at a crucial time for u.s. german relations. the chancellor and the president held a joint news conference after their meeting. merkel speaking through an interpreter that said globalization needs to be fair. >> i believe that globalization ought to be shape in an open-minded way but also in a very fair way. elementvery important of our economic progress of peace. it has been for many decades. concerned by is mr. trump's criticism of nature -- nato. for republican governor say they oppose the current plan to replace the affordable care law. mcconnell, to mitch and now speaker paul ryan, the governors of ohio, nevada, michigan, and arkansas argue the legislature does not ensure adequate coverage and shifts significant cost to the states.

presented an alternative proposal for a medicaid expansion program. it would wind down medicaid expansion starting in the year 2020. the white house has assured edition officials it won't repeat allegations that british intelligence was involved in spying on president trump before the election. after a whiteed house spokesman cited a fox news commentators report that the british helped president obama spy on mr. trump. a british spokesman called the report utterly ridiculous. pushing into western muzzle today after the advance slowed because of bad weather and concerns about striking highly populated areas. commissions are said to have intoved, forcing further the heart of iraq's second-largest city. returning tore now

previously liberated areas. global news 24 hours a day powered by more than 2600 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg. >> live from bloomberg world headquarters in new york. joe: we are 30 minutes from the close of trading here in the u.s.. ; -- scarlet: tranquility across the markets. it doesn't mean uncertainty doesn't exist but we will look at other gains of anxiety. and fixing health care. i sat down with kathleen who worked to pass a model she

shares her thoughts on the gop health will. the clouds are clearing. oracle shares cleaning. it the ceo joins us in the next hour. what did you miss? president trump says he is behind the gop plan to repeal and replace the affordable care act despite the bill running into some resistance from conservatives. the president spoke this morning after meetings of the republican study committee. trump: all of these nose or potential knows are all yeses. every single person sitting in this room is now a yes. i sat down with the former health and human services secretary who served under president obama. inegan by asking if there is each are to the claim that the affordable care act will collapse under its own weight?

>> i don't think that's inaccurate claim. over 12 million people signed up in the marketplace during the last open enrollment. in spite of all the uncertainties and the fact that the trump administration pulled all the advertising to tell people when open enrollment ended. it was still very solid. there are companies entering and leaving marketplaces and we need more competition in some of the states. all of the health economists agree that the 2017 rate increases were a one-time pricing adjustment based on three years now of a trend line. and most health consumers, all but 3% did not pay those premiums because their subsidies went up along with the premium. it is a solid market. i think the notion that if they just do nothing, it will fall apart.

harmwill do a great do of to people who rely on this health insurance. one argument that conservatives make is that rural communities are not well served by the affordable care act. why did they end up with fewer choices? >> the choices in rural america have been pretty slim for decades. i was governor in kansas and we always had trouble with the western part of the state, both attracting doctors and making sure hospitals state open and having insurers that really look after an older and sicker population. a lot of young people moved to the city's. tend to be older and often less healthy. what this plan does is double down on that. it allows insurance companies to

charge the older citizens five times as much as the younger ones. and the subsidies are cut back for every low income individual. problemsave far more in rural america getting health coverage. i think what is alarming about is that theyction say rates eventually will go down. they will skyrocket initially and then go down. the reason they go down is older people will be priced out of the marketplace. so you will have a younger group leaving older americans with virtually no choice. >> should there be different health insurance options? get away from the one-size-fits-all policy? nownsurance companies right

pick and choose what markets they want to serve. that is what you are seeing. some survey full state. some are in 10 or 11 or 12 states. some only choose portions of the state. there are certainly more choices here in kansas and in the kansas city area. that is how this operates. place, there is a mandate -- putting together a network of doctors. pharmacies that offer those services. the rural parts of america have always had fewer choices. scarlet: has anyone any

administration reached out to advice on how to guide through a bill and get it through congress? has there been any outreach? >> i haven't heard from anyone in the trump administration. joe: would you speak -- scarlet: would you speak with them? >> i would be happy to speak with them. it is one of the most important issues that this administration and this congress will be addressing because it is life or death issues for 20 million people. and i would be delighted to offer any health suggestions, advice. is thatt of our world this bill as is goes through the congress and 14 million people are projected to lose their coverage next year. and eventually 24 million americans, moms and dad, grandparents, sons and daughters , they will be out in the cold again.

