>> two days after the brussels attacks, police hunt for a new suspect involved in the boing. after having projections for interest rates, eu officials talk about a rate increase. eu.k. vote to leave the might force gas and power bills up by 500 million pounds. osborne testifies next.

this is "bloomberg surveillance." -day week nextour=da week. tom: do a victory lap on what you learned in your credit suisse interview yesterday. it looks like they had a trading error of some type? francine: the ceo in the great, exclusive interview yesterday was telling me that there were too many large positions. tom: yeah. [laughter] francine: that he did not know about. 90 billion of this stuff has to be unwound by the end of the year. i don't think we've seen the end of the repercussions. tom: exactly. vonnie: authorities now believe there was a second suspect involved in the attack on the

brussels subway. that suspect reportedly accompanied this suicide bomber to the subway station and may still be alive. european union interior minister's meet in brussels today. islamic state has trained 400 people and sent them to europe for terror attacks, according to the associated press. builtare camps specifically to train for attacks against the west. north korea claims it has made progress in developing ballistic missiles that could attack south korea and the u.s. reducesof solid fuel launch preparation time. iran's linked to government will be indicted -- for an attack on a

u.s. dam in new york. republicans are not rallying behind plans to stop donald trump. republicans back trumps view that the person with the -- 63% of republicans back trump's view that the person with the most delegates should receive the republican nomination. tom: yields are in over the last number of days. dollars stronger. euro weaker. i don't want to make a big deal about it, but oil. four-day work week. not bad. german government 10-year bears

watching. there is more to that. china over the evening. francine? francine: i want to show you european stocks. i want to show you the basic resource stocks getting hammered today. strength ties into where crude is. we are seeing losses and commodity producers. it is the last trading day of the week in europe. tom: let's go over to the terminal. irving fisher from a few years

back. let's look at the five-year. this is five years out and then looking forward five years from that. i will be in the casket. here is the inflation and the disinflation we have seen recently. we move the dots a little bit yesterday. april is sort of there. that was a great interview. you moved more than the dots. you moved to the dollar. tom: michael mckee moved the dollar. not me. francine: it was a two-pronged attack. i have the pound. ignore that. tom: but francine, rule number one, if you get the wrong chart, you just go with it. francine: i'm going to go with

it. this is all about osborne. i did this on purpose. this is pound-dollar. look at the pound. decidesif this country to leave the eu. it may fall another further 25%. let me start with the dollar. we had the fed saying, we are going to increase rates only twice this year. officialsve other fed saying we may see increases earlier than we think. >> it is tough because we have markets hanging on the words of

these fed officials. you have these hawkish statements where you keep april on the statement. , april is less of a possibility. i think this is a testament to the flexibility of currencies in the global environment. francine: are currencies the name of the game in the next months? commodities are very much linked to the dollar. our fears and shocks going to be played out in currency moves? >> i think so. , it works forbank their economic goals. currency is where they are action.ost of that

i currently think currencies are the name of the game. tom: i go to bill gross's phrase "the cleanest dirty shirt." in finance, investment, and international relations, is it just that the u.s. is the safe haven? >> i would say so. whatever the politicians seem to say in the u.s., the people have confidence that the u.s. has the capacity for underlying growth. it is almost as if people don't pay attention to where the presidential rhetoric is going. the bigger fears are sometimes outside the united a from comments inside -- outside the united states from comments inside. when you fear presidential presidential hear candidates dissing trade deals, it makes people outside more nervous. tom: is there a regime change

within the eu and within the ministers as they meet today? >> it depends what you mean by regime change. if you mean a completely new outlook of the nature of the and whetherpe faces governments are going to make real changes, sadly not. i think the pressures from the rise of populist parties, the pressures from slow growth and high unemployment in many countries, and the way the media is playing now in the wake of the fallout from the brussels attack, governments are turning inward to a large extent. there is a lot of posturing. we are still in a cautious phrase. tom: francine, that speaks to your sterling chart you had earlier. it is a set of lower highs. francine: you are absolutely right.

this is a theme we have been trying to explore even before the latest polls, whether you talk brexit or donald trump. it is becoming much more difficult to become a moderate politician in today's world because of security, growth concern, the economy -- it is being played out in things we have not seen in the past. i wanted to get back to the supremacy of the u.s. yesterday,d the fed stop worrying about dollar strength. does dollar strength but that much pressure on the u.s. economy? >> it is a big consideration for the fed. the fed is looking at financial conditions, aside from their dual mandate. the dollar has been on a rip roaring 2015, still strengthening this year. the u.s. is a pretty inward facing economy. tom: we will continue here on

the markets. we will tilt to belgium, as well. the news flow continues to brussels this morning. howard ward joins us. we will talk to him about use of cash. ward has been dead on about a resilient bull market. this is "bloomberg surveillance." ♪

loans and pictures. this is a picture from the city of london. it is a little bit gloomy. are they thinking about brexit? there was a colorful and spirited conversation yesterday. francine, go back to that

photo, please. you've got the ugliest architecture in the world. that looks like a backdrop for the movie "roger rabbit." -- like that she's great cheese grate and that walkie-talkie. francine: i happen to disagree. yahoo!'s board failed to live up to their promises -- ceo marissa mayer has been trialing the struggling company -- but starboard wants to replace the board.

