Transcripts For BLOOMBERG Whatd You Miss 20170307 : vimarsan

A federal judge has declined to temporarily stop construction of the final section of the Dakota Access pipeline. It means that have could be operating this month. The Standing Rock and Cheyenne River cioux asked sioux asked the judge to do directed the lay corps of engineers to pipe. No final decision has been made on the merits of the tribes claims that the pipeline threatens cultural sites, water, and religion. Global news 24 hours a day powered by more than 2600 journalists and analysts in over 120 countries. I am mark crumpton. This is bloomberg. Scarlet live from bloomberg World Headquarters in new york, ims followthrough. Joe and im josie wiesenthal. And im joe weisenthal. Scarlet stocks are trading 1 below alltime highs. Joe but the question is what you miss . Bill to the republican his obamacare is being savaged with one senator saying it is dead on arrival. House speaker ryan and a Committee Chairman on the Affordable Care act will be holding a News Conference on the capitol. Plus, analysts on snap say to sell the company. The company has been tumbling from its highs. We will look at what is behind pessimism on snap. Joe now lets look at where the major averages stand as we head towards the close. Abigail doolittle is standing by. Abigail not a lot of action for the major averages heading into the close. Downs p 500, nasdaq, all ever so slightly. Both the dow and the nasdaq traded slightly higher earlier but basically, were looking at the fines for a second day in a row, but not a lot of conviction. The s p 500 with one of the smallest trading ranges of the does but if the s p 500 close down the second day in a row, first time we have seen that since the end of january. Beneath the service these are some of the biggest movers for the s p 500. Frontier communications down on at bank ofutral americamerrill lynch. We have cautious comments out of citi on signet jewelers. He believes the numbers could come in well below consensus expectations on sluggish mall traffic. We have humana trading higher as the gop has put out a new replacement to obamacare. Viacom is trading higher after the ceo spoke at the Deutsche Bank telecom and internet conference saying that the company is on its way to finding new leadership. Bullish action for the last two stocks. Turning back to the macro can we are so far away from the alltime highs we saw last week. What does the Retail Investor think . 6556. Aaiiite we have the bullish sentiment. Were looking at a divergence. Aaii has been down since the end of november while we have been going to these alltime highs pit in the past, as indicated by bullsue arrows, the aai have been ahead of the s p 500. This may suggest that there could be a bit of a pullback for the s p 500 and the other major averages from the alltime highs last week, joe. Joe thanks, abigail. Lets talk more about the markets. Whatd you miss . Regional investors are showing up to equity markets in droves after years of snubbing stocks in favor of fixed income. Since the election, equity etfs as seen in its low of 86 billion. Here to talk more about the risk appetite, liz ann sonders, Charles Schwab chief investment strategist. Here we are several months after the election, an extraordinary run up in the stoxx. Our Retail Investors still enthusiastic about this market . Liz i can look at the traditional attitudinal measures with the sentiment you just if you looki, and at newsletter writer sentiment, that is in the stratosphere in. Erms of bullishness i will say that anecdotally i am on the road every single week talking to our Retail Investors and we have a good snapshot into the mindset of the individual i would schwab say i see at least as much skepticism as optimism. If you look at the behavioral measures of Investor Sentiment you cited some of the more positive flows recently into equitybased etfs if you go back the entire span of the bull market come inclusive of traditional mutual funds, not a single dollar of net new money has been added to the equity market in this entire bull market. We have seen a trend but we have a long way to go before it reflects the from that the attitudinal measures suggest. Scarlet one thing Oliver Renick here at bloomberg was writing about recently is Retail Investors are using passive strategies like etfs to plow into equities. 6550, caps on flows into etfs in 2017. The biggest are tracking u. S. Stocks. To what extent are Retail Investors holding their nose and thinking theytfs cannot afford to sit out but they are not completely convinced this is it . Point clear,ke one etfs are vehicles that not only Retail Investors are active in training, but institutions and hedge funds as well. I dont think you can consider the move purely a retail flow story. If you look at the more macro patterns and the trading patterns we have seen in the market recently with strong closes into the end of the day in the u. S. Markets and many foreign markets, weaker closes, and suggests institutional rotation back towards u. S. Equities, and oftentimes with the shortterm tactical move, institutions will use etfs as a vehicle. It is a sign of increased enthusiasm, but i dont think you can make a blanket call it is represented by Retail Investors. Joe it seems like there is never a year that goes by without someone saying this is going to be the year of picking stocks, or this is a stock pickers market. One of these cliches were people just roll their eyes. Nonetheless, im looking at a chart of s p 500 implied correlations, dipped quite a bit. For the first time in a while, not all stocks seemed to be moving in the same direction, and as such, interior, there would be returns to people who picked the right stocks and avoided the bad stocks could do you see interest among Retail Investors in trying to take stocks or sectors as opposed to just the typical index etfs . Liz i wrote about this last week, actually, why the underlying fundamentals have improved quite dramatically in favor of active over passive. We are strong believers that investors ought to have both in portfolios. It is just that the fundamental underpinnings for active doing better have not been in place, because correlations have been high. To your point, within the s p 500, correlations have come down quite dramatically, which means greater dispersion among stocks. But it is happening across asset classes, too. That is to the benefit of active over passive. It is also to the benefit of lower feetype structures. That said, i think the balance of both probably makes a lot of sense, and i think particularly when investors, whether Retail Investors, institutional investors, make the initial rush into the market, based on the low fees associated with income based on the ease of getting access to markets, i still think that passive and limitation makes a lot of sense passive implementation makes a lot of sense. I think the Playing Field is getting a lot more level and it has to do with this move away from Monetary Policy being the only game in town towards fiscal policy having more weight in the story could that allows for a pricing dispersion to be greater. Scarlet it allows people to look for comedies that are more geared towards the economy as well. One thing we notice is that those who look to buy safe haventype assets, it hasnt exactly paid off. Take a look at the bloomberg. Goldtfs that track miners, the blue line there, and the yellow light, these are leveraged etfs as well. Vix shortterm futures, the pink line, they have been terribly if you put your money, joe coming to the russell 2000 etf, or the purple line, you would have done just fine. Doubledigit returns. Joe keep it civil. Scarlet just keep it simple. Recession82000 and still waiting on peoples minds when they look to taking sectors and parts of the market . Them back from being on board with the idea that we are part of the Economic Cycle where there are more gains to be had after 7, 8 years . Liz i think the muscle memory has been quite stark following the financial crisis. With the exception of the more beent period we have talking about with this pick up in optimism reflected in attitudinal and behavioral has been what particularly unique about this entire bull market is the lack of enthusiasm that i think we have out ways to go in this bull market but i do think at its seele, we will likely not the same levels of euphoria that we have seen in the past. I think the grudging acceptance of this market rally that is bringing people in, but i dont get that anywhere near the same sense of enthusiasm or euphoria as you had a certainly at the 2000 and even to some degree the 2007 top. Joe fascinating conversation. The zen sonders, Charles Schwab chief investment strategist, joining us from stamford, connecticut. We have headlines that are interesting. House representative jim jordan says he is going to introduce a bill tomorrow that will just be a clean straight up repeal of obamacare. Last night we got the mainstream house, paul ryan bill to repeal and replace obamacare come already coming a lot coming under a lot of criticism from conservatives, saying, what happened, you were just going to repeal a good we are seeing conservativety types jim jordan in the house, rand paul in the senate both plan to introduce bills tomorrow that will be straight up repeal obamacare. Scarlet shows how the Republican Party is fragmented when it comes to a policy prescription repealing obamacare. Joe bloomberg chief washington correspondent Kevin Cirilli is with us down in d. C. Day one after this repeal plan coming through from paul ryan, how is it going so far . Are they happy