♪ >> coming up on "bloomberg best," the stories that shape the business around the world. the panama papers deliver a flood of leaks and tsunami of controversy. >> his name is not registered anywhere. the u.s. comes down on conversion with implications for deals. the fed to discuss a rate hike, but what should make of that debate? and the serious challenges to global growth and john kerry on the serious opportunities for companies minute to clean energy. >> we need clean energy jobs and conscious decisions. scarlet: all of the most telling

charts straight ahead. ♪ hello and welcome, i am scarlet fu, this is "bloomberg best," the weekly review of analysis and interviews from around the world. let's begin the book at the top headlines with a recession report -- astonishing report from monday, the panama papers. >> a new report says will letters, criminals, and celebrities used companies to hide their wealth. according to investigative journalists, at least $2 billion in transactions involve people and companies linked to vladimir putin. canada --irm in panama. >> they are newspapers lighting up with interpretations of $11.5

million -- 11.5 million documents. 11.5 millionout files from the world fourth .argest offshore law firm you are try to conceal your identity, conceal your mouth. that is not legal. the issue right now, the law firm, how much protection they have, a huge security breach. >> a lot of this is legal stuff. and it isillegal, used by high net worth individuals for state signing to reduce taxes and completely legal format, and then there is that yeah button. >> is embarrassing many of the world leaders are brushing aside? it is a nonevent. >> it depends on where you are, but the relegation -- revelations, it is an outrage. >> there is dramatic video of

people sitting down with the people of iceland. what do we know about home this effect? >> they were calls for resignation, elections that could move him from office, so he is in the hot seat, but the prime minister of pakistan is also there. david: what do you think reporters will be looking for? andirst would be fifa, there is a lawyer on the ethics committee who is doing work for some of the people that been charged criminally in the fifa scandal. and that credit suisse, hsbc according to the documents, tens of thousands of shell companies. a win for the white house, a fight against corporate inversion. the $168 to terminate billion merger, what would have been the largest health care acquisition. tothis the end of efforts

convert abroad completely, or should be the end to all of the mergers on the table? >> in the first case, there is a question the u.s. government went after pfizer specifically with this deal. relations were written in such a way to specifically target pfizer. i think it is very clear that if pfizer tries to do this again, it will be as my response in as much the white house has still post is current occupants in the future, who knows. for now, i don't think pfizer will try to do anything else. generally, we will have to see. a lot of writing a course in the u.s. and whether congress can pass the tax reform that would remove the incentive for inversion in the future. >> i think the administration should be focused on pfizer, not allergan. the rules and pass today were to stop the inversion. i think, we have a competitive

advantage for the walls around the u.s. to launch u.s. -- being to be led less competitive global to the -- globally. rishaad: this company is being sued by the u.s. and they say they will be blocked because of brexit competition. vigorously find the charges. what is the justice department worried about? >> there are trying to take the services based on the number of people that were competing in it largehree really players, that is what halliburton was trying to do. havecould charge more and one less competitor to compete against a. that is something usually the doj and regulators will resist. i don't think anyone is surprised by the announcement today. thee are moments away from

minute to the federal reserve meeting with a lower from 4% to 2% in these minutes. you look at how dovish the yellen fed is. >> into the outline of what was probably a lively and contentious meeting that centered around the question of whether a rate increase would be advisable at their april meeting . they held off in march because the minutes show, many participants expressed a view that global economic financial situations still hold appreciable downside risks to the investing economic outlook. surprisedople are a that it is as heated as it was. what does it tell us about the potential debate at the april meeting at the end of this month? >> did the minutes say it was heated? >> we are looking at the back and forth. they did not all agree. course, people are passionate about their positions

, and these are hard decisions to make. kathleen: so what are you watching? have been concerned about inflation expectations when i talked in february, especially after the five-year forward where inflation measures are down below 1.5%. that got me kind of nervous, and i started to flag those numbers. we have recovered probably back to december levels. i find that comforting. we would actually like to see those numbers were higher than they are today. reflect somehow the credibility of the fed and its ability in the long run inflation target of 2%. his annualond issued letter to shareholders. he emerged -- warned about emerging risks and also protecting interest rates among other things. he took shots of u.s. relators

by saying our shareholders should bear in mind the u.s. government requires a capital surcharge. double that of the international competitors, it may ultimately put u.s. banks at a disadvantage for international competitors. describe what that means in your biggest take away from this. >> there are many places in the letter where jamie dimon sounds strong. there are other places that he feels he is under attack. certainly i people like elizabeth warren but others as well. here's a quote for you. i don't want any american to look back in 20 years and try to figure out how and why america lost the leadership position in financial services. if not us, it will be someone else, and likely a chinese bank. it is hard to see right now how the chinese banks are going to get into that position. >> the eu referendum is a massive political risk. jamie dimon talked about it.

