Committee sent letters to the fbi and the white house. Howill wants to know he was allowed to work at a white house despite allegations. Charged with harboring islamic extremists in november of 2015. Denied knowing the identity of the two men. They suspected ringleader of the paris attacks. Kuwait says a total of 30 billion in pledges have been made at a summit rebuilding iraq after the Islamic State war. Todayss announcement at a conference falls short of the more than 88 billion that iraq asked for but much higher than amount for this offense participants originally pledged. 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. Julia live, i am julia chatterley. Scarlet i am scarlet fu. Joe i am joe weisenthal. Stocks rallying. The s p in the green for a full day. The 10 year yield is pushing above 2. 9 . Joe the question is what did you miss . Jump in an unexpected inflation in january shows the rate hike schedule act in the forefront. Here are over year because of closing costs. Meanwhile, data releases also keptng coldweather shoppers away in january but the retail sales declining. 3 , missing estimates. On siliconotlight valley. President and coceo of Goldman Sachs joins us exclusively from the Goldman SachsTechnology Conference in san francisco. Julia one of the mostwatched of latecipated delivered a surprise for investors. 0. 3 month over month, 1. 8 yearoveryear, topping estimates. 10 year yield rising to a fouryear high after the report at 2. 91 , to be specific. Joining us now is professor at the university of oregon. Great to have you with us. Been saying all along, one number does not make a trend at this stage but it helps to explain some of the conundrum last year about why we were seeing a better or more. Ignificant pickup exactly. Why inflation was so low, it seems to be resolving itself late last year. This number in particular being a good sign that maybe the fed Inflation Forecasts will work out as we get further into the year. Maybe there hasnt been a huge change and may be market volatility is market volatility but big picture, has the fact that the inflation forecast may be starting to come around to how the fed expected to evolve, does that change the macro backdrop in the sense that it is not worried about disinflation anymore . Remember that the fed hadnt is a pitted that inflation is going to be rising this year. Big part of how we think about inflation numbers. Forecast,ll meet its that it didnt think it would meet the hike expectations this year. The three hike expectation. I think we are coming along to the feds view of the world. I think the fed will resist wanting to move in that direction too quickly. The big thing to keep in mind was last year, the fed did not react to the numbers we saw. They stuck to the basic forecast. Arguably, it could be said they should have stopped hiking in december, not hike in december, and be prepared more quickly this year. They chose to keep hiking despite low inflation low inflation numbers. I expect they will look at the a littlend say this is high. Closing prices, apparel drove the increase. Is that a big chunk . 3 is not a huge chunk. The component was up. They one big chunk in apparel prices. The red flag was how broadbased the gains were. Is this really a reflection only wanting to increase those a year. That is worth considering. Talk talk about the bond market. It can you 10year curve in particular. What d. C. Going on here in terms of the evolution of repricing that we are seeing in the bond market . A couple of things are going on, one is that we clearly have to have more expectation a fed rate hikes. If we are thinking maybe they will not get a full three and maybe they thought the risk would be less, it is clearly the opposite and maybe more. We also have to think that at this pace of growth in the fed forecast, we will see more in 2019. That is really an element here. If you have it still going in this year, clearly the rise of inflation suggests you should take out any remaining deflation at the forecast, if other factors are the real Interest Rate, the neutral Interest Rate could be rising. That was always part of the fed forecast as well, that as we move further from the financial crisis, we would see a healing and onecial markets response to that would be a rise in the neutral rate. There are a lot of reasons to think yes, rates should be muchd higher and how higher is still the big mystery. Joe the other huge question hanging over everything now is the surprise amount of fiscal stimulus we will get from the big budget deal and the tax cuts. From a macro perspective, do you think it can raise real growth or will this just result in inflation . How do you see it changing numbers . A bigare running experiment. Fiscalsuch a large stimulus in this business cycle, we are really going to be testing, i think, the extent and Spare Capacity left in the u. S. Economy. Now, i think you have to say the nearterm outlook should be for a boost of growth, higher in 2019 than expected. The possibility is the Federal Reserve will try to raise Interest Rates next year and is it that. I am not sure we will change it dramatically a growth side but it is more how we do the Interest Rates that im really watching here. Something could occur over the next two years that not many people would have expected here it may be we get Interest Rates back up to an environment where the fed is not think about the zero bound anymore. Would be nice. Professor at the university of oregon joining us. Thank you. Coming up, co. Coo david joins us from the Goldman Sachs tech office in san francisco. Is bloomberg. This is bloomberg. Scarlet we have breaking news for the president of south africa says he has been says hed to resign and will continue to serve the party as president of the bidding of the National Conference party. He earlier said it was unfair him to party to push resign because they decided to replace him and said there was nothing that was wrong. A huge day today, 2. 