>> president trump says he is considering a revival. griffin gives that the thumbs up. >> i am really excited to see that. you thinking it would be good for the economy? >> i think it would be great for the economy. francine: the treasury's curve steepen. the alleged disastrous dinner. but they do not outright denied the accuracy.

there is t minus one year and 11 months to hash out a deal. this is "bloomberg surveillance ." i'm francine lacqua. we are joined by the head of all the assets. we will be speaking to aberdeen asset management's martin gilbert. if you have any questions and are a bloomberg customers, just hit tv . we can ask the guests a question on your behalf. this is the eurozone data and eurozone manufacturing pmi, coming in at 56.7, a touch below what economists were expecting. anything below 50 indicates an expansion and it is a touch above what we had the previous month. this is for april, for the euro area.

we are waiting for the breakdown to give us the strength and weaknesses of each country. this is the picture for the markets and i would point to global stocks overall rallying. european stocks, gaining 0.2%, heading for fresh highs. investors are focusing on stronger corporate earnings. the yen, extending losses. a second.t to the and first, let's get straight to the bloomberg first word news. nejra: donald trump says he would meet with kim jong un, if the circumstances were right. this comes amid heightened tensions'over north korea's nuclear weapons program. >> under the right circumstances, i would absolutely made with him. most political people would never admit that. sayster: theresa may brexit talks will not be easy,

but she alluded to the elite details with her disastrous dinner with junker. the european president left talks last week, shocked at may's reluctance to compromise. in france, presidential candidate macron has mocked le pen's plan to create a new national currency, calling it monopoly money. her plan would impoverish the country. meanwhile, le pen attacked macron as somebody who worked closely with francois hollande during his five years in office. cronlatest polls show ma with 59% of the vote on sunday, a fall of one percentage point from the previous poll. global news 24 hours a day, powered by 2600 journalists and analysts in more than 120

countries around the world. this is bloomberg. francine: thank you. president donald trump is actively considering a breakup of giant wall street banks, giving a push to efforts to revive the era separating consumer and investment banking. he spoke to bloomberg at the oval office. >> the are lucky. there are some people who want to go back to the old system. so, we are going to look at that. and dodd-frank is going to be very, very seriously changed, so the banks can go back to loaning money. francine: meanwhile, speaking to bloomberg's editor in chief, steve mnuchin all weighed in on banking regulations. >> we are determined to make sure we have proper regulations so we do not put taxpayers at risk, but also do not have overlapping regulations and have clarity so banks and insurance companies know what they can do. francine: ken griffin told

bloomberg he would be really excited to see a breakup of the big banks to increase competition and boost to the economy. >> i believe that when a market becomes overly concentrated, you reduce competition and competition is the lifeblood of what makes a free economy work. when you have many firms competing to get ahead, that is when creativity happens, when innovation takes place, when consumers win. francine: let's bring in michael moore. you covered u.k. banks for 10 years. we are also joined by trevor, the head of london asset management. michael, let's start with you. what have we learned from the president? are we serious about him wanting to break up the banks? >> he had some campaign rhetoric last year, but this is the first time since he took office he has

specifically addressed this element of perhaps breaking them up. we have had some people in this administration talking about that, but the fact that they are looking at it is stronger than what we had heard before. francine: who are the winners and losers? we assume all wall street banks would lose in this. >> i think the industry would be very much against it. it would be a costly and complicated process. jpmorgan and bank of america, two of the largest, perhaps would be under pressure from this. ,ou saw from the bank's stock they went down at first, but recovered a little bit. people know if this were to happen it would be a long, drawn out process that needs congressional backing. francine: trevor, your thoughts and the odds of this happening. >> i think this is why the market recovered. the first initial shock about

the idea of breaking up the banks and then the realization that this could be like the mexican wall. it is talked about, but difficult to get through congress. there is a general feeling that this is not in the top 10 priorities of the administration . francine: if it were, what would it mean for portfolios? what impact the way, and i don't -- specifically, right? of course. we do want you to keep your job. but does this have an impact on portfolio managers and the way banks?u would be buying up >> the most important thing for the continuation of the recovery we are seeing is the continuation of the flow of credit. flo credit in the state is slightly reduced around the time of the year.