the case for rao and worse than that. what are they from his standpoint? >> from his perspective, the best case scenario is that britain and the eu are quickly able to renegotiate the trade agreements and business .ontinues more or less as usual the bad scenario is where britain leaves the eu and they take reevaluation against -- retaliation against the action. worst so far is the dissolution of the eu, not just by britain leaving, but by other , and thisving the eu great european experiments that has been underway for a quarter century would fall apart. >> we are learning more about the potential buyers for yahoo! verizon and google among possible suitors. with all of the challenges, stocks are valuable, right? >> they are more valuable than

verizon, because verizon bought aol. they have problematic advertising technology, come with a very big digital reach. >> but why would they want them? >> verizon's plan is to marry data to users. they have over 100 million odds, files, you can take the digital data you get for users from aol and yahoo! and mary that with this advertising technology that uses algorithms to show digital advertising, and compare that with the mobile video product verizon has already introduced. that seems to be the plan here. because this is so similar, you can take out a lot of cost. there is synergy that verizon cannot get with any other company. i think that is why verizon is taking a hard look at yahoo! >> [indiscernible]

alex: absolutely. we know private interest are interested. they will in fact make a strong bid. are of the big players reporting, at&t, comcast, disney, microsoft, southbank. they have limited to no interest here. that narrows the film -- field a little bit. scarlet: coming up on "bloomberg best," more reaction to the panama papers and repercussions already felt around the world. ♪

♪ scarlet: this is "bloomberg best." i am scarlet fu. over a little -- 11 million documents released no as the panama papers.

will take time for the impact to be known, but the story unfolded dramatically. >> nobody said mr. bruton was involved, because it is not his name registered anywhere. some people who know mr. putin have certain offshore business, so why, what? what is wrong about this? i have many comments on this. russia have to offshore zones. i never read anything mr. bruton directly. he was never involved. will kind of business were you doing in panama? >> we only accept structures, vehicles with legitimate purpose of avoidance. every client has to certify to is planned, or they have to leave. there is a structure with

beneficial third-party, we insist on knowing who is a beneficial owner, or will not engage with that entity. we are very careful in our practices. we are very strong. >> in iceland, a bombshell. the prime minister resigning one day after a massive data leak known as the panama papers linked into secret offshore bank accounts. joe: you literally wrote the book about the offshore -- what is the most significant of this? >> it made a lot of progress in enforcing venture institutions to apply regulations, but what we discover even to this day, there are some of them violating these laws. having the customer identified, potential owners, violated by

some of these safe havens. >> the investigation into offshore accounts in the so-called panama papers is now putting the british virgin islands, a cluster of islands in the caribbean just east of puerto rico, under some major scrutiny. the overseas territory is home to half a million companies. tell us about the u.k. relationship with the overseas territory. >> revelation that more than half the companies exposed by the panama papers were registered in the british virgin islands has put the spotlight on the u.k.'s awkward and ambiguous relationship with this territory. the prime minister david cameron put pressure on the bbi to open up a public register of companies registered there, but so far he say it is more of his call. he is facing pressure from opposition politicians like labor leader jeremy corbyn.

