the champions league quarterfinals. the match was postponed after last night.ions one player was wounded. authorities still don't have a motive or know who's responsible. angela merkel called the attack repugnant. there has been a surprise entry in iran's election. the former president unexpectedly filed to run. that was despite being told by the leader to stay out of the race. has been assad considered an overwhelming favorites. is the one negotiating the nuclear deal that led to sanctions against iran. nearly 5000 economists have sent a letter to trump stressing the importance of immigrants for economic growth. andgrants start businesses are proficient in math, science, and engineering.

this comes across the political spectrum including the economic surprise -- advisor to president trump. global news, 24 hours a day, powered by more than 2600 journalists and analysts in over 120 countries. i am mark crumpton, this is bloomberg. >> life from bloomberg world headquarters. i'm julie. stocks are lower for a second session in a row. >> the question is, what did you miss? president trump said the u.s. dollars getting too strong and he will not label china as a currency manipulator.

everything is reacting. he also made comments about janet yellen. president trump meets with secretary general of nato and we will take the news conference live from the white house. says summer could bring turbulence and with it, disappointment. andman behind guggenheim the portfolio is coming up shortly. at where the major averages stand as we head toward the close. taylor riggs is standing by. >> we have seen a small recovery after them up -- russian meeting and we are lower. the as a be 500 is there the session. i want to look at the dollar index. from president trump saying the dollar is strong as of him. he respects yellen but he is undecided on the renomination. he will not label china as a currency manipulator, but the

dollar is too strong. all of these headlines coming out and pushing the dollar lower. let's flip to the next screen and look at what we are looking at next. havens, theafe dollar is actually stronger as we head to the you one as well. we're seeing the euro-dollar reaching a fresh high of 10658. atlar-yen is down to new low 109. that is simply taking a leg lower down to 109. but keep flipping the screen. do we have a tenure charred? you can see down here near the indexf the session, the is something i was looking earlier. it was down 1.1% and even down more now. joe? >> thanks taylor.

for more on these trump headlines and how their moving it's thewith us now global cio of guggenheim partners. 97% over the past two years and doubling over the past two years as well. we have some interesting market moving news. we see the dollar going down on these trump headlines. he says he likes a week of low interest rates. what you make of that? >> there's nothing here that is surprising. we knew, based on the signaling of the administration, which is not always consistent, that we weren't going to label them as currency manipulator for the time being. the market reaction we are getting is in line with taking out the uncertainty. julie: something that you've been talking about was the idea of a few factors come into play. if we look at the chart over the

last 10 years, this is g #btv 7739. it appears tt or out of the years and led to decline. only two of them have been all that significant. >> in some ways, maybe this is a bold call on your part. why do you --? >> you have to go back and look at the academic work done on this. in 1988 us that he was done using historical data saying the , was actually real. going away and coming back at labor day, the time to come back and actually the first game of the world series, but the strength of the pattern, you can see that, for having your money at risk during those periods, you're not getting paid in the good years. when you factor in all the uncertainty that is out there now.

like will we get a tax plan this year? will we get a health plan? will we even get the debt ceiling extended? what is going on with north korea? what is going on with the french elections? what about italy? we have a lot of potential events out there that could spark a decline in equities. based on the market moving dramatically, over the last few months, we are on the trump we areigh, and hopefully going to get some real policy. we are still long on promise and short on delivery. and theess comes back people start to recognize the policies they have counted on to see the improvement in the economy are not coming through, people might say let' take some money off the table and take a look at it later in the summer. front, one of the

promises of the campaign was to label china a currency manipulator, right? so that we have these comments that that is less likely to happen. we have comments saying janet yellen for non-renomination, that is less of a surprise. , other ways these the president has chosen to communicate, how do you have any predictability whatsoever as an investor. >> i think it is difficult. the question and markets is always about expectation. where do we set our expectations? starts tosident figure out which policies he really wants to implement aggressively and which ones he wants to take more time on and reconsider, that brings uncertainty into the market. uncertainty is not something that markets like. when you gets more and more uncertainty around policy and

other initiatives, market say, maybe we should discount the price for more for uncertainty. as the the -- administration figures out which policies it's going to implement and how to do that, the market is not going to like that. at some point, i think we have to take back some of the price appreciation over the last few months. >> tourney way from stocks to the bond market, we saw the sharpest reaction to the headlines coming from washington journal in the dollar. i'm looking at the tenure on the bloomberg. we saw a drop in yield although they have come back up a little bit. when trump says something like him in favor of low interest rate policy, how does that affect your thinking inthis debate that has been going on recently about whether the bull market and bonds are over? >> first up we have to step back and look of the great bull

market that we have been in since the great 80's. bull markets don't to die of old age. when you look at the last time we had rates at the levels back 1950's,930's into the we stayed below 3% for 22 years. we have yet to break the down , and bull markets like this typically don't roll over and die. what would typically happen is, we would break the downtrend and then we would begin consolidation phases, being the face of -- basis of reversal. low interest rate era is with us for a number of you turn tond when some of the things we were just talking about, near-term, as i was saying, markets don't like uncertainty, the save haven is to move back to treasures.