with the rollout . Kevin well, i can tell you that the House Freedom caucus Committee Chairman mark meadows, republican from north carolina, saying that earlier this afternoon, Vice President mike pence was on capitol hill and said that this proposal was open for negotiation. That being said, kentucky senator rand paul as well as senator mike lee, republican from utah, as well as representatives jim jordan, the former founder of the House Freedom caucus, all lambasting this proposal, calling it obamacare lite, saying it is not conservative enough. This represents a real challenge for President Trump, as well as House Speaker paul ryan, who has endorsed this plan, come out in favor of this plan, if they want to get this through. This is the First Political fight President Trump will have to referee between the tea party, more conservative wing of the Republican Party, and the moderate, centrist wing. Scarlet to what extent is he leaning towards one side or the other . Is he playing it neutral now . Kevin President Trump earlier today sending a letter to leaders on capitol hill saying he endorses House Speaker paul ryans plan. Conservatives led by kentucky senator rand paul, senator mike lee, arguing that this provides subsidies to big insurance companies. They take issue with the socalled cadillac tax, which would be more prolonged. They feel that this is not the right plan. I can to you that representatives jim jordan, republican and house of representatives, founder of the House Freedom caucus, saying minutes ago that he plans to introduce his own plan tomorrow. Bloombergut thanks to chief washington correspondent Kevin Cirilli. We will be speaking with you in the next hour as we get more updates from washington. How the Permian Basin is proving to be the hottest ticket in town for Service Companies. They look at the redhot shale industry and the Jobs Available there. This is bloomberg. Joe Goldman Sachs has reiterated its outlook for crude in new york to rise to 57. 50 a barrel in the Second Quarter before declining to 55 for the rest of the year. On bloomberg daybreak americas, jeff curry talked about the demand problem and supply response. Have beennd levels getting higher and higher and supplies continuing to play catchup. I would like to point out, when these markets go into a deficit and they stay in a deficit for several years. When they go into surplus, they stay in surplus for several years. Joe the supply and demand puzzles you listed it can be sharply felt in the shell countries including places like the Permian Basin. Production,om in service committees are having problems filling jobs and production costs are rising fast. Bloomberg news Energy Reporter gave west. Fascinating situation. There was this huge crash in oil and then i guess people went and looked for other jobs and now that oil has come back, those people who were working in the oil field are not there anymore. Who is feeling this most acutely . Anymore,re not there and you have probably the toughest job to find right now is sand truck drivers. You need sand to pump it down the oil well to keep the cracks open and oil to flow out. Sand is a vital piece and theyve been using more and more sand during the downturn to just try to survive. The need for sand is huge. Ship it down by trains. Truck drivers arent there anymore. They found other work driving trucks. Nobody really wanted to come back to the oil industry anymore, so you have people offering one guy told me he tooffering jobs for 16,000 80,000 a year, and he can fill five jobs but he has to fill 20 so he is having a hard time doing it. That is one example. Another example is fracking, where you are running the big pumps that blast the water down the well. Some of those crews are selling out. You have got to try to hire more guys to run the pumps. Scarlet so the solution is to offer high salaries in the hope that that will draw workers out, or make do with other workers, which means you are being less productive. Either way, your costs go up for the companies. David you know where the costs go up by the Service Companies, and the Service Companies argued they have been running in the red during the downturn to just fill orders from customers. They are asking the Oil Producers to pay off more, but that is where the Oil Producers say, hold on, wait a minute, we just lower our costs and now we can finally survive and now we are not going to raise or spend more money. It is this push and pull between servicers and producers. Joe how technical other jobs that these companies are looking to fill . Someone with have no experience before in the oil industry. Are these roles that could be trained into fairly quickly or are they looking for people with experience in the industry . Scarlet could joe do this job . Joe yes, could i do this job . David send in your application, see what happens. It depends on the levels you are talking about. Certainly there are jobs were you dont need experience. The sand Truck Driving company said i am hiring people who have never driven a truck for the oil industry in the life and i give them equipment or whatever they need but i just need a body. You can have guys who dont have any experience. But the jobs are starting to get a little more technical. Theyre looking for geologists a little bit more. Not necessarily hard to fill. They are getting more experience in automation and technology, Silicon Valleytype jobs. Not necessarily something that is work in the oil industry before, but you are feeling those jobs as well. Scarlet you talked about the push and pull between Oil Producers and the services company. Cost is going to become a problem. How big of a risk is that too production, because production comes back online. Isnt that going to decrease production down the road . David it could be a saving grace, like a governor to keep reducers from just shooting up with production. If you shoot up with production, that will drive oil prices down and we are back to square one again where oil is falling to 50 or 49 from break even. Good thing to keep the growth of just exploding too fast with production. Joe great stuff. David wethe, fascinating story. Bloomberg news Energy Reporter, thank you very much. We have footage of trump talking about the health care bill. President trump as i said during my joint address to congress, and i think he mostly , you mostly likes to that, we are witnessing a renewal of the american spirit. Andsearch for optimism National Pride is sweeping across the land could i see it, there is such a spirit, whether it is for the business things were doing or whatever. There is spirit in the company we have not seen in a long time could jobs report you saw what happened with exxon where they announced a Massive Jobs Program could we are going to have some fun. You have to remember, obamacare is collapsing, and it is in bad shape, and were going to take action. There is going to be no slowing down. There is going to be no waiting and no more excuses by anybody. We are all now i can probably say, im a politician [laughter] Dakota Access<\/a> pipeline. It means that have could be operating this month. The Standing Rock<\/a> and Cheyenne River<\/a> cioux asked sioux asked the judge to do directed the lay corps of engineers to pipe. No final decision has been made on the merits of the tribes claims that the pipeline threatens cultural sites, water, and religion. Global news 24 hours a day powered by more than 2600 journalists and analysts in over 120 countries. I am mark crumpton. This is bloomberg. Scarlet live from bloomberg World Headquarters<\/a> in new york, ims followthrough. Joe and im josie wiesenthal. And im joe weisenthal. Scarlet stocks are trading 1 below alltime highs. Joe but the question is what you miss . Bill to the republican his obamacare is being savaged with one senator saying it is dead on arrival. House speaker ryan and a Committee Chairman<\/a> on the Affordable Care<\/a> act will be holding a News Conference<\/a> on the capitol. Plus, analysts on snap say to sell the company. The company has been tumbling from its highs. We will look at what is behind pessimism on snap. Joe now lets look at where the major averages stand as we head towards the close. Abigail doolittle is standing by. Abigail not a lot of action for the major averages heading into the close. Downs p 500, nasdaq, all ever so slightly. Both the dow and the nasdaq traded slightly higher earlier but basically, were looking at the fines for a second day in a row, but not a lot of conviction. The s p 500 with one of the smallest trading ranges of the does but if the s p 500 close down the second day in a row, first time we have seen that since the end of january. Beneath the service these are some of the biggest movers for the s p 500. Frontier communications down on at bank ofutral americamerrill lynch. We have cautious comments out of citi on signet jewelers. He believes the numbers could come in well below consensus expectations on sluggish mall traffic. We have humana trading higher as the gop has put out a new replacement to obamacare. Viacom is trading higher after the ceo spoke at the Deutsche Bank<\/a> telecom and internet conference saying that the company is on its way to finding new leadership. Bullish action for the last two stocks. Turning back to the macro can we are so far away from the alltime highs we saw last week. What does the Retail Investor<\/a> think . 