that is a terrible place for those individuals to be and for this country to be. we have the lowest uninsured rate we have ever had in this country. we have more people in the health market and more people being able to pay doctors bills. more people having preventive care and not waiting to go to the emergency room and something happens. i hate to see us take a big step back. that was kathleen sebelius who served under president obama. joe: the israeli prime minister exclusive -- four of interview with vonnie quinn. this is bloomberg. ♪

vonnie quinn is

standing by with an exclusive interview. you.e: thank you had a long day yesterday with president trump and it has been, what, 65 years of ireland visiting the white house? one of the more controversial ones. headed to get along with president trump? first of all, you do a wonderful job with news of substance. we had discussions with general john kelly and respective matters on immigration. then we met with the president in the oval office with his team and various other meetings after that. the conversation was broad ranging. it was very engaging. and from my point of view, there was different progress in terms of having a clear understanding

that led to america over all those years. across 50 states. and also is a member of the european union. the real potential in benefit you can have -- specifically,re the immigration band that was supposed to go into effect yesterday. do.gs that he wants to what did you say to him on those issues that you can bring home to ireland and tell people that did want you to come in the first place. is fort of all, these people that want to come and work for a period. we want a decent allocation of those. we would like that revived. on immigration itself, we have 50,000 people in america that are undocumented. surprised thate it was that low.

did you get the sense that you can get along? >> i did. this contribution that people make. they are living in limbo. home.an go it is a very particular problem for open immigration. but our people that we know contribute greatly. -- they want done that taken off their shoulders. the 4000 plus medals of honor given to defense forces. -- vonnie: about u.s.

companies using materials in the u.s. and being protectionist. from edible competitors, won u.s. and one for britain. >> irish firms are now sufficiently confident to expand the united states. they employ 100000 and can employ more. it has been very strong with all 600 american companies in ireland. they are not going to move from ireland. vonnie: what makes you so sure? this president is putting pressure on companies to bring back jobs from mexico and undue factories built in other countries. what makes you sure those -- >> i have spoken to most of them and even since the new

administration took office. asy want to be recognize international global players. they set roots in ireland for 40 or 50 years and developed a talent pool that is quite incredible. the european world headquarters. they expanded in very recent past. what about new jobs this year? >> all i can say is that the agency that deals with inward investment. the pharmaceutical area, software, financial services, telecoms. ireland is now gearing up as a very safe thing. it is all over the country.

vonnie: let's move on to article 50. european officials ruling out the idea that any discussions can take place. it is $60 billion right now? >> that is a set of principles that haven't even commenced yet. >> the bill is paid. it is to be set out and negotiating stance to be adopted. vonnie: that would delay things even further. ask there are figures mentioned here -- >> there are different figures mentioned here. it would trigger at the end of march by running a letter to the president of the european council. vonnie: but how do you know? will they still be paid by the

end of march? >> there are different assessments. there are 10,000 issues to be considered here. aat britain wants is as close relationship to the european union as is possible. we support that. of all the countries to be affected by a hard brexit, they point out that ireland would be most adversely affected. the trading issues, the common travel area, and where we will stay. it has been affected to the tune of $1 billion. they have been really heard by the currency issues. >> it is in value terms so we do 100 trade missions to different areas around the world this year. aboard the eurozone and the european union with how we can increase it ourselves and trade

