With. Everybody wants to sing come kumbaya and wants to hear that melody floating through. Julia and we recap another wild week of earnings reports. It is not turbulent. We are very stable. There is an absolutely an opportunity to drive through. Julia it is all ahead on bloomberg best. Julia hello, and welcome. I am julia chatterley. This is bloomberg best. Your weekly review of weekly analysis from Bloomberg Television around the world. The week began with Important News from oil global markets. Saudi arabia and russia signaled oil cuts are likely to continue. He is going to head straight to beijing where the saudi a a oil minister is speaking. Lets take a listen. We have come to the conclusion that the agreement needs to be extended. We will not reach the desired inventory level by the end of june. And therefore, we also came to the conclusion that ending will probably be better at the end of the First Quarter of 2018. With the same volume allocations that were included in the december 10 agreement we entered into of december of last year. Saudi arabia and russia are making strong statements, including a joint statement that they will do whatever it takes to get to their longterm goal of reducing global inventory. The market is fresh and healthy. It is able to get a rally. This bullish news came at a good timing for the market, especially on the back of u. S. Data showing u. S. Inventory continuing to decline. David reactions in the markets and elsewhere to reports to the Washington Post and wall street journal that President Trump disclosed classified information to the Russian Foreign minister. National security advisor mcmaster publicly denied the reports outside of the white house. The story is false. At no time were intelligence sources or methods discussed. David as i understand the facts, what the Washington Post is reporting that they specifically talked about a specific threat from Islamic State and identified the city which was important for this purpose in terms of inferring the sources and methods. That is right. The mcmaster denial was a nondenial, denial. He was denying something the Washington Post did not actually report. You just saw an hour ago a tweet from the president that says he believes he had the right in terms of sharing information with the russians. He says he did it for humanitarian reasons. And to help russia to combat terrorism. So, the white house is scrambling to straighten out their story now that the president has contradicted his National Security officials. I think we could do with less drama from the white house so we can focus on our agenda, which is deregulation, tax reform, and repealing and replacing obamacare. I think it is another example of the president being a loose cannon. And sometimes, it is not clear when he is going to shoot, or what he is going to shoot, or where he is going to shoot. Emily breaking news happening right now in washington. The New York Times reporting President Trump asked the fbi director to shut down the federal investigation into trumps former National Security advisor, michael flynn. The white house has denied this report. The confluence of events, it couldnt be a more tumultuous time in d. C. And the drumbeat is just going to continue. And of course, the white house is denying it ever happened. So, it does sound like something donald trump, the real estate ght say if one of his employees got a traffic ticket. But he is president. You just cannot do that. The u. S. Dollar has fallen for a sixth day. Futures are pointing lower after the latest controversy involving President Trump. Want to talk about the deep crisis what is your sense of the magnitude of what is happening . It is amazing to think that any one of these things, the emergence of intelligence information, this Bombshell Development yesterday, it would be almost impossible for the white house to get traction and to regroup. We are dealing with the deepening crisis. Even republicans saying that the white house is in a spiral. That they cannot seem to get out of, much of it on their own. It is not about comey or trump, this is about the United States of america. This is about our democracy. We must have an independent prosecutor. We need a Serious Investigation now. Volatility awakened from a period of dormancy. Stock three closing at lows with the dow tumbling 300 points. The 10 year yields are lowest since the brexit vote. Talk about how this is a risk off moment and the biggest decline for u. S. Stocks since september. A 370 point drop. There has been a change here. Some people have been saying the rally has been holding up nicely. Only because of earnings and because of better numbers on Economic Growth around the globe. And that we didnt need trumps new proposals to take the markets higher. I think that people were saying it is ok that a gets pushed up a little bit. It was ok as long as it came in 2018. With this new scandal, or possible scandal, that pushes everything out further. All of the talk we have heard has been about timing. Now, they are talking about how much you can actually get past. It is a bit of a game changer. Jonathan mark volatility surging. Stock markets across the world declining. The white house trying to get a handle on this latest scandal. The u. S. Justice department has appointed former fbi director Robert Mueller to oversee the investigation into russias alleged meddling into the 2016 u. S. Election as well as possible collusion by Trump Campaign associates. The s p 500 plunging by the most in eight months yesterday. Asian and european markets following the downward trend overnight. Mueller is a very respected figure and enjoys bipartisan support. One of the longest serving fbi directors. So, he is a very reassuring figure. The last eight days in washington with the white house were unsustainable. I have been