♪ bloomberg world headquarters, i am mark crumpton, and this is bottom line. today, republicans assess their prospects after the stunning primary loss of air at cantor. then, elon musk, his latest machine for manned spaceflight, and putting a lot of resilience in spirits. and to our viewers here in the united states and those of you joining us from around the world, welcome. we have full coverage of the stocks and stories making headlines today.

alix steel reports from the goldman sachs energy summit. to liana goldman breaks down the latest rumor news national poll. we begin with peter cook on capitol hill and more on last night shocking primary defeat for house majority leader eric cantor. peter, let's begin on the breaking news about his future. >> that is right, his future on capitol hill will not include serving as majority leader of the house of representatives. he is going to be stepping down at the end of july from that position. at is the immediate consequence from, as you said, his stunning defeat in the virginia primary yesterday. 24 hours ago, people saw him perhaps replacing john boehner, and now, he is effectively out of a job and will be out of the leadership at the end of july, a stunning turn of events for somebody who was ratcheting to the top of the republican party leadership. it is hard to imagine this could have happened 24 hours ago, but that is what happened. a tea party conservatives, the

seventh district in virginia, challenged eric cantor, saying he was not conservative enough and was waffling on immigration and even criticized him for those that feeling votes. the career for eric cantor, a young guy, only in congress for 13 years, now coming to a close, and he will address members of the conference tonight at 4:00, and that is going to be a very, very momentous event went eric cantor talks to his colleagues there, and there will be talk about who will replace him going forward. >> peter, does business take a hit with the departure of eric cantor? what this is someone who really cultivated the business community. he has been one of the ambassadors for house republicans not only on wall street but in silicon valley, as well, and ceo's come to capitol hill and spent a lot of time with eric cantor. they were among his biggest fundraisers. you have steve schwarzman from blackstone, and a hedge fund

firm, american express, top and they lose, some of their clout with the departure of eric cantor. partompany is off today in , eric cantor was one who was thought to deliver. boeing has used it to help further their sales abroad. there is an immediate consequence for the business community with eric cantor losing his job. thanks, and more on the political fallout of the eric cantor lost is coming up, and al hunt will join us from washington with his analysis of the virginia race, the tea party, and what the loss means for the republican party. that is coming up in about 17 minutes right here on "bottom line." not have toama may worry about reelection, but a new bloomberg poll says he is

suffering from low ratings. just how downed is this on the president? >> according to the poll, the public essentially saying to the president, look, we are just not that into you. his favorability rating, this is something that measures how popular he is and how much he is liked by the public, they have reached new lows in this bloomberg poll. 40 four percent of americans view the present favorably. 52% view him unfavorably. the unfavorable level brings it back to where we saw him at the end of march. remember, he saw a bit of an uptick following the healthcare.gov will and the government shutdown, but he has erased those gains, and the low favorability ratings are dragging down his approval rating overall. the president has a 43% job approval rating, 50 three percent disapprove. and then when you look at the individual measures that measure job performance, the president

is underwater, so you have more people disapproving than approving. you have that when it comes to his handling of the economy, where it comes to his handling of health care, where it comes to his handling of negotiating with house republicans. that has reached an all-time low. also, his handling of the deficit has reached an all-time low, as well. >> the poll also look at the recent controversies of veterans affairs and surrounding the release of sergeant bowe bergdahl. , when it comes to the taliban prisoner exchange for sergeant bergdahl, when it comes to the controversy surrounding the health-care system that veterans affairs, 51% of americans is approved with how americans handle that. one bright spot to the white house could be that for both of 18%, 16% of americans say they are not sure how they

feel. now, republicans are obviously going to try to make both of these issues a campaign issue, so we're going to see it play out over the coming months, but they are using this to point to mismanagement, point to and point to add on to the indictment of the president's handling of the economy. >> washington correspondent julianna goldman joining us. thanks. we have an update on a story that we have been following. the u.s. senate with a block rose -- to have bar , and the refinance senate failed to advance the measure. this was in part because it would be paid for by imposing new taxes on the wealthy. coming up, de two of the goldman sachs energy summit. we will learn more about how industry stakeholders play to harness the continent's energy

resources. stay with us. line" on bloomberg television continues in just a moment. ♪

