that the policy of our government is to aggressively promote and use american-made goods and ensure that american .abor is hired to do the job america first first, you better believe it. it is time, right? it is time. we'll first fully monitor, uphold, and enforce our buy american laws, which we have not done. when theire that funds agovernment project, domestic goods and should be used. over the years, these have been anded by excessive waivers reckless exemptions. the result has been countless ins that were lost

subsidized and low-quality foreign goods. i am directing every single agency in the government to strictly withhold our laws to minify -- minimize the use of laborers and maximize made in america content and all federal projects. [applause] it is time. and for the first time ever, we will crack down on foreign steele too used dump take contracts from workers like you. they have been doing it for a long time. it will not happen anymore. we're finally standing up for workers and companies. the order declares that american product -- projects should be made with american goods.

allow foreign countries to cheat our producers federalers out of contracts. everyone in my administration will be expected to enforce every last provision on the behalf of the american worker and we are going to investigate that single trade deal undermines these positions and we are secondly going to enforce the higher american rules designed to protect jobs and in the unitedrs states. we believe jobs must be offered to american workers first. does that make sense? widespread abuse -- abuse right now in the immigration system is allowing american workers of all bykgrounds to be replaced

workers brought in from other countries to fill the same job for sometimes less pay. this will stop. workers have long called for reforms to end the visa abuses and today, the calls are being answered for the first time, including taking the first steps to set in motion a long-overdue reform of h-1b visas. now, they are awarded in a and thatandom lottery is wrong. they should be given to the most skilled and the highest-paid applicants, and should never be used to replace americans. no one can compete with american workers when they have a fair level playing field, which has not happened for decades. at ourusing every tool disposal to restore the american dream. when it comes to wasteful, destructive, job killing regulations, we will use a tool

you all know well. it is called the sledgehammer. what we will use. we will also stand up for our dairy farmers in wisconsin. [applause] and i have been reading about and i have been talking about it for a long time. it demands immediately fair trade with all of our trading partners and that includes canada. [applause] because in canada, some very unfair things have happened to our gary farmers and others, and we will start working on that with ron and scott and paul and all of your representatives. what has happened to you is very unfair and it is another typical

one-sided deal against the united states and it will not happen for long. we will get together and we will and we will get the solution and not just the answer. we know what the solution is. if you guys cannot do it, we will bring in right speed this. reince.get that -- we will get that. it is a terrible thing that happened to the farmers in wisconsin. a disaster for the united states, a complete and total disaster. and we do some things

have all sorts of rules and regulations that are horrendous. provisions where you have to wait for a long time and have to notify congress and after, you have to get certified and then you cannot speak to them for 100 days and the whole thing is ridiculous. nafta has been very bad for our country, very bad for our companies and workers. we will make a very big changes or we are going to get rid of nafta once and for all. cannot continue like this, believe me. [applause] they think will be happening on trade with other countries over the coming months and i mean very big. we are working with congress on and we are on time if we get the health care approval.

everyone of your congressmen and press everybody because we want that approval. easier makes tax reform and better and steeper. it will be bigger. we are in very good shape on tax reform, we have the concept of the plan and we will announce it .oon we have to get the health care taken care of and as soon as health care takes care, we will march very quickly and we will surprise you, right steve mnuchin? secretary of treasury. i see sean. stand up, sean. i had no idea. he has been so great to me. he is like a world champion climber and every time i look at him, i look at him differently. he is also very good on

television and very helpful. we will make a big investments building our military and reap -- repairing the badly depleted infrastructure. ,ig infrastructure bill probably using it was something else, it is a little harder to get approved, but infrastructure is coming and it is coming fast. bridges, tunnels, and airplanes will be constructed with american hands, and yes, american tools. [applause] as we work to restore the american dream at home, we are also working tumors tour america's standing abroad and that means strengthening partnerships and ensuring friends and allies pay their fair share and fat very much includes, as i already said in

my little statement to paul, it also includes the nato countries. they are letting us down in one respect and we do not want people taking advantage of the united states and that will not happen for much longer. i will go over there soon and everyone will be paying and we will be a happier country and a happier world, no matter the circumstances. act from all know we core conviction that america's strength must be unmatched. the first priority, unquestioned. the safety and security of our citizens. this is the surest path to a more peaceful and prosperous for assault. in the spirit of this company's earliest days, a great company