6556. Aaiiite we have the bullish sentiment. Were looking at a divergence. Aaii has been down since the end of november while we have been going to these alltime highs pit in the past, as indicated by bullsue arrows, the aai have been ahead of the s p 500. This may suggest that there could be a bit of a pullback for the s p 500 and the other major averages from the alltime highs last week, joe. Joe thanks, abigail. Lets talk more about the markets. Whatd you miss . Regional investors are showing up to equity markets in droves after years of snubbing stocks in favor of fixed income. Since the election, equity etfs as seen in its low of 86 billion. Here to talk more about the risk appetite, liz ann sonders, Charles Schwab<\/a> chief investment strategist. Here we are several months after the election, an extraordinary run up in the stoxx. Our Retail Investor<\/a>s still enthusiastic about this market . Liz i can look at the traditional attitudinal measures with the sentiment you just if you looki, and at newsletter writer sentiment, that is in the stratosphere in. Erms of bullishness i will say that anecdotally i am on the road every single week talking to our Retail Investor<\/a>s and we have a good snapshot into the mindset of the individual i would schwab say i see at least as much skepticism as optimism. If you look at the behavioral measures of Investor Sentiment<\/a> you cited some of the more positive flows recently into equitybased etfs if you go back the entire span of the bull market come inclusive of traditional mutual funds, not a single dollar of net new money has been added to the equity market in this entire bull market. We have seen a trend but we have a long way to go before it reflects the from that the attitudinal measures suggest. Scarlet one thing Oliver Renick<\/a> here at bloomberg was writing about recently is Retail Investor<\/a>s are using passive strategies like etfs to plow into equities. 6550, caps on flows into etfs in 2017. The biggest are tracking u. S. Stocks. To what extent are Retail Investor<\/a>s holding their nose and thinking theytfs cannot afford to sit out but they are not completely convinced this is it . Point clear,ke one etfs are vehicles that not only Retail Investor<\/a>s are active in training, but institutions and hedge funds as well. I dont think you can consider the move purely a retail flow story. If you look at the more macro patterns and the trading patterns we have seen in the market recently with strong closes into the end of the day in the u. S. Markets and many foreign markets, weaker closes, and suggests institutional rotation back towards u. S. Equities, and oftentimes with the shortterm tactical move, institutions will use etfs as a vehicle. It is a sign of increased enthusiasm, but i dont think you can make a blanket call it is represented by Retail Investor<\/a>s. Joe it seems like there is never a year that goes by without someone saying this is going to be the year of picking stocks, or this is a stock pickers market. One of these cliches were people just roll their eyes. Nonetheless, im looking at a chart of s p 500 implied correlations, dipped quite a bit. For the first time in a while, not all stocks seemed to be moving in the same direction, and as such, interior, there would be returns to people who picked the right stocks and avoided the bad stocks could do you see interest among Retail Investor<\/a>s in trying to take stocks or sectors as opposed to just the typical index etfs . Liz i wrote about this last week, actually, why the underlying fundamentals have improved quite dramatically in favor of active over passive. We are strong believers that investors ought to have both in portfolios. It is just that the fundamental underpinnings for active doing better have not been in place, because correlations have been high. To your point, within the s p 500, correlations have come down quite dramatically, which means greater dispersion among stocks. But it is happening across asset classes, too. That is to the benefit of active over passive. It is also to the benefit of lower feetype structures. That said, i think the balance of both probably makes a lot of sense, and i think particularly when investors, whether Retail Investor<\/a>s, institutional investors, make the initial rush into the market, based on the low fees associated with income based on the ease of getting access to markets, i still think that passive and limitation makes a lot of sense passive implementation makes a lot of sense. I think the Playing Field<\/a> is getting a lot more level and it has to do with this move away from Monetary Policy<\/a> being the only game in town towards fiscal policy having more weight in the story could that allows for a pricing dispersion to be greater. Scarlet it allows people to look for comedies that are more geared towards the economy as well. One thing we notice is that those who look to buy safe haventype assets, it hasnt exactly paid off. Take a look at the bloomberg. Goldtfs that track miners, the blue line there, and the yellow light, these are leveraged etfs as well. Vix shortterm futures, the pink line, they have been terribly if you put your money, joe coming to the russell 2000 etf, or the purple line, you would have done just fine. Doubledigit returns. Joe keep it civil. Scarlet just keep it simple. Recession82000 and still waiting on peoples minds when they look to taking sectors and parts of the market . Them back from being on board with the idea that we are part of the Economic Cycle<\/a> where there are more gains to be had after 7, 8 years . Liz i think the muscle memory has been quite stark following the financial crisis. With the exception of the more beent period we have talking about with this pick up in optimism reflected in attitudinal and behavioral has been what particularly unique about this entire bull market is the lack of enthusiasm that i think we have out ways to go in this bull market but i do think at its seele, we will likely not the same levels of euphoria that we have seen in the past. I think the grudging acceptance of this market rally that is bringing people in, but i dont get that anywhere near the same sense of enthusiasm or euphoria as you had a certainly at the 2000 and even to some degree the 2007 top. Joe fascinating conversation. The zen sonders, Charles Schwab<\/a> chief investment strategist, joining us from stamford, connecticut. We have headlines that are interesting. House representative jim jordan says he is going to introduce a bill tomorrow that will just be a clean straight up repeal of obamacare. Last night we got the mainstream house, paul ryan bill to repeal and replace obamacare come already coming a lot coming under a lot of criticism from conservatives, saying, what happened, you were just going to repeal a good we are seeing conservativety types jim jordan in the house, rand paul in the senate both plan to introduce bills tomorrow that will be straight up repeal obamacare. Scarlet shows how the Republican Party<\/a> is fragmented when it comes to a policy prescription repealing obamacare. Joe bloomberg chief washington correspondent Kevin Cirilli<\/a> is with us down in d. C. Day one after this repeal plan coming through from paul ryan, how is it going so far . Are they happy with the rollout . Kevin well, i can tell you that the House Freedom<\/a> caucus Committee Chairman<\/a> mark meadows, republican from north carolina, saying that earlier this afternoon, Vice President<\/a> mike pence was on capitol hill and said that this proposal was open for negotiation. That being said, kentucky senator rand paul as well as senator mike lee, republican from utah, as well as representatives jim jordan, the former founder of the House Freedom<\/a> caucus, all lambasting this proposal, calling it obamacare lite, saying it is not conservative enough. This represents a real challenge for President Trump<\/a>, as well as House Speaker<\/a> paul ryan, who has endorsed this plan, come out in favor of this plan, if they want to get this through. This is the First Political<\/a> fight President Trump<\/a> will have to referee between the tea party, more conservative wing of the Republican Party<\/a>, and the moderate, centrist wing. Scarlet to what extent is he leaning towards one side or the other . Is he playing it neutral now . Kevin President Trump<\/a> earlier today sending a letter to leaders on capitol hill saying he endorses House Speaker<\/a> paul ryans plan. Conservatives led by kentucky senator rand paul, senator mike lee, arguing that this provides subsidies to big insurance companies. They take issue with the socalled cadillac tax, which would be more prolonged. They feel that this is not the right plan. I can to you that representatives jim jordan, republican and house of representatives, founder of the House Freedom<\/a> caucus, saying minutes ago that he plans to introduce his own plan tomorrow. Bloombergut thanks to chief washington correspondent Kevin Cirilli<\/a>. We will be speaking with you in the next hour as we get more updates from washington. How the Permian Basin<\/a> is proving to be the hottest ticket in town for Service Companies<\/a>. They look at the redhot shale industry and the Jobs Available<\/a> there. This is bloomberg. Joe Goldman Sachs<\/a> has reiterated its outlook for crude in new york to rise to 57. 