it is day two of the goldman sachs energy summit in new york, shortly,ll be joined but first, let's listen to what lloyd blankfein told charlie what the united states needs to do to become energy independent. when you think of the u.s. being as close as it is to energy sufficiency, not having to be a net importer of history, looking at the history over the last 40 years, we had the oil embargo, which highlighted how dependent we are on oil, and with the history over the last 40 years, can you imagine how different things could have been over the last 40 years, and looking forward, can you imagine how different it will be over the next generation if we get

this right and make america energy efficient, both in terms of the economy and in terms of the geopolitics and the american position in the world? thes a blessing, but benefits of that blessing do not come automatically. you have to do things. >> what do we have to do? >> we have to reconcile the differences between the people who are only thinking in terms of the environment and people who are only thinking in terms of supporting the economy and get some accommodation between the two, both of whom are right, and both are right, but an accommodation has to be reached and go forward and then have rules that are durable and reliable so people can make the kinds of long-term investments that allows us to make the arefits, and those benefits growth and jobs. >> and you can watch the full charlie rose interview with goldman sachs ceo lloyd blankfein tonight at 8:00 and 10 p.m. new york time, only on

bloomberg television. for more on the goldman sachs energy summit, my colleague alix steel is standing by. >> takes so much. i am joined by david crane, looking at having a hand in every energy that you can andine, including oil, gas, cold. what about five years from now versus 10 years from now? diversity think fuel is the most important thing, but clearly, we are undergoing a big trend from fossil fuels, and i think whole is more a 20th century fuel as opposed to 21st century fuel. >> a bridge fuel. can you talk about what you mean? >> natural gas and the bounty we have in this country is a huge development, a positive development, but i think we have to talk about in terms of supporting renewables, looking at renewables. if all we do is replace coal plants with nuclear plants and

natural gas, we will not make a meaningful reduction in the country's carbon emissions over time. time, energy,king and money away from renewables. do you see that as not eating the case? >> in the short-term, yes, but in the long term, it is just replacing the base load of fuel. people may be able to do without an electric line into their home, just like they can do without a six line telephone in their home because they will have solar on the roof and appliances in the basement that converts natural gas to electricity. >> in a different way. >> having a second one. >> a lot of the chapter at the summit has been about regulation , sort of what the government can do to help energy, right? but you spoke on the panel about what private companies, public companies can do. can you talk a little bit about that? >> i think one of the most

exciting things we have in the sustainability world is companies, walmart, coca-cola, you know love her -- you need lover -- unilever. about recycling cans anymore, and these companies reach a lot of people every day. >> would you rather spend your time and energy lobbying big companies or lobbying congress? about lobbying. doing deals, i would much rather spend my time doing that. about not a big optimist top-down in light and policy, but in terms of big companies doing the right thing, we are very bullish on that. >> and you have a partnership with the company that was recently acquired by google. what is your relationship now with google? >> google is going to be a big player in this space.

google would love to partner, but they may turn out to be a competitor. apple, facebook, amazon, what they are doing with data centers, but also how they are getting involved in bringing energy technology to the space, there are major players in the energy sector going forward, so i suspect they shall be at this conference in the years to come. >> we talk about about bringing cheap howard to india and china. what is the potential for big companies -- bringing cheap power to india and china. they are now taking responsibility for their supply chain. i think equally interesting is what happenings with their their applee all of devices. they use a certain amount of energy. what is the environmental footprint of those devices? i think apple cares about that,

and i think they want to see their devices used in the greenest way possible. we want to be a part of that. has been a lot about the new iep yeah proposal, trying to reduce the co2 emissions. a lot of cold people are very defensive. >> on that sort of level, we are a bit surprised by the allocation of carbon between regions, and we think texas is a part of the country that has grown significantly since 2005 and is recently disadvantaged, but the long-term, bigger picture, i think one of the issues we are focusing on with existing coal plants, which, by statute, we are allowed to focus on, it takes away from what we really think the sustainability's they should be, which is not how quickly do we retire the past, which is the wel front, but what are

going to put in its place. >> meeting what will be there in 20 years. >> i just feel that all of the debate right now for the next few years is going to be specifically about these plans. if the epa is totally successful, what will they be accomplishing? accelerating the retiring of plants by a couple of years? now are we going to build and the future? one thing we know we are not building is traditional coal. there have not been a traditional one built in five years. >> thank you so much. the ceo of energy march. back to you in the studio. >> thank you very much, and we will have more from the energy summit, and we will hear from the former israeli ambassador about the energy situation in the middle east when "bottom

line" continues in just a moment.