and a great history. orades ago, in the 1920's, staying, which i have seen many out a find a spot to let beautiful matt. on the green felt matt, you would carefully place a gleaming set of new snap on tools. the founders of the company wanted customers to know the tools of the mechanic were just as important as the tools of the doctor, the dentist, but politician, or the business leader, and that his was a noble craft, as noble as any. it wonderful story about your and wisconsin heritage, a truly great heritage led by

incredible people. it is also a story that tells a lot about the american spirit. grit,or work and we honor we honor craftsmanship, we honor the men and women who turn dreams into reality with their own two hands. in america, we honor all of you. wilderness,ion of we are the country that dug up the panama canal, put a man on the face of the moon and linked the cities with majestic railroads and curving highways. we are the country that is always on the cusp of the next invention. we can always -- only get there with all of you. working anddo it by building with all of you and we can only get there together.

purse -- the one people sharing one destiny, saluting one great, beautiful, american flag. --m thrilled to be here to celebrate our american heritage and proudly embrace our great american future. that is why i came back here not just for the company but the people of wisconsin. it has been so incredible and we will never ever let you down. worker,s the american the american dream, and god bless the united states of america. thank you very much for the honor. thank you very much.

>> that was president trump including his remarks wisconsin. the white house saying the will make iter harder for tech companies to replace workers with cheap foreign labor. you can see him getting ready to sign the executive order and he made a number of comments about campaign promises, including tax reform, saying they would get on there soon. also saying we needed health perform and infrastructure bill would do it with something he said to get done. >> not a lot of specifics. but he said it in a few different ways that he still wants to get health care reform done first. there, soa priority not letting that go.

also, not new, but reiterating the nafta talk, that if they cannot get an agreement, they could theoretically extricate and that we could remove ourselves. >> maybe even get rid of a completely. we're joined from washington. the comments,to it sounded like another campaign speech. he reminded everyone that he won the presidency. he gave a lot of shout outs. did he say anything new? >> i was reminded of the campaign trail. it sounded like a campaign speech. nato, talked about in terms ofre and anything new, the new executive in his words, in order to

americanhe goal of products and american companies, the one thing administration officials had talked about, that he wants to do again, that he seems to want to do is change how the system works in a fundamental way. there is a lottery for all visas , about 20,000 of which are masters degrees. they are right now selected at random. what officials have talked about is changing that around. the approval goes to the highest-paid applicant. was disadvantage international students graduating from college and try to stay here. and particular, to try to event american workers from being displaced.

to get health care reform done, i know congress is not in the session right now. is there any momentum toward ?hat >> the answer is no. it is with this resist movement. we see it in town halls where republicans are getting yelled at by constituents, and the basic fundamental dynamic that has stymied republicans from getting stuff done has remained. it does not repeal as much as they would like. still have moderates who are concerned these cuts go to deep.

they are not ready after promising it for seven years. >> we will be on the watch out for that. you areck to what saying about the program, he seems to want to change how that works and give approval to the highest paid applicant. i wonder what kinds of changes the white house can make congresslly without chiming in. can this be done executive lee? >> my understanding is cs. there is no statutory theirement as to what administration is required to do . it happens in most economic years. down pretty precipitously. the administration has an option here. the traditional way is choose at random and known gets special preference. my understanding is the administration has some level of discretion here and it could get doneenged legally if it is

without the normal rule-making process. if it is done by regulation, it needs to go through the administrative procedural acts. it is not something that can be done with a flick of a switch. the filing season began april 3 and petitions have already gone across. it is significant. >> nothing to do with the president's now, but the special probablytonight, people who are not knee-deep in politics, maybe not paying close attention but why should viewers care about what is happening in the special election? >> it is an important one. the district will determine whether the democrats have a shot at taking the house.

if republicans lose this, it signals democrats are doing well in polk and leaning districts and that could be a lot of trouble for republicans in the 2018 midterms. given that president trump only district, we will see where this comes down. thank you. verizon can meet -- communications, because of the , he would consider talks with disney. we know that verizon is struggling with the challenges of this mature mobile phone industry.

yahoo! will be reporting image -- later today. a huge move on the day, on the day a jump up on the back of these headlines. if brianact quote was, roberts came knocking on the door, i would have a discussion with him about it. in the next hour, we will go to facebook's conferences. ahead of 50's messaging products. this is bloomberg. ♪

oliver: let's look at where the major averages stand now. >> we have got the major averages trading lower.

