He tweeted let righteousness flow like an ever flowing stream. Congressman john conyers is the michigan democrat will decide within days whether he will resign a longer for congressman john conyers says the michigan democrat will decide within days whether he will resign. H isdded that conyers healt not the best right now. Party leaders, including nancy pelosi, have called on 80yearold conyers to step down. The eu says that british Prime Minister theresa may has until monday to present its final offer so we can be assessed ahead of a summit in two weeks. Tusk spoke alongside the irish Prime Minister. The irish Prime Minister says that they must guarantee there will be no northern border between ireland and the irish republic after britain exits the bloc. Day,l news 24 hours a powered by over 120 journalists and analysts. I am Mark Crumpton. This is bloomberg news. Julie live from new york, i am julie hyman in for julia chatterley. Scarlet i am scarlet fu. Joe and in joe weisenthal. Julie john mack in washington ways on investors. Joe but the question is whatd you miss . Nationalousted security adviser Michael Flynn pleading guilty to lying to the fbi. He admitted to communicating with the Russian Ambassador, directed to buy a very senior Senior Member of the Trump Transition Team. That number was Jared Kushner according to sources. In allublican tax plan would cost over 3 billion over 10 years. Lets get a check on where markets stand. Abigail doolittle no, i am doing it abigail is here with the latest. Abigail we are having an interesting day. The dow, s p, and the nasdaq all sharply lower. Lower i should say. They had been sharply lower. The s p in the nasdaq down. 5 . En. 3 and the dow at a low, shutting to do points. The s p 500, a 45point range. The largest drop since brexit, uncertainty around what those Michael Flynn headlines could mean for President Trump. And of course we also have tax reform and played. , the small 2000 down cap down more than 2. 5 . , it is the worst since may. There had been a weekly gain at the lows, but now the dow and s p 500 the index the nasdaq is the odd index out. This is an intraday chart of the dell, to really see what that roller coaster ride looks like. Before 11 00, a small gain for the dow, and as those headlines at about Michael Flynn cooperating with the russia probe came out, and that he may be testifying against president down 1. 4 saw that dive percent at the lows and then coming off the lows, trying to determine what does that mean, the uncertainty. Now they are moderating the losses in a pretty significant way. However, when we look at the world markets, we are going to see an interesting picture. Tos goes all the way back 2008. What we are looking at here are themonthly declines in red, monthly gains in green. We see the monthly decline after monthly decline, and then in the bull market we have mainly monthly gains. This year up until this day, the first day of december, we have months of gains, but december off to a shaky start. Everyone wondering what could stop the bull market we have been in the middle of, and brexit it will be this Political Uncertainty that has certainly started today. Finally, we have a selloff or, excuse me, a rally, confirming the selloff that we have seen for stocks. The 10year off for basis points. We are showing that in green. Bonds are rallying. We have the yen rallying against the dollar, gold up half a percent and the vix. The vix at its height had been at 35 . There is about 4 . At definitely uncertainty on the part of investors going into the weekend as more news and headlines is made on everything. Know what isver going to happen next. Thank you, abigail doolittle. Trump Administration Official putting tilting after lyingading guilty after to fbi agents. This is not just any senior trump Administration Official. This is Michael Flynn. We are joined now by megan , andy and Jeffrey Wright he is joining us from washington. Jeffrey, lets start with you. This is not just any this is not papadopoulos. This is not manafort. This is the highest Administration Official buspar. What is the significance of all of this . I think it is extremely significant for trump, especially that flynn is connected to obstruction of justice and the other, the potential for collusion with russia during the campaign, and a beasley, the involvement of kushner makes a quite personal for trump given his Family Connection to kushner. I think is the worst day yet in the russia probe for trump. Joe megan, would you agree . Yes, it is dialed into a very senior figure in the administration. Even more significantly, there is an indication that a plea deal has been breached in terms of ongoing cooperation, in terms of what Michael Flynn might say about conns direct involvement, what Jared Kushner might say, what he was instructed to do, what contacts he was instructed to carry out. That all goes into an obstruction case, a lying case. More dominoes are likely to come on this. A truly extraordinary friday. Scarlet absolutely. The thinking is Michael Flynn will testify against the president , which will reveal something that will incur a lot of damage. But we know that the president was loyal to flynn up into the end with that stay strong message. What is the likelihood that Michael Flynn might throw Jared Kushner or Jeff Sessions under the bus to save the president . Hmm. This point, the deal he has reached