Transcripts For BLOOMBERG Bloomberg Surveillance 20150508 :

Cameron called for unity. Pm cameron i would like to reclaim a mantle we should have never lost, a mantle of one nation, one United Kingdom. That is how i will govern if i unfortunate fortunate enough to hold a government in the coming days. Olivia it was a crushing defeat for labor leader ed miliband and raises questions about his political future. The Scottish National party won 56 of the 59 seats in scotland almost shutting out the other two major parties. We will know in 2. 5 hours from now whether marchs disappointing jobs report was more than a onetime event. Job figures at 8 30 a. M. Eastern time this morning. 235,000 jobs were raised and the jobless rate fell. 1 to 5. 4 . In march, employers hired the fewest workers in 15 months. President obama is in Portland Oregon today where he will push for the asian trade deal and have an appearance at nike headquarters. Nike announcing that if congress oks the trade deal, the company will increase manufacturing in the u. S. Nike says that could create up to 10,000 jobs directly and tens of thousands more for construction and supply companies will set some argue that will depress jobs and wages. Brendan fitbit has filed for an ipo and plans to list on the new york stock exchange. Earlier, Bloomberg News reported that fitbit could raise the Company Posted a profit. In sports, that is right, tom brady said the new England Patriots super bowl win was not tainted by controversy over deflated balls. An nfl investigation found the patriots cornerback probably knew that balls had been illegally deflated speaking to a friendly crowd in salem, massachusetts, brady was asked what he thanks about the pro. Tom brady i have not had much time to digest it fully, but when i do, i will be sure to let you know how i feel about it. Brendan brady could end up being suspended, the patriots good faith a big fine meanwhile, new yorks papers are having the best year of their lives. Tom . Tom there were three adverts in the top two paragraphs of the boston globe yesterday. There are no facts. It is sort of kind of like. Brendan oh no, there are facts. There was some investigative reporting. Tom ok, lets do a data check, equities, bonds, currencies, commodities. Futures up 3 oil get the back onto the next ring, plate, we have got to get to the election and some of the exchange thats onto the next screen, please, we have got to get to the election. Lower yield really across the board this morning. Lets go over to the bloomberg terminal. Brendan, this is euro sterling a snapshot of a backandforth of britain in europe. This is margaret thatcher, wrong sterling hair, 30, 40, tiny tony blairs. Trouncing a stronger sterling. Brendan one of the things we are looking at in the background of this entire election is the u. K. s decision pending by 2017 whether to stay in the eu or not, and they carved out this exemption to hold onto sterling. That is never going to change. Tom and we will have this referendum. Olivia David Cameron promised that as part of his Election Campaign he will hold that referendum, and if he does get a majority, it is likely he will make good on that. I look at that and i see the strength of David Cameron, George Osborne policy coming out of the crisis. The question is currently, britain is the fastest g7 economy, they do more trade with the eurozone man with the u. S. At some point, and because a lot of restaurant euro. Brendan i tell you what i see i see crowds and crowds of brits making way for their stack andg and hen parties. Tom i spoke to moments ago and basically at 12 00 noon london time, the most likely cameron victory will be cast in the own. It is jobs day america. Yes it is our top story, but maybe it is not. We know the United Kingdom held an important election yesterday. We and our Francine Lacqua stunned. Labour has been crushed, liberal democrats wiped off the map, conservatism and the ghost of 1707 have one big. Francine let me go to what you nailed the other day, which is the undecideds. What and why did the undecideds go to the conservatives . Francine tom, you are right, it is from the undecideds that they won the election. The undecideds we understand, are a lot of the younger crowd the ones on social media and a lot of the undecided were undecided because they were not taken by any leader, by one or the other. Think about this you are in the booth, you are about to tick a box and you think the last five years have not been that bad, maybe im concerned about the Scottish National party, so would seem natural with hindsight that you would take the conservatives if you were undecided until the very last moment. Olivia francine, what does todays vote mean for britains future in europe . Francine i think we are now moving away from the election debate. We will have a better idea of exactly who resigns the next hour, but we have moved away from that to can the u. K. Stay in the eu, and how to the u. K. Deal with the Scottish National party . On the eu referendum, it will be difficult for David Cameron at the moment to back away from that. Then timing is crucial. He needs to give himself time to convince do not forget, David Cameron wants this country to remain in the eeo, so he wants to give himself time to negotiate with the eu, he needs to give himself time thomas have a campaign for europe, but what he does not want us to leave it too late so that businesses get scared off. Uncertainty in britain because of this possible eu referendum. Brendan francine, are you one of the people who francine well so this we have been trying to figure out, brendan. It is i think a