500ve a look inside the s&p with the various groups and where they are trading. financials have been steady with the biggest rags throughout the day. all of them are up off the lows. we see the rotations in some of the defenses by consumer staples. let's look at universal health services. the shares have been lower all day. they took a leg even lower than that just around 1:30 when senator chuck grassley said he would be interested in a probe of the country. news. reports in buzzfeed -- e buying businesses

this fiscal year, generic truck pricing will fall in the low double digits. a lot of concern about pressure for drug prices in the industry. the couple competitors fell as well. johnson, out with its down 3%today, shares today. drop than estimated. saw declineugs also and that is what pushed down the shares as well. oliver: thank you. scarlet: we want to recap the breaking news we got on verizon. the biggest u.s. wireless

carrier, looking to diversify. >> we see the company's mentioned. not a massive spike, but clearly a jump, comcast up 1% with most of the gains coming in the wake of the headlines. be idea that there could some activity and verizon could .e open to it, a little boost classes interesting which names have built on the gains. to move higher whereas disney and comcast have given back some of their advances. before the headlines came out. environment set looser.

conflicting remarks about whether he will approve this kind of deal. his agenda will be seen as more pro-business and that will allow for consolidation. >> it still exists out there, moreelief that he will be pro-business and other narrative is that a lot of these are not moving as fast as people would expect. agenda, people believe there could be a change and to whatever extent potential deal activities had not gotten done, that maybe there is a pipeline or something like that, you see a little enthusiasm. it is important to mention these are not massive moves. >> it is interesting because the president has made interesting comments about the media deals. he did not like time warner at&t p said he did not like comcast either when it bought the nbc assets. >> ambiguity about what the administration stance is. >> the market close is next.

.ook at the major indexes the dow is down more than 100 points. yesterday, a gain of more than 100 points. from new york, this is bloomberg. ♪

awayet: we are moments

from the closing bell. "what'd you miss?" self-closing lower today. the pound soaring. i scarlet fu. joe: i'm joe weisenthal. if you're tuning and live on twitter, i welcome you to our closing bell coverage, every weekday from 4:00 to 5:00 eastern. scarlet: we begin with our market minutes. the dow ends a third straight day of 100 plus closing. it is interesting. the last few days, so little movement. nonetheless, over half a percent. look at the imap of the s&p 500, goldman is the biggest reason why financials and eight of 1%. you can see the red and that

sector. if you look at the other sectors overall, you have five groups .igher health care and energy are the leading decliners. in terms of the actual individual names, let's point out goldman because it is the worst day since june 2015, trading at the lowest level. j&j was the second worst performer. for harley davidson, more read their as well. certainly a sign of how the stronger dollar has hurt the revenue. cardinal health has the worst a sense 2014 -- 2004. they say that falling drug prices will hurt the results for the medical unit. in the last 10 minutes, we learned that verizon is open to perhaps deal talks with a number

of players including cbs, disney, and comcast. joe: let's look at where the bonds are moving today. a lot of action. look at where the 10 year yield closed. 2.17%. that is a really big move. we were down. 2.3 was the level. we sliced right through that. i did not they had gotten that low. we are at levels now that are the lowest for the year. not far off the immediate wake of the election. i want to quickly look at the u.k. 10-year. lot at thelooking a u.k. at the surprising news that theresa may called snap elections. we see earlier, the news that she was going to have a press conference, people kind of nervous.

a pretty wild day in the u.k.. scarlet: sterling rose. that came after theresa may called for the elections. not until june 8, but you can see when the headline crossed, a big move there. when you look at the pound over six months, you can see the pound trading at the highest level since december. we need to take a look at the metric, the barometer of the risk aversion, dollar-yen. extended the decline to the lowest level this year. the dollar did have a brief rally after it was indicated that dollar strength over the long-term is a good thing. again has come out stronger once again. joe: finally, on commodities, let's look at oil and gold where hardly anything happened. the real action in the industrial metals. ore,, lead, copper, iron

all getting clobbered. fears of supply and demand. something you want to keep a demand on. look really ugly right now. scarlet: those are today's market minutes. that's go back to the breaking news on horizon. we are now joined on the phone. in this context that verizon would be open to discussions , to walt disney. >> for rising was thinking about 10 different targets. this was around the time that news had broken that there was a discussion between the verizon .eo and liberty media ceo