out, i uncertainty plays think we'll see a stronger been for bonds in lower yields. you are talking about this idea that there is uncertainty in regards to policy and, at some point, equity investors might from the towel and say we're not think visibility. you could've made the argument for a long time and, so for this year, several people have made versions saying we're going to need clarity at the state of union and saying we're going to need them as health care so they can do taxes. it doesn't seem like the markets actually responds to what seems like a logic idea. to your point, people lose faith slowly. every time one of these events occurs, it is chipping away at the confidence of the investors. for the. of time you talk about, the big gains were made between november and january. they haven't been made since then.

the lack of upward momentum in the markets is telling you people are reassessing and saying they want to hold back for a while before they disperse capital. you will bold call their on the bull market. most investors at this point are talking about an end to the bull market in bonds. rates would go lower if you're right, what you think that means if investors are expecting that type of cycle it's interesting. i just came from the federal reserve. one of the discussions was about low rates and rising rates and the impact on stocks. i think stocks are in a pretty good position. higher, start to move the reason they're moving hires because the economy is doing well. if the economy is doing well, earnings are awesome. lower, thee moving discount rate on future earnings is falling, that implies higher stock prices. whichever way the bond market

12es, at least for the next to 24 months, i think we'll do fairly well. it is nice to have multiple ways to win. you scott. withe going to be sticking us through the break. we'll talk about how bodybuilding scripture and behavioral economics help you out reform. and we'll get you a check on all the assets moved on the trump headline. the wall street journal spoke to donald trump, the president, on wednesday and he said china has not manipulated the currency for months. he says he might not renominate janet yellen. responding dollar shooting sharply lower. all prices are spiking up to three quarters of 1%. yield is moving lower, off by about three basis points at the moment. coming up, bring you the news

conference between president trump and nato secretary jens when it starts at 4 p.m. eastern time. this is bloomberg. ♪

>> julie hyman, what you miss? behind these unusual upgrades, let's take a deep dive into the bloomberg with scott. is the global cio of guggenheim partners. scott, you are talking about earnings and their strength potential. this is g #btv 7737. earnings growth globally. this is estimated earnings-per-share. basically what analysts think,

right? analysts think this is unusual and they think they have raised their estimates versus downgrading it. because analysts do tend to be conservative, and companies tend to manage it.ctations, we willbeat the earnings momentum is very strong. once we get past the earnings was the whisper -- was the performance is good as the whisper. we won't know that for weeks. we get a shot tomorrow for banks. i think that will give us an early clue on the how the quarter goes. are equity strategist was talking about something for the financial, that the top line might not measure up that --

like earning growths will. >> i think the top line has to start moving. that is the key to the whole scenario that we are going to move higher over the next two years. if we don't see a pickup in topline growth, there is a list on the cost side. , the cost ofnly liabilities is not going down so we will have to get it on the top line. >> sticking with your theme of reasons to be cautious, you mentioned domestic policy. one story is the french election. i was playing with the chart theier in the white line is gap between to your yields and german to your yields. that spread is widening. the blue is the line betting jean-luc. pen or

typically, we don't associate communist backed candidates with good performance and equity markets. that is not typically that thing. the risks in europe are high and the stakes are high. having a candidate like len, pe how much this is rhetoric or real policy and legation. this is the continuation of nationalism that seems to persist around the world. certainly, if she were to be elected, and there was a move in europe, thisve would be devastating to the whole solidity of the european union. having said that, she is not the prime minister. people don't seem to grasp the idea that the president of france is not the same as the president of the united states.

gives still had to parliament and the prime minister to along with the change. i think that the real elections we have to be worried about are the ones that are coming in the fall. in the french elections for parliament. scott, it would seem that you expect more volatility to arise. it would take a look at a chart in the bloomberg. there might be another tell to think volatility might fight. this is g #btv 7740. yen.ite we have the that was one of the best-performing currencies that year. even as stocks made all-time highs. vix started to spike higher and get volatile. markets in 2008. what you think about this? >> i think the appreciation of degree, is some

predated. with the meeting president of japan and trump, it is clear that it would be seen as depreciating their currency. . think that is happening at the same time, the recent spike in vix that you would expect with a crisis, i think is one thing i would make a comment about is that i'm thinking we will have a significant correction the summer or early in the fall, but i don't think this will be a bear market. i think the great bull market is still intact and the evaluations for stocks will be higher than what we are today. expecting 20% over the next two years. >> switching gears we talk about