talking to republicans. You saw a really important mood shift. The fact that you couldnt find any republican lawmakers ready to defend the president after that explosive story about the comey memo hit, and now that there is a special counsel there is some breathing room. He can try to be the president again. I respect the move, but the entire thing has been a witch hunt. There is no collusion between certainly myself and my campaign. But i can always take from but i can always speak for myself and the russians zero. Vonnie Steven Mnuchin giving his first testimony to the urban Affairs Committee of the senate. I believe that a goal love 3 of 3 gdp or higher Economic Growth is achievable if we make historic reforms to taxes and regulation. Vonnie did you feel we learned anything new about this administration or its plans . Well, i am not sure. The secretary was very general. In most of his remarks. There is a lot of discussion. I think everybody has their own concept of what tax reform would look like. But so far, it has been very difficult to get everybody around a single plan. Especially given the concerns of blowing up the debt deficit. David at the end of a long week, the president is getting out of town, traveling for nine days to five cities in four countries. As the president setting out if he goes all around to change and sees back initiative on the foreignpolicy front, something that he can really do . There is no action that they have spent a considerable there is no question that they have spent a considerable amount of time planning this trip. I will say that this president s staff has not shown tremendous ability at logistics. This kind of trip requires intense planning and advanced work. Things can go wrong, and they better not if he wants to make his message clear. David as President Trump his way to saudi arabia, today is a big election. Voters will decide whether to keep incumbent masson honey incumbent Hassan Rouhani will be a good choice for second term. They look at this election in iran. In terms of what is at stake, it didnt go well under barack obama. It was a tense relationship and the saudis and donald trump are looking to revive this. They see a lot of gains that could be made. Look, in terms of big deals, 10 possibly big deals with saudi aramco, the state owned oil company. You look at the bigger banks like morgan stanley. They have a slice of the cake of what could be the biggest ipo in the history of the kingdom. Julia still ahead on bloomberg best, more on chinas belton road forum. It was a big deal, but will it lead to big deals . Despite distractions in d. C. , legislators talk to us about tax reform. And investors weigh in on the setting on the siding return on the sudden return of market volatility. Up next, more of the weeks top headlines, a rash of cyberattacks rattling businesses and governments around the world. It brings home how vulnerable the economy is on a global basis. Julia this is bloomberg. Julia this is bloomberg best. Im julia chatterley. Lets continue our global tour of the weeks top business stories in china, where the government hosted a summit to advance its ambitious belton Road Initiative. More than 60 countries involved in the belton Road Initiative have issued a joint communique promising to expand trade and investment after the chinese president said the plan is already in full swing. How much progress has beijing made to move this usually a this hugely ambitious plan forward . We are getting now is a solidification of some of these parameters and getting some of clarity around some of these parameters and questions that need to be answered. We have this communique was put out by the belton road members who came here. They said and vowed to continue to push forward with globalization, trade, and investment. We also had details around financing proposals, concerns being voiced by the germans that the bidding process process may not be transparent or fair. The germans are pushing for more clarity on that. The question is around whether the u. S. Is going to participate . They gave their backing to this trade deal. Emily over the weekend, a global cyber attack snowballed to infect 200,000 computers and in 150 countries. It hit systems ranging from the u. K. S National Health Service to the Russian Ministry of the interior. What does that tell you about the actual target and intention behind the attack . I think it reinforces again that cybersecurity is a very important issue. It reinforces that it is a weapon that can be used in the wrong hands, and a way that is very bad for the global economy. In the breadth of this, there was nothing novel in this attack. It was leveraging a set of things that had been known for quite sometime, but it was done in such a broad way that it brings home how vulnerable the economy is on a global basis. Momentum in china may be softening. Factory output, and retail sales growth slipping from the previous month. What is the key takeaway here . The numbers are fairly good but they are decelerating from march. March was a real blowout number as we finished the First Quarter with higherthanexpected gdp growth at 6. 9 . What you are seeing is that march was the peak. We are seeing a deceleration. Retail sales coming in at 10. 7 . Industrial production 6. 5 . We were expecting 7 . March was 7. 6 . We were not going to get that. That was the fastest since december 14. Since so 6. 