♪ >> the surprising defeat of eric cantor in the republican arty primary has shocked the nation's capital and has sent reverberations throughout the party. we have more with al hunt with a capitol."olitical >> it petrified them. the message is you have to protect your right front. all of that narrative a few weeks ago that the tea party was something you did not have to worry about the challengers, the perception is now, they got eric cantor. >> but i thought eric cantor was

the tea party. what happened? >> well, that is an interesting point. he is. if you were in washington and analyze the house leadership, the republican party in the house, you would say that eric cantor is one of the real conservatives. that is not the way he was viewed by the rank and file, and that is what killed him. >> what was his undoing? was it, perhaps, his willingness to compromise on immigration reform? piece ofure that is a it. it is like everything. it is not one thing. i would guess more than anything, and i did not this coming. i was shocked last night, as i think just about everybody else was. i think there was a sense that he was from the district. >> it is interesting. i looked at my blackberry last night, and i thought it was a mistake. >> i did also. i think the single most surprising primary election return since i have been covering politics. >> it is different from when

house speaker tom foley was defeated and when tom daschle was defeated in the senate, because that was in the general. they were defeated by republicans, correct, not a primary? >> you're absolutely right. they were defeated by republicans, and they were both republican years. totally different order. anythingnot think of that has this kind of repercussions. and this is unusual. unusual, howf worried is speaker john boehner right now? >> i think john boehner is worried and a different sense, not so much for his own job. i think at least entertaining the notions of perhaps leaving. this makes it almost impossible for him to leave now because there is such a void of leadership. no one can raise the kind of

money that he can raise for the party in the next election cycle, but what worries him is there will be -- i mean the next five weeks, the children, babies, you do not want to see what is going on in the house of representatives. they are jockeying. they are fighting. these internal struggles are not welcome, and nobody knows what really motivates them, and it is going to be a humongous fight for the majority leader and too.bly for whip >> talk to us about that. who wants the job? >> the head of the financial committee right now. mighther strong candidate be kevin mccarthy, who is the current whip. usually, the republican party moves people up. i think there will be a very formidable candidate. pete sessions says he is going to run. i think another will bow out, and then the issue becomes there is the right wing of the party,

the ultra-white wingers -- ultra-right-wingers. >> is that something that is going to happen? will speaker boehner have a choice? >> speaker boehner can certainly influence if there is an open whip. i think that would be different. majority leader, i think the speaker's influence will be very limited. this is something where these guys vote on their own, and i describing what a caucus is like, he said it was not fit for family television, so there will be a lot of fun, but it will be rough. >> we have about 20 seconds. what other races are worrying republicans right now? >> is a sippy. june 24. that mississippi runoff.

the tea party candidate, if that akin you could have todd having an effect. >> all right, our bloomberg news columnist joining us from washington, al hunt. mr. hunt, thank you for your time. appreciate it could >> thank you. >> 26 minutes after the hour, time for on the markets, and matt miller is standing by. >> we want to bring you up to where stocks are trading. it could be that eric cantor news that is hurting stocks as well as the world bank revising its stance on growth. after four days of gains, and now it is off, the dow now off more than 120, the nasdaq off by about half of a percent. replacing a ceo in september with hancock, currently overseeing the property casualty insurance, taking the reins of the company that has shrunk in half since the financial crisis

in 2000 eight. also, we are keeping our eyes on laxton, preparing its first sale sales.l chain blackstone was selling 90 million shares. more bottom line after this. ♪

welcome back to the second line" on of "bottom bloomberg. helping to fund investments and startups, rainbow medical seeds and grows companies that develop breakthrough medical devices. >> in the medical device area right now, the stimulation of which also is new modalities for treating a range of diseases, such as sleep apnea

, epilepsy, and several others. we are actually based on ideas, withovative an injectable, small device, that once injected and inserted into the body close to the nerves can fix neural disorders that are associated with these diseases. >> the cofounder told bloomberg middle east correspondent elliott gotkine about one of the new dimensions -- him and -- inventions, which can help people living with diabetes manage their disease better. >> it can improve the signals more than five percent today.