the tease of the break. a profile of your bloomberg markets magazine. that calls you a bond savant. you coming to guggenheim and coming to your strategy from a lot of different backgrounds and inspirations that you draw on. i'm curious what, which plays the biggest role or what do you attribute to the success of our? >> -- so far. hashe success of guggenheim decreased and the time for bodybuilding has gone down. [laughter] one of the things i said in the article is that bodybuilding is an incredible discipline that sport. some of my sports that have done triathlons and other things have decided they are going to try out bodybuilding and that worked

out for me for a few months and i said i'm giving it up, because it is a 24/7. i like that with what we do with investing. his is a 24-hour job. -- this is a 24 hour job. how much time you're focusing on the macroeconomy a market, and other things. it's the same kind of discipline. what they had to say is a lot of bodybuilders tell me that they are so disciplined and that they would be great at what i do. i remind them that there was a little bit more than discipline. there is education, experience. >> [laughter] >> i think those things are part of it and, as far as my faith is concerned, having grounding in life, no matter what you do is important.

i think that is the thing that keeps me from getting too emotional at times in the markets or facing life with a sense of realism. . >> sky, thank you so much. you can check out that profile in bloomberg markets magazine out right now. >> you're looking at a live shot of the lighthouse and we are awaiting the joint news conference between president when and jens stoltenberg those happen live. this is bloomberg.

♪

>> president trump hosts nato secretary jens stoltenberg today. after the discussion, they are expected to hold a joint is conference any minute. bloombergng -- bring

national reporter in. what are the big reporters there focusing on in their discussion? >> joe, as you mentioned, trump's munchen -- trump is meeting with jens stoltenberg. there are two big things that they have told us. one is that the united states maintains an ironclad commitment to nato which is a reversal of the presidents campaign pledge. he talked about whether nato was obsolete and whether it was necessary. now at a time of elevated tension, the president seems to be appreciating the value of this. he is going to call on nato members to increase their defense to meet the 2% of their gdp. right, sawtelle, will be staying with us to the next hour.

president trump is expected to hold a conference at 4 p.m. eastern. this on bloomberg television as well as the bloomberg app. averages less than four minutes until the close. we have them near the lows with industrials leading the decline. this is bloomberg. ♪

abigail: "what'd you miss?" president trump host nato leader jens stoltenberg at the white

house today. the conversation will likely focus on the night dates commitment to the alliance as well as the chemical attack last week in syria. u.s. stocks lower, as we now watch the close. livesf you are tuning in on twitter, we want to welcome you to our coverage live every day from 4:00 to 5:00 eastern. abigail: we begin with market minutes. another volatile day. the dow and s&p 500 having their worst day. more into day volatility than we have seen recently. offof the big stock sectors hip.ntly, the ship -- c an economist at needham told me this was the worried point that this had been on fire. joe: unlike yesterday, in which

the market generally embraced all of its losses, going pretty low. fromestingly, the comments trump, not providing any sense of risk. what is interesting about the philadelphia semiconductor, and i know you will dive more deeply in a story, bloomrg posted a earlier this week on the big run they had. hopefully that was not the jinx. abigail: that is interesting. saidf our analysts this is seasonally a week time for the index. if we happen to the bloomberg to take the deeper dive on the stock that julie was talking about, this is the mrr member rate return -- rank return

function. no winners for the stock today. qualcomm, apple, others. the supply chain shaking up. valuation high also. sharese to qualcomm, the second-worst performing there. a more than $8 million lawsuit against qualcomm. qualcomm lower. lastly, take a look at the banks lower. once again down, perhaps a bearish tale of the trade there. joe: let's focus on government bond markets. that is where a lot of the action is. in the middle of the screen, to the right, yesterday, 2.3%. a lot of focus on this range.

bouncing back and forth. today, decisively breaking through. taking a look at currencies as well on the day. first, the japanese yen, which recently has in some strength. once again, a big move on those hdlights that we have been talking about. it had an bouncing around the .hanged lines the pound gaining on the date, even though we got data that pay rose through february. nevertheless, the pound did not its gains.ost of the south african rand, despite a vote of no-confidence on the president has been postponed. people protesting in

ranttreets protesting the this year. joe: it looks like we have president trump and jens stoltenberg. let's go live to the white house. president trump: secretary-general stoltenberg, it is a pleasure to welcome you to the white house, especially moment in important our great alliance. i want to organize the great work ring done by our secretary of state rex tillerson to strengthen the nato alliance as well as the secretaries trip to thea -- moscow to promote united states and its allies. he did a terrific job. watch parts of it. and slew -- an absolute terrific