novartis will pay $25 million to settle bribery claims. in italy, the third-largest bank will buy another bank in an all stock deal. this could lead to a wave of consolidation among italian banks. tom: thank you so much. francine: there has been so much speculation about consolidation. it puts us a step closer to finding a resolution for some of the bad banks. there has been a lot of government pressure on one of the other banks to take care of it's concerns. onto brexit concerns. usrge osborne will join today. guests are still here.

there is so much concern about brexit because everything has been modeled. george osborne faces lawmakers today after a tumultuous week, where he had someone from the cabinet resign over cuts to disabled benefits. >> yes, indeed. it has been a real test for george osborne and one that has damaged his future leader's chances. he has a hole in the budget, which he has deferred until the end of the year. he is facing tough questions. this also raises the issue of competence. his big brand has been competence and austerity. it does damage that particular image that he has been seeking to promote. given the fact that he is making the economic case for britain staying in, this leads to the other issues. francine: it gets muddled,

right? when you go to the referendum vote, do you trust osborne? do you believe in boris johnson? boris johnson was very entertaining yesterday. >> what people say about any referendum is that people never really vote on the question being asked. it is going to be a vote of confidence in the government. it is a personality thing. boris johnson is larger than life. he does not always stick to facts. he manages to deliver a powerful message. with the resignation of iain duncan smith, there was a lot of talk. iain duncan smith is an activist. tom: help me here, robin. how polarized is the united kingdom right now? how distant are the elite from the people of the united kingdom

as they deal with the vote at the end of june? >> i'm not sure it is the distance between the elites and the public. i think it is the elites themselves at war. in the conservative party, you have a civil war. two types of establishment. one is called the foreign-policy establishment that wants to stay in and one believes that britain can be great, free trading nation. then you have the labour party where its leaders are decided between the ambivalent jeremy new style socialist labour leader who has always been skeptical about the single market, and you have the ed miliband, the former leader, and david miliband, all arguing to stay in. the argument is between the elites themselves. that makes the public more confused. do you listen to entertaining boris or more stable george

osborne? tom: that is the clearest explanation i have received yet. who has the high ground among those conservatives right now? >> that is a very good question. to go back to your previous point, most voters don't actually think the eu is a major issue. it never comes up in polls as the big issue people vote on. however, issues such as immigration are. it is about how successfully people make that link. david cameron is campaigning on the issue of economic stability. makes the link between the eu and immigration -- their success will depend on , especially ink light of recent events. francine: coming up in the next hour, u.k. chancellor george osborne will testify on britain's u.k. membership.

we will bring you that testimony on bloomberg. if you want to watch george osborne back from yesterday, you can do so by going to bloomberg.com. ♪

good morning from new york. from london, francine lacqua. we will continue with the news from belgium in a moment. much on the markets today. howard ward will join us in the next hour. we will talk to him about the use of cash and his conviction

on apple. tom, i thought i would bring it back to u.s. politics. mark halperin spoke to ted cruz yesterday on "with all due respect." >> when we have police in a community, it protects that community and keeps it safe. we need to stop pretending radical islam does not exist. we need to work to defeat it. vonnie: many strategists think this could be the turning point in the republican race. it looks like governor scott walker will endorse ted cruz. jeb bush has just endorsed ted cruz. strange racee this where we see the establishment rally around a candidate like ted cruz in order to be donald trump? say, i've not been

following the u.s. news as closely in the last two or three days. i was surprised to here what you said given the deep feelings against ted cruz in the establishment, especially in the senate. i understand he is one of the most unpopular senators out there. it gives you a sense of how concerned people are the donald trump is going to get this nomination and the sense that to bring someone like john kasich up from a low delegate count is just not feasible politically at the convention. ted cruz must be doing good background work to do those -- get those investments --endorsements. trump, is he just popular because he was on tv 15 years before hand? he puts on a show. >> i think the show is important, but there is almost something else going on. people don't want to send

leaders into power to do things. they want to send leaders to pull things down and destroy things. a frustration with leadership. they want somebody who will go in and rick things apart. he is really good at giving that message. in terms of offering a solution, i don't see it. tom: we will continue the discussion. halperinemann and mark , "with all due respect." wonderful interviews recently. look for that tonight at 5:00 p.m. from new york. this is "bloomberg surveillance." ♪

lacqua ini'm francine london. tom keene is in new york. let's get to the first word news with vonnie quinn. vonnie: the manhunt in belgium

has gotten even bigger. police are searching for a second attacker from the belgian subway. a man was seen by surveillance cameras carrying a large bag before the explosions and may still be alive. the leading suspect in the paris attacks faces a hearing today in brussels. he was captured last friday. british lawmakers are urging david cameron to challenge turkey's shameful policies toward the kurds. has driven president kurdish factions into the arms of the syrian regime, a new report says. they say that is counterproductive in the fight against islamic state. australia says two pieces of debris that washed ashore in mozambique are highly likely to have come from that missing malaysia an airliner. airliner.an

jinpingt obama and xi will discuss security in washington at the end of the month. earlier this year, kim jong-un's regime conducted another nuclear weapons test. it really does take two to tango. the president was watching the entertainment in buenos aires when one of the dancers coaxed him onto the floor. his wife michelle ended up getting on the floor, too. i'm vonnie quinn. it is a different kind of an argentine tango. tom: oh really? vonnie: they use their legs a lot differently. they kick a lot. forward and back. tom: have you tango? vonnie: i did last year. in argentina. tom: did you? i'm just trying to get my hands around tonal trump -- donald trump or ted cruz tangoing.