4 we should bear in mind, if you look at the performance we since november, you can see the significant rally we are seeing since the back end of in ther, a 20 rally South African run. A lot of good news. If you want to listen to the speech, you can go to live go on the bloomberg. He says he is not above reproach. Wall street and Silicon Valley emerging at the conference in san francisco. The dealmaking summit includes presentations, Panel Discussions by some biggest names in finance and tech. Emily chang is standing by at the event with an exclusive conversation with a special guest. Emily thank you. Im here with david solve david. This is obviously a big Technology Conference. Jack dorsey spoke yesterday. Cooper is speaking later today. Why do you do this conference . Is it about getting the lead on the next video . The conference is actually sponsored by the Research Area of the firm. The goal has always been to convene out here in san to bring the companies in the Technology Space and give them an opportunity to connect with of thousands investors that come throughout the country. You hear about the growth plans and it has been a hugely successful conference. Ot of very introduction and really to bring them best together. Will we see more m a . Wayhe year has set up in a that i think it will be a constructive vote for m a activity and ipo activity. Picks upes toward the end of 2017. We have a healthy backlog. We have the environment for a variety of reasons here and why 2018 should set up to be an active year for strategic m a. What do you think we will distinguish from last year . Speaking, you look at last year and you had us a sense of the election. Regardless of your politics, there was a general point of view that the shift have the potential to be progrowth with the economy, and therefore progrowth with asset prices and obviously instructive for m a and equity market activity, very quickly we got to a mode of discussion about whether or not tax reform so people sat back and waited to see how the policy discussion would play out and that slowed activity down particularly m a activity but then we reached a point where the process it wasnt clear that process would come to a conclusion. Taxdialogue started but now reform is done, we are at a moment in time with strong, correlated Global Growth across economies. Ity strong and it feels like is it celebrating. There is a rollback in so 2018 is set up to a a lot of those discussions. You said we see a pivot and growth expectations p what do you mean . There has been a lot of talk about whether or not growth would accelerate, whether 2 was the new normal, whether or not we would see 3 growth again in the u. S. Economy, would we ever see inflation, is everything going on with technology so reached ary, but we point with a couple of quarters of growth that nearly 3 , we are starting to see signs of wage growth, the result of an economy , and the result is people are inflation coming into thousand 18. Are we going to see rates be higher and the consensus is yes, we are going to see that Monetary Policy that has been so prevalent in markets for a long time as we came out of the financial crisis. We are at a point where people are saying that is starting to occur and that is different from where we were last year. The focus on primary valuation, are they healthy right now . I think private market valuations have heightened it it in the course of the last 12 to 24 months. Capital has been a little tighter for private market funding. I would not say valuations are bubbly but there is no question that in an environment to last where growth was sluggish, investors are looking for a place where there was growth and Silicon Valley technology was a place with a lot of growth. Tech, itat largecap is remarkable what is going on. You look at amazon throwing 30 on 180 billion of revenues. You look at facebook, 40 billion of revenue and it is growing 40 . These are Big Companies with a large market cap and they are growing very quickly. That obviously creates interest around other businesses. By tightening, are you saying they are plateauing or going down . I wouldnt say going down. As long as growth continues, i think there will be plenty of capital. Ambulance of the private Capital Raising has tightened a bit. Better for trading, we see a lot of volatility. Do you expect it to keep up . How do you take advantage of it . There is no question the volatility is a result of what we were talk about. People are seeing signs of wages if they increase your think there is a chance of inflation in the economy and you see the strong Growth Numbers come out, that will bring it back to a normal environment. No question it spiked a little but remember it is coming off of extraordinary lows. It would be healthy for volatility to be more normalized in the top in the context of a larger time. The ultra low volatility of environment we have been with in the last couple of years. Any concern that maybe some of your employees have lost mojo . I do not. It was a tough environment. If youre in the market business, what our business is, almost 100 market and mediation, if youre into that is this, it was not a great environment for the business. There were places where we may what we formed versus would like to hold ourselves accountable to hear we have got the best team on the street and we are very focused on client market shares and the opportunity for us to row market shares, off of a very high base, i think environments for the business will be better and tough but it is part of a portfolio of businesses at Goldman Sachs which are doing very well and this environment overall. I know you cannot speak to specifics what do you think that size of a deal will be an outlier or would be . It is still a very large deal by any stretch. An interesting thing, bringing