combination of smaller parties being in the mix so if you only speak to 2000 voters and it is quite easy to get it wrong. Because this is a country that has always had a bipartisan system, it is difficult to poll now. Tom francine the results in key landing one also good as i recall from season one of game of thrones. Exactly what does the Scottish National party do if they are Kings Landing called westminster . Francine w well, they create chaos. They have a mandate, tom, and lets not make any mistake, this is a person, 56 members of parliament that have a mandate and it is looking after scottish interests. How does westminster deal with this is really the other big unknown because, of course remember, scotland has deluded power, which means if you are in england, you cannot vote on what happens in scotland, but now you have 58 abl wher ther are si hundred 50 seats that will have a say about what happened here in the u. K. Olivia we want to underscore that that is really annoying to britain that the scots can vote in westminster by the brits cannot vote on Scottish National policy. To take away from game of thrones for a second everything moving. What do you see going on . Francine sorry, banks . Olivia walk us through the Market Reaction to the tory victory. Francine this is an interesting rally because the polls got it wrong, this means a victory for the tories come it means that taxes are not going to increase, it is as friendly. You solveaw the pound surge. Once they realize that what they are dealing with now is in a eu referendum, we may see some of these gains being called back. Olivia all right, Francine Lacqua, editor and large for Bloomberg City in europe, we will get back you later on any show. Tom bloomberg covering the United Kingdom Election Results all day long. We will bring you an Election Special at noon eastern time live from london. The Economic Cycle Research Institute has gained global acclaim for focusing on the part of america, whether a better economy or not, they feel like they are in recession. You call for recession, a lot of your critics will say it did not happen. I would suggest mine mail says it is still happening. Guest well i will give you some news. That recession call did turn out to be a false alarm ok, so technically i do not think with the data in hand that we are going to see a recession back in 2012. Olivia it is so refreshing to have a guest call out his own call. Tom it is part of the game. Where are we in this job state that does not feel that wonderful . Lakshman we called the slowdown in the beginning of the year. That is what is happening in the middle of the weakening economic growth, but i do want to make a point that is very important. While there was not a technical recession, there was a downturn a growth rate downturn that turned out to be the worst nonrecession in half a century. Tom where are we at 1 gdp, to first quarters in a row. To a lot of americans, i will say that is a recession. Lakshman but when you go to technical definition outcome employment and put a sales come i have to live in recession. If we dodge a recession, we have slightly positive growth. It was not negatively it was not technically a decline, but it was the worth and half a century. When you look at why, it is astounding because it has big implications for now. The reason is because volatility in the economy plunged to a new alltime record low, so when you look at the cause of why it is i think a lot of people look at the fed, it is not actually. It is oil, price, volatility. Oil price volatility from 2011 to 2013, not where the prices but how much it is bouncing around. That fell to a 40year low, the lowest and since it was fixed in the 1970s, and when in the early 1970s and when you look at how we predict the recession, right, why should i even come on here and say it is going up or down . It is because we are monitoring the inherent segment cyclical forces in the economy. The way we predict a recession is when you have a downturn in the cyclical forces, a window of vulnerability opens up, and in a shock is a recessionary shock. Over the past several decades it has been an oil shock that compliance that combines with cyclical weakness. Brendan do you believe that oil prices are stable . Tom alan krueger with us later on. Olivia still to come here on bloomberg surveillance, fitbit has filed for an ipo. We will break down the companys fit financials after the break. This is bloomberg surveillance. Bloomberg. Comon Bloomberg Television, streaming on your tablet, your phone, and bloomberg. Com. Happy friday. Tom good morning, everyone. Job state. Futures up 2. Alan krueger and bill gross will join us in the 8 00 hour on Bloomberg Television and Bloomberg Radio. Brendan baltimores police will face a Justice Department investigation. An announcement is expected as soon as today. Rioting erupted of the city last week after the funeral of a man who died in police custody. Some analysts are raising concerns about teslas cash and say elon musks electric car Company Needs to raise money. Last week, a Morgan Stanley analyst called teslas casper and high watery. Analysts at Jp Morgan Chase also suggested the company needed to raise money. Barack obama is crossing a big item off his bucket list. He will become the fourth president to visit every state while in office. He will notch number 50 today while he lands in south dakota. The others who did it richard nixon, george h. W. Bush, and bill clinton. Tom coming up on bloomberg surveillance today, and jot stay. We look at india. Better than good on Venture Capital investing and of course the election in the United Kingdom. If