vonnie: i think the optics would be bad. tom: oh stop. i'm glad the president went to the baseball game. right now, we shift to economics. mr. bullard moved the needle yesterday. there was some movement in the markets. we are back to's this -- to this silliness. have you ever seen a set of central banks so confused? >> it is a very interesting time. andmeeting in which yellen official statements came out having the dot projections and then within a few days, you have these hawkish statements, that is a bit surprising to have these dissenting voices from within what should be a group

think or group communication from the fed. tom: within asset allocation, do you know where the risk-free rate is? are we truly unanchored from where we are one year or two years? >> it is tough to think about where the markets and the fed are expecting. there is such a big divergence. finding the risk-free rate when you are trying to invest in government bonds in different parts of the world, it is very difficult to see where exactly your projected spreads are going to be with this type of monetary policy. francine: do you look at negative rates or central banks? it seems like they have taken so much divergence. if you are going to see risks out there, the next shock could be coming from loose monetary policy, which goes into other territory. financeyou see global

move into such uncertain, uncharted territory that we have had with this extensive quantitative easing at the same time as you have a rise in geopolitical tensions, at the same time as a rise in populism, it has a 1930's feel to it. there is a cocktail of instability. governments losing the normal levers of fiscal policy, you see there is no for the normal factors. the global economy is detaching from mature politics and that is a worry. francine: this is also very clear when you look at how we price risk and fear on the markets. we just don't anymore. >> the way markets took off last year when you had the ecb come out with their first round of qe programs, you saw

equities take off immediately. there is a lot of risk-taking that some of these bubbles have deflated. think, in this march meeting, when mario draghi threw everything at it -- negative interest rates, buying noninterest grade, doing whatever it takes -- our markets continuing to rise or are we still in this heavy monetary policy? >> markets end up focusing on the brussels attacks and wind up closing down borders and you don't get to see the positive outcomes from those moves by draghi. tom: when you look at the future of equity investment as we regroup or recalibrate, what is your weighting of european equities? >> we are most positive and most overweight on european equities.

there is struggle in the fiscal stimulus or reforms world. there is the potential for these product market reforms to reduce the domestic demand story. we do find most value and strength in european equities in the developed market space. francine: i want to show you my terminal that i could not show tom before. this is a leveraged index. you can see it hitting the lowest in three years in february. how much do you work about liquidity on the markets? needs to getsse out of $90 billion, will there be a further shock to market in the next few months? >> i think the liquidity issue is one of our biggest concerns

in the fixed income space. since the post crisis regulations, you have a massive crunch down in the trading. , thepreads are wider trades are lower. you are seeing that is a big concern. this deleveraging, that kind of thing, it is really a new thing -- theme. you have to have more conviction to put your money out there and ask your dealer to do that. tom: we will continue the conversation. theill look to belgium and very important meetings by the european union interior ministers today. in our next hour, howard ward joins us. we will speak on apple computer. howard ward on the resiliency of cash flows. kevin roberts will join us on political ads -- are they a thing of the past? ♪

francine: i'm francine lacqua in london. tom keene is in new york. time to go to china, where we find our "morning mover." the chinese central bank weakened its daily fixing. pimco says it sees further depreciation for the currency. -- andu look at the yuan let's look at offshore -- pimco says it will be value. is this -- devalue. is this a general assumption? >> i think so. we are in a similar camp where we see 5% or 6% reduction. the actual value of the yuan is

lower. you have a very active central bank trying to make sure the currency is freely traded, to be included in the currency packet. you have a couple dynamics pushing down the value of the yuan. the big concern is why markets react so negatively when they do depreciate every so often. francine: the authorities keep on saying, we are not actively trying to devalue it. will keep stable at a balanced level. china is a responsible country and developmental fundamentals decide that the renminbi will not devalue continuously. we will push forward the inhange rate of the renminbi controllable manners. we will never stimulate with devaluation. francine: this goes back to trust.

the markets get freaked out and exaggerate moves because they still don't have the confidence that the authorities won't do anything messy. do we need to trust the officials? it is so difficult to read. my impression from china is that they have some very talented people involved in managing the currency, and leaving their economic program in general. however, they are in the process of the most difficult transition to a conservator's -- service led model of growth. there are winners and losers in this model. you see some big protests taking place recently. people losing their positions in smokestacks. that theto make sure credibility, the loosening of control, is allowed to happen.