[indiscernible] scarlet: we're having some technical difficulties with alex sherman. he is giving the background for the comments of verizon would be open to conversations with or disney.s, joe: of course, there is this quote that if brian came knocking on the door, i would have a discussion with him about it. not very subtle there, announcing that his door is open if anyone is interested. scarlet: we know that verizon has already purchased yahoo! assets. reading analyst estimates. when it comes to revenue in the first quarter, if you back out the revenue of partner sites, it

is higher than what analysts were expecting. higherng profit also than expected. joe: yahoo! sees the verizon deal closing in june 2017. reseau, the saga will officially come to an end. scarlet: we will keep you updated. for now, yahoo! shares up. joe: "what'd you miss?" . recent divergence perhaps there could be a headwind for stocks. how should we read into the recent moves and the divergence? we want to bring an cameron price. he joins us now with more. that chart looks good. thinkt something that you

is key to measure think is key to measure that, for a while, the data was -- had an extraordinarily large down move that perhaps, over the last couple of days does not reflect adequately the actual tone of the day. the data has been bad for the last few days. no doubt about it. tilted a little bit lower, but not nearly the same magnitude. if the city index is hanging on the five standard deviation this on the empire survey, i'm not sure that is something you want to hang your long-term hat on. that being said, the corporation -- correlation recently has been strong. that is largely because they have been driven by the same thing which is the reflation hope, as a result of the election and the new

administration. you draw an important point that remainsity index inverted. ares&p and indices diverting. you can tease out some information in the short run but, over time, is is not work. from that perspective, you need to be a little careful. i look at the longer-term correlation and it is positive, but not very. you need to be careful. scarlet: i want to interrupt because we also have ibm shares moving as much as 2.9% after the company reported, beating analysts estimates. 8.2reported revenue of billion.

another focus point is growth 42%.n of we will continue to monitor these headlights as they come out. joe: you were talking about the reflection hope -- reflation hope. what is happening? is it over? is there no change on the there has been a lot of focus on the hard data versus the soft data. the hard data was never that great. most of the movements say the surprise indices were driven by the soft data. historically the soft data tends to improve more with republican president spent democratic presidents. to some extent, want to filter out the political fx, i think there was an overstatement there, looking at the surprise indices and the rise in the soft

data. that being said, i think it is indisputable that there has been a disappointment in the overall tone of the data. withso have to temper that the fact that the 10-year gilts has gone up over the last few weeks. if we look at that as a surviving competition for equities, the competition has gone down. it should have all else spend equal, but is going up. scarlet: joe mentioned the move down. it is now back to levels right after the election. is this a leading indicator necessarily? >> leading indicator of pain, market pain. it is indisputably reacting to the tone of the economic data that we have seen. there is up initially -- a positioning aspect as well.

if you look at the data on interest rate futures, the market has been short bonds, short interest rates in record levels. for the first part of the year. , particularlyeen after we broke out of that range is positions being vacated and shorts buying back the short run. joe: speaking of bonds, you are a strategist. anchorage everyone with a terminal 2 reacher stuff. markets live every day. you set out this chart, which amused me. i'm looking at it on my bloomberg. it is 10 year yield versus the weather in sydney, australia. i know we say correlation does wouldual causality, but i trade on it. zoom in and people will see. >> you are stilling my thunder.

joe: sorry. >> it was a slow day yesterday. i sent this out saying, i have discovered this great indicator for 10-year gilts. the white line appears to lead the turquoise line, which is the 10 year yield. it is sort of in the spirit of what we were talking about. you have to be careful, looking at these overlay charts. the white line is the average temperature at the sydney airport. joe: you can also get sydney weather data. scarlet: investors are looking for any way to suss out where prices are headed. there is so much debate. >> that's right. you also have to be careful. the human brain is sort of

hardwired to see pattern where randomness actually exists. this is sort of an amusing example of that. more often than not, there is no holy grail. you have to grind and see little pieces of information rather than one easy overlay. joe: very disappointing we will not find the holy grail. cameron price of bloomberg news. sign up for his research. thank you so much. scarlet: coming up next, we will go to facebook's messaging conference. from new york, this is bloomberg. ♪

alisa: let's get to first word news this afternoon.