anything that reinforces the flow of credit in this economy has to be a good thing. the most important thing for us is a continuation of global synchronized growth. wereine: michael, if this to happen, what does it mean for european banks? >> perhaps. in some cases they have had a little bit of a funding disadvantage. this could narrow that gap. it is yet to be seen how the u.s. operations would be affected. trump'smany of donald statements, the details that come later could be what matter most. francine: meanwhile, steve mnuchin hasn't spoken out about the prospect of ultralong bonds. >> we are studying ultralong bonds. we have a working group, looking at it. we think it is something that could absolutely makes sense for us at treasury.

francine: i guess, the problem, as soon as you start talking about the possibility, you saw a huge repricing of the yield curve, and the going back and little bit. is the trump administration looking at all possibilities? >> i think so and we are learning how the politics has been conducted over the last 12 to 24 months. first, you plant a flag on an extreme, and then you challenge your opponents, talking you back from that position. we see this with president trump. he favors this as a way of engaging. we see this with the european union and the u.k. government at the moment with the brexit negotiations. francine: trevor? >> i think it is obvious why the government at the moment would love to have ultralong bonds. duration,uch a long liability hedging.

there is massive demand. if you are trying to fund government debt, why not issue longer? it does have an impact in the short-term, affecting the yield curve, but it makes sense at the moment with interest rates this low, that governments would want to lock in long-duration bonds. francine: thank you, michael moore, our u.k. finance team leader there. we are back with stephen macklow-smith and trevor greetham. aberdeen asset management has reported slows and the most recent six-month period as markets recovered. asset management climbed to 308 billion pounds, while cost saving boosted profits ahead of the merger. let's speak to the ceo and cofounder of aberdeen asset management, martin gilbert. i am losing my voice.

this is how excited i am about your earnings. it is his first interview since the results. martin, give me a sense of how the merger is taking place. are clients sticking around and asking questions about the merger, martin? martin: thank you. i hope your voice recovers. clients so far have seen the sense in this merger. the reaction has been very positive. francine: positive in any aspects? what do they want to know the most? the strategy, will a change? -- the strategy, will it change? >>the strategy, will a they wane people managing their money now will be managing it in the future. this is why we have put this retention package in place, to make sure the people managing

the money stick around for the long-term. francine: how much savings are you expected to do with this merger? martin: the overlaps will result in savings of about $200 million over the next three year period. duplicatehat is offices, duplicate systems, all of the things fund managers have. people, buty, some i think that will be easily absorbed by the market. as i said, this is about creating something big that can compete with the big global u.s. giants. francine: overall, and i know you said this has had a very limited impact on your clients. have they been adding money and head of the merger, or have they been holding back to better understand the exact terms? martin: i think the encouraging thing is, especially in

emerging markets, they have then adding money. so, since the first quarter, we have had about four years where we have seen positive flows into emerging markets and emerging-market debt. and obviously, being overweight emerging-market debt in our global portfolio has helped performance there as well. it has been a very positive quarter for us, probably the best for three or four years. francine: do you think the trend will continue? martin: i think so. people are beginning to see value in emerging markets, compared to develop markets. we have seen a big rise in the u.s. market, u.k. market, european market. people are looking at places like india with the growth rate it has got and investing their in equities and bonds and more generally in emerging markets globally, looking for value. francine: are you confident you

will be holding on to the cash you have invested four scottish widows? -- invested for scottish widows? martin: client very confident. we have a very good relationship. hopefully, we can make them see the benefit of this transaction, this merger of the two asset management operations because they are the type of client i am speaking about who can see the benefit of having a larger team managing their money with broader capabilities. things one of the key this merger gives us, broader capabilities. francine: martin, give me a sense, assets under management climbed about 5% to 308 billions pounds. are you going to get a lot more new clients, or is it the same clients adding more funds? martin: it is a mixture of

existing clients adding more funds and the other. we saw the world's biggest banks withdraw cash from bthe emerging-market funds. that is those clients we are seeing coming back into the fu nds, as well as new institutional clients allocating more to emerging markets. that coupled with the improvement and performance, because we were overweight emerging markets in our global portfolio, has meant performance has improved dramatically and clients are encouraged i the performance. -- encouraged by the performance. francine: how many asset managers do you think you will end up with in five to 10 years from now? martin: globally, you mean.