missions. it is like the opening of the european market. they havejapan, certain elements -- vonnie: you can negotiate trade deals without the backing of the european union? >> it is not true to say, for instance, america -- vonnie: but what do they end up in concretely? -- >> it would increase the value of the sales and the range of products we have on offer. vonnie: what do you tell president trump and vice president pence about a border adjusted tax? what would that do to ireland? >> the only border i mentioned was asked leaning to the president and vice president that we are not returning to a hard border as we had in the past with customs controls. that the only internal border once britain has left -- a

political agreement between the irish government and the british government not to have a hard order. vonnie: and that is possible somehow? >> it is a political agreement. it would have to happen because they won't stand for anything else. line,: you left out a that you would be stepping down in a matter of days after 11 great years and 40 plus years in ireland. having seen the wonderful renaissance of the irish economy. you took that line out or someone took that line out for you. how long will you be -- first party is to make sure there's an executive in place -- [indiscernible] the second is to put in place the platform for negotiations. we have the 60th anniversary of the foundation of the treaty in rome.

i want those in place. vonnie: that's only two weeks. prioritiese the beyond anything else in my immediate priorities. they need to get running for the voice of the north. the triggering of 50. that sounds to me like that is all possible by the end of this month. are you saying you might be gone by the first of april? >> are not saying that. i'm just saying that's what my immediate priority is. vonnie: and when brexit is triggered in negotiations start, you will have done everything you laid out in october -- >> we have an agreement for three years. andll deal with this matter

that's what i intend to do. the negotiating stance. what is broken about europe? the builders, a lot of countries talking about exiting. is there something broken about it? of potential.lot they are optimistic last week. 4.5 million new jobs. every single country's economy is now growing. answering in the netherlands yesterday. like there is a renewed vigor about the european council in making decisions that would benefit everybody. trade agreement between the european union and the united states.

my view is focused. vonnie: you are leaving tonight. tell us what your final thing is. >> we want to bring the freedom tower. this example in the resilience tonew york city, and also those in the nypd. and i just want to point to one of my colleagues in the op-ed today. how the irish are still doing the same types of jobs. >> they want to do it again in the future. and also if you want to get the opportunity, you would see what the irish can do for america. scarlet: thank you so much, vonnie quinn speaking with the irish prime minister. from new york, this is bloomberg. ♪

scarlet: we talk about u.s. stocks hovering near record highs and a lot of complacency. but maybe not as much if you look at what to call ratio. it is for the s&p 500 and it goes back to 2007. it is a simple moving average here. you have bearish options to bullish options. peasant indicate more is him and it is in the lowest since 2013. if you break below this level, you go all the way back to 2009. joe: it fits all these charts like a broader look to try to find levels of anxiety in this market where people are looking at eskew, the vix, other measures. volatility has been very low but everybody is trying to figure out where the anxiety lies. and he keeps going up and up. the market close is next. and speaking of hovering near

record highs, take a look at the major indexes before the close. losing one point, two points, maybe. for the rest of the week, it is higher. from new york, this is bloomberg. ♪

>> we are moments away from the closing bell. what'd you miss? the dollar is closing towards its biggest weekly loss in more than a month. i'm scarlet fu. joe: if you are tuning in life on twitter we want to welcome you to closing bell coverage. with ourwe begin market minutes. when you look at how the indexes have closed for the day, pretty much how home. s&p 500 down. little change. the nasdaq virtually unchanged at this point. i want to look at the sector groups to see how things fared. bonds, thather in means a drop in yield. you are seeing the bond proxies, all doing well. investment trusts gaining as well.