you have some real swirling pressures in the middle. in that context, they've got to let the renminbi devalue to a certain extent. they are testing the economy. tom: i totally agree. unlike 1997 or back to 1994, how alone china is. back then, there were a lot of managed currencies, there is a lot of day-to-day manipulation. from where you sit, are you -- are they alone because somebody else -- everybody else is in free flow? >> they are alone in that sense. at the same time, they are trying to show that they can be treated as a country that thinks about the impact of its currency on the global economy. they are a region that is critical to growth in the region . even the smallest percentage decline in growth in china has of southeastall

asia. tom: vonnie quinn was pointing out to me that taiwan has effect -- the knock on isthe surrounding nations visible. >> i think ultimately they will try to look to fight back with their own managed or allowed depreciation. they are much more dependent on the export market then even china is. china is becoming a bit like the united states. it is in market with its own points of reference internally. it has a large enough consumption market internally. for their neighbors, exports are critical to growth. i think they will respond quite aggressively. how important is it for emerging markets overall that the fed does not move quickly in adjusting rates?

>> i think it is fairly .mportant the taper tantrum is a lesson. i think this is a bit of a different story. ,his is a very gradual slow recalibrated rate rise. could be coming back on the radar in terms of investment possibilities because of how much they can adjust to the fed hiking rate. francine: thank you so much. in the next hour, we will bring you highlights from the that starts at 6:00 a.m. in new york, 10:00 a.m. in london.

tom: good morning, everyone. futures, -8. right now, vonnie quinn. says oil is slow to deliver boosts to economic growth. energyld's biggest clean

developer is facing a default. they could be in technical default on loans. edison'sdebt -- sun debt doubled in a year. vivendi, backld off or game designers will leave. ubisoft has developed blockbuster games such as "assassin's creed." francine: thank you so much. this is what we are watching today. we start at 10:15 a.m. london time. monetary easing will be discussed in china. at 10:30 a.m., u.k. chancellor george osborne will discuss a possible brexit before the

treasury select committee. that may be quite entertaining. at 3:00 p.m., european interior ministers will hold an emergency meeting in brussels to discuss security in the wake of the brussels' attacks. the case against the paris attacker will be postponed. those attacks left more than 130 people dead. he was arrested in brussels last tuesday. on friday, suicide bombers kill 31 people. we understand that the paris attack suspect has now changed his mind and probably will not fight extradition. what have we learned in our fight against terrorism in europe that is going to be longer, more difficult? >> i think we are in for a long haul here.

this stuff does not just appear. you have a region in flames. you have a middle east, in north africa with radicalized networks that have been built up. you think of europe of the 1970's, 1980's. that lasted 10-15 years of european capitals having to cope with a form of terrorism. i fear we are into a longish period and adjustments will have to be made at the level of cooperation. francine: this feels different to the 1980's. the network seems to be wider and cross-border and better organized. >> in a way, it is almost one network. we are in a different world of social media and ways to connect to the internet. travel is more open. the simple point i was trying to make is that that took a long and it will take a

long time to fix here. what you don't have in europe is basic types of cooperation. passagenger -- passenger name records. there is not and it will take a long time to fix here. what you don't have in yet the infrastructure for security cooperation either between the within nor in many cases nations themselves. continental europe is going to have to do it. tom: i'm going to defer to your knowledge on modern europe and modern belgium. this is the single best thing i've seen so far. this is a wonderful op-ed off of "bloomberg view." i featured it on twitter today. "the institutions of an efficiently governed state have been evaporating for decades."

the essay is fabulous. you've got to be kidding me. can they come to a successful solution here? >> that is the point i was making. belgium is an extreme. you have some developments in other parts of europe. you have separatist movements in spain. europe is made up of a whole confluence of countries that are still pretty new nationstates. many new nations, new states. britain and france are relatively rare.

you of all sorts of faultlines within the european union that we disguised through a trading agreement that is not necessarily the frontline afoot governments have to worry about -- that governments have to worry about. france are relatively rare. you of all sorts of faultlines within the european union that wetom: i have trouble with the word security. to me, it is just the will to do with intelligence and there is a diminishment of liberties here. explain to me any optimism you have that the united states of europe can act like the united states of america. >> i personally don't believe there will ever be a united states of europe that will look like the united states of america because we have come at from a different angle. what i do think you have found in the past is that the reason the eu existed was because those proud nationstates reckoned they could not compete in an increasingly difficult global economy without coming together. now they are going to realize that they cannot survive without pulling together at the security level. and in the end, governments do what they have to do to survive.