it is a very small implant. it doesn't implant that is injected under the skin. , and we send a signal close the loop. sony and abbott are also major investors in rainbow medical. he continue our coverage of the goldman sachs energy summit here in new york. luber's alix steel is standing by for more. -- bloomberg's alix steel is standing by for more. >> a chairman of a petroleum company, i asked him, in light of today's opec meeting in vienna, everybody is talking about the prospect of the u.s. exporting oil, does opec still matter? matters, will matter. i think the key here is that shale, whatever form,

gas, natural gas, be it oil, it is a global commodity, and therefore, the world energy needs are a global demand, so as the united states grows very dramatically and his store only producer oflly as a energy and gas, that means that the dependence by the united states on middle east oil is going to decrease, but it does not mean that the dependence of these emerging powers such as india and china in asia are not going to continue to look to middle east oil as a major source for their energy. >> so you do not think that the u.s. if we exported oil would then displace saudi arabia in ? >> no, i elsewhere do not, because, again, there is

growing demand for energy, not only by india and china but by the emerging countries, and when you look at the energy deficiencies in the world, the areas of the world where people do not have it, electricity or or coolewithal to heat their homes, this is a global demand that will be met by the global producers. do you think that the u.s. exporting oil is a reality? >> yes. we are not there yet, but i think with the shale oil, the shale gas, i think we are going to the united states for the first time beginning to export oil. but definitely gas. lng. and this has tremendous geopolitical implications. >> what are they? how does that shift the balance of power in the geopolitical landscape? what i think one of the most

interesting phenomenon of all time now is the potential synergy of canada, the united , largelynd mexico based on their capacity to increase their energy security, , that northction america, i believe, will he emerge in the 21st-century as the preeminent power, if, and this is a big if, if we can get our political act together in the three countries, and in the parliaments and the congresses of the three countries, and really coordinate policies so that the vast trade between the countries, the growing energy reforms, for example, critical factors in all of that, and as we mentioned, shale gas and shale oil, and canada. fundamentally, you are going to

see china emerging, india emerging, and the so-called other countries emerging, but as an economic, social, political block, i think there is a potential for north america to be the eminent power in the 21st-century. >> the opec of the west? is that a possibility? >> that is a good way of putting it, yes. >> it does seem in the belief that infrastructure buildout could be big for oil products in general. with the violence we have seen in iraq, what you think is going to happen there? >> these are the historic surprises that occur. what is happening in iraq and that, i mean, the fact there is the islamic state in iraq and furious, they have now virtually eliminated part of the border between iraq and theory of their, professing to put in place their own islamic emirate,

their own islamic state, the fact that they are taking over most of the second-largest in iraq, with militia against the andblished iraqi military security forces speaks volumes, and whether it is sustainable or whether it will be driven out is another story, but it is a very negative development, and it will impact on iraq's potential to export oil. hope was the great that iraq would be able to get back to pre-gulf war levels. not with this recent development, and it is at energy crossroads in iraq. >> some very thoughtful remarks there from the ambassador, and i should point out that about 10% of the iraq oil production and oil reserves are actually in the northern part of the country. shale, theof u.s. middle east remains key for growth around the world.

the iea says about $40 trillion worth of investment will need to happen in the energy sector, and the majority of that will come from the middle east. mark, back to you. >> alix steel joining us. thanks so much. ourng up, we continue special series, the road to rio and the world cup in brazil. we will meet one of the top -- thers of such office spirit of brazil when we continue in a moment. ♪

>> and breaking news, eric primary, andhe there is a meeting set at 4:00 p.m., a news conference set to get underway around 4:30 p.m., and, of course, eric cantor lost

the primary race in his home district in virginia. has announced plans to establish a lab in costa rica for testing new products. today, i sat down with a president, and here is what he for his country. >> first, it signifies that costa rica continues to be a trusted ally of foreign investment in the region. secondly, it increases the quality of the investment. we are now dealing with research and irrelevant issues, not only manufacturing, which looks at breaking ground at the way in which we have made deals for this company. >> and we will have more on this aterview with him tomorrow 2:40 new york time. meantime, if you are not braziliansth cachaca are hoping that will change.

they could be on the verge of a tequila like explosion, and some are getting into the market. with onetzker sat down of the top producers to take us from the sugarcane fields to finished product, and, yes, we tasted a little along the way also. >> drink twice a week, when it is raining, and when it is not raining. here, and i make the best cachaca, made from is a liquor 100% sugarcane. >> it gives energy for cars. it is energy for the body with sugar. and it gives happiness with cachaca for all of the people.