not so much by utilities and the telcos. financials off by 1%. day really was not all that exciting. you can see the big moves in financials again down 9/10 of 1%. individual movers, keep your eye on amtrak. adobe came out with an upbeat forecast gaining 4%. tiffany's profit topped estimates. let's take a look at the government bond market. the big story of the week, the rally in bonds. the drop in yields. we saw more of that, ending at 2.50. both of these 10 year yields were over 2.6% earlier in the week. it came down a lot on that that decision. let's look at a one-month chart

to give more perspective, sort of where we have been and how far we have come. we are over 2.6. earlier this month we were around 2.3%. this is the debate. everyone is up waiting for breakout of this 1.2 range. that to nots shown necessarily be so simple. >> we are talking about significant levels as well. it is something bill gross has highlighted. joe: we were supposed to be off to the races but we have low buying. scarlet: he did say it would be a monthly average. that was something to keep in mind. in terms of currencies the u.s. dollar had its worst week since july. 1.3% for the past five days. university of michigan survey long-term inflation expectations declining to the lowest since 1980. pound, the at the

first weekly gain since february .oving, gaining market expectations are now increased at some point as -- joe: o slightly more hawkish expectations than the beginning of the week. let's look at the zinc, oil and gold. oil doing nothing but of course. the last couple of weeks it has been fairly week. gold taking out. i want to look at a one-year chart of crude to give us some perspective. we have been generally trending higher. you can see the dip, that 10% move we saw last week. the question is this part of a protracted selloff or is this in a general uptrend? scarlet: looks pretty range right now. those are today's market

minutes. let's take a deep dive into the bloomberg. you can find our charts at the bottom of the screen. after brexit, investors are prepared for another disruptive election in europe. there was some panicked hedging. the white line, -- the first round of the presidential election versus the may contract. take a look at the yellow box. the stock surged. the blue line overall is -- it is the bmp political risk index. you can see the yellow box shows how there was a build a political risk in february because marine le pen's prospects for improving. it has come back down. it is proving to be fairly costly after the -- [inaudible] risk, butone said by

it costs a lot of money. scarlet: bankers and hedge fund managers are hedging by meeting with the national front economic teams to learn more about their plans. they are taking steps regardless. joe: i'm skeptical that is going to help. i suspect these early meetings will not help. scarlet: they want to hear what they have to say. joe: earlier today, neil kash kari explained why he dissented. everyone should check it out. i thought it was a model of clarity of fed riding. i wished more people would explain their decisions as clearly as he did. the just was this chart. the fed goal on inflation, as he notes since 2012 headline and core pce have not touched the fed goal. what is the rush? below it so long.

why the rush to hike? it is clear about why he dissented and why he doesn't believe the fed is meeting its goals. scarlet: especially when they come right back down. miss? you bond prices surged after the dovish height. -- hike. markets are moving in the same direction. with $23 billion in assets under management. if we are back to this environment where everything is rising in seeing how do you diversify from a macro standpoint? have become a new way. bonds have not play that role anymore. another idea, trends you can find in the market, that you can construct in a systematically

good way. moret can be done in a systematic liquid way. joe: let's talk about that. we might be talking about equities or going to the long end of the curve. you are into alternative risk tacticalthe serpent strategies that historically outperformed, that are not necessarily correlated to risk. one that you cite in your work is a trend following strategy. how does it offer diversification? why should to be categorized as a form of risk premium? >> with the value growth, etc.. when you play the alternative you play only the outer parts.

the trend is very basic. stocks thereon the is a trend. it continues to win. this has been academically shown to be consistent through time. they have been in the market for a long time. value is one. trend is one. carry strategies is another one. about howk multi-asset managers can implement new asset classes. >> you see a lot of lines being worried about equity moderation. they say i want to have some equity but i want have risk management inside of it. they will ask is to have dynamic

pieces inside of this. the corridor or of -- a quarter of performance rather than being the detailed play of the market. >> traditional portfolios of this we think of them have done well. a nice set of equities. how much should a large institution devote to these alternative risk premiums? >> it is becoming more and more important. bonds, you hadg 64 people follow you. today in burma we can see interest rates revert there is a need to increase the