they will be thrown out by populist groups or they will split if they cannot do this. now, they have no choice. francine: are we too cynical if we say they had a chance of sharing information and intelligence after the paris attacks? why was the sharing not done earlier? do we give them more time? >> i think they have been scrambling around to follow up leads. belgium was cutting its intelligence budget 5-6 months before the paris attacks. you will have to have a complete flip around in the focus on andlligent and policing connecting intelligence to police. that is not something that most continental european countries have experience doing. hs of the eu that have no experience in connection -- the connection of policing

and intelligence. i think it will take a long time to fix. .om: a terrific briefing there i cannot say enough about the "bloomberg view" op-ed. truly, a must-read. coming up in our next hour, howard ward will join us. we will dive in to a slower nominal gdp and the idea of use of cash. i really need an update on what he thinks our corporations will do. also joining us, kevin roberts. we will look at the advertising political derby in america. from new york, from london, this is "bloomberg surveillance." ♪

unionivided european

interior ministers meet today on airport security. belgian police hunt for a second suspect as people mourn in brussels. lower thise oil morning. james bullard moves the dots. april, come, she will. , i standle inc. corrected. howard ward will be with us on apple. good morning, everyone. this is "bloomberg surveillance." francine lacqua is in london. the story unfolds in belgium. we are getting to the point where it is a story we have heard before. security just cannot get its act together. francine: it is a story we have heard before. it is a story we have heard before, but intelligence are trying to get their act together.

time thatt take more we do not have, as european countries face new attacks. tom: we need to get an update on this right now with vonnie quinn. vonnie: thanks, tom. authorities believe there was a second suspect involved in the attack on the brussels subway. that suspect reportedly accompanied the suicide bomber to the subway station carrying a large bag and may still be alive. european union interior ministers meet today in brussels and will try to overcome their divisions on how to fight terrorism. there is a report that islamic state has trained 400 people and sent them to europe for attacks. there are camps built specifically to train for tax -- attacks against the west. north korea claims it has made more progress in developing ballistic missiles that could attack south korea and the u.s.

they are working on a high-powered, solid fueled rocket. solid fuel makes it harder to detect the missiles before they are launched. hackers linked to iran's government will be indicted for an attack on a dam in new york. new bloomberg politics poll shows that republicans are not plans to stopd donald trump. 63% of voters back trump's views that the nominee with the most delegates should get the nomination despite having the most delegates -- not having the most delegates. -62.dow futures, this is a new market.

dollar stronger, euro weaker. we are watching crude. vicks is still showing -- vix is still showing the better than good market. francine, i'm watching renminbi. the abrupt move managed by beijing, a weaker women be -- i over the -- renminb past 24 hours. francine: this is my data board. i want to show you basic resources. we have seen quite a lot of losses. bhp. european shares are lower. tomorrow, it is good friday. we have a four day trading week. tom: this is off of the james bullard interview yesterday. this is the five-year and the

five-year forward. some people like this, some people don't. we go down. a measurement of disinflation. there is a participant -- rebound. the belief of inflation driving higher. you hear president bullard adamantly stating that an overshoot was appropriate. there is a bit of touch off the bullard interview yesterday. it was really a great interview. bloomberg.com. i wanted to talk about liquid markets. we talked to the credit suisse deal yesterday. this is the fallout of what their president announced yesterday. we have two pieces. what i wanted to show bloomberg. you on the terminal is a leveraged loan index. it hit the lowest in about three weeks. we have so many questions that are unanswered.

uisse said it was going to move $90 billion. when you move $90 billion in liquid stocks, it is going to hit a loss. billion by move $90 the end of 2016. this is the key leverage loan index. tom: this is a world coming to an end. back from the precipice of evil. our guest would not know it leveraged loan if it hit him over the head. knows, hold them if you fold them -- i'm going to break into a kenny rogers song. what have you done in your portfolio since january? we did buy a little bit of energy.

energy has become part of portfolios. energy and youn are double weighted. it seems a little silly. we did get the opportunity to buy into energy stocks on the decline. you had a 70% decline in crude june 2014. you are going to get the reversal. are that over time, that is going to continue to compile. tom: we get a huge response when you are on because it is more common sense. what do you buy in the winter at the end of march? howard: well, there has been a bit of a rotation going on in the markets this year. some of the more defensive names that have been big winners in the market the past few years have trailed the more economically sensitive value type stocks year to date.

that might be getting a little bit overdone in some cases. some of those momentum stocks are real secular growers that have tremendous prospects for topline and bottom-line growth over the next several years. there is only one facebook. i'm sorry. there is no competition. if you are talking google, i.e. alphabet, the same thing. ,f you are talking amazon amazon between its web services and retail juggernaut for online shopping, there really is only one. tom: francine, we are going to rename howard's fund. it is going to be the ward monopoly fund. [laughter] francine: i like that. but what about exporters? how much do you have to look at the dollar? what does janet yellen do? -- will theyorters

be hit, hurt, or helped by dollar strength or weakness? howard: that is a great question. from the macro level, exports are 13% of gdp, so it is not that big of a factor. export manufacturing companies have a double waiting -- weigt hting. the strong dollar rose 20% over two years. the manufacturing sector basically went into a recession for all practical purposes. that seems to be reversing. we are getting better news out of manufacturing. the richmond pmi yesterday, very strong results. impact ofhe lagged very low interest rates is beginning to kick in and we are going to see better news for manufacturing. the dollar, that strengthen the