us back to the Technology Space, is when you look at these companies with 5 billion plus market caps, they really have not participated. They have pretty much grown organically and they are. Of the bigble one companies steps in and wants to enter a space and does something significant . That is possible but by and large, 100 billion will very bigto be a transaction. Speaking about cryptocurrency, a lot of curiosity about it. How can goldman help clients who are interested . The space andhing we are interested and one clients say they want to learn about this, we are learning. Clearingment, we are for some clients. That activity is small. No immediate plans to trade the currencies. There is at lot of hype and activity for this. We are watching the space cautiously. We think blockchains are very interesting technology. Cryptocurrency has become real value, it is something we will watch carefully. You have been vocal about hiring and promoting women. What specifically are you doing to make that happen . Importantty is hugely to us at Goldman Sachs and our business. Us to be successful with the clients and sell the Human Capital organization, we have to have that and 20 years, we have worked at that in our business. We have been focused on hiring a lot of people every year, particularly out of school young people, focused on trying to make sure the diversity of the group of people we hire every year out of school matches the diversity of the world that we are hiring from, whether it is women or black americans, or hispanic americans. We are looking for opportunities to into continue to increase the population. We have made Real Progress p are we brought the diversity of women in the summer class that will come in this year up from something below the 40s to the higher 40s by focusing on entry point on the pipeline. If you do that and your entry point at the pipeline where you are hiring people creates a more , itrse population over time is premuch the same and you should do better having a broader pool in the organization. It interesting that the numbers are closer to 5050. Still work to do when it comes to getting leadership women but in the valley, they make up for 7 of investors. How is it possible wall street is doing a better job than Silicon Valley . You have to put some of this in perspective. You are talking broadly about a broad universe. A lot of the companies we have , technology about companies, talk about google. It is not 20 years old yet. Facebook is 15 years old. Than 20s a little more years old. These are young companies. In the context of getting focused on this, they have only gotten focused on it recently. Goldman sachs got focused on this in the early mid 1990s p we have a lot of work to do but we have made a lot of progress because we have had that focus and leadership from the top really focused on this. It is a real strategic priority for the organization of my guess is we will make progress but it takes time. Scarlet, i will send it back to you. Scarlet thank you. We want them recap the breaking the Cross Bloomberg earlier. This is the president of south africa speaking right now. He has said that he has been compelled to resign by the presumably the vote of noconfidence or the one that is scheduled. He talked about how he will continue to serve the party, the ruling party of south africa. If you look at the South African rand, it is stronger right now. But you can see the move is slightly higher in the line indicating the dollar strengthening or reducing some of its losses. We will continue to monitor and give you any other headlines. He says he has no confidence or impeachment. This man has hung around for a long time. So we will see. Lets turn to the markets now. We are taking a look at the top of the hour. It is at a record high. We looking at soda stream climbing after its latest earnings report, up 5 . It is. It is trading at a record. It used to be anonymously shorted. It came down a couple of years ago and now it is rebounding again. It still looks relatively strong. Revenue rose a most 1 during the quarter. The company side 21 gain in sales. Ands selling more machines more of the Carbon Dioxide canisters going to their machines. Full disclosure, i have one of these. That sodar noticed stream passes percentage game has just outpaced amazon. Fun. Of they are neck and nine. 74 percent, amazon, 73 . Thank you. The market close is next. This is bloomberg. [applause] u. S. Stocks in their session in the green. If you are tuning in live on twitter, we want to welcome you. We begin with market minutes straight the headline that just broke a few minutes ago is that jacob zuma has resigned as president of south africa. Rain, theook at the move south has been going on pretty much all session long. We have been talking throughout the show we have seen a significant rally since november of last year. The speculation that he would be ousted this week. A rally in the emerging markets standardlt curated we are nowng that could round to 10. 9. A quick look at what else is going on. Yen, 8 10 of 10 curated he said there is a behindofound disruption the move we are seeing. What else do you need to energize . Dollar risee the areier, but those gains shortlived. A quick look at what is going on. You can see the Canadian Dollar stronger. We are talking about more details going on. He can see the dollar seen playing out. Says u. S. Stocks resume their offense, the vick having its worst season since april. It has come back down to 19 and if you look over the last couple days, you had that spike to over 50. It has come way down and people are talking once again about volatility returning to the new norm. If you look at the industry movers, im looking at consumer discretions. Overall, seven finished in the green. Lets take a look at those bond proxies. Higherubstantially across the board. Look at that. I we have had conversations in the