50 a barrel in the Second Quarter<\/a> before declining to 55 for the rest of the year. On bloomberg daybreak americas, jeff curry talked about the demand problem and supply response. Have beennd levels getting higher and higher and supplies continuing to play catchup. I would like to point out, when these markets go into a deficit and they stay in a deficit for several years. When they go into surplus, they stay in surplus for several years. Joe the supply and demand puzzles you listed it can be sharply felt in the shell countries including places like the Permian Basin<\/a>. Production,om in service committees are having problems filling jobs and production costs are rising fast. Bloomberg news Energy Reporter<\/a> gave west. Fascinating situation. There was this huge crash in oil and then i guess people went and looked for other jobs and now that oil has come back, those people who were working in the oil field are not there anymore. Who is feeling this most acutely . Anymore,re not there and you have probably the toughest job to find right now is sand truck drivers. You need sand to pump it down the oil well to keep the cracks open and oil to flow out. Sand is a vital piece and theyve been using more and more sand during the downturn to just try to survive. The need for sand is huge. Ship it down by trains. Truck drivers arent there anymore. They found other work driving trucks. Nobody really wanted to come back to the oil industry anymore, so you have people offering one guy told me he tooffering jobs for 16,000 80,000 a year, and he can fill five jobs but he has to fill 20 so he is having a hard time doing it. That is one example. Another example is fracking, where you are running the big pumps that blast the water down the well. Some of those crews are selling out. You have got to try to hire more guys to run the pumps. Scarlet so the solution is to offer high salaries in the hope that that will draw workers out, or make do with other workers, which means you are being less productive. Either way, your costs go up for the companies. David you know where the costs go up by the Service Companies<\/a>, and the Service Companies<\/a> argued they have been running in the red during the downturn to just fill orders from customers. They are asking the Oil Producers<\/a> to pay off more, but that is where the Oil Producers<\/a> say, hold on, wait a minute, we just lower our costs and now we can finally survive and now we are not going to raise or spend more money. It is this push and pull between servicers and producers. Joe how technical other jobs that these companies are looking to fill . Someone with have no experience before in the oil industry. Are these roles that could be trained into fairly quickly or are they looking for people with experience in the industry . Scarlet could joe do this job . Joe yes, could i do this job . David send in your application, see what happens. It depends on the levels you are talking about. Certainly there are jobs were you dont need experience. The sand Truck Driving<\/a> company said i am hiring people who have never driven a truck for the oil industry in the life and i give them equipment or whatever they need but i just need a body. You can have guys who dont have any experience. But the jobs are starting to get a little more technical. Theyre looking for geologists a little bit more. Not necessarily hard to fill. They are getting more experience in automation and technology, Silicon Valley<\/a>type jobs. Not necessarily something that is work in the oil industry before, but you are feeling those jobs as well. Scarlet you talked about the push and pull between Oil Producers<\/a> and the services company. Cost is going to become a problem. How big of a risk is that too production, because production comes back online. Isnt that going to decrease production down the road . David it could be a saving grace, like a governor to keep reducers from just shooting up with production. If you shoot up with production, that will drive oil prices down and we are back to square one again where oil is falling to 50 or 49 from break even. Good thing to keep the growth of just exploding too fast with production. Joe great stuff. David wethe, fascinating story. Bloomberg news Energy Reporter<\/a>, thank you very much. We have footage of trump talking about the health care bill. President trump as i said during my joint address to congress, and i think he mostly , you mostly likes to that, we are witnessing a renewal of the american spirit. Andsearch for optimism National Pride<\/a> is sweeping across the land could i see it, there is such a spirit, whether it is for the business things were doing or whatever. There is spirit in the company we have not seen in a long time could jobs report you saw what happened with exxon where they announced a Massive Jobs Program<\/a> could we are going to have some fun. You have to remember, obamacare is collapsing, and it is in bad shape, and were going to take action. There is going to be no slowing down. There is going to be no waiting and no more excuses by anybody. We are all now i can probably say, im a politician [laughter] President Trump<\/a> but we are going to get it done, and you are the leaders will get it done for the American People<\/a>. Obamacare is in very bad shape. I believe if we wait two years, it will totally implode. It is pretty much of floating now, steve for pretty much imploding now, steve. But it will implode and people will be like, please help us, and that will be the democrats asking for help. They are asking for help in the true sense of the word because it is a disaster. Some states are up over 100 in costs. The deductibles are through the roof and you dont even get to use it. We will do something that is great and im proud to support the replacement plan released by the house of representatives and encouraged by members of both parties. I think, really, that we are going to have something that is going to be much more understood and much more popular than people can even imagine. It follows the guidelines i laid out in my congressional address, a plan that will lower costs, expanded choices, increased competition, and ensure Health Care Access<\/a> to all americans. This will be a plan where you can choose her doctor, this will be a plan where you can choose your plan. You know what the plan is. This is the plan. And we are going to have a tremendous success it is a complicated process, but actually, it is very simple. It is called good health care. So i want to thank you folks for being with us today, ladies and gentlemen. And we will do something really, really important and really good for the American People<\/a>. I think it is going to go very quickly. I hope it is going to go very quickly. As you know, after that we work on the tax cut could we are going to be planning a major tax cut. I know exactly what were looking at. Most of us know exactly the plan. It is going to put our country in great shape and we will reduce taxes for companies and people, and i can use the word again, massively. It is going to be a big tax cut, the biggest since reagan, maybe bigger than reagan. I really look forward to working on that but we cant get to that come unfortunately, because of the way your system works, we cant get to that until we take care of health care. We will take care of the health care. I appreciate your great support. Lets get it done. Thank you, thank you all. Fantastic. Thank you. Joe that was President Donald Trump<\/a> talking to the deputy whip in the house of representatives about the urgency and they needed to pass this Health Care Replacement<\/a> bill that came out last night. He is talking about it because in part the bill is under fire obviously, democrats and liberal groups dont like it for obvious reasons, but it is getting slammed more importantly by some of the more conservative groups cato institute, heritage action. We saw Tea Party Congressmen<\/a> jim few minutes ago and say he was going to introduce a bill that is just a clean replacement. A lot of irritation on multiple aspects of the spectrum. Scarlet the president also said that after they resolve obamacare, they will look to make the tax cuts they will address that as soon as they are done with this part of it. He offered some superlatives, saying it will be the biggest tax cuts since ronald reagan. Joe if you are an investor betting on the tax cut, you want them to get the obamacare replacement done fast. Scarlet before we had to the market lets look at the charts in the deep dive today. Im looking at the growing divisions between defensive stocks and cyclicals. If you look at this chart, g btv 6544, this is defensive stocks relative to cyclicals. Doing in july 2016, right here, they went straight down. And then they started to recover right around december, after the election. The ratio at this point was the lowest since 2013, when these indexes were introduced. Research,to bca defensive stocks have more room to rebound in the next three to six months. The firm says a more forceful response, Economic Data<\/a> joe julie that is a great joe that is a great chart, and it turned the same time rates bottom of the middle of the year last year. Scarlet market closes next. Less than four minutes to go before the close. Dow off by 37 points. This is bloomberg. We are moments away from the closing bell. Major indexes trade in a tight range. There is little on the calendar steering markets in any direction. Im scarlet fu. Live onyou cheering and twitter, we want to welcome you to our closing bell coverage every weekday from 4 00 to 5 00 p. M. Eastern. Scarlet we begin with our market minute. There was a late decline but weve come off the lows. The dow off by 30 two points, the s p 500 losing seven points, and no Economic Data<\/a> to speak up. We are all waiting for the jobs report on friday. Really is all about the jobs report on friday. Who knows what could happen . Weve now seen a number of these little selloffs start to string together. Scarlet theres only one group that gained for the day and that was tech. Energy the big decline or, losing about 1 , telecom losing. 