job. arefar from where we gathered here today, president harry truman spoke at the signing of the north atlantic treaty. in the nearlyeven decades sie harry truman spoke those nato alliance has spent the bulwark of international peace and security. communisms defeated and liberated the captive nations of the cold war. they secured the longest period of a broken piece that europe has ever known. this is rooted out of so many different things. our common security is always number one. and, our common devotion to human dignity and freedom. that's 1949, the nato member

states have what the double, increasing from 12 to 28. on monday, i signed the protocol to approve the 29th, the country of montenegro. years,coming months and ourll work closely with allies and to adapt to the challenges of the future, of which there will be many. upgrading the focus on today's most pressing security and all of its challenges, including migration and terrorism. we must also work together to resolve the disaster currently taking place in syria. grateful for the nato members and partners in their condemnation of

s attack using the most horrible weapons, including the killing of small and hopeless children and babies must be forcefully rejected by any nation that values human life. it is time to end this brutal ,ivil war, to beat terrorists and allow refugees to return home. in facing our, challenges, we must also ensure that nato members meet their financial obligations and pay what they oh. many have not been doing that. the secretary-general and i agree that other member nations must satisfy their responsibility to contribute to percent of gdp to defense. if other countries pay their fair share instead of relying on the united states to make up the difference, we will all be much

more secure. our partnership will be made that much stronger. the secretary-general and i had a productive discussion about what nato can do in the fight against terrorism. i complained about that a long time ago and they made a change. now they do fight terrorism. was obsolete, it is no longer obsolete. it is my hope that nato will take on an increased role in supporting our iraqi partners in their battle against isis. i'm also sending gentleman find out mcmaster to how we can further support our partners and allies. every generation has try to adopt the nato amounts -- alliance to mt thchallenges of their time.

this visit to brussels spring, which i look forward to, we will work together to do the same. we must not be trapped by the tired thinking that so many have, but apply new solutions to face new circumstances. that is all throughout the world. to stand onere ceremony, but develop real strategies for safety, security, and peace. we seek to protect the prosperity and peace of our citizens. commitment to this alliance and are values that we probably share. thank you very much. thank you for being here. secretary stoltenberg: thank you so much, mr. president. excellent and

very productive meeting. it is really an honor to meet you for the first time here in the white house. we agree that nato is the bedrock of security both for europe and for the united states. warworld wars, and the cold have taught us all that peace in europe is not only important for europeans, but also important for the prosperity and security of north america. is good foro europe, but a strong nato is also good for the united states. therefore, i welcome the very strong commitment of the united states to the security of europe. onlye this commitment not in words, but also in deeds ver thpast month, thousands of u.s. troops have been deployed to europe.

a clear demonstration that america stands with allies to protect peace and defend our freedom. yesterday, you announced the completion of nato's membership montenegrin's membership in nato. we thank you for that. in a more dangerous and unpredictable world, it is important to have friends and allies. nato, america has the best friends and allies in the world. represent half of the world economic and military power. no other superpower has ever had such a strategic advantage. this makes the united states stronger and safer. we saw that after the 9/11

attacks on the united states. natoas the first time invoked our article five collective defense clause. allies sent planes to help control american skies. we launched nato's biggest military operation ever in afghanistan. hundreds of thousands of europeans and canadians soldiers have served shoulder should shoulder with american troops. have paidf thousands the ultimate price. i laid a wreath at arlington national cemetery in tribute to the fallen. it was a deeply moving experience. we only to our servicemen and made to preserve the hard

gains we have made together in afghanistan. we are reminded of the sacrifice just this week when the u.s. soldier was killed there, fighting iso-. iil. our mission in afghanistan is a major cut to be shipped to the fight against international terrorism. nato plays a key role in many other ways also. all nato allies are part of the global coalition to counter iso-. nato provides support to the coalition with training for iraqi forces and the fight against terrorists, and more intelligence sharing. you are right, we have established a new division for intelligence which enhances our ability to fight terrorism and work together in the alliance against terrorism in an even more important way. we agree today, you and i, that

nato can and must do more in the global fight against terrorism. in the fight against terrorism, training local forces is one of the best weapons we have. , thehas the experience expertise, and staying power to make a real difference. fighting terrorism will be an important topic when nato leaders meet in brussels in may. be other major topic would fair burden sharing in our lives. a total discussion on this issue today. mr. president, i thank you for your attention to this issue. we are all seeing the affect of your strong focus on the importance of burden sharing in the alliance. wagree that allies need to