taking direct control of overseas territory they continue to flaunt u.k. tax laws. >> hong kong and china have emerged as the stock market firm for the center of the panama papers leaks, almost a third of the offshore and shell companies set up worldwide. what is the latest to come out of china? >> just the significance of the china market for the law firm's business, setting up offshore entities. almost a third. they set up 16,000 offshore companies for chinese and hong kong business people in the relevance of political leaders with some cases. of attention,ot this was their most important market they set up in 1989 in hong kong, and they make good use of their presence here. jinping seems to be the focus in china with relatives having offshore

accounts. very inconvenient in a time when he is trying to drive his anticorruption efforts there. drew: not allow smoking guns have come out yet. it just goes to the contradiction between xi's efforts to crack down on corruption and the senior chinese elite and political elite dabbling in offshore energy. the grand order of one standing committee member set up for the first officer company, a freshman at stanford. she has already got her name on a company. and a couple more. >> the panama papers saga has ensnared crudest prime minister david cameron after four days of questioning regarding cameron's investment in offshore accounts. he finally gave details on his interest in his holdings funds. take a look. david cameron: we haven't joined to count -- we have a joint account. 2010. in january

that was worth something like 30,000 pounds. i pay income tax on the dividends, but there was a profit on it, but it was less than the capital aimed attacks. i did not pay capital gains tax, but it was subject to all the taxes on the way. stephanie: how big is this, john? john: it was all legit, but the fact it was organized by supposedly dodgy and the company is the slow. it comes in a time when you have the brexit in 11 weeks, the problems in the u.k. steel industry, and the difference of meandering and so about the budget. it is just an element whereby cameron, despite winning the amazing victory last year, suddenly stumbling. the worst thing is it took him five different iterations to finally come out with what was sort of fairly simple to say. ♪

♪ scarlet: you are watching "bloomberg best." i'm scarlet fu. let's continue the weekly tour with a look at company news. we begin with the merger of airlines. air is buyingka virgin america for $2.6 billion. it is a 47% save to the stock price. we first reported richard branch and -- benson was looking for a buyer. told bloomberg news it is unlikely the u.s. government will seek investiture's. they did not been significantly below alaska air. so the that was not nearly as bad as we thought. it could have been -- why did they move out?

>> alaska air was willing to pay more, however million dollars more per share. they are a bigger company, up $10 millionish compared to jen blue -- jetblue. have been unable to get more gates at laguardia or others, so america gives them access to that and helps them. >> what happens if they lose? jeff: alaska air is paying so much. 47% premium is significant. you don't see that much. usually in biotech's. perhaps jetblue can look at frontier or spirit or smaller airlines, but there are not a lot of big deals that can get done in the airlines base. rishaad: chinese smartphone makers et naming a new president u.s., battle for the

hurting the business. the results come out next month. columnist. gadfly what is the mess they got themselves into? >> this goes back to 2004 were equipment fromng various companies and reselling .t and shipping it to iran the u.s. has sanctions on iran, you are not allowed to sell this kind of stuff to iran. they were alleged to have done so and guided by shell companies and the front companies, they got caught. and now we got to the point where the u.s. department of punished-- commerce cte directly. they said, we are not going to let you sell to zte. rishaad: have they reacted? tim: they have changed their management. they announced they are appointing a new chairman. -- foundingchairman

chairman has been there for 30 years, he is gone. he is no longer chairman. it is very unusual, and they are going to try and speak to these issues the u.s. has about trying to get rid of the people who are doing the various stuff were alleged this various stuff -- nefarious stuff. the disney ceo oh is stepping down. no reason was given for his departure. he was to remain at disney, but the special advisor to bob iger. it was widely seen as his successor, so what happened? >> he was the cfo for a long was being groomed for a long time. risulo left when tom skaggs became coo. they have had 10 + years to look

at tom stagg said his qualifications before naming him coo. for the board to say you are not the right person is very surprising. >> usually disney like to promote from within. michael eisner breaks that rule. was there a big surprise if the successor to igor was an outside manner women? -- man or woman? igor actually ran a very good signal selection plan -- good succession plan. grooming them over a long evening of time to succeed him. bob iger was getting a lot of points for that correctly so. it did not work out here in the end. the company is left with very few internal candidates. they will look outside of the company for new executives to come in.

in the peripheral, they would have loved to take an internal candidate. >> twitter making a strategic push into online programming. the social networking company will stream 10 thursday night company games to the public for free. who wins and loses? >> the fans when. -- win. it is purely green. the nfl is looking through the windshield, not the rearview mirror. if you think about it, this device looks like a small football field. they are taking chances, they are being entrepreneurial. if you look at the 50th anniversary of the super bowl right here in silicon valley, the nine second attention span is perfect for this device. emily: and also a great win for twitter. >> yes, and allows them to get in the game with the most powerful broadcasting entities in existence today. the nfl is pricing the value of what these rights are.