8 . Health care kind of in the middle, that group under pressure as House Speaker<\/a> paul ryan introduced the bill to replace obamacare. It has come under a lot of scrutiny from republicans, particularly those in the more conservative wing. Saying they want to come up with. Straight up repeal you can see the Health Care Index<\/a> all. 7 . Care losinglth trading at the lowest since 2011. To your yields up , we still see the yield scripting higher. , 2. 51 . Yields i want to look at something we dont look at that often which is the yield on the one year. It just broke 1 for the First Time Since<\/a> 2008. Readily signaling this is supersensitive to the policy. One year yield over 1 for the First Time Since<\/a> 2008. Scarlet ring the bells. In terms of currency, the dollar basically unchanged if you look at the bloomberg dollar index. The euro trading in a narrow band. The jobs report on friday and next week the elections in the netherlands take place. That will be a fun one. If you look at it does looking at it from a spectator point of view. The Australian Dollar<\/a> had gained ther an assessment of global economy. The central bank said its keeping a closer eye on the currency, warning that a stronger aussie would complicate things. Australiane, the dollar is the bestperforming g10 currencies versus the dollar so far in 2017. It gained as much as 7 , still up 5. 3 after giving up some of that advance. Joe lets look at the commodities front. Milk gained but it had a huge loss yesterday. It is very sensitive to the new Zealand Dollar<\/a> the new Zealand Dollar<\/a> is very sensitive. Thats why were looking at todays quote, but milk got clobbered. Gold was down for six days in a row. A dramatic selloff in the treasuries and it has similar characteristics due to save haven status. That is down by nearly another 1 , and crude oil not moving around 53. Gain, looks like gold his hat in its longest losing streak since november 14. Joe pay attention, because stockpiles are calling up and copper is at its lowest level in a month. To whatever degree you believe copper is a bellwether, its a good reason to pay attention. Scarlet thats todays market minute. Lets head over to kevin who is with congressman jim jordan who said at a News Conference<\/a> that he will be introducing a bill tomorrow that will fully repeal obamacare. Kevin, over to you. Kevin thank you, scarlet. Representative jim jordan, thank you for being here on bloomberg. Earlier today President Trump<\/a> said House Speaker<\/a> paul ryans Health Care Plan<\/a> would allow folks to choose their own doctor. Is he wrong . Theres probably some improvements in the plan compared to the draft a few weeks ago. But lets just be clear, this plan keeps and expands the Medicaid Expansion<\/a>. This plan keeps some of the starts a taxes, and it new entitlement. That is our concern. Did we tell the American People<\/a> in this last election that were going to repeal obamacare but keep some of the taxes . We will keep Medicaid Expansion<\/a> and extended for years into the future . Did we tell them we will repeal obamacare but start a new entitlement . I dont think any republican campaigned on that. Look,e are saying is lets do something every single republican voted on, voted for. Lets just repeal it, put the same piece of legislation on President Trump<\/a> desk that we put on president obamas desk, repeal it, and lets debate what the replacement should be in lets get that done as well. While the obamacare lot remains unpopular with a large swath of the Republican Party<\/a>, there is polls that suggests obamacare remains popular among independents. Unconcerned about the poll that took place on november 8 where the American People<\/a> spoke loud and clear and said get rid of obamacare. You are introducing your own plan. How does it differ from paul ryans plan . Ours is consistent with what the American People<\/a> said. Repeal it, and replace it. Lets repeal it. Every single republican just 15 months ago, every republican voted for that repeal measure. Thats what we need to pass. We are divided. Lets have a debate about what replacement should be, but the book the goal should be simple. We want to lower premiums, for working class and middle class people who have been hurt so badly by obamacare. That is our goal. We are not convinced this bill will do it. Thats why we think our plan is the one that will accomplish that and is consistent with what we told the voters we would do. Kevin one of the concerns you had is with entitlements. One of the concerns the tea about is spoken out the socalled cadillac tax. What are your thoughts about speaker ryan and the cadillac tax and his policy proposal, and what would your plan tomorrow do regarding the socalled cadillac tax . If youre going to get rid of obamacare, it get rid of all the regulations, all the mandates, all the taxes. That is what repealing obamacare is. That is what we told the voters we were going to do. Would not tell them we keep some taxes and have the cadillac tax come back in the out years. We did not tell the voters that. Way toowe make this job complicated. Our job is pretty basic. Do what you told the voters youre going to do when they elected you. They did not send us here to keep obamacare. They sent us here to repeal it. President trump wrong on this, and what does it mean in terms of how his administration and leadership in congress were able to negotiate a congress . Folks in the administration of very clear. This is the start of the debate. You dont just have some decree that happens from leadership and says this is how its going to be. That is the intro. Now its time for debate. There are 100 members of the United States<\/a> senate. The American People<\/a> probably want to see a debate. They want to see some real discussion about what is best for them. That is how the process works, through their elected representatives. We have a debate, we figure out what really works and what is consistent with what we tell them, and then we have a bill we can vote up or down on. Have heard from the administration, the process will play out and thats way it should be. Kevin republicans i speak with have told me that something needs to be done, fixing health care, simply because to invert a fiscal crisis in the states and obamacare has created such a fiscal mess for the states. What about passing an alternative plan that would cause folks to lose coverage . Is that a concern for you and your constituents and the Republican Party<\/a> . My concern is about bringing back rick Affordable Health<\/a> care. Americans have fewer choices and higher costs. The plan i see out there is subsidizing unaffordable insurance and that is the dog chasing its tail. We want to bring back affordable insurance so working and middleclass families can afford it. Afford theeople can premiums, but they cannot afford the deductible. We want to change that. We think the only one the only planet will do that is the plan we have introduced. The only one that is consistent with what we told the voters we would do when they elected us to come here and serve them. Kevin we appreciate you coming on Bloomberg Television<\/a> and talking to us about your plan. Scarlet kevins a really speaking with congressman jim jordan of ohio. Urban outfitters reporting earnings per share . 55. Missing the consensus estimate by a penny. 33 gross margins. Analysts were looking for 33. 5 . Yet when you look at the stock price, its up more than 5 in afterhours trading. From new york, this is bloomberg. Mark im mark crumpton, its time for first word news. President trump said the Republican Health<\/a> care bill is a good bill, and he supports its passage. The president said the Affordable Care<\/a> law has to be repealed. President trump im proud to support the replacement clan released by the house of representatives and encouraged by members of both parties. I think really that we are going to ask something thats going to be much more understood and much more popular than people can even imagine. Mark the president also said he has seen support from everybody for the plan. Airports estimate they need almost 100 billion for Capital Improvements<\/a> the next five years and they can only find half of that on their own. Thats according to a Group Representing<\/a> commercial airport owners. British Prime Minister<\/a> theresa may suffered a fresh blow to her plan to trigger the start of brexit talks after of brass lawmakers today demanded the power to reject the final deal she reaches with the european union. 268 house of lords voted 366 in favor of changing the Prime Minister<\/a> strap brexit law to give parliament the ability to send her back to the negotiating table if legislators decide the terms of the exit agreement are not good enough. Global news, 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. Crumpton. This is bloomberg. Scarlet lets take a deep dive into the bloomberg. You can find our charts using the function at the bottom of the screen. There was one report today and that was the trade gap or the trade deficit. Donald trump likes to use tray to determine whether the u. S. Economy is in good shape or not. Here is the latest report card. Seeing its biggest trade deficit, thats the purple line. We saw imports rising 2. 3 , but gained. 6 percent. The overall gap in goods and 48. 