premium you can get from the market and be more diverse. there is a need to get out of this sample allocation bond and equity. new ways of generating returns. >> let's get a view on where we are in the market. with regard to political risk. we have seen the dutch elections this week. think some of the urgency has been removed because of the dutch election outcome? market, a trend in the the has been in the market for the last two years. there is a rise of antiestablishment candidates around the world. the market now, lots of people in the middle class which is not been satisfied, and less in europe

because growth hasn't been as strong as in the u.s.. the monetary policy has been more to save the bank than to kill people in the middle class. the netherland election is a good news because it shows is some rationality and the candidates have been the right candidates elected. although he has shifted his course of discussion in regards to immigration. there is a feeling this has to be dealt with. scarlet: all right. thank you. president trump demanding all nato members must pay what they in his first meeting with angela merkel. we will have the highlights come in next. this is bloomberg. ♪

>> it is time for first word news. for the first time during his administration president trump welcomed angela merkel to the white house. they held a news conference. touched on the nato. my strongrated support for nato and the way for our nato allies to pay their fair share for the cost of defense. many nations oh vast sums of past years. it is unfair to the united states. these nations must pay what they. the two leaders spoke about

defeating the islamic state and resolving conflict in the ukraine. more coverage coming up shortly. in asia u.s. secretary of state rex tillerson got a look at north korea and had a warning jong-un.ong-nam -- kim secretary tillerson says the u.s. is considering putting all options on the table. he did not rule out a preemptive strike. he heads to china where he is scheduled to meet with senior officials. more than 40 somali migrants in yemen were killed when security officials say was an airstrike by a saudi led military coalition. confirms at least 80 others were hospitalized. it is unclear where they were headed for what happened.

the european union is ruling out any talks on a post-brexit trade deal with the u.k. until theresa may agrees to settle the country's financial commitments according to two european familiar with the plan. global news 20 for hours a day powered by more than 2600 in 100ists and analysts countries. scarlet: for more on that story you just heard, president trump is meeting angela merkel. let's bring in mike durning. he joins us from washington. this was a bit of an awkward meeting. they looked at each other out of the corner of their. talk about the impression, the body language that was present.

>> was a tense day. there was one moment people are talking about. throughout the day, there were some barbs back-and-forth. he was saying german negotiators have taken advantage of u.s. , she responded saying that is not the way the trade negotiations work which when the european union and the u.s.. she was gently saying that maybe it is better they talk to each other rather than past each other. of course, trump had been talking a lot about her during the campaign. joe: obviously there was that moment where trump run-up the fact that he and merkel were the victims of wiretapping. , ondes the awkwardness

substance are there areas that they agreed on that perhaps they didn't? did they reach common ground anywhere? >> it was important to the germans the u.s. expressed a commitment to nato. vice president pence had done that at a summit in human -- in munich. it is important to have the president say that. angela merkel stressed in the press conference that he did. they haven't released publicly, we don't know yet what their private conversations were like but the idea that he is showing support for that and sticking to that was important to the european side of the alliance. thank you very much for the update. if you are frustrated with the vix, we have a few other measures you can look at.

we will talk about those in the next conversation.

>> uncertainty may be a regular feature of policy from the u.s.. is not necessarily -- people think it is not reflected in the market. people don't understand why are changing.els here to explain, i want to start with you. there is all different kinds of other measures. why the surge for others? changing. are

it is a fear of people within itself. there's all these alternatives out there. maybe the vix has broken. we know it is not. it is a reflection of asset pricing. there should be more of a reflection of uncertainty. people going out there, whether it be other firms trying to take more indexers. we have a chart of two of them. -- ion >> nations made theirs in 2013. it is tracking at the money options which has fallen further. i want to bring you in. say this.oing to it indicts the media, but it is

ok. we have this chart showing the vix, the green line in this chart versus the white line. it's this idea of economic policy and uncertainty. there is this big divergence. why isn't the market paying attention to the uncertainty. chart shows uncertainty driven by mentions of uncertainty in the media which is just as talking all day. line isally the blue high. in the real world not much. >> if you look at the longer-term chart it is actually quite interesting. mentions, amedia blue line. they tend to soar above the