with prosecutors tellres him to them everything he knows. I do not think that flynn has any discretion. Faces to be honest or he the possibility of putting himself and more hot water. The fact that he has reached an agreement with prosecutors indicates he will be honest about what he knows, regardless of who it implicates. Julie megan, its interesting. We have been on for couple hours waiting for reaction from the white house we just got one. Julie a tweet from the president. It has nothing to do with this. It is about Rex Tillerson and whether he is leaving. Administration official saying that tillerson is meeting with Sergey Lavrov next week, the Russian Foreign minister. Does that tell us anything about how seriously they are taking these allegations . Is it just a coincidence . We have two discrete statements. One is the statement from the present the lawyer, ty cobb, saying theres nothing in these single charges against Michael Flynn that appliques the present. They were very careful to call him a former obama Administration Official. Say thatare going to he was a liar and he continues to be a liar now. The has been speculation in the media, including ourselves, that Rex Tillerson, the incredibly beleaguered secretary of state, who has vast differences with the president , is on his way out as soon as christmas. The president repudiating that today. There is speculation this late change of plans is actually because tom cotton and mike pompeo have gotten cold feet in the wake of todays allegations. Joe way to preserve your job if you are Rex Tillerson. Jeffrey, for a while there has been speculation that trump may just fire mueller. At every turn, is he going to fire mueller . It never seems to happen. I guess the question here, is this the catalyst were you can see trump firing mueller, or is trump boxed into the fact where he cannot fire mueller because it would look to ridiculous t oo too . I think there are two sets of concerns. He would have to fire people at the Justice Department given that sessions has already recused himself. He would have to fire people until he found one willing to fire mueller on his behalf. The other is the political problem. The issue he is facing is the perception he obstructed justice firing james comey. This would make that certain because he would have done it again for a second time. I think he has no good options here. If he waits and let the investigation play out, it seems likely to come for his family, if not for him. If he takes action and tries to fire mueller, he makes the situation worse. Its a very difficult position. Hes in a horrible position on both counts, as you said, but this is happening at the time the Senate Tax Bill is playing out, something that you would expect the president to tweet about. It looks like they have enough votes. But such major changes going through this bill at the 11th hour. I was stunned when i saw the alternative minimum tax come back, major changes, medical expense deductions you know, this is the biggest change to tax policy in a generation and still major, major changes. He will be 20 about the tax code later on. Joe not even the biggest story. Scarlet minute by minute. Thelaire mccaskill, democrat, saying she got the latest changes from the lobbyists, not her the public and colleagues. Whatd you miss . A lot. [laughter] scarlet id with that, megan coming thank you both up, Senate Majority leader Mitch Mcconnell says republicans do have enough votes to pass the tax bill. So what remains to be changed . A lot apparently. This is bloomberg. Scarlet whatd you miss . So the Majority Leader Mitch Mcconnell says he has the votes to pass the tax overall with jeff flake voting yes. Senator Susan Collins has not announced which way she will go p ricci seems to be on board. She tweeted that it will include her amendment to allow taxpayers to 10,000 for state and local property taxes. Never say never because this is far from over, isnt it . A lot more can be crammed in at the last minute. Reporter thats right. They have the votes, but they do not have the bill. We have not seen legislative text. They have not finalized it. They are still crafting it. They are still working to make sure the numbers add up and the deficit does not blow beyond 1. 5 trillion in a decade. They have not even released that yet. Senators hadring different issues. Concerned about the passthrough, others about state and local stuff, like collins, and some who care about the deficit, and originally they wanted some kind of trigger to raise taxes, but the parliamentarian in the senate next nixed that. Does it seem like they are getting anything through . Reporter it is hard to overestimate how badly the deficit hawks have been shafted. Concessionslight with a phaseout on the business expenses. That makes Congress Less likely to extend it. The only person Still Holding out on deficit concerns is bob corker. He has said repeatedly he will not vote for the this bill if it adds a penny to the visit, thereby 120 trillion pennies added to the deficit through this bill. It will be a hard to see how he squares that circle. But other senators like Susan Collins have gotten everything that she wants. Ron johnson has gotten the passthrough with tax rates up to 23 . You know, so people are getting various concessions and that seems to be enough right now. Even if collins and corker into being no. Is people onre capitol hill