dollar, the dollar peak on january 20, the same day that oil bottomed -- so, you have had a 5% decline in the dollar on a trade weighted basis since january 20, so it is beginning inlook like that 20% rise the dollar, the dollar is now rolling over. if we do get some acceleration in global growth, which we would expect given the prolonged level of low rates and fuel prices, that would be signaling the continuing decline in the dollar. global growth is accelerating, the dollar almost always declines in value. francine: it sounds like you have been nosing around manufacturing stocks. howard: yes. we are overweight in the industrial sector. there is a new name in the industrials that have been absent for a while and that is general electric. it has gone back to its industrial roots and has become a great global infrastructure play. talk about cash flows and tremendous cash on the balance. finally. 15 years into it, they have the

company that i thought they would. tom: honeywell, was that a merger that should have happened? howard: it would have been a good merger. would it have passed regulatory muster with this administration? i doubt that. tom: howard ward with us. we will be with him for five hours this morning. [laughter] tom: howard ward on general electric. kevin roberts coming up. we will work -- look at the advertising world. we will find out more on "bloomberg surveillance." stay with us. ♪

francine: i'm francine lacqua in london. tom keene is in new york. let's get straight to vonnie quinn. vonnie: hedge fund starboard

value will launch a move to remove the entire board at yahoo! has beensa mayer trying to turn around the struggling company. yahoos board is looking to sell its business. ovartis will pay $25 million to settle a bribery case. the company says the issues raised by regulators happened before they instituted new compliance measures. a takeover in italy will create the country's third-largest bank. deal, they will raise more than $1 billion in capital before the deal goes through. this could lead to a wave of consolidation among italian banks, according to speculation. francine: thank you so much.

later today, european union interior ministers will meet in brussels to talk about their response to coordinating more intelligence and a response to the bombings in the belgian capital. let's get straight to our belgian bureau chief. give us an update on what it is like in brussels right now. the manhunt is still underway. we understand there is a second suspect. >> that's correct. they've identified another man who was in the metro just before the bomb exploded on tuesday. that is that the station very near to the european headquarters in brussels. they have video images of this man and he has been added to the manhunt by police in brussels. that is in addition to the suspects seen on videotape at the airport.

one of three. the other two were suicide attackers. tom: which institution do you look for to make for better intelligence, better security? they trot out the king of belgium. i get that. there is the federal leadership of belgium within a fractious belgium and then there is the brussels police and other agencies. who do you look for to make for a safer belgium? >> well, i think it has become clear that belgium cannot do it by itself, that this is a european problem. if you want a free and open europe, if you want the system to be working, you have to solve this problem on an eu-wide basis. in that case, it is europol. they have try to beef up europol in the last few months. in january, they brought out a

brand-new, shiny counterintelligence headquarters in the hague. they need to get these things up and running better, getting more effective, getting people to talk to each other. that is what the interior ministers are going to be talking about later today. francine: this delay of the court appearance by the paris attacker, does that mean they might need him for beefing up their investigation? >> it is hard to tell. it looks like the court decision today was going to be on the belgian arrest warrant. that has been delayed. he has also been issued with a european arrest warrant. that warrant is the one that he would be extradited to france under. it is possible they have delayed the decision on the belgian one in order to make progress on the european one. we have heard this morning that he said he wants to go to france. his lawyer was adamant

he would fight extradition, but now he seems to have changed his mind. this seems to be playing into that. they have postponed the belgian decision. they have 10-11 days to make a decision on the european warrant , which would be extradition. >> as we see more and more arriving at the memorial in brussels, i'm looking at a headline on the "london times" newspaper that says "blunders by belgium helps bomber slipped through." our authorities coming under criticism? >> the criticism has escalated, as you can imagine. very similar to what we had in november. i think european officials are trying to come together to deal with this problem and to support belgium, but you can't help but having a wave of criticism after something like this happens. it is difficult for belgium to

solve a problem like this on its own when you have such porous .orders within the eu the interior ministers will be trying to address this. how do we tackle this and make this better? tom: thank you so much. next week on "bloomberg surveillance," we will continue this discussion on europe's international relations. richard haass will join us from the council on foreign relations. look for that next week. futures deteriorate. "bloomberg surveillance." ♪

francine: i'm francine lacqua in london. you can see the city of london, the millennium bridge overlooking st. paul's. yesterday, boris johnson talked about the risk of brexit. it was quite entertaining. osbornee have george talking about the economic risks to brexit. tom keene is in new york. tom: our morning must-read. everyone is waiting on matt levine of "bloomberg view" to weigh in on valeant. this is a superb essay on a number of nuances with valeant.

howard ward has seen all this before. i love what you said on the , you can't be half ethical. you either are or you aren't. howard: this is a situation where what they were doing with the pharmacy business was, in my and it, very unethical casts a dark cloud over the enterprise. nothings they say can make that ethical, in my mind. tom: remember when they were printed annual reports and you got them in the mail and you read them? i read them from the back to see involved. that were how do you judge management nowadays, particularly of a company you don't know? howard: you still need to look at the board, you still need to look at management. thesuccess of management, success of the enterprise, get a sense of the history.