redouble the pledge that we made in 2014 to invest more in our lines. onis about spending more defense, delivering capabilities that we need, and about contributing forces to nato missions and operations. this means cash, capabilities, and contributions. fair burden sharing has been my top party since taking office. we have now turned a corner. time in for the first many years, we saw an increase acrossnse spending european allies and canada. a real increase of 3.8% or $10 billion more for our defense. keep upow working to the momentum, including by ,eveloping national plans

making good on what we agreed in 2014. we know that we all need to contribute our fair share. safeed to keep our nation in a more dangerous world. discussed many different topics during our meeting today, including the harvard this use of chemical weapons in syria. any use of chemical weapons is underptable, cannot go on spotted, and those responsible must be held accountable. mr. president, thank you once again. i look forward to working with you to keep the alliance strong, and i look forward to welcome you -- walking mean you in yousels in may -- welcoming in brussels in may. and, to respond to both the need

for fair burden sharing, and fightng up the against terrorism. president trump: we will have a couple of questions. jeff mason. >> thank you, mr. president. i would like to ask you about two topics, if i may. first, has your view of vladimir putin changed? what is the united states prepared to do if he supports assad? have you made a deal after your chat last night with the president of china and china reign thembring in -- in? for the secretary-general, do you believe that nato should presenceto bolster its

along the border, and are you confident that you have the president support on that? president trump: i will be having a meeting with rex tillerson shortly. i believe he had a successful result. everything i'm hearing, things went pretty well, maybe better than anticipated. it would be wonderful, as we were discussing a little while ago, if nato and our country could get along with russia. right now we are not getting along with russia at all. we may be at an all-time low in terms of relationship with russia. we will see what happens. leader -- putin is the leader of russia, russia is a strong country. we are a very, very strong

country. we will see how that all works out. last i, ice with a man i have gotten to know. i do not know putin, but i know this gentleman. i have spent a lot of time with them over the last two days. he is the president of china. you were there, most of you were there, it was quiet and interesting time. once to do the right thing. we had a very good bonding, i think, we had a good chemistry together. i think he wants to help us with north korea. we talked trade, a lot of things. i said, the way you will make a good trade deal is with north korea, otherwise we will go it alone. getg get a loan means going alone with a lot of other nations. i was very impressed with president xi, i think he means well, and i think he wants to help. you have aeel

deal with him, in terms of the currency manipulation designation? have your views changed on putin ? president trump: we will see about that. utinill also see about p overtime. you what i would like to do. i would love to be able to get along with everybody right now the world is a mess. by the time we finish, i think it will be a lot better place to live. time i am finished, it will be a lot better place to live in. right now, it is nasty. nato isy stoltenberg: in the process of implementing since thet defense cold war. deploying for battle

groups to the baltic countries and poland. u.s. will also be more forces in that part of europe. we see an increase in the military presence in europe. we are increasing our presence. we are also increasing the preparedness of our forces so we can quickly reinforce, if needed. presence whene the for battle groups are in place, and sufficient, given the situation in europe. we will follow the developments closely. from nato is what we do is proportionate, defensive, and we don't want a new cold war or arms race. we strongly believe there is no contradiction between a strong

nato, a credible defense, and political dialogue with russia. we believe that a precondition for political dialogue with russia is we are strong, united, cannoted on that, we talk with russia. we have to find ways to manage our relationship with russia. an absolutely certain that the united states supports this approach. the united states is contribute with forces to ennce the , and the united states and the president has clearly expressed that they want dialogue with russia. the next question is from john . >> thank you very much. secretary-general, how much you think it will take you to persuade the other european countries to burden share?

what do you think he will do to persuade them? mr. president, do you think it is conceivable -- was it possible that syrian forces could have launched the attack in italy last week without the russians knowing? have you been disappointed, surprised by vladimir putin's reaction and spend -- since then? secretary stoltenberg: i think -- president trump: i think it is possible. i think they are doing investigations into that right now. i would like to think that they theyot know, but certainly had been there. it is being looked into with the entire pentagon group that does that work. it was very disappointing to see.

disappointing no matter who does it, but when you get into the gases, it is vicious and violent. everyone in this room saw it all to me times -- too many times. young babies dying, fathers holding children in their arms that were dead. dead children. there cannot be a worse site. it should not be allowed. th is a butcher. i felt we had to do something about it. i have absolutely no doubt we did the right thing. it was very, very successfully done, as you know. thank you. secretary stoltenberg: on defense spending and burden sharing, that has been my top priority. i have raised it in all of my meetings. i have visited with prime ministers, the minister of finance, and defense ministers. i expect, of course, all allies