actual economic uncertainty. which obviously got a lot of media attention. 2001 in the aftermath. note was also inconsiderable amount of media attention. same a't really see the fact. it actually was an economic crisis rather than a mild recession. the most recent was the election which has garnered a not insubstantial amount of attention. we have had no real policies. there is some uncertainty about what he is going to do. scarlet: if you put it all

together, when you look at the vix, it is doing what it is supposed to be doing. there are other measures out there. one way of looking at that, through skew. >> cameron and i had a good discussion about this. it should be measuring tail risk. once you get more standard deviations away what are trading partners pricing in? it is risen more than the vix. baseline makes the spew go higher. you can say tail risk is growing a lot. you looked at an interesting chart breaking down whether that is true or not. >> if you look at the level of , versus thedex subsequent one day move in the

s&p, there is a strong correlation. the lower the skew, the tendency is the higher the volatility of the s&p. and the larger the worst day is. in fact when the skew index is high it is associated with a low amplitude of daily changes. scarlet: vaidya think that is? >> i don't knew -- scarlet: why do you think that is? >> i don't know. in of the all-time highs was 2006, a year that is infamous among many traders of being a year of a note to low volatility. >> whether there any other measures people really liked and track or is it the vix and others? >> the gss i look set slows.

risk andle talk about complacency, they are always going to go back to the vix. at some function it is a reflection of realized volatility. it is pretty good at reflecting that. the correlation is something like 90%. not as good as predicting the next 30 days. a prediction of the market. it does a decent job of showing how much movement there is. scarlet: coming up next, how market conditions have a major impact on equity management. from new york, this is bloomberg. ♪

>> time for first word news. president trump met today with house republicans who were opposed to the replacement of the affordable care act. mr. trump said the gop is rallying behind the bill. 12 no's and they went from all no's to all yes's. it is all coming together. >> it would kill much of president obama's health care law. the white house is appealing a

ruling that prevents the revised travel ban from taking effect. fromuling were victories civil liberties groups and advocates from refugees. i temper a ban on travel from six muslim countries violated the first amendment to the constitution. the trump administration argued the ban was intended to protect the united states from terrorism. a new surprise for the former editor chancellor, named of the london evening standard. theresa may fired on his born last july. supporters accuse him of raging a fear campaign to keep the u.k. in the european union. in the middle east iran has reached an agreement with saudi arabia for 85,000 pilgrims to attend the hage.

iran would move from last stampedege after a killed more than 2400 people. iran has the highest death toll in the disaster. global news 24 hours a day powered by more than 600 journalists and analysts in over 120 countries. >> little change for the major indexes. the week however, stocks did gain in the s&p 500. been a rough several years for active fund managers. mediocre performance and the surgeon strategies has resulted in major managing outflows. will it ever improve?

the chief strategy officer joins us now. everybody knows about the lows of active fund managers. is there any reason they think it is going to turn around? >> they have been focused in u.s. equities. that is where we focused our research. the last seven years has been an abnormal market, benign market conditions. driven by quantitative easing. we are going to return to normal conditions in the marketplace. the more normal conditions. scarlet: you are talking about the propensity for dips. we see three things. much more sectoral levels.