somethingnew area they are going into. consider going for the highest price now, they are going to see how it works for twitter. >> glencore is moving forward and plans to sell assets to curb the $30 billion debt burden. they bought a minority stake in the agricultural unit for $2 billion. they will own about a 40% stake in the business. ,e have been talking about this and you were talking about the agricultural deal as a major component for what eisenberg was to do in releasing the debt burden. >> the biggest part of his debt reduction plan for reducing that billion, $70 $30 billion by the end of last year. glencore is trying to get rid of assets, i $6 billion of and also write equities. the centerpiece is done. and they are a bit more to do

because if you think about borrowing the company's low prices, relatively low oil prices, and general all the commodities glencore produces are very low. were 30%, they are trying to get to 70%, where are they now? javier: some of the streams already deal done, what is left is potentially selling the cultural unit, they can sell out of 20%. it sold 40% of potential, they could do more than miners and chile. looking to pursue a premium spot on the london stock exchange. you are pursuing this london listing areas of question is, are you ready? i am concerned whether or not this is the right time. i want to point to the book on cyprus, .45. your price to recovery story,

priced as a stock that has issues with mvls. why the step up to the big stage on london is the right thing to do right now >>? the sectors, and on germany it is more than that. there are new reference point for you. we've been talking about fighting liquidity and value discovery for our stock for more than a year now. the cyprus exchange the quiddity is too low for a balance sheet that has more than 3 million in equity. we need to find more long-term investors, greater liquidity in the stock, and the story to long-term investors. >> will you be able to do this? >> wilbur pushes you on everything, and that is the nature of having an investor in your stock. it was initially my idea. >> he is saying something else. >> we are all saying we need the

highest standards of corporate government, corporate banking, we need to tell our story to a wired or audience -- wider audience, and it can be done by longer-term investors. the preliminary first quarter earnings coming in from saint-saens. -- samsung. sides -- predates a surge. >> the new galaxy is being put into a market where there weren't any real competitive products. the iphone seven is coming out probably toward the end of the year, and that will be real gadget to beat. rishaad: you always get fixated, a whole array of different products. until recently, it has been the most profitable. they are also having problems. apple itself is predicting its

first sales to decline in a decade. so with the global and chinese smartphone market sort of e-voting, prices for chips and displays them some makes will fall as well -- samsung makes will fall as well. scarlet: still to come on "bloomberg best, go john kerry energy ishy clean worth investing in. ♪

♪ scarlet: this is "bloomberg best." i am scarlet fu. it is time to replace some of the week's most interesting conversations, and there was no better place than to start with this exclusive interview with managing director christine

lazard. we sat down in frankfurt to discuss her top concerns about the global economy. baseline ase slightly lower, but we also see what we call downside risks, a bit higher on the horizon, and we don't see much by way of upside. we believe that the three key risks that are china, change of business models, and the results of lower growth, lower humidity prices, andmmodity the tightening of financials as a result of new monetary policies that has just begun, and will probably come out too as the key factors. those on the economic side. and on the top of it, we also see some very concerning geopolitical threat that have an economic impact on many countries around the world. haved then of course we the fully vote of brexit. is that in your top risks for

this year? christine: it is clearly part of the uncertainty we have at the moment, concerning the european union and the financial sector as well as the private sector that london represents. thecine: even at all concerning news were to come true on the geopolitical front -- chrinstine: what we fear is the new mediocre that i have heard about last year, which would mean we can growth, no new jobs, debt.h inflation, high all of those things that should be high continuing in that trends. we call for policy actions and what i have names the three onged approach p -- pr approach. economic.fiscal,

we are seeing a lot of policies at the moment, but we need this change of need it fast. >> what happens if you elevate the prices with real growth and fundamentals have to go up to match the higher level. one thing that would send us is very strong growth, but if we get that, the prices are very side -- verified by the strong growth. the problem is that we have to keep monetary policy so accommodative that it actually happens. if that is not happening, growth is still, you heard the imf managing director, the new 2, 3,re, then this is not 4, to eat. we keep doing it because it is not going to meet, right? that is the concern because as