do not have copies of the bill, how are american supposed to know how this is going to affect them . One would imagine the American People would like to know if their taxes are going up or down or what is happening, and it does not seem like really have an idea this point, do we . Yes, this is precisely what democrats are coming about. Senator Claire Mccaskill of missouri got a list of amendments that republicans are planning to make to the bill at the last minute, before they pass it, from a lobbying shot on k street. P on k street. O they are blasting the process. She called that disgusting. Senator wyden demanded to know when we would see the final text. Senator mcconnell, the republican leader, said there would be plenty of time to read it to read we do not know what that means. It is getting late in the day and they hope to wrap this up, if not the ring today, then in the late hours of the night. This will be a ridiculous question because you keep reiterating there is no bill yet, but from the outlines, from the concessions we have seen, the passthroughs, some of the concessions, we have seen what senator collins tweeted about thats in the bill doesnt seem that there is a big difference between the senates version and the house version . Reporter i think the is onerough provision significant gulf. The house version imposes a 25 rate with some exceptions in the Senate Version goes a different way. There are other differences, too. Thesenate bill is expanding medical deductions that the house eliminates. There are things they will have to get ironed out in a Conference Committee while keeping house and Senate Republicans on the same page. Of how give us context frenetic and frantic negotiations are going. How does it compare to other legislation that has been pushed through in the senate . I wonder when this extra level of dealmaking in negotiating suggests that passage is more likely, because you would not go through all of these machinations unless it was going to lead to something . Reporter the dealmaking in negotiating is normal. That happens all the time on every piece of legislation. Theres nothing unusual in the slightest about that. What is unusual is how quickly they are trying to pass this group. They thought the initial we saw the initial version of the senate will 10 days ago and they want to pass it now. The affects 100 percent of United States economy. This could affect every taxpayer in some way, shape, or form. That is unusually fast. The house took a between 10 at 14 days between releasing its bill and passing it. They are trying to pass this bill before lobbyists and Interest Groups can really mobilize to take it down. U. S. Economy. The thats a very good way of describing how important this bill could be. Thank you so much. Up next, our stock of the hour go throughs shares the worst day of the year. The political effect on this stock. From new york, this is bloomberg. Scarlet it is time for the Bloomberg Business flash. The opioid addiction drug approved by the fda available next year, it eases withdrawal symptoms and addict to parents patients. I am addicted patients. Becausehave pushed back the drug itself is an opioid. Former pharmant shkreli to martin forfeit a rare wutang album. And that is your Bloomberg Business flash. The time no fear stock of hour, selling off right about the time the Michael Flynn headlines were coming through where many big names north rock off 3 , the of come back a bit, now down to. 4 . Now we have more with what this has to do with President Trump. Is interesting. They started to sell off. Other Defense Company started to sell off about the time of the Michael Flynn headlines, especially the headlines that Michael Flynn might be willing to testify against President Trump. The question whether President Trump might be impeached. There is the sense that President Trump is a Strong Defense spending person, but i am trying to set up the surprise i have given up a little bit you can see all of these defense stocks out of the election up in a huge way. Northrop grumman up the least. Now the surprise here i was speaking with george ferguson, Bloomberg Intelligence analysts, and he says it does not have to do with defense. It has to do with tax reform. Now that it looks like salt will be added back in the mortgage, property tax deduction, that could widen deficits, so in the future if something will be caught, it could be defense. He thinks that President Trump if he is out of office, if another republican comes into play, that republican will probably be a stronger defense commanderinchief and probably would have budgets ratchet up. There is a National Defense authorization act back in september of 700 billion which is more than the Trump Administration had actually requested. The defense stocks selloff today may have more to do with tax reform but certainly those headlines caused it. To be a lot of ambiguity about the future of defense spending. Trump is seen as a hawk, but maybe some people want to spend more . Its hard to say. Back in the day, he was actually a democrat. All right, abigail doolittle, thank you so much. The market closes next. Lets look at the major indexes. The dow down 37 points. At one point it was off by 350 points. This is bloomberg. Is this a phone . Or a little internet machine . [ phone rings ] it makes you wonder. Shouldnt we get our phones and internet from the same company . Thats