5 . December 2014. If you take of march, it is the pace of growth for factory output since march of last year. Vonnie a rocky decade for aig. The company is starting to show some signs of stability this year. Just in time as the Company Names a new ceo. He secedes peter hancock. Who is he . He is it wellrespected leader. One analyst said he is the white knight coming in. Vonnie they said there may be the white knight. People are wondering if aig will bring another reserve charge. He said the reserves look reasonable. People are wondering if that will continue because hes coming in to invest. Unlike carl icahn who said in 2015, he wanted breakup of the full insured. He said hes not there to break it up. Scarlet ford is cutting its workforce with plans to trim 10 of global workers. The move is part of an effort to boost profit in a lagging stock price. We know auto sales have been disappointing. They appear to have peaked. Is this in response to the slow down in auto sales . Auto sales are turning down after seven years of growth. There is particular pressure on ford and its ceo mark fields. The ford board of directors scheduled extra time to have fields explain his strategy because profits were down 42 in the First Quarter. They are going to be down for the year. They wanted to know what fields was going to do to turn things around. And now, and looks like one of the things he will be doing is cutting staff. Lloyds Banking Group has returned to full private ownership, almost a decade after it was bailed out by the u. K. Government for 20. 3 billion pounds. Should the government have waited . Are there more great things to come . If you are a pragmatic shareholder and you think things are Getting Better, hold on for a little bit more . There is lots more to do, but i dont think governments should be shareholders of banks. This was a bailout which was required by rbs northern rock, at the height of the financial crisis. Taxpayers money was used because it was a major crisis. Tax payers money should not be used to bail out banks, and taxpayers money has made better uses to it. The government did well in selling their shares. They used a good plan and sold everyday a part of the daily flow, so progressively, they diversified themselves. They got their money back. 20. 3 billion pounds and around 900 Million Pounds more than what was put in the bank. So, they did the right thing. In the u. K. , Prime Minister theresa may has committed her party to a hard brexit. She outlined the partys manifesto today, promising british voters she would deliver a clean break from the European Union, and warned no deal with the e. U. Was better than a bad one. Theresa may we will leave the European Union and take control of our money, our borders, our laws. This is theresa may sitting out her grand vision for the future. Not just what is going to win her the election, but the policy she believes in, which are pretty radical in some ways. She is directly trying to appeal to all of these people who voted for brexit who feel left out and left behind by globalization. No Single Market and immigration curbs. Thats one of the big things. She is talking about doubling the levy on how Companies Higher re skilled migrants. That is the kind of language that makes big corporations nervous. Matt stocks, bonds, and brazil all tumbled as president as the president became embroiled in a new political crisis. Trading and briefly halted yesterday. Sinking the most since 2008. He denies the claims he endorsed the payment of hush money to the former house speaker. In a televised address, declared he would not step down. This is the biggest event we have seen an emerging markets in the last six months because brazil was the flag bearer of reform. It was the leader of the pack last year when emerging markets came back from the dead. If investors get disenchanted with emerging markets because they thought it was of reform story, that has an impact as far as korea, russia, south africa because of brazil. I think this is coming in at a bad time for emerging markets. Julia welcome back to bloomberg best. I am julia chatterley. Policy conversation was diverted, but republicans on capitol hill insist they are moving forward with their economic agenda. This week, bloomberg spoke with key legislators about the prospects for tax reform. Kevin cirilli sat down with Senate Majority leader mitch mcconnell. Kevin the president is proposing a massive tax cut. Seemingly, there could be some tension on visions. Is there tension and what is the timeline . Are you confident we could have comprehensive tax reform by the end of the year . It will have to be revenue neutral. We have a 21 trillion debt. Kevin a lot of money. Yeah. Amount ofremendous debt during the obama years, so we will have to be revenue neutral. I dont want to put a strict timeline on it. The last time it took several years, but we want to try to complete it this congress. We want to make america more competitive. That is what it is about. We did not have one year of 3 growth during all of obama. Kevin of the most controversial one issues of tax reform has been the border adjustment tax. I have spoken to a lot of senators who seem against it. What is the chance of this being involved in all of this . It probably would not pass the senate, but the way we are trying to go forward is the secretary of the treasury, the speaker, and myself are trying to reach an agreement on a proposal we can all agree to start with. It will start in the house. We have not reached that agreement yet, but we will at some point. Border adjustability is a controversial thing in the senate, but we will see what is in the final thing we agreed to. I am not as caught up in revenue neutrality as others are. I would rather have this country go forward and take a chance than sit back and not get anything done. I agree with revenue neutrality as a goal, something we should try to meet. We will probably have to do that because of the revenue neutrality around here. David meeting that goal, the house has proposed this border adjustment tax. A number of senators, including the republican side, expressed skepticism about it. Is it feasible for a border adjustment tax to make it to the senate . Im not sure that one has been pr