president trump was pushing his buy american, higher american agenda today wall speaking in kenosha. president trump says his executive order is aimed at improving guestworker relations in an effort to help workers. now,dent trump: right visas are awarded in a totally random lottery. now they should begin to the highest-paid applicants. they should never be used to replace americans. no one can compete with american workers when they are given a fair and level playing field which has not happened for decades. alisa: it has inspired americans to stay in the united states. one third of the

electorate is undecided. fillon -- front of rancois fillon within striking distance. the governor of michigan recommends that based -- they waterue getting drinking from a nearby reservoir. global news, 24 hours a day, powered by more than 2600 journalists in more than 120 countries. i am alisa for many. this is bloomberg. now, let's take a deep dive into the bloomberg. you can find all of the following charts using the function at the bottom of your screen. i want to talk more about the industrial metals. i talked about them during the

market minutes. copper. .ot doing good i made this chart, the year over year change. this blue lines, the industrial metals sub index. you can see there on the right side, really rolling over. of course, a lot of talk about that, the inflationary impulse. tracked eacht of other over time. you can see, the blue line rolling here. very differently so they can matchup better. nonetheless, i believe people should watch this. scarlet: what is notable is the difference with 2008. really taking off

in 2008. joe: that's a good point. since then, trending in the same direction. scarlet: coming up, we will head to the facebook conference. from new york, this is bloomberg. ♪

scarlet: "what'd you miss?" facebook's conference is in full swing in l.a.. new features for the facebook messaging app. let's go now to caroline hyde of bloomberg technology. caroline: let's get straight out to david, vp of messenger.

a product that has 1.2 million users. welcome to the show. you are unveiling yet more platforms. 2.0, you are calling it. it seems to me that you want messenger to be the only at that we need to use. orderingour food, cars, through this messenger? >> it all depends on what you want to do. there are things that belong in conversational context. it is the place you go to two coordinate plans, whether making reservations at a restaurant, building a playlist with friends, or many things that require some form of coordination and conversation. instead of app switching, you can do it right there and then inside messenger natively.

so, it is easier for everyone to do the things they are already doing. caroline: therefore, keeping box,n messenger, and using the way you want to see people interacting with companies more. there was a lot of hype when we saw messenger in 2016. can it live up to the hype in 2016? >> i think every new technology has a hype cycle when it lives on a platform as large as ours. i feel we have made a lot of progress in the last 12 months. we now have a lot of progress. we have 65 million businesses on facebook and pages, of which 20 million respond to messages on messenger every month and provide services much better than we could over the phone. things are happening and they are happening because we have learned a lot.

messenger now has over 1.2 billion people using it every month. viewers outr those there, applications help it move very smoothly. are we going to see adverts come up? how will businesses be using it and paying give? >> the way we are thinking about my physician for messenger, if we create more value in the conversations that we want to create more of these. a great way to do this now is to newsfeedpeed -- ads in that create conversations about this in newsfeed. gradually, over time, we will test ways for companies to advertise inside messenger that do not get in the way of messaging because that is what people come to messenger for.

caroline: do you have a target? do you have a utopia? >> we do not break that out. it is very early, as you can imagine. buying apps is something that anyone building companies on the platform could start doing since last december. it is very early still, very small, but we think with the user base that is what it is and the thriving ecosystem that gets more value from the platform, will, over time, be able to build a solid business. caroline: this is the story feature that we saw not only a instagram,but also how are people using it? to games, whens you think about it, social games were a big thing on desktop, but

they ceased to be a big thing on mobile. messenger,ames on game developers can what's again builds on messenger, and the other way around. we are unlocking the capability to build on messenger, so you will be able to play "words with friends", with all of your individuala group or conversation, and many more types of games as of today. we just opened that right after think giving last year. since then we had 1.5 million games that have been played. carolyn: plenty of gaming. many feel that facebook is showing how they can overtake snaps that -- snapchat. you agree? >> if you look at the stories format, the format was the end standard.nd now it is

it does sit in a number of apps. posting something on your day helps to build context for better conversations. it enables you to share plans. if you want to send a quick message, facebook is a great place to do that. we feel this is a product that is actually adding a lot of utility across our platforms. we will continue to invest in it . carolyn: competition continues. thank you for taking time out of a very busy day. the vp of messenger, more than 2 million users across facebook. thank you. scarlet: thank you so much, caroline. that was head of markets. may up next, theresa

announces a snap general election in june. we will talk about what is driving her thinking next.