change,y regulatory winners and losers. we see valuations at highs in the s&p 500. that may return to more normal conditions. we see quantitative easing .eversing as that tapers we see new opportunities for more normal conditions. joe: this chart compares a few different lines. one thing we see is dispersion this goes back to 1996. is the macro dominated central out world's moved dispersions, everything up and down at the same time, and as we get back to that focus we will start to see dispersion again? >> we believe we have been in a trancelike environment driven by

central banks protecting us from real market forces. reverses and it balance sheets decline, as new regulations create more asset managers of a certain kind will thrive. joe: all the active managers have to average out. how do you pick the good ones. >> we went to the data. we don't believe in rhetoric. we believe in what is actually happening. 1800 u.s. strategies, what worked well in each environment? active managers work better in particular environments where markets are week. they do particularly well in environments where week markets are combined with dispersion. when marking conditions are a little week you see significant

outperformance of asset managers. side, yountitative have weaker environments but it is a more stable risk controlled style. both of those environments continue. scarlet: and excess returns, talk us through what the chart indicates and how it may have surprised you in terms of what you found compared to ideas you had going into the research. , the last eight years have been challenging for some active management styles that rely on dispersion. our key finding is that as the environment changes we will see active managers perform and generate more as before. coversoke with eric who atf. a financial advisors are the new active managers.

how much you decide to put into equities versus other asset -- ses, what about just the consumer behavior who has been trained. will they get the message? >> most investors think this is a false dichotomy. there is very much a role for active strategies as well. the either/or debate is not one that is in the investment. there is a road for a core and a satellite. rathergo to the data than the rhetoric to see which active strategies will do well. scarlet: thank you so much.

coming up, the climate for women conference around the world. her city faces a water crisis. those details are coming up from new york.

cape town mayor joins mayor's more on the role at the climate for women conference at columbia university in new york. they came together to exchange ideas to reduce greenhouse gas emissions and deliver on the promise on the paris agreement on climate change. her city faces a massive water shortage. i sat down to discuss the ugly reality. >> we experience the worst

drought in the past hundred years. we didn't get out of normal range for winter. that has aggravated the situation. we have 100 days of usable water left in our dams. sure we needs to make mitigate not running out of water. this is a huge opportunity. people that they will not only be scarce now but in the future. find we have a number of rivers and we are now going to clean the water to make it possible.

you can no longer rely on rainfall alone to fill up your dam. that has come out is that you can only save water while you still have water. fromerewith we water come -- where will the money come from for these projects? the programs for building infrastructure. we have to bring them forward. we have to reprioritize our spending. we will be spending most of our funding from the city side to the money rates. we invest at least a billion rand every year and infrastructure. we now need to complement that with climate change.

created the green economy. there is now an opportunity for solar panels. it is reprioritizing and then raising the funding. i can tell any company that is interested in buying climate change and the city of cape town, we have a good credit rating. aaa, that is higher than our natural rate. we are very reliable and will be holding companies on the stock gets changed by our bond. >> companies might be investing in your bonds. what do you expect to happen to water prices? >> unfortunately one month a we have to take some of

that money and we have to also poor and indigenous. so they don't have to pay the higher water rates. i don't want the money. it is not about the money. we have to get people to save water. you can't buy water with this money. we are trying everything to change it. people are not listening. we have to work together. scarlet: that was a portion of my conversation with patricia. joe: time for the business flash . the biggest stories in the news right now. goldman sachs lloyd blankfein has taken a pay cut.

the firm eliminated a long-term change. it includes a $2 million salary and $60 million in shared base on performance. minneapolis fed president neil cash car explaining why he cast the only vote against raising interest rates. he says economic data hasn't changed much. the fed is still coming up short of inflation target. we will hear more from him on bloomberg daybreak america. a big acquisition in the insurance industry. kkr and canadian pension fund manager cd p q have agreed to buy usi insurance. they bought usi from goldman

sachs in 2012. blackstone group is ending a thrill billion dollar hedge fund and will ship most assets into other credit funds that lock up client capital. investors thered option to move assets into other distressed credit. that don't feature withdrawals. that is your bloomberg business flash update. scarlet: coming up next, mark barton will join us. this is bloomberg. ♪