prices start going back to fundamentals, which is far lower than the elevated levels at which they have been kept. then, and somek central banks say wait, there is more combination. we go back to the higher level. the point is, i don't think this is a stable situation. either we need stronger growth or we need to recognize we have reached the limit of monetary policy and slowly, i don't say abruptly, slowly we get back to normalcy across the world. >> what about messages coming out of the various the reserve numbers? it seems they are not cohesive messages. there was a lot of talk about about april and the tightening. >> there's been a number of people coming out and talking about the rate increases this year, whether it is 2, 3, or

even four. i think the education strategy, if you look at what we put out, the stock charges, if anything, the margin stock charge should we have more agreement and the inller number of increases 2016. i think that a lot of the commentary you have heard is simply a number of people who have one more this year, talking about big things today, stronger, it may be in meetings to talk about. it could be 2, 3, it will depend on the data. rishaad: would you support a rate increase in june? : i would be looking for to this year, not surprised if one in the beginning, one at the end. one of the fall, one at the end of the year. it will depend on the data, but i will be open-minded for sure. >> the department of labor unveils the final version of the expeditionary rule which shows

investment advisors are putting clients interests ahead of their own. what is the problem they are trying to address, and why is this the right solution? >> the problem we are trying to address is the entire landscape has changed dramatically over the last years. in the inheriting world, they had defined investment plan, retired with a pen, pension, and a party. they did not have to worry about that pension running dry because it was a side benefit for life. world,the 401(k) and ira the consumer has to take ownership over how to spend their hard-earned money. we are doing today is making sure regulatory plan skate -- regulatory landscape matches up with the retirement landscape and the principle of consumer protection, putting consumers first is put in place in the retirement space. to do this byight

product regulation that affects everyone instead of just going after bad actors? tom: i really appreciate your question. this is not a case of people who have malice in their hearts, and i have said that repeatedly. advisors are not bad people. i have spoken to so many, who try to do the right thing. this is a case about a system that is structurally flawed. how do you view silicon valley right now with talk of human forms and that is competing by a different rule from everybody? >> i am worried, but excited and delighted, many of the companies that have been created, they are exceptional. they are a little disconnected, they work in their own world. they talk about being inside the belt, it is like inside silicon valley mentality. people think more broadly around the country or around the world,

and i think they get caught up in the valuations. -- franklyion is valuation in new york city is a little too high. we call it the rise of the rest cities. cities in the middle of the country where the entrepreneurs are building great countries -- companies, but they tend to be more moderate. people -- venture investors start to invest in these cities as well. banky have we not seen the by facebook? i have we not seen a bank by google? steve: they are expensive. in this, you are more of a defender. doctors, big, just companies are playing defense instead of offense. ♪

♪ scarlet: you are watching "bloomberg best." i am scarlet fu. we had a future of it energy climate. many speakers joined us on bloomberg television. here are some of the comer stations leading off with secretary of state john kerry who sat down with david westin. what is that you are asking the private sector to do that they would not otherwise? john: make energy conscious decisions, how that power the plant, where they do it, and also in their choices for national policy. to energy.t we need to move rapidly as a low carbon energy-based economy, and that would be not only significant in terms of emissions and negative consequences that come from

climate, but it is the greatest economic opportunity the world is looking at today. millions of jobs are being created in making energy conscious decisions, and by the way, a lot of savings for companies. you could power a plant more efficiently, even save billions of dollars literally. david: source ceos and business it investors losing the boat? many companies understand this. walmart, pepsi-cola, general electric. list ofwrite a long american brand-name companies, but we have lots of other people that are engaged in smaller and lower levels to make wiser choices about their energy use and energy production. david: are you encouraging the government with regulatory tips to account differently for the costs of climate change? john: not regulatory, but we would urge -- counting is

supposed to be an exercise in transparency and accountability and truth. real figures, really counting. todaycounting on injured does not take into account what costs that we paid, the taxpayers cost. billion from hurricane sandy. this is a huge transformation taking place that has potential negative consequences, but the accounting is to reflect the realities. >> why not just impose a federal carbon price unilaterally? why not just do it? >> if you try imposing things on 10 canadian provinces lately? >> i have not. popular.hink they are we just sit down and talk to the people, and the prime minister has done that twice.