5es trade wide is now billion. This indicates that trade will weigh on the economy again in the first quarter. Gdp trackeranta fed really coming down in part because of trade. At least based on one of Donald Trumps<\/a> favorite measures, thinking about the economy, we are not doing that good. Defense, hehis would probably say, but i wasnt president then. Im looking at the ishares core growth etf. How is a nice snapshot of diversified portfolios are doing. It isnt etf that has allegations to stocks and bonds. Theoretically you have a diverse you shouldgations, do well. But lately weve seen stocks and bonds selling off on the same day. The big spike up was the day after President Trump<\/a>s speech. And now lately people forgot about the speech. In the last few days, march 2 was the first worst day in a long time, and down again today and yesterday. There seems to be a theme where everything has been selling off. Not massive selloffs, but they are diversify diversified across asset classes. Scarlet it wasnt moving quite to the same degree. Joe its just a few days, so you dont want to freak out or anything, but keep an eye on it. U. S. Stocks may have piled up 1. 5 trillion dollars more in market value this year, but hedge funds are bracing for tough times ahead. Managers today have been selling economically sensitive bankshares and materials like copper, according to Credit Suisse<\/a>. Thats a big shift from three months ago when Hedge Fund Exposure<\/a> was reaching record levels. Here is dani burger who wrote about the story. Hedge funds getting cautious on everything. This is a perfect transition from that ishares epf you love so much. Stocks continuing to pile up. There was get this where is the skepticism out there . We dont know when the policy is going to calm. I think we found the corner where theres a bit of skepticism which surprisinglys hedge funds. When you look at their mass exposure u. S. Stocks and their very bullish. December 22 according to equate its wiest data according to Credit Suisse<\/a> data. They have started to pull back on their exposure. You look at equities in general, the u. S. Is where comes down the most in terms of exposure and diving further into u. S. , the sector thats come out the most is financial. Going back to copper exposure, you assume growth is coming and you would not pull back from copper. Then loaded up on gold two times as much as where they were at the start of the year. A matter ofit just people taking money off the table and taking ofs, or is it a real shift in thinking with genuine doubts emerging . The analyst i talked to said its clearly a tactical shift. Just because theyre such a large number of funds doing this, its more than just taking profit. But there definitely is some profit taking. Banks have rallied about 24 elected. Mp was it is just prudent management to pull back a little bit. Hedge funds in general have reduced their exposure 15 to banks. That doesnt do it justice because you have to lower it so much to get down to 15 since they rally. Joe im looking in a chart that you brought us, the white line is just the financials index. ,hat has been on a massive tear close to postelection highs. The blue line is a five year, six months treasury yield stretch, another way of looking at the steepness of the curve. Wassaid the mass exposure the 22nd, close to the peak of the yield spread on the 15th, but its been coming down since then. They are more closely aligned with bond traders in this respect. There is a large question of why they would be pulling back on financials when they are about to get rate hikes. The past two rate hikes, they loaded up on financial support. The chart does the justice to why they would do that. If the yield curve is flattening, this is the trade they will make. They will pull back on banks and take some of those profits. They are still somewhat bullish on banks. Their exposure is in the 80th percentile. They have to have a big justification to go in and buy more. With fiscal policy taking longer the regulations through, this is not a congress that is known for being speedy. A lot of managers are waiting a bit before they got back into bank. They dont have many shorts right now. Shortsll back on their late last year so there are not a lot of hedges right now. This is another way to protect the health should there be another selloff in stock. They are also pulling back on Consumer Discretionary<\/a> companies that have to do with the sense that whenever economic recovery happens, it will not trickle down to the consumer right away. That is so interesting and a grim picture that this is one of the sectors they singled out to pull back. Like you said, it means any sort of growth we are seeing in the economy, they dont see it coming down to the consumer. That pairs nicely with the gap between Consumer Sentiment<\/a> numbers as well as Consumer Spending<\/a> numbers. Lessmer spending increased than analysts expected in january. That has some analysts fullback. If we look at this chart, you see the divergence between the blue line, the sentiment numbers, the white line being dropping. Pending and sentiment might be rising, but again there is a disconnect between the hard and soft data that has a lot of managers concerned. Joe Peter Atwater<\/a> last week pointed out that people decide how they feel first and then rationalize and explanation. It doesnt necessarily come from people feeling great in their pocketbook. Scarlet so what are hedge funds buying . They are putting their money in gold, which fits into the picture of defensiveness. They have a pretty Good Opportunity<\/a> here. Shorts are somewhat low. If they want to get back in, there is some money they can put back on the table, but i think theyre waiting before they really died in and make any tactical decisions. , thank you. I burger opec announcing output cuts late last year. Traders getting ready for a surge in prices. We will look at the numbers showing what long longterm investors are doing. This is bloomberg. Scarlet im scarlet fu. Going to take a deep dive into the bloomberg. Im looking at how investors are positioned on oil. Futures ande is wti the white line is net long positions in crude. There is the move up. Opec and its partners and nonopec partners continue to make progress in delivering on promised output. Jeff curry of Goldman Sachs<\/a> tells us that stockpiles will decline. An oil company is revising investments following a twoyear shock. The question is how this plays out for investors. Calmly was on yesterday and he tells us is Companies Made<\/a> a generational bottom last year. Joe there is all this speculative action on oil, theres all these stories on how the cuts are happening and in the u. S. They cannot find employees fast enough to ramp up production. Minute and do market its like 53. About theeople talk recovery in oil as if we are searching, and we are not. We have stabilized area. Brazilople talk about coming back, its currency is doing pretty well, its stock market has done well, but the data is really not looking so good. Sincer over quarter gdp, q1 2015, its been in what is the opposite of expansion . I guess recession. The last couple of quarters are showing a further decline in the face of the recession. A lot of the come back in brazil has been predicated on all the political corruption and stuff. The data is still not looking good, the Unemployment Rate<\/a> has been high. Still waiting on the actual economic rebound in brazil to justify that. Of that and maybe part is because oil is not surging, it has stalled out. A stronger currency doesnt necessarily help. Next, sharesng up of snap falling for a second day in a row. Will look at whether the forymoon could be over snapchat. This is bloomberg. Ways wins. Especially in my business. With slow internet from the phone company, you cant keep up. Youre stuck, watching spinning wheels and progress bars until someone else scoops your story. Switch to comcast business. With highspeed internet up to 10 gigabits per second. You wouldnt pick a slow race car. Then why settle for slow internet . Comcast business. Built for speed. Built for business. Mark it is time for first word news. Health and Human Services<\/a> secretary dr. Tom price told white house reporters the goal of legislation to repeal the Affordable Care<\/a> law is to allow americans to select their own doctors. In a briefing seen on Bloomberg Television<\/a>, secretary price said the federal government has to get out of the way. What is happening right now is that the American People<\/a> are having to sacrifice in order to purchase coverage. Many individuals cannot afford the kind of coverage they have right now. So they have the insurance card, but they dont have care. Our desire is to drive down the Health Care Costs<\/a> for everybody. The way you do that is to increase choices, increase competition, return the regulation of health care where it ought to be, which is at the state level, not the federal level. Mark there is already pushback from conservative lawmakers. Jordan said he will introduce a bill to fully repeal obamacare tomorrow. Our goal is simple, to bring down the cost of insurance for working class and middle class families across this country. We think you have to get rid of obamacare completely. Therrow i will introduce bill that every single republican voted on just 15 months ago, the bill that actually repeals obamacare. Mark chiefs of staff met in Southern Turkey<\/a> today to discuss developments in syria and iraq. This followed renewed turkish threats to hit u. S. Back Syrian Kurdish<\/a> targets. They also discussed plans to raqqa. Re global news, 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. Im mark crumpton. This is bloomberg. Lets get a recap of todays Market Action<\/a> to be u. S. Stocks falling again with the dow losing about already points, the s p losing seven points. Everyone looking ahead to the jobs report on friday. News that came out after hours, Urban Outfitters<\/a> reporting Fourth Quarter<\/a> earnings missing analyst estimates by a penny. The gross margin coming in lighter than expected. When you look at the stock, its trading so much higher in the after hours. It was up as much as 5 preparing for that advance. Joe and earnings out from h r which a lot of people are intimately familiar with right now. That stock is up over 6 after hours. The Company Coming<\/a> in with a narrower loss then expected. Were . 