in the case of valeant, this came out of nowhere. next thing you know, you have $30 billion of debt and that is a problem. tom: the rule of thumb is you always look for a hard ass on the board. there always have to be one -- has to be one board member who is scrupulous. francine: yes, you would hope that all of them are scrupulous, but at least one. howard, when you look at valeant and the follow-up from it, this is the first time we have a real scalp. they had stepped down because of huge losses. are we going to see many more of those? howard: i don't know about that. this is a pretty significant disaster, as an investment. i'm shocked that some investors that had very good investing reputations got caught with a very outside, large, concentrated positions in this particular security. i just don't get that.

i don't see how that is possible. i don't know what varies managers will do. this was a huge mistake. it speaks to the risk of investing in highly concentrated portfolios. you can wipe out years about performance with one very bad investment and it can happen very quickly. francine: you don't pile up the happened, but has it to you? what seems like a transparent company suddenly has a problem -- do you get out immediately? howard: that is a great question. not in this particular type of situation. when you get back to the dot com bubble, you will recall that that started to burst, first quarter of 2000, then we had a 2.5 year bear market -- well into that downturn, we could talk to the ceos of a number of the top dot com -- and i don't

mean internet stocks, but the providers of various internet infrastructures -- i don't want to name the names -- but the biggest of the big technology names, where the ceos had seemingly no clue as to how bad the business was well into the downturn and then the business continued to deteriorate long after that and there was a total denial. so, did they -- tom: we are going to come back. howard ward with more stories from "i'm not going to name the companies" but i could possibly guess them -- just possibly. kevin roberts will join us. he knows a good ad when he sees them -- one. ♪

to the first's get word news with vonnie quinn. vonnie: the manhunt in belgium

has gotten bigger. police are searching for a second sus act in the attack on the subway. a man was seen carrying a bag before the explosion and may still be alive. theences mounting that attack was carried out by the responsible for the paris attacks. british lawmakers are urging david cameron to challenge turkey's shameful policies. australia says two pieces of debris that washed ashore are likely to come from the missing malaysia an airliner. of theties say discovery

debris reaffirms their plan to search the southern indian ocean. president obama and the china's leader will discuss security in washington. north korea may be the focus. conducted another weapons test. learned it takes two to tango. he was watching the entertainment when one of the dancers coax temp onto the floor -- coaxed him onto the floor. michelle obama ended up out there, too. they are not doing the argentinian close embrace. there is a hollywood tango. the output genotype tango where it is -- there is the outfit she pacino tango. l

tom: there is the uneven walk of the present. say he is more open embraced that close embraced. that is the president of the united states, not "dancing with the stars." continuingcredit for his trip after what we saw in brussels. he must signal life goes on. it is an important signal. advertising. he has given us wonderful perspective over the years. wonderful to have you here. you have a new book out, 64 shots. what is the 64 shots for our presidential candidates?

is there a new model and advertising? it stops with the world we live in. military leaders say we lived in uncertain, complex and ambiguous world. they are spot on. volatility, every time donald trump speaks, volatility goes unpredictable, that is the world we are living in. news -- tom: is this the year where an ad can change the dialogue for the remaining candidates? kevin: those days are over. the people who change the dialogue now are we the people. the big ad, labor isn't working,

whatever, that is not the way forward this year. francine: what is the way forward? you need it clear messaging. if it is not the big, bold ad, it must be through social media. what advice would you give any presidential candidate? stick with it and make it coherent? that is the standard response we would have gotten for five years ago. now we live in this much more complex world. we have to constantly build relationships. execution will be strategy day in and day out. both candidates have got to win the race, job number one. and you will see the terrain change as it comes down into this head-to-head. it is going to be a battle every day in a rapidly changing environment to win the emotional

high ground. can we rear sure the people out there that they are going to do the right thing? not a case toere be made that you want to reach out to the moderates or people that are more thinkers. why is execution so important? you put yourself out of business. don't disrupt yourself, you are being disrupted. itselfsing has to put out of business. if we do not, somebody else will. the simpleld, solution, it is not going to happen. people are far too well informed and interested. the fourth largest

shareholder of apple, would you tell me what we are going to watch in five years? vonnie, help me. we look at usages around us. it is totally changing. what are we going to do in five years? we are going to watch screens and feed on video content and share on great stories. the technology is with us. who ownmericans smartphones are never more than three feet away from the smartphones. we're going to absorb video. we want to be entertained. completelyg to be dominated. vonnie: we have been talking

about campaigns, do you see a successful revolution happening? kevin: what they are saying, ,herever you live, populism people are saying we are hats off. tom: the guy sing next year is one of the biggest dominant believers in that dominant companies will win. will that continue? the single company success in your world? you will see disruption,

transformation, and these writers of the apocalypse will be big. they can be and seated by the next technology. tom: amazon can be unseated? click i don't think it will occur. howard: i want to go back to the political campaign. republican front runner. he had over a million dollars to spend on ads and he never clicked with the public. is there any message she could have sent out that my have changed the outcome? paid for media was swamped by donald trump, who about 400 million of unearned media because what he was saying , andtimulating provocative

the whole notion now of sharing, .eople have the power out it goes there. i think bush fought the campaign, thinking it was 1995. it is 2016. you have to choose one person to do a campaign or one group of people. who do you think needs the most in terms of having a little bit of a better reputation? the bankers, central banks? have liked to have run a campaign for michael bloomberg for president of the united states. thatwe should point out mr. bloomberg is majority owner in this media station.

we have seen quite a lot of pressure on the basic resources. trading week.ay european shares lower. ♪

>> decisions will take affect some years down the track. osborne speaking and being interrogated about brexit. let's get back to kevin roberts.