youre just waking up, it is a flatout stunner. Martin sorrell will give us important perspective later in the hour. Olivia, i am the only one anyone who is not bodybought a fitbit. Olivia i havent, either. Brendan i feel like i do not need something telling me i am not getting enough sleep. Olivia exactly. We are excited about the elections, jobs day, and Companies Continue to go public in the u. S. Fitbit files for their ipo. They sent their documents to u. S. Regulators last night. What is interesting about the filing is after a string of highprofile ipos twitter, boxx and etxysy fitbit is pretty profitable. They have a plan for a Fitbit Premium package. There are questions about whether or not it will be valued as a hardware company. Maybe they will try to do what gopro did and get filed as a media company. Cory johnson, impressive numbers, 191 million for 2014 with a 26 operating margin. Tom i will go with the 26 margin. I just it is clearly a small olivia you are not a gym rat tom. Lets call a spade a space. [laughs] brendan they have first mover advantage. Fitbit went into this before job onawbone did, before apple did. It is comparatively simple technology. Of all of them, fitbit comes away with the best reviews. Please show tom pretending to lift weights as i talk. Whatever it is i might be saying about the strength of the device, evidently tom does curls with the bar. Olivia one of the questions is how loyal users will remain, they have 25 active devices since they lunch, a lot get them in their christmas stocking but by may they are not using it. Tom we are talking to Lakshman Achuthan about the American Economy and some of the sluggishness that is there. In our next hour, alan krueger on our jobs day. We dig into the covers as we look at ways growth or the lack thereof. From new york city this morning more on the United Kingdom elections as well. This is bloomberg surveillance. Tom 10 downing street, of course the road for the Prime Minister, David Cameron. He will leave sometime around lunchtime to have tea with the queen i am told. Olivia two formally get her approval. Brendan to formally stroll in there and give her a high five. That is actually protocol with the queen. Olivia i think she will be happy to see him. Tom lets get to our morning mustread with brendan greeley. Brendan may 8 is of course ve day. It has been 70 days since world war ii ended in europe. We have talked about the celebration in moscow. This is a german magazine, and basically they dedicated an entire issue, of course the end of the war, the quote is have we thought enough . A bony finger point strictly at us with every word. Moment soo nazi comes the warning. Because this wont is supposed to bleed forever. Tom we have this with the japanese front minister visiting the white house with the recent 70th anniversary, shots of airplanes and all that. In germany, it is nothing like the nostalgia here. Brendan an academic historian actually spoke at the boneund entag and said we must remember this forever. This is part of their negotiations with greece right now. Lakshman absolutely. So you have the history, and then you have the pressures of the moment and in the pressures of the moment there is obviously the political exercise of a unified europe, and then there is debt right . We have more debt today floating around than we have had in all of human history, and it is starting to weigh on nations. There is no easy way out of it if you look at the map. A certain amount of growth is needed to handle you need growth and inflation to handle debt. We are hurting on growth and inflation, so there is a lot of pressure. Brendan and of course the word debt in germany is interchangeable with the word guilt. Lakshman well done. [laughs] olivia as we had to break, our twitter question of the day, we ask you how do you define full employment . Tweet us bsurveillance. Tom good morning, everyone. Mr. Farage of ukip steps down. What did we see earlier . Mr. Miliband resigns . Olivia he has not yet. Tom nick clegg, a speech here at some point. Top headlines, we must begin in britain, olivia. Olivia it appears Prime Minister David Cameron will return to office, something he had not counted on. A majority in parliament for his conservative party. Both are still being counted, but the bbc is forecasting that cameron put the party will win 329 of parliament 650 seats. That means cameron could govern alone without his liberal Democrat Coalition partner of the past five years. Voters responded to the conservative message. Pm cameron i think weve had a positive response to a positive campaign about safeguarding our economy, about creating jobs about a ripple in government over the last five years, but above all, a plan for the next five years. Olivia laborur Party Leader Ed Miliband called the results disappointing. People will be looking to the april jobs report for a sign that things are Getting Better. We will find out two hours from now whether or not that happened. Economists forecast that employers added 230,000 employers workers last month. That would be a huge improvement over marchs number. If Senate Banking chairman Richard Shelby has his way, banks would no longer be too big to fail. Senator shelby wants to free those banks from the tough oversight Capital Requirements now apply to the nations largest lenders. Shelby is about to propose the biggest changes to the doddfrank format since it was passed in 2010. Among the banks that would be affected, u. S. Bancorp and suntrust banks. Brendan the Worlds Largest maker of agrochemicals significant execution risks. The combination of syngenta and monsanto would dominate. A