i think, as i have said, the market is moving towards both ends of the spectrum. there is going to be more boutiques, more asset managers at the smaller end of the range, very profitable with very good fees. at the other end, there is going fund 20, 30, 40 of the big managers that have been global capability to run a global organization, as we will have with 50 officers around the world. that is how i see the market going. and both will do a very good job, i think. francine: what do you make of the first 100 days of donald trump? i think you were one of the first ones i spoke to the day after he got elected because you knew him from golf courses in

scotland. has he delivered a little bit? martin: no, i think he has found, like most political leaders -- and theresa may is known different -- the difficulty is with her own par ty, rather than with the opposition. i think he is finding that probably more difficult than he did running golf courses. i think that's probably the thing that would have surprised him the most but i think most of the things he is doing are good for growth and if the u.s. grows the global emerging markets, the global economy grows as well. francine: he spoke to bloomberg news yesterday and says he is considering breaking up the giant wall street banks, going back to glass-steagall. what do you make of that? martin: gosh, i have not seen that. that would be a surprise to the

market. but the banks have had great rises in their stock prices since he got elected. i think that run was overly optimistic. so, i'm not really in a position to comment on whether that would get through or not. francine: i think that is what we are trying to figure out. you hold a lot of european banks. would that help with european banks? martin: certainly the european banks have suffered at the hands of the big u.s. investment banks. that has been a trend we have seen over the last -- since the financial crisis. the rise and power of the big u.s. investment banks. that has been at the expense of some of the big european banks, the deutsche banks of this road. barclays has done well in

investment banking and lloyds has done best of all by exiting and becoming a pure play in teh he u.k. market. there's arguments both ways to whether that would be beneficial banks.fo rbr francine: martin, thank you for joining us. let's get straight to the bloomberg business flash. >> bp reported first-quarter earnings that beat estimates as oil prices climbed. profit adjusted for one time items a most tripled from one year earlier to $1.51 billion. that might help ease investor concern about the company's ability to maintain the dividend without increasing debt. pimco's new ceo plans to add 100 new employees over the next year.

speaking to bloomberg at the milken institute global n says the, the manuaroma company intends to spend on hiring and technology to become better. >> we want to be the best at what we do. we don't think we can be the biggest. we think we can be good at managing conflicts and deliver. it gives us plenty to do and we once the results of the firm to be focused. >> twitter says it will not attribute a bump in activity to president trump's use of the social network, but chief operating officer says the company would love it it every world leader used tweets as the primary way of talking to their constituenties. that will not translate right into increased revenue. >> we don't today have

visibility on seeing the revenue trend improve. first, we need advertisers to recognize the significant rioi.ase in and so, not only is our audience our prices are%, down 60%. >> that is the bloomberg business flash. francine: as the race enters its final five days, the candidates for the french presidency are laying out stark futures for the future of the company. national party has not changed. it carries hatred, dividing of the country and carries especially and can greatly. that is what i fight against and what i said during this is a project of weakening the country, of the

purchasing power of our citizens. an industrial weakening because the exit of the euro is a weakening for france. francine: meanwhile, le pen accused her party of being the candidate of the unpopular president francois hollande. macron is the outgoing candidate. since december, people thought they had gotten rid of francois hollande, the president who failed france, who never presided for the people. you saw him leaving through the door, and there he is, back through the window. francine: let's get more with stephen macklow-smith and tre vor. what do you think about france? >> i think the first thing to note about france, the first

round, he absolutely nailed it. one of the reasons for that is the national friend is not a new political stance. the is good for adjusting what could be a less popular political party, that people are less willing to admit they support. if we run the into the second leading, 6040.s -- 60-40. that would be good news because with having le pe havingn previously endorsing the referendum, it drives up funding costs. the removal of the concern would remove yet another impediment to towards european equities in general. francine: trevor? >> i say this in the context of the political shocks that affect markets. we had may day yesterday and the average stock markets were flat

and bumpy. usually there are two or three reason stock markets sell off. i think summer came early. the first round of the french reasonns were the first for a panic. i would agree that this polling for the second round, 60-40 thereabouts, is nowhere near as tight as things were for brexit and trump, which were quite close to 50-50. francine: which means we can go back to worrying about greece. >> greece is a potential problem. we have not found out what kind of structural deficit greece has to pursue. the most difficult thing, in terms of pensions being cut or removed. it could be geopolitics. arguably, donald trump, a populist leader. we had that week where we had the missile in syria, the bomb

in afghanistan and the ships going towards north korea. we could have standoffs over the summer. secondly, the main thing would be growth and there are signs of growth becoming weaker in china. some of the global pmi's are close to peaking. i think we will get more stimulus and things will pick up again. summer could be when we go from a strong upswing to a correction and growth and therefore, requiring more support. francine: does that mean more volatility? , as long as said the growth picture holds up around the world, that propels revenue and earnings. then, volatility -- you work your way through. francine: what would you be buy ing? i volatility what you would be buying actively? >> very clearly, the sectors

within the european economy were flat during that period. and any part of the economy could grow, or stock market, which is the more defensive area, they were in favor. but now you are walking back to more -- there is a sense there is less risk around, bringing down the cost of funding. i think that continues. francine: stephen macklow-smith, ande for jpmorgan, trevor greetham stays with us. a disastrous dinner, or just brussels gossip? this is next. ♪