>> this is bloomberg market live from new york. we want to welcome our viewers and our listeners on bloomberg

radio. oracle's push into software is paying off. the company secured his position as the fastest cloud company at scale. cory johnson is in palm springs, california where he is joined by mark hurd. ory: we are right next to palm that is why mark is here. the stock is at a 52-week high. why are we here at this event? >> this is a big tennis tournament. the tournament itself has been bought by larry ellison. us, he hassee around upgraded the facility to a fantastic place. we are a sponsor.

we use it as a customer event. 600 customers. cory: a really interesting quarter for oracle. some trends continuing. the one that struck me the most was enterprises and services. withusiness that competes amazon web services and microsoft. the growth really excel or rates. -- accelerates. what is driving that? >> it is a common nation of all of the things we have been doing for the past several years. i don't think this should be looked at as an event. things inmany good the quarter. we grew 86%. i will tell you it is going to get bigger.

the way i think you should look at it, the execution of our entire strategy. the platform strategy and the infrastructure strategy. we are excited about all of them. >> how do they hit that introduction to the service business? >> we then worked -- hr.ications like brp and it's hard to go from bottom-up to top down. it is usually an easier strategy. applications are hard. now we are optimizing the infrastructure. >> as that grows here, i never would have thought i was talking about amazon as a competitor to

oracle. it is infant has more a smaller. i wonder what you make of that doing better than it has in the past? i wonder what the effect is? >> let me give you a view of the business. if you look at our database business,our license very strong regardless of where you place the database. from a infrastructure perspective there are things we can do with our database that nobody else in the world can do. >> google, microsoft. nobody. it is clustering performance, any of those things you would like to do with a sophisticated database, nobody will run the oracle database

better than oracle. >> is that why you are seeing this effect? >> this is, if we were using a baseball analogy, i would say we are still in the dugout. this is a huge growth business for us. growing, this business one of the things amazon is willing to deal with, the overall business. are willing to get in the price wars with these guys, to take market share because you are in the dugout. have costs. we have to bring in all of the pieces. we have an operating system business.

our cost base is lower than almost everyone else because we own all of the components. we don't have to buy the database from anybody. we have a lower fundamental. together we those can be extremely competitive. it is going to be about those other things i described. you have to be available. i heard that. it doesn't matter who it is. you have to be available. you have to be secure. some of these data pieces run companies. secure.e to be nobody will run the database in the world better than we will. >> we have several advantages in

the core technology that we think gives us an advantage. >> you play tennis in college. you play a lot of tennis still. do you keep score? >> we actually don't play. sometimes, i think he is to hit one of the best tennis players in the world. >> thank you. fantastic. back to you. scarlet: bloomberg editor at large cory johnson speaking. coming up, what you need to know to gear up for next week. ♪

scarlet: u.s. stocks not moving a lot for the week. s&p 500 is higher. coming up, secretary of state rex tillerson heads to beijing to meet with chinese officials.

trade and north korea on the to do list. joe: monday, the house intelligence committee on russian interference in the election. james comey and the nsa chief has been asked to testify. and luminarysales data on durable goods. joe: we just had a fed decision and more fed decision stuff. janet yellen, charlie evans, and the onlyri, dissenter on the fed will be joining the team of daybreak

alisa: i am alisa parenti and you are watching "bloomberg technology." president trump welcomed german chancellor angela merkel to the white house today. it is the first meeting between the world leaders after trump

won the election. michael's high-profile visit comes at a crucial time for u.s. /german relations. they held a joint news conference after the meeting. house leaders are planning to vote on the plan to replace the affordable care act next thursday. the proposal has been criticized by house conservatives who say it is too similar to obamacare and offers few cuts. governor sent a letter to mitch mcconnell that house speaker paul ryan saying they oppose the plan. the legislation does not ensure adequate coverage and shifts significant cost to the state. rex tillerson says the u.s. is considering all options to counter north korea's nuclear threat. he criticized china over moves to block a missile defense system on the peninsula. tillerson spoke today in south korea. he has to china tomorrow. global news 24 hours a day powered by more than 20