alisa: let's get to first word news this afternoon. in the u.k., a surprise announcement from prime minister theresa may. she has called for a general election june 8. that is indication that may the brexit legislation she needs through parliament. tremendousmoment, of national significance. there is division. the country is coming together, but westminster is not. alisa: an election is not due until 2020, but the party 20

points ahead of opposition. the u.s. attorney general says the justice department will crackdown on gang violence. blamesssions says he hearings such as ms 13. in prepared remarks today, session said gangs like ms 13 represents one of the greatest threats to american safety. he says that so-called thanks ray cities make efforts to fight gang violence more difficult. jim maddox says north korea's latest failed mission -- missile launch was a reckless act of provocation. begins aarabia, he week long tour. his statement was shorter than a statement he released later in

which he said he was aware of the failure. the international monetary fund issuing a forecast. left the u.s. forecast unchanged but the imf also warned that the emergence of protectionist forces could undermine economic growth. global news, 24 hours a day, powered by more than 2600 journalists in more than 120 countries. im a lease this is bloomberg. scarlet: let's get a recap of today's market action after a big rally yesterday in which every sector in the s&p 500 gained. 3/10 of 1%.ng falling for the third straight day. sachs's results, a big drag on the doubt. in terms of earnings coming out after the bell, let's start with

yahoo!. estimate.e consensus perhaps the big news here, yahoo! sees the rise and deal june 2017.occur in joe: a quick look at ibm earnings which came out after ibm hours and are also not good. the stock down 3.1%. 18.4 the estimate of million. etf, slightly beat. .he adjusted margin you can see this, the stock not doing good after hours. a week margin, the stock down over 3% after hours. "what'd you miss?" prime minister theresa may

calling for an election on june 8. this, as she heads into brexit talks with the european union ph he made the announcement earlier this morning. >> we need a general election and we need one now. we have, at this moment, of one off-chance to get this done while the european union agrees before the detailed talks begin. only i have recently and reluctantly come to this conclusion. jumped on the announcement, moving up of the moving average. this chart goes back to last year -- june. you can really see if you're at the end, the big spike. markets really liking the announcement from may. for more analysis, i want to bring in nina, associate

director for henry strategy. there was some debate that this could be a possibility for a while. she is so ahead in the polls. a huge opportunity to consolidate power for the tories in parliament. why do you think she decided to go with this? >> there was quiet a lot of surprise in westminster because they did not expect the close not election. once you get past that, you can see why she would do this. the tories are riding high on the polls. labor has been in self disintegration mode. this will give theresa may the mandate to strengthen her hand discussions.he she only has a 12 seat majority. she has already laid out what kind of brexit she wants.

she wants a hard brexit. in order to get that through, she wants minimal interactions on the visual front. election, itis brexit doesr that really mean brexit. it has been perhaps some wishful thinking. scarlet: elections are not scheduled until june 8. there is still some time between now and then. how does this change how eu leaders negotiate in the meantime? could they get anything done or are they held hostage to the fact that this election is scheduled in june? >> from the eu side, they have a lot to do with, not the least, the french election. done in terms be

of eu leaders coming to any big decisions. the national elections in germany out of the way. though imagine that even article 50 has been triggered and technically talks are begetting, europeans will not be able to engage. therefore, it makes sense to focus on the homefront and consolidate the majority before going into the talks. scarlet: we use words like gamble to describe what theresa may is doing. to what extent is this comparable to david cameron calling for the referendum? >> i think that obviously she has taken what she sees as the caliphate risk because labor is not performing well. even if labor were to perform 5% or 10% better, she still has a 20% lead. she sees it as a very calculated