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and add phone and tv for only $34.90 more a month. call today. comcast business. built for business. hey you've gotta see this. cno.n. alright, see you down there. mmm, fine. okay, what do we got? okay, watch this. do the thing we talked about. what do we say? it's going to be great. watch. remember what we were just saying? go irish! see that? yes! i'm gonna just go back to doing what i was doing. find your awesome with the xfinity x1 voice remote. ♪ you are watching bloomberg surveillance. i am francine lacqua in london. here is nejra cehic. sebastian: president donald trump says he is actively

considering a breakup of giant wall street breaks -- banks. he spoke to bloomberg. >> we are looking at that. some people want to go back to the old system so we are going to look at that. we are looking at it right now, and dodd-frank is going to be very, very seriously changed so the banks can go back to loaning money. nejra: in that same interview he said he would meet with kim on -- kim jong-un. this comes amid heightened tensions over the nuclear program. >> i would absolutely meet with him under the right circumstances. most political people would never say that but i am telling you, under the right circumstances i would meet with him. nejra: presidential candidate emmanuel macron has rallied the depaul create a new --

france out of the euro would impoverish the country and be irreversible. le pen attacked him as someone who worked with francois hollande during his five years in office. poll sees macron defeating his far right opponent with 50% of the -- 59% of the vote. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. cehic.jra this is bloomberg. francine: we are just getting some breaking news, this is the u.k. april manufacturing pmi and factory pmi. they've both been much better than expected. to manufacturing pmi rising 57.3 when we were expecting 54. if you look at the factory pmi, unexpectedly rises to a

three-year high. it is the same figure. it is a three-year high. just another way of looking at the same number. prime minister theresa may alluded to the details of her dinner with jean claude juncker that talks about brexit will not be easy. he left the downing street meeting "10 times more skeptical" of reaching an acceptable deal with the u.k. let's get more with trevor manages $100 billion -- 100 billion pounds overall. talk a little bit about brexit. i don't know if this is just what we need to get accustomed to, leaks from brussels and a

prime minister saying this is not exactly how it is going. trevor: you are going to get leaks and it is not surprising that opening positions are very different from each other. is not really too surprising that we have had this sort of idea that the first meeting was quite difficult, but there are some pretty clear areas where there seems to be a lot of movement required. they cannot agree at the moment on how to talk. this was a talk about talks, in a way, and they have not agreed to a basic principle theresa may wants to sit down about having parallel discussions on exiting and the trade deal. you may find a delay, and initial standoff about how to talk to each other. francine: i know you read the transcripts from the fas did you think, i'm concerned theresa may was so naive and thought she would get a deal, or is this two

people trying to get along with fundamentally different views? i do not think she was naive. she wants to get the best deal for the u.k. that she can. came outt poll yesterday that said 51% of the british population want to stay in the single market and only 26% want to leave. conservative supporters support which he is doing, but the population as a whole does not necessarily support what she is doing. she has this interesting position where she will build this power base to do something based on support from her own party, but there is not the necessary port -- support from the country. volatility is what sterling cares about, but so far when the general election was called the pound goes up. if she wins and increased

majority that an increased majority, the pound -- an increased majority, i think the pound is likely to strengthen, and there will be very big setbacks. the interesting point of view from the u.k. investor is the pound going up does not necessarily help return. it could mean worse returns because last year was a bumpy year for u.k. returns because the pound was so weak and the ftse went up. the bond market likes it. you get a sense the u.k. economy is staying strong and theresa may strengthening her position and pursuing this policy, the pound could continue to stay strong. francine: i wanted to ask you whether the belief that a general election might actually stop brexit. she is popular but not with a

huge margin because people are concerned with a hard brexit. 9, they believe they will have a different theresa may, one that will negotiate a deal at any cost. trevor: i think it is hard to say, and we have all tried looking in from the outside on what theresa may is thinking. she is a pragmatist. we cannot really say. what we are doing is watching volatility of currency markets, and when volatility starts to pick up then we are likely to like that position on sterling. that is a way of understanding the way the currency markets are processing the political news rather than trying to second-guess it. francine: this is the kind of chart you were talking about, this is the ftse and pound, and you can see it in dollar terms. when you take away the currency