53. The q3 revenue came in at 451. 9 million versus estimates of 427. 4 million. It makes all of its money in one quarter, or a lot of it. 2. 3 billion expected in revenue for the fourth order that ends in april versus 451 billion for the quarter that just ended. So very seasonal. Shares euphoric debut, of snapper down more than 20 over the past few days. You have three holds and for self with an average price target of 16. 80 per share. It just close at 21. 44. Caroline joins us from san francisco. Are people in Silicon Valley<\/a> saying this is what they had anticipated . You got the initial pop for the first few days and now people are taking the money and running . Caroline it was anticipated that the euphoria would die away as people look to the worries and concerns highlighted by so many in the runup to the ipo. Daily average user growth is slowing and thats what analysts are starting to report. We had a report from asia saying we might be seeing 3 growth in the daily active user base for snap. Compared to instagram, they say it doubled that pace. That is the key competitor who has basically been copying some of the key features of snap and doing it rather well. This is when the sellers come out to play and the short , saying its to the tune of 300 million. Snap andissues with its has been well known for a while. At this point in its cycle, immediately after the ipo, its kind of like a roulette wheel. Some days its on to be on green, some days on red. Nobody really knows. At this point it is still a gamble. The one outperforming sector today was the i. T. Sector. We saw a lot of tech firms outperforming the markets, whereas snap was clearly underperforming. 30 growth,ore than the market cap has gone from 31 billion down to 25 billion dollars today. So there is volatility at play. Looking back at twitter, it jumped more than 70 on the day of its ipo and he continued to get higher all the way up until december, a month or so into its ipo we did not see the money coming off the table. That sometimes the euphoria does stay there. None of the banks that helped , they havethe deal not been able to put their analysis out on the company theres a dearth of positive viewpoints coming from the analyst at the moment. Twitter, theioned euphoria lasted for a long time, but if we go into the bloomberg, im looking at a chart of reallyk, it got off to a mediocre start. The first day there were all kinds of glitches and it traded sideways to down for a long time. Out with that famous cover story saying it was going to go down to 15. Of course it has done phenomenally well since then. So the early days dont tell us too much ultimately. Caroline you are exactly right. Fromeals weve seen coming tech giants such as alibaba and snap because of the glitch that hit facebook. It took months to prove that mobile was where it was at and they were making the right sort of bit. Maybe it will take time for snap to do that to the market as well. Analyst think it will go up to a billion. They can start selling more to the advertisers out there. That gopro isng near record lows. And snap trying to sell itself as a camera company. But you are right, you cannot out tell by the first few days. I love the fact that it is thinking of itself as a camera company. Gopro wanted to move away from that by saying it was a media company. Caroline hyde in san francisco, thank you very much. Coming up, the former chair of the joint chiefs of staff tells us why he thinks the most important global bilateral relationship is between the u. S. And china. This is bloomberg. Scarlet u. S. China relations have been at the forefront of the new trump Relations Administration<\/a> in terms of everything. We spoke with retired admiral Michael Mullen<\/a>. He has dealt extensively with china. I think the most important bilateral relationship in the world is between china and the u. S. That is principally because of the economic relationship. The otherdd to it geopolitical tensions out there about whats going on in north korea, what the chinese are doing in the south china sea, it is trending significantly in the wrong direction. Actually think that our administration and the chinese leadership have to figure a way to make sure it stays or gets to a position of relative calm. The Chinese Government<\/a> itself is feeling some pressures. They are feeling internal pressures to keep growth going. They have a lot of credit coming on board. How much of their approach to the u. S. Is informed by their own internal domestic issues and how much does that limit what they can do with us . The general approach is focused on the internal issues. Xi is keepingent his powder dry to sort out where the United States<\/a> is going. Hes coming up for renewal of his administration toward the end of this year. I expect him to be more active and aggressive in that raise. So there is a window of aportunity here to establish relationship between our new administration and theres, to really focus on keeping that part of the world stable. Meantime we have the Trump Administration<\/a> trying to get an economic plan going and part of that is putting together a budget. One thing we have heard is that he wants more money for defense. He wants 54 billion additional for the next fiscal year. It wasnt that long ago you were on capitol hill testifying about the budget. Does that make sense to you . He wants to add about 10 to the Defense Budget<\/a> and he wants to add about 30 billion this year in the amended budget for this fiscal year. That will principally be focused on readiness for all the surface all the services. Increase is something obviously that will be debated. The Services Want<\/a> to get bigger, the navy wants a bigger navy, the army wants more troops as well. I think that will be debated on. Im not against a marginal increase because we got a growing challenge with russia, weve got the terrorism challenges out there, we have an emerging china. So we are in a situation where the threats overall are growing, but im really concerned about, at least as i hear in the media, where the money is going to come from. Scarlet that was retired admiral Michael Mullen<\/a> speaking earlier on bloomberg daybreak americas. Time for the Bloomberg Business<\/a> flash. Goldman sachs will consider expanding its Consumer Lending<\/a> business, depending on the success of its new personal loan product, according to a Company Executive<\/a> who spoke at a conference today. Goldman is pushing into Consumer Lending<\/a> after long avoiding main street in favor of big clients. Consideringole is its sale of a 31 stake in a saudi arabia and lender, according to people familiar with the matter, who also say the deal could potentially produce 2. 4 billion through its largest bank. Credit agricole is said to be of ng to investors about buying. Chilly said the prolonged stoppage at its top mine mace in the Global Market<\/a> back into deficits and further propel prices. The governments Copper Commission<\/a> currently projects a 3000 metric ton surplus in the world supply of the metal for this year. But thats being jeopardized and ongoing strike at a bhp billiton my where wage talks remain stalled. Goods suffered its worst share decline in nearly four months after forecast missed estimates. The Retail Company<\/a> expects and . 55,etween . 50 compared to analyst predictions of . 61. This suggests the retailers efforts to revamp operations can have a low payoff. Thats your Bloomberg Business<\/a> flash. Are moments away from an News Conference<\/a> by House Speaker<\/a> paul ryan. He has just come out, he is at the podium now and will be speaking on the republicans response to obamacare. The American Health<\/a> care act, its been a long time coming. This bill keeps our promise to repeal and replace obamacare. To americanselief fed up with skyrocketing premiums and fewer choices. It moves us away from the broken status quo toward a better, patient centered system. That means lower costs for hardworking families. It means more choices and competition, so that you can buy the plan you need and that you can afford. Yourans greater control of health care. This is the culmination of years long, of an inclusive process we have been doing here for years. Last june, as part of our better way agenda, we put forward our vision for health care. After the election, we began to work with her current partners in the senate and with the Trump Administration<\/a> on this plan. I want to thank President Trump<\/a>. The vice thank support inor their getting us to this point. Chairman brady will be joining us in a minute. Now the bill will go through the regular order process in the house. As it does, i encourage all americans to read this bill at read the bill. Gop. Go online and read the bill. Doing the things is never easy, but we have made a promise and we are going to keep that promise. We made a promise to repeal and replace obamacare with conservative solutions and reforms. That is exactly what this bill does and that is why we are here. Thank you. I want to echo a couple of things the speaker said. I do want to thank the president , the Vice President<\/a> , and our new secretary, tom price, as well. I just listened to the president meeting with the deputy whip team. He said he was proud to support this new bill. Why . Because of the years of work that of gone into it. Obamacare did three essential points. One, create and exchange. We all know the history of what is happened to that. The failures, the Companies Pulling<\/a> out. And now you have one third of the entire country with one only health care provider. We created 23 coops and billions of dollars. 