.esterday, we had boris johnson he was also talking about brexit . they banned children from blowing up balloons and everything and we had to get out of the eu. if you were to do his campaign to become prime minister, how would you portray him? kevin: boris has innovation in his blood. warmth.umor, what i would try to do is give anda little bit of gravitas a little bit of calm this and tranquility. he has the fundamentals out there to create a storm. what he says is interesting. around himoonery that is not very prime minister-like.

francine: when you look at advertising on the political front, how do you reach millennials? some look at trends, retail, buying. he still hasn't figured out what millennials do. with millennials, they want to be involved. they want to connect and collaborate. they do not want to be talked at, they do not want to be marketed at, they do not want to be interrupted. them as a thinking of target group, as a demographic, this is going to result in failure. we have to be part of their lives, not advertise and target them. the is in part of segmenting of the public by age over? it is a starving, smart audience

of wide ages. we did not know that when we started this. the people i know that our millennials rebel against that certitude. kevin: i don't think we live in an age related area now. these great and ablest of technology. we are bending them to our will. equalization and segmentation and targeting is becoming narrower and narrower. the core idea of giving somebody a brand, giving somebody a personality, or giving a brand a personality, that never goes away. has changed a lot. the role of marketing is no longer to build a brand and create awareness. that is going on or you are dead. the role of the marketing group

is to create a movement's, create a movement. , not that through great storytelling, but story sharing. tolde do not want to be anything. tom: howard ward will be with us to get an update on apple. he has been adamant about the use of cash and technology. ♪

tom: good morning. let's get to the forex report. a weaker chinese currency. not near any resistance. sterling, 1.

4137. it is time for our single best charge. to helpberts is going out. i want to talk to howard about apple. apple nine times. selling, howard ward was buying. apple is done. go to cash. this is a company that has $215 billion in cash. dividend yield, 2%. it has become a low expectations stock in terms of the way it has in price. has done nothing for the last 12 months. we are moving to a better season. you will get an announcement in the share buyback. you will look for the release of

the iphone seven. win foruld be a big them. apple is gaining market share. tom: the media does a unit based analysis. opposite.you do the you look at the price dynamic at the revenue line and you bring it down to profitability. howard: virtually all of the profits are going to apple. no one else is even a player. tom: will they maintain gross margins? i see tremendous brand loyalty and demand for the phone in china.

it is priced as if there is no growth in the business. i argue there will be growth. francine: there will be growth. equations.as doing i look at my iphone and think i am forgetful, i forget my wallet and my iphone is paying for my shopping bill. as we also became less reliant on our plastic cards, iphone growth will continue? every year there will be new features introduced. wallet, the apple pay i use its a terrific

whenever i can. it is great. tom: how do you advertise sell market brand engineering. another new miracle from apple. how do you sell that. you start with the consumer, the benefit. don't estimate -- don't underestimate the creativity and innovation. in their genes, consumer people, touch and feel. they are going to build this in. we will come back to that. plenty of guests coming up on radio. i want to come back to howard. the lengths of how long we hold on to the iphone is too good.

amazon went into web services. apple only has this one business. howard: one business that drives their profits. onto yourou hold phone. they are pricing phones to make it easy for you. this is going to shorten or compress the time holding, the. of time where you hold a phone. salesgoing to bump up the over the next several years as more and more people do this. vonnie: why haven't we seen it already? howard: about one third of the new buyers are taking advantage of this option. what is the brand value.

if you have strong brand value, you attract talent, you keep talents. that is when you keep innovating. is the most valuable and most famous brand in the world. facebook is only ranked 64, i think. facebook as a company, a consumer vehicle, is fantastic. it has massive opportunity to create its brand value. -- applies torise google. they have tremendous but they have emotional ground they could build on. the top talents now, creatively, is looking to go to two places, or three. businesses, these technology companies are now looking for more outcome this. people who can bring together

and technology. not have them separate. they can bring these together. i think the other creative people are going to work on television. this is the golden age of television content. is talking about the demise of tv. television as a medium has never been hotter. people doing all of the acting, they are going into tv. francine: thank you so much. heaven roberts and howard ward joining us. bloomberg is up next. it is the week we saw the brussels attacks and the manhunt ongoing. ♪

pimco sets the currency. still the single biggest risk to markets. commodities fall on a strengthening dollar as some fed

officials try to put an april rate hike back on the table. star board is pushing for a replacement of the company's board. a warm welcome to our viewers across the world. upr-day week, we wrap it ahead of the easter weekend. futures softer. dow points off by 83. call it 1.4%. the dax off by 1.5%.