benefit it becomes much less convincing. trevor: in sterling terms the u.k. has been one of the worst foreign markets -- i should say in dollar terms. ftseound lifted the because 70% to 80% are foreign earnings. all assetasically classes going up quite a lot in sterling terms. assets and commodities getting a direct translation benefit. hand sterling is sensing a firmer position with the general election, and that could result in less short-term uncertainty, but that could crimp returns. francine: trevor greetham stays with us. up next, we go inside the oval office. president trump said he would meet with north korea's kim if

the conditions were right. this is bloomberg. ♪

♪ francine: you are watching bloomberg surveillance, i'm francine lacqua in london. mark: european stocks rising for the first day in for, coming off the best week since december. the best monthly stretch since may, telik one -- telecom leading the early advance. this is the difference between the french and german 10 year yield, falling 19 basis points after the first round of the french election. it will change for the rest of the week. we have been hovering around 50 basis points. the polls give emmanuel macron a

20% point lead. keep an eye on the spread this earnings,irst-quarter the company -- bp first-quarter earnings rising. pricesound in oil failing to cover spending and dividends. struggling to cover billions of dollars in payments related to the gulf of mexico oil spill despite an increase in crude prices of more than 50%. it has been one of the worst performers. lovely chart, after years of europeantment

companies are finally living up to market expectations, enjoying the best earning session in seven years. third into europe's first-quarter season, companies listed on the stoxx 600 have reported a 24% jump in eps year over year, on track to be the best rise since the third quarter of 2010, according to data from jpm strategist. francine: thank you so much. u.s. president donald trump says he would meet with kim jong-un if the circumstances were right. amid heightened tensions with north korea's nuclear program. >> under the right circumstances i would absolutely meet with him. most political people would never say that but under the right circumstances i would meet with him. francine: let's get more with trevor greetham from royal london asset management.

how do you look at political risk? trevor: it is always with us and the markets tend to see a heightened period a volatility during a political crisis. more often than not the political crisis does not have economic consequences. if you are thinking of accumulating equity exposure because of the fundamental backdrop that gives you quite a bit of opportunity to do so. if you are negative and want to sell equities you should not do it in one of these panics. it is very tempting. earnings are bad, i'm getting out, it is a bad time to do it. geopolitical,the -- the geopolitical, do you just ignore it? trevor: you have to separate out short-term uncertainty from things that can actually affect the business cycle. obviously the danger is with most political crises or

flareups, there is always a scenario that can really affect the markets. 2003in the gulf war in people were talking about a rebellion and civil war in saudi arabia and the oil supplies being cut off. all sorts of tail risks that did not really come through, but this did not. the last two shocks we had, which arguably where brexit and donald trump's election, both saw a one-day selloff and it was a classic immediate turnaround. both were shocks that resulted in extra stimulus, either in terms of in brexit the pound going down, the bank of england going -- holding its rate, and donald trump promising a great bit of stimulus. it is a surprise but will give us more stimulus. francine: as long as central

banks are there, the risks are different than eight or nine years ago. vix, we are almost at the lowest level we have seen in seven years. trevor: i think it is the lowest level since before the financial crisis. you have a very low level of volatility but seasonally it starts rising this time of year and peaks in october. people are thinking it could be a summer of shocks. the msci world index has returned 90% since last summer, which is in line with its 40 year average. rallies in q4,ig q1, and a soft period over the summer because the economic data is very seasonal. if you do not look at the seasonally adjusted data it is weak in the market -- in the

summer and the market does not have a lot to go on. a central bank talking about the balance sheet, and is this the biggest risk that we could have a re-pricing of asset classes and the fed says they will pull back? trevor: i do not think they will make take surprises like that it is all about data. the investment clock looks at growth and inflation and those cycles set the table for the central banking. we have a good growth picture, some fraying around the edges but a good overall. the second half of this year it will be about, growth was not quite what we wanted and inflation is dropping, let's do some more stimulus. i do not worry about tightening. equities are something you want to pick up for the summer. francine: trevor greetham from royal london asset outage meant.

-- management. talk ofdonald trump's separating investment banks from retail. this is bloomberg. ♪

♪ francine: you are watching bloomberg surveillance, i am francine lacqua in london. nejra: bp reported first-quarter earnings