risk. weight could see gains could be with the democrats who crashed out of the government. they will position themselves as the anti-brexit party. labor cannot do that. they have the problem, after the referendum, with most were in favor of staying in the european union, but a lot of the electorate were not. notyn himself is necessarily pro-eu. labor is between a rock and a hard place. it is a clever strategy. joe: is there anything to the theory that an expanded parliamentary majority will let theresa may be less beholden to the extreme brexit parts of her party? i have seen that offered as one possible theory as to why the pound did so well today. >> that is certainly a possibility. she has a lot herself a little

more leverage, especially when it comes to things like will ?here be a transitional period how much money will the you have to pay for its exiting of the european union. scarlet: of course, we mentioned markets. you mentioned earlier the french elections. i have a chart here are the highlights what tends to happen with french president elections are held, as we look ahead to the elections on sunday. the cace part shows declining. the blue line shows how it rebounds. if rebounded each time except for 2002 when the income it was facing off against john marine le pen. joe: the race is now a virtual tie a monk the four final

candidates. in the final days before the first round, what are the things you are watching to determine how this ultimately breaks? a obviously this is fascinating election. we have a four course race. you can potentially have a scenario in which markets would react in the second round. we simply do not know. this is simply unprecedented. we will have to wait until sunday comes and goes and looking beyond that, you have the legislative elections in june. they'll also be key to how markets react because basically all of the forefront matters in the race right now, no guarantee that any of them could get a parliamentary majority. good point.eally one thing that we can be of toehouse or mindful of is citizens were arrested in marseille over a plot to disrupt the election. if there is any violence ahead

of sunday does that swing the contest away or towards any particular candidate? >> certainly. i think the national inclination would say that gives an advantage shoe le pen. france has been under siege for many years. security and terrorism is something that is riding high on the minds of the french electorate. were there, god for bid, another terror attack, that could shift the race. joe: thank you very much for coming on. scarlet: coming up, more details on the verizon headlines that we got less than an hour ago. the ceo of verizon think he is open to merger possibilities and will consider negotiations with comcast, cbs, disney. this is bloomberg. ♪

miss?" "what'd you verizon ceo open to deal talks with those including comcast, cbs, disney. give us a little context here around the comments that he would entertain discussion talks, or deal talks, with those players. >> back and gently we reported that verizon had about 10 targets. this was around the time where we, and others, were reported interests and had some with the largest u.s. cable company. basically, we are putting together some names. week learned during an interview that comcast might be interested . big companies like cbs or disney, similar to when at&t went out to buy time warner.

probably he is not satisfied. he feels like this company needs to do a game changing acquisition. joe: are we to presume that these other companies would be interested in a deal? clearly make out as has mentioned some interest. that is a great point. in fact, nothing has taught verizon from going out to do the deal with some of the concept players, let's say, disney and cbs. nothing has happened at this point. therefore, you would have to approach that was some suspicion that may be there is not the same mutual interest there. what we don't know is if there is any interest with comcast. comcast and verizon have both been participating in the wireless spectrum option going on for the past year, which has zero rules around the anti-collusion rules that prevent any of the companies around that option from

.iscussing any m&a verizon participate as well. the two companies have not been able to talk deals. that all ins on inventory seven. we should get some indication after that if there is some mutual interest. of course, there would likely be major regulatory issues, at least from a political standpoint, is comcast and verizon were to do a deal. you might remember that comcast time warner cable, and that did not go through. telecom companies coming together, in a trump administration, that may bring some alarm bells. scarlet: absolutely. we are waiting for any movement here. how much, or to what extent are verizon ambitions hinge on what happens to at&t and time warner? deal, tosingle telco

some degree, hinges on that deal. i think the entire general world, in fact, the entire world m&a is waiting to see how the trump administration will deal with that transaction. it speaks to have -- if trump will put politics front and center, or if they will let president and law dictate how it goes through. there is no strong legal argument that i have seen that would prevent comcast from time warner. if the at&t deal is blocked, all of the other telco company certainly are going to approach mna differently because they will realize, ok, politics is clearly the main issue here going forward. scarlet: a lot of hypotheticals there. thank you so much. up, car sales at the

lowest level in more than two years. concern growing over subprime auto loans. does that give investors reason to be concerned about the broader economy? we debate next. this is bloomberg. ♪