to make good and what they defined in 2014. the very strong and clear message from president trump husband helpful. now we see things moving in the right direction. for the first time after many, many years of decline and defense spending, we see an increase in defense spending in europe and canada. they have started to move in the right direction. 3.8% real increase in defense spending is a significant step in the right direction. we still have a long way to go. at least they have turned a corner. european allies have turned a corner. they will start to increase defense ending. i think it is important to this is something europeans do because it is in investwn interest to more in defensbecause the world has become more dangerous. reduceropean allies

spending after the cold war because tensions went down. if you are decreasing spending when pensions go down, you have to increase spending when pensions go of. now, they are going up. so, we have still a long way to go. i'm encouraged by the fact that we have started to move in the right direction. last year, there were five dollars spending 2%. this year, romania has declared they will reach 2%. next year, latvia and lithuania will also reach 2%. going the right direction, but we still have some work to do. president trump: i did ask about all of the money that has not been paid over the years, will that money be coming back. we will be talking about that. you?, where are hi.

>> can you talk a little bit about your reaction to china? [indiscernible] did talk trump: we last night. i think it is wonderful that they abstained. very few people have talked about that. no, i was not surprised that china abstained. very few people thought that would happen. we are honored i the vote -- by the vote. moscowtalked a bit about .nd russia how do you counter moscow's power? secretary stoltenberg: the most important thing is to have a stronger lives, stay -- alliance, stay firm. we have to invest in our

collective defense here that is defense.ey -- that is exactly what we are doing. i welcome a strong message from president trump along the importance of defense spending. we have started to do this so we are implementing the biggest reinforcement of our collective defense that's the cold war. at the same time, we have to find ways to engage, talk with russia. the russian assault will not go away. we have to find ways to live with them and avoid a new cold war and arms race. i'm very much in favor of what we call the dual track approach to russia. i have the experience to work with russians. i was able, even during the cold war to have a pragmatic working

relationship with russia, cooperating on energy, fishery, and also, military affairs. despite our membership in nato, but because of our membership in nato. nato provided strength, connect ability to have a strong dialogue russia. i believe that the only way to deter russia is to be strong. the only way to avoid a cold war, arms race is to engage russia in the political dialogue. floor to the reporter. >> thank you. i am from norway. russia is our neighboring

country. think european countries have to fear if this tension continues. what do think european countries have to fear from russia if that tension continues to escalate? attack int that the syria last week was wanted and allies.ttack on do you think this attack was warranted? : hopefullyrump they will have to fear nothing. right now, there is a fear and there are problems, certainly problems. ultimately, i hope that will not be a fear, there will not be problems, and the world can get along. that would be the ideal situation. it is crazy what is going on. you lookat -- whatever

at, there are problems, so many problems. ultimately, i believe that we will get rid of most of those problems and there will not be fear of anybody. we have a very big problem in north korea. as i said, i really think that china will try very hard. a lot of the cold boat -- coal boats has beenurned back. that is a big step. there armany other steps that i know about. we both the what happened. if it is not effective, we will be affected, i promise you that. thank you. nato has stoltenberg: constantly condemned the use of chemical weapons in syria. and, the use of chemical weapons

is have read this. it is a clear violation of international law. the use of chemical weapons is unacceptable and cannot go unanswered. those with uncle must the help accountable the. held accountable. the strike against airbase in syria was a u.s. operation, based on u.s. intelligence. you have seen that within the alliance, this has been something which has been met with a lot of understand because -- allies do not except weapons arechemical used, so we strongly support the fact-finding mission to find out what happened and make sure we do not see any use of chemical weapons in the future. president trump: thank you very much. thank you.

that was president trump and nato secretary-general stoltenberg. jens for more, let's bring in kevin cirilli. still with us, scott meyer. kevin, we will start with you. what do you see as the big headline from the press conference? kevinthis is a presidt that just a ltle ov a week ago ordered a missile strike in syria. hours before this to these, we had rex tillerson delivering right in front of russians essentially saying, we have a very different policy on russia than you do. make no mistake, what you are .itnessing right now not only are we having a shift in policy, but also a shift in rhetoric. he looked at these concerns, quiet friendly, nato allies, who this newerned that

white house would not be able to work with our allies, despite the rhetoric saying they would have to pay their fair share. 2014.eement started in what he is doing is serving a .arger megaphone, so to speak this is a president shifting his tone and also policy, on full display in the white house. abigail: not just on nato. it's to me the promises of the campaign trail meet the reality of governing. you have the president softening the stands says some degree, a very consolatory tone. an have him saying, in interview with "the wall street journal" saying, china is not a currency manipulator, maybe i will not keep janet yellen on, and the russian situation as well which seems to be a switch in stance. what have you heard from the