18 of those coops have collapsed. It expanded meditate medicaid and it cannot sustain itself. I want to change thank chairman greg walden for the work they are going to do as well. And third, it made government controlled health care, the regulations imposed upon everybody. Today is a new day. We stand proud with our proud with our president that he supports this bill to keep the promise that we made to repeal obamacare and replace it to put the power back with the individuals. Good afternoon. I want to thank my colleagues for their work on this, wesley president and Vice President<\/a> , secretary price, and the members of the energy and Commerce Committee<\/a> and our subCommittee Chairman<\/a>, who put in incredible amounts of time and work. Nightll went public last about this time, Available Online<\/a> for everyone to see. This is the conservative alternative to obamacare. This is how we give choice back to the people, and rescue the failing individual market. Ofare proud of his peas legislation and look forward to marking it up today. We made a promise to the American People<\/a> and were going to keep it right here and right now by repealing obamacare and it with something that will work for them. Remember, this is just the first step. This legislation begins the process of transforming the Health Insurance<\/a> market. It also amounts to the biggest entitlement reform since bill clinton signed welfare reform into law. Restore to the states the authority thats been taken away from them, make them have to not come here to washington and ask some bureaucrat for permission to do it anything, and allow them to innovate and to best use those dollars. Medicaid, it amounts to a per capita allotment, so they will know what they can expect. We worked closely with the governors. Tomorrow we will kickoff our markup. We will begin the process in an open and transparent way. To me state again, going make sure that those with preexisting conditions continue to get health care and Health Insurance<\/a>. We will make sure there are no lifetime caps were not going to kick your kids off their plans. This is important work we are doing. We look forward to moving forward on it and providing a rescue for the individual market and relief to the states and help to the people that sent us here to get this job done. I think mr. Brady is still at the white house so we will just go to questions. [indiscernible] im prepared to lead our conference to do what we said we would do in the election. We ran on a repeal and replace plan. Thats what this is. On making sure we fulfill our promises. But i believe in regular order. Going through the process the way it was meant to go through. We did not write this bill in my office on Christmas Eve<\/a> and jam it through to an unsuspecting country. These committees are writing this legislation. They will be marking it up which is regular order. I am excited we are doing this the right way, out in plain sight. I want to tell my fellow citizens that the nightmare of obamacare is about to end. That we are doing what we said we would do in this campaign, which is repeal and replace this awful law that is crashing. Lets not forget, obamacare is collapsing. It is not staying. If we did nothing, the law would collapse and leave everybody without Affordable Health<\/a> care. We are doing an act of mercy by repealing this law and replacing it with patient centered Health Care Reforms<\/a> that we as conservatives have been arguing and fighting for for years. [indiscernible] let me just give you a list of what is in here that conservatives should be excited about. Number one, the bill repeals obamacare. Number two, it repeals the obamacare taxes. It repeals the obamacare spending. It repeals the obamacare mandates on individuals and businesses. It has a medicaid per capita entitlementiggest reform anybody has seen here for decades. It nearly doubles the amount of money people can contribute to Health Savings<\/a> accounts. That is a crucial part of conservative health care policy. Ive been doing conservative Health Care Reform<\/a> for 20 years. Years, have been arguing for equalizing the tax treatment of health care for all americans so we can have a vibrant, individual market so we can have choice and competition. There are two ways of fixing health care. Have the government run it and ration it and put price controls. Or do what conservatives have been arguing for years. Having a vibrant, free market where people get to buy what they want. Equalize the tax treatment. Stop the discrimination of people who want to go out in a free marketplace and by the health care they are choosing. This does that and allows choices. The most important thing it does, it takes power out of washington and puts it back to doctors and patients where it belongs. By some estimates, 10 Million People<\/a> will lose their coverage. What matters is we are lowering the cost of health care and giving people access to Affordable Health<\/a> care coverage. I think the entire premise of the comparison doesnt work. The fact is we are not going to have the government tell you what you must do and what you must buy. We will allow the market to do that. We will let people decide what they want to do with their lives. We want to lower costs by having more competition. Health savings accounts gives people the freedom to buy the covers they can afford and what they want. This is the beginning of the legislative process. Have 218 when it comes to four, i can guarantee that. [indiscernible] readthebill. Gop. Its not that this is open for negotiations. We envision three phases occurring here. Let me describe what they are. This bill which we use as reconciliation, this repeal and replace bill is what we passed through reconciliation. Phase two, all the regulatory flexibility that the secretary of hhs has to deregulate the marketplace and stabilize the market. Thats what tom price will do. Theres Something Like<\/a> 1400 instances in the law that gives. He secretary discretion secretary price will use that discretion to bring more Market Freedom<\/a> and stabilization. Phase three is to pass the bills that we want to pass that we cannot put in reconciliation because of those budget rules. An example of that, interstate shopping across state lines. Buthink that is critical, you cannot put that in a budget reconciliation bill, otherwise it can be filibustered. We also believe in Association Health<\/a> plans. Farmers with the American Farm<\/a> toeau plan, Small Businesses<\/a> plan. Ib we believe in that policy, but we know the rules dont allow us to put that in reconciliation. Medical liability reform. Practicing defensive medicine makes health care ultimately more expensive for everyone, but we know we cannot put that in reconciliation. Were going to push those to the finish line but those will ultimately take 60 votes in the senate. Phase one is this repeal and replace ill. Phase two, tom price regulates phase three, passed the reforms that we believe in and think make it even better, but we know we cannot put in reconciliation because of the 60 vote threshold. Thank you very much, everybody. Appreciate it. Mark speaker of the house all right, joined by his colleagues on capitol hill, discussing the gop plans to repeal and replace the Affordable Care<\/a> act, also known as obamacare. Speaker reince telling reporters that doing big things is never easy, but we have made a promise. He said this legislation is being called the American Health<\/a> care act. He said the markup of this legislation will begin tomorrow in the house. He said it is centered on patient centered Health Care Reforms<\/a> in the bill repeals of obamacare and its taxes and mandates. And he added it doubles the amount of money that people can contribute to Health Savings<\/a> accounts. When asked whether or not he believes he has the votes for this, speaker ryan said, i can votestee we will have 218 when the bill goes to the floor of the house. Joining us. Thanks for your time. I know it has been a long day for you. Votes . E speaker have 218 kevin not if you ask conservatives in the House Freedom<\/a> caucus. There has been a bevy of activity of criticism coming from the House Freedom<\/a> caucus jordan and mark meadows. Senator rand paul also saying this legislation is dead on arrival in an interview with Bloomberg Television<\/a> earlier today. The question becomes, regardless this advance not is the house of representatives and goes to the senate, in order to avert a filibuster, they need to still hear back from the Congressional Budget Office<\/a> to see whether or not this plan will cost money. The house ways and means Committee Chairman<\/a> brady saying they do not have a timetable for but that will come through, should they get that scoring, and people like this is the first policy division President Trump<\/a> will have to referee with the tea party. Interviewhad a great with congressman jordan. He called the gop proposal obamacarelite. Kevin . Our feed toe lost cap in nyc and 10. We will get back at him in a minute. Speaker ran also said of the American Health<\/a> care act that it creates what he called a vibrant free market. 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