scarlet: "what'd you miss?" subprime auto loans inviting comparisons to subprime mortgages. the value of those currently behind 30 days surging in december, a 14% jump from one year earlier. our sub prime auto loans that next big short? welcome to the program. thank you so much for joining us. danielle, let's begin with you. state the case for why subprime

auto loans are a huge concern for the economy. >> i think you have to look at subprime auto loans as one of the main factors that is holding back house full debt and the spend. you tack on the fact that rents are higher than they have ever been. credit card borrowing on a real inflated -- adjusted inflation bases have been running past incomes. you tack on how many households have adjusted themselves to squeeze into these car payments. they are one hiccup away budgetary speaking from really rippling through the economy. not at the same level as we saw with mortgages, but again, you have to look at every factor affecting households now. joe: how big of a big deal is subprime auto? >> not nearly as big as mortgages were.

subprime auto builds are typically in the used car market. maybe they get sick of it, and residual values are lower. that is one factor. in the broad scheme of themes -- things, we see more trucks and suvs being sold which indicates it is not a broad economy problem. scarlet: the other thing pointed out is yield premiums on the risk of auto loans has been falling. why do you think that is? >> i actually wrote about that recently. we have seen a cutting in half of yield premiums associated with the deepest subprime borrowing. i think that is really a reflection of the negative interest rates and the reach for yield here and the united states. people are desperate to get into these asset-backed securities, but again, deep subprime's do

not exist to the extent that it does today. joe: do you believe investors in these automotive backed bonds are missing the story and blindly reaching for yield? >> know, we have seen credits fall pretty much everywhere. auto loans do pay off quickly. they're not 30 year mortgage like houses were. they are easily monetize a bull. i think investors know what they're doing here. scarlet: is the business cycle turning? to what extent do you see auto as a or dealer inventories coincidence or coordinator here? >> may be like energy, they will suffer with lower sales and prices for a little bit. with an economy of 4.5% unemployment and still strong job growth and steadily rising wage growth, it is something

that the economy should be able to handle easily. joe: danielle, you are shaking your head. i am shaking my head hard. our dealers that have been in business for up with of two decades, throwing in the towel. they cannot safely be in the business of taking cars on to their lots, doing trade-ins because they are becoming afraid get hurtdly they will at auction. we have never seen 4 million cars coming off lease in a single year, which is what we are seeing in 2017. it is a million more units than 2015. i think the used car market, as we saw in the consumer pricing indexed last week, 5% year-over-year decline in used car prices is unprecedented. this is the beginning of the ways of cars that will be coming on to dealer lots. i do not think anyone can predict at this point, with any certainty, what the effect will be on new or used cars. scarlet: you pointed out something else in your column.

issue- who are the big rs? you pointed out that private equity is backing some of the issuers. >> that is something i have discussed on a one and one basis. they are concerned that underwriting standards have not come it more. private equity has backed so many of the new lenders in the subprime space. right now they are trying to underwrite these loans, get the paper, package it, and sell the securities off. they are not turning a prudent i to underwriting standards. the dealers who deal with them concerned that the money that raced into the sector will be just as fickle and quick to race back out. we have to leave it there. we will be following both of your work on the auto sector. thank you very much, both of you. coming up, what you need to know to europe for tomorrow's trading day.

this is bloomberg. ♪

scarlet: "what'd you miss?"

a pullback in u.s. equities after goldman sachs and others admit to analyst estimates. as far as tomorrow, don't miss this. results out at 5:00 a.m. and don't miss this. the fed releases their beige book at 2:00 eastern time. that is all for "what'd you miss?" thank you for watching. joe: have a great evening. this is bloomberg. ♪

reporter: i'm alisa parenti. you are watching "bloomberg technology." going it is in judge are to choose a new member of congress. kevin cirilli sat down with the

rnc chair and rnc headquarters today, and asked if this election could predict what could have been nationally in 2018. >> there are so many unique characteristics to each of these elections. you can't model turnout. it is hard to predict who is coming out to vote. you have to take each of these special elections on an individual basis. reporter: you don't think this is an indicator of 2018? >> i don't. i don't think you can predict 2018 based on an election not even 100 days into the president's administration. alisa: french police say they thwarted an imminent terrorist their election. two men have been arrested in the southern city of marseille. officials believed they are converts to radical islam. tax returns are due in the u.s. today. so is any money you only uncle sam.