this?house on is it a larger vision or a case-by-case business? kevin: republican members on capitol hill are breathing a sigh of relief. they were questioning the white house about whether or not they were able to take on russia. fom the political optics lens of all this, you have one , saying, sergey lavrov he wants to speak in a more conciliatory tone. i have to be blunt here. no way, no how. never going to happen in terms of president trump and the ministry should getting behind syrian president bashar al-assad. like johnepublicans, allieshappy, but also breathing a sigh of relief. bloomberg'sto go to

correspondent in the white house right now. what do you make of the chemistry between trump and jens stoltenberg? does that say anything about the white house and nato? >> it seemed to be of one chemistry-- a warm president trump and jens stoltenberg. a few notable things he said. he pointed out, he argued early on, nato was obsolete. he said, i said it was obsolete, it is no longer obsolete. he said he was honored to have mr. stoltenberg there, to honor the commitment of the night it's too nato. the president pointed out that

he would like other countries to pay a larger share. he mentioned the 2014 pact in which countries were supposed to aim to spend 2% of their gdp on it. mr. stoltenberg said, since then, natcountries have increased spending by a significant amount. there s a point of his agreement, some contention, but with this cloud of russia hanging over them, that has been a huge area of tension between the united states and russia, that i think has convinced president trump that he needs to be very much in favor and committed to nato. julie: now what? to the to have a longer visit? -- do the two have a longer visit? do they continue talking? to continuelan

talking. the president said he will go to brussels regarding the next steps of nato. we know the president and mr. stoltenberg talked about areas membereration between countries to nato as well as iraq and afghanistan. we do not know what the night dates next policy in syria will be. that remains an open question. it depends on how russia response, and how far the president decides to go here. that is another discussion for nato. nato has become one of the big ullworts with regard to its neighbors. abigail: we were talking about last weekthe attack in syria, president trump's approval rating actually popped higher and there was bipartisan support. we now have a more consoles her tone. -- conciliatory tone.

what do you think of this? >> the first time the president had bipartisan support with the syrian missile strike. now, we have had this press conference with nato. these are things that there can be a lot of democratic support for. i think, for the first time, he has some momentum in a bipartisan way. the question will be -- there are two issues. one, will he built on it? will we move on to something like infrastructure think he can get bipartisan support for? the other question or observation is the markets, i think, are picking up on it. as we sit here now, we see the 10-year note at 2.25%. i know the magic number was 231 and then we removing lower. technically, breaking into these levels tells us that we probably evenbond yields moving

lower. from the standpoint of the comments on "the wall street journal" the president has scored a number of victories in short order. julie: yet, there is a disconnect between the rates that you talk about and the stock market. it has been very sideways. stocks close to record highs. why is that disc that happening? -- disconnect happening? >> we have been very long on promises up to this point and short on delivery. i'm not sure this is going to be the tipping point i'm getting a lot of policy through. we need to get it through in the next few. if they get the president come on the policyery, front, it will make it raise uncertainty in the market. another thing on my list of

worries, of course, is the growing level of militarism. having an aircraft carri sitting off the coast of north korea does increase the chance of having him kind of military act. that would not be good for the markets. is -- all of this military uncertainty now between the russians, what is going on is. korea, and in the hands of a new administration raises questions about how we would react and what the reaction is. joe: i want to go back to the white house. here is my question. what do we know about the relationship between the white house and russia today? how the administration use russia -- views russia? >> a lot of tension obviously between the night dates and

russia, especially in the wake of this attack. russia has good behind its alliance with syria. president trump said, right now we are not getting along with russia at all, we may be at an all-time low in a relationship with russia. this is a dizzying turn of events. he said today, i would like to it happen, it may not happen. clearly open to the fact that it may not happen. this is clearly notable because of the other, somewhat more awkward inc. goal -- angle that the intelligence community has concluded that the russians meddled in the election that trump ended up winning. that is another factor in this whole conversation going forward. president trump clearly taking a different approach to russia in wake of this checal attack, that he described in graphic

terms. it is another thin that prompted him to reverse a campaign vow, to stay out of intervention, to not launch military strikes on countries like syria, which he argued in 2013. a number of realities on the ground the of faxing -- affecting president trump's views on the number of things. as a: he referred to assad butcher in his comments to date. kevin, i want to go to you now on his emotional nature, talking about the dead children in syria, as a result of this attack. i went to come back to something you talked about with congress. sort of more congressional allies being on board with what he is a. them along with other parts of his agenda? kevin: absolutely. delegation is going

next week to visit several nato allies, including in the united kingdom. it withf you juxtapose the images we saw coming out of the white house, again, this washington, as a whole is trying to send a message. the butcher line that president trump said, hours after -- is after sergey lavrov speaking with rex tillerson, that is a line in the sand. joe: kevin cirilli, great to have you on set. at the white house. thank you. we will be talking about bank earnings coming up tomorrow. this is bloomberg. ♪