they have their own carbon mechanism. the talk about what is on the national objectives, and then the best mechanisms for us together to get that. >> exactly the economy has been hit ready well by low oil viruses -- prices. you think the strong revenues from oil will cut into the potential investment in renewable energy? james: i hope not. i think the entrepreneur always has his or her mind on what is next, an investment is what is next. it becomes a part of a priority. we know there are meetings, companies in the oil capital of alberta who have come together to pool their r and d resources together aside from intellectual property interest to find a

practice for the entire industry to share. while it may in some cases be more difficult to make the r and d argument during a time of low commodity prices, we see they are making positions anyway. -- petitions anyway. >> one country leading the way is chile. from renewable by 2030, and they have predicted to grow in the last five years. renewables a boom in , no fiscal subsidies. that is very important because it is sustainable. today, energy, this sector in the economy with the highest investments. it is more than what we used to have. we used to be number one. no energy is number one. -- now energy is number one.

we are building new infrastructure. we have more than 2000 kilometers under construction today. and more than 58 power plants under construction. we have more than $13 billion in infrastructure incompletion to to comeenewable energy under operation in this year. something that has happened during this has been the fallout of commodity prices. you mentioned mining was the number one thing there for chile. if you have alternative energy to power minds and they shut down, how do you manage that? is one third of all of the demand in the country, but we have another two thirds in other sectors of the economy. we need to restructure the energy basis so we have a lot of

opportunities for renewables. we are in a region of the world that has huge opportunities or integration and interconnection. ♪

♪ nine it fdi, was was on a fabulous trend for years, has changed. is based new globalization. -- it speaks to new globalization. >> it is not just a stock turn the meniscalp, but amounts of buying, red is selling. >> talk about allergan and the acquisition machine, you can like at this on the bloomberg byp. >> we used an array of functions on bloomberg to enhance coverage of businesses. bloomberg terminal customers can #bypgo.

scarlet: here are some of the favorite charts from this week. >> i want to ask you about the divergence we have seen in equities. it is interesting if you look at a longer-term picture, this is a them -- they at i,e -- 10 year look at the msc the stoxx 600 fell to a five-week low, and a few weeks ago, s&p 500 was at the 2016 high. why is that, and will continue? >> that is a reference to the -- i think the real reason is earnings. i don't think europe's earnings have grown in five years. the u.s. has doubled since the trough. it is fundamentally based. when you look at a of companies, the u.s. has a better health

care sector, technology, banks, market. if you go down the line. companies that deserve to have a huge premium relative to the global peers. it is relative safety of the environment, i think >>. , and itd a great chart has been in the downtrend. is barely even a blip. trend has-- long-term been a weekly basis. >> the japanese yen. >> here is the basis of the yen and what it has done today. major currencies that have cross with again are seeing declines. the south african rand, and you can also flip this over to look at the year to date, and you will see similar movement obviously of more magnitude in

terms of movements. all of the major currencies falling versus the japanese yen if you look at the debate of the pound, following the most versus the japanese yen. also looking at the forecast for xfs whichthis is f looks at currency. here are strategists looking for weakening in the yen, this is where the forwards are trading. this is what the market is saying, strategists are saying. interesting convergence there. big on britain. i am going big on brexit because you know is the fascination and the u.k. at the moment. the stock market does not care. this is my charge, you have got #btv11. you have a premium of about 8% versus the stoxx 600.

we are trading at 16 times estimated earnings, whereas the stock 600 is trading at 15 times earnings. estimated earnings. we have never seen the stock market actually do so much every single week since the referendum was announced back in february. every single week, bearish coming down on the u.k. stocks. the british pound has come down about 4%, versus the u.s. dollar. that helped. if you look at the energy stocks, doing well. scarlet: we have created a new function dedicated to rex it, brexgo. it lets you monitor news indicators. you can always find news from around the world 24 hours a day on bloomberg.com. that does it for "bloomberg best compo this week. thank you for watching. ♪

♪ john: welcome to this edition of the best of with all due respect. we saw wisconsin build a big boost to ted cruz and bernie sanders, and they blow through clinton and donald trump. we watched as the race came to the empire state, home turf of the two front runners and birthplace of bernie sanders. in an interview following her loss, hillary clinton gave her rival a taste of new york magic. >> jeff weaver says something very interesting, inflammatory on the air,