>> it is very good. it has a honey like quality, that it does not taste alcoholic. mythis beverage runs in blood. i drink all of the drinks. i love beverages. >> cachaca is the main nationalt in their cocktail. last year, the country exported 9 million liters valued at about $16 million per year mexico exports about as much tequila. the world cup is looking to put it on the map. >> many people for the first time are going to taste cachaca, and i think all of them will like it. , the best.quila >> initially, it was considered a low class drink, and it had an

image problem in the u.s. also, where it was classified as rum. >> you let it ferment. for you use the pure sugarcane juice and you ferment the sugarcane juice directly. when it is fermented, you have about 12% of alcohol. >> now, it is recognized as a distinct spirit. in return, they grieved to recognize american bourbon and tennessee whiskey. >> they offered jack daniels. it has been improved. >> this is where we age the

cachaca. good dealing with milk. this is better. >> that is your latin america report for this wednesday. we will be right back.

>> we have more on the eric cantor fallout. i'm joined by one of the cofounders of an organization has been fighting over the issue of immigration reform. how do you think his departure from the scene of the immigration pipeline going forward.

>> republicans, self-described tea party republicans. to look at the rate. he won by higher margin. he explained that i am against -- amnesty. we saw him win over womanly. >> it was an issue that surfaced in his race. one of the reasons that he lost, he talked about the notion of amnesty for younger americans. you don't see this as a death knell for immigration reform? forhe need to do this policy remain strong for the american people. the republican party wants to do

well in the next presidential election. you saw that eric cantor was not out there explaining his position on immigration. boehner,raham, john they explain how they wanted to fix this problem him and they have won over womanly. >> when you walk into a republican lawmakers office, join us on the conference. >> ted cruz's bolster all say this is good for republicans. >> do you have any expectation that that will happen. >> we were seeing progress. it will take a week or two for the smoke to clear.

it said that lindsey graham is is going tocantor be fined. >> the been completely economic argument, and you think that will resonate most. >> there is the human argument. ucd evangelicals don't want to see families separated. -- you see evangelicals that want to see families separated. the republican party cannot keep writing off the fastest-growing part of the population. >> we will see what happens with immigration debate going forward. much more from here on capitol hill. >> thank you so much. we will have live coverage of the house majority leader's news conference. that is expected to get underway at 4:30 p.m.

line"ith us, "bottom continues in a moment.

of thelines of the top hour on bloomberg radio and streaming on your tablet. that doesn't for this edition of "bottom line" on bloomberg. i will see you tomorrow. >> it is 56 past the hour, bloomberg is on the markets. let's get you caught up quickly on where stocks are trading. thead another down in afternoon. the s&p is still down about half of one percent. the dow jones, two thirds of one percent. left in trading.

the nasdaq down a third of a percent. now, stocks are still near the record highs that they hit a couple of days ago. investors are looking for ways to make money. a new strategy is shorting what they call never never stocks. for more on why they are selling, kelly is here to talk about this. >> they have stories, this is the company the future like facebook. >> their heart on facebook because this is a really compelling story. they are hard on facebook and mark zuckerberg because they think the company prioritizes their user base more than their investors. >> this is where the term never never comes from. returning cash to shareholders, never earning profitability.

seem to hurt a lot of companies? amazon hardly ever makes really a decent profit. they hardly ever give money back and yet the stock is out of this universe. >> that p/e ratio has skyrocketed. amazon is not in this list of the stocks. it could be they believe that amazon has good long-term potential for growth. there are a lot of companies like that like facebook and linkedin, opentable. some retail companies also and some health-care companies which is an internet provider of services for position, for medical positions. that is the company that david einhorn has also shorted. >> who is behind this? who is behind the strategy? >> the person's name and the red leaf. he is pretty much a math genius and he runs a multi-strategy hedge fund. they do a lot of traits.

they are there across equities. it is across different assets. >> this is applied to 18 different names. >> it is some names like under armour, kate spade. >> there are a lot of companies that have pretty high valuations. but they screen for companies that have one over a billion cap the market. operating expenses that exceed revenue growth. also, the underlying criteria is that they don't do dividends or stock buyback. of course, you have seen that they outperform the s&p over historical time. the thesis itself is compelling coming as a matter of whether it will actually play out. >> it is a fascinating story.

that is it for "on the markets." smart" starts now. welcome everyone to the most important hour of the session. defeat,tor surprising the republican jockeying to take his place. the sharpest minds in los angeles, we will talk about