abigail: "what'd you miss?" anksks reporting -- b reporting. trading revenues, rates, and regulation will be the biggest numbers for investors. we are expecting to see a continued surge in fixed income revenue. the five largest nhbanks income.ort you can see how the growth is expected to outpace equity trading by a large margin. in particular, goldman sachs and morgan stanley. if you look just at j.p. morgan, you can see how the trait --

trend has lifted overall. those are levels that we have not seen going back to 2009 p with regard to race, analysts reported six of the largest levels.port banksan he help things -- have been slow to pass on rates. comments in regard to regulation will be another topic of interest. recently, gary says he supports donald trump's call for a new version of the glass-steagall act. we will have full coverage of the releases tomorrow morning at bloomberg. i will be on the bank earnings calls. julie: looking forward to that. we're back with scott minor of

guggenheim partners. thank you so much. we have been talking over the last hour or so, and thank you for taking the time. we're talking about technical levels and is one longer-term chart that we have here in the bloomberg. thewere talking about downtrend. >> that's right. the downtrend has been in place 35 years. trends like this do not break quickly. it is to enforce. we have some room to the downside for yield from here. overail: let's get other -- to another chart. what do you think of the struggle -- of this? >> it is not often i am on tv and we break an important analysis. here it is. that -- a measured move is typically taught of as a measured move.

we should see the lord rates over the coming weeks. julie: to bring it back to banks, that would not be good for banks. for a bankwas made earnings preview. it looks at the 10-year gilts in white, and s&p financials actor as a ratio in this amber color. they track closely here. doing, -- gs not was withstanding, our rates going lower? >> in the near term, yes. i am an investor, not a traitor. i would look at this as an opportunity to wait until we get , with theelloff decline in yields. certainly the longer-term trend is rates will rise eventually. especially in the shorter

maturity of the curve. that is where we need to focus. rise, they do not pass on the benefit of the increase. like bank of america, their profit margins continue to open up. for the moment, i would have to say, it is time to sit on your hands in bank stocks. if you want to buy something, and look at it in three to five years, probably not a bad place to go. joe: we will go to break. before we do, let's look again at the 10 year yield. earlier today, we were over 2.3%. this is a real break. like down after the trump comments to "the wall now, anotherl," leg down here. we will be keeping our eye on this. pretty extraordinary move. from new york, this is bloomberg. ♪

joe: we are back with scott der of guggenheim partners. we got a question from a bloomberg contributor. the question is let's take it to the next level. we have the drop in the 10 year. one of the hottest traders this year has been emerging markets, doing remarkably well. does this mean they can have another boost? >> i certainly think so. one of the biggest questions i have been asked this year by investors is what about emerging markets. dollar strength is typically trends in with emerging markets. we went back and did some work and we found that the real correlation is with commodities. the disconnect and what a lot of

people miss so far this year is with trade. when we see the dollar goes down , they will look more attractive, and i think we are in a bull market for emerging markets. i do not think people should be misled here. we have a chart here that supports your view on e.m.'s. in white, e.m. bonds. blue, yields. we see the downtrend. high-yield, perhaps spread is getting set to go wide. >> i don't think so. i think the widening in high-yield spreads is an anomaly. history shows us that you go back into the late 1990's or you before thee period financial crisis, high-yield spread actually got significantly tighter than they are today.

i think the recent selloff in high-yield is the buying opportunity. we will see that spreaco down. the real question for me longer-term, as an investor, is the amount of debt that is getting a committed in emerging markets. as a remarkable, that is a crisis for another day. until then, things that continue to go up in price are bull market and we should take it vantage of the bull market. really appreciate you coming on. everybody should go and read the profile of scott. it is out now. fascinating conversation. coming up, what you need to know for tomorrow's trading day. this is bloomberg. ♪

julie: don't miss this. j.p. morgan come out wells fargo, -- j.p. morgan, wells

mar i am mark crumpton. you're watching "bloomberg techlogy." president trump welcomed jens stoltenberg to the white house

today. the president, who had been critical of nato during the campaign, took a different approach. president trump: the secretary-general and i agree that other member nations must satisfy there were -- their responsibility to contribute 2% of gdp to defense. if other countries pay their fair share instead every line on the united states to make up the difference, we will all -- instead of relying on the united states to make up the difference, we will all be much more secure. mark: the president added that nato was no longer "obsolete." secretary of state tillerson says that relations between the u.s. and russia have it a "low point." sergey lavrov says moscow is ready to restore the syria air support. has vetoed a yuan resolution condemning the use of chemical weapons in syria. the draft -- a you and -- a u.