordinated response. Shutance, president macron down the economy and it is doing better now recovering than the u. S. Is doing, because he also had a systemic or systematic approach to dealing with the crisis. The u. S. Is the only place where there was not a systematic approach, it was chaos from the start and unfortunately it is still chaotic today. David we have four months until the election, is it too late for the president to make a difference in the economy, given the fact that there is some momentum to this disease . Matt you have far more astute political analysts talking to you every day on your show than yours truly. Having said that, i look at the polls and i do not think it is a coincidence that since the coronavirus became so prevalent in the u. S. That trumps popularity and Approval Rating has plummeted. Seemven parts of his base to have peeled off to the extent that his numbers are atrocious right now, you know, six months from the election. Does that have a lot to do with the pandemic . I think it does. There is no question people are reacting and responding to the lack of leadership dealing with this crisis. David thank you for being with us. That was matt winkler. Coming up on the radio, we will talk with the president of the American Petroleum institute. That is continuing on bloomberg. It is 1 00 p. M. In new york, six a copy him in london, im vonnie quinn. Welcome to bloomberg markets. The u. K. Lays out its recovery plan, and nearly 30 a billiondollar blueprint named at saving jobs. I will be speaking with the chief secretary to the treasury in just two minutes. Vonnie in the u. S. , the president is set to meet this afternoon with his mexican counterpart. They are said to discuss usmca trade and investment. We will get the view from former u. S. T. R. , carla hills. With onel speak businesswomen balancing social activism and a recession. Lets take a look at the markets. As you can see, very much a massive disparity want to come the nasdaq and s p, although both are higher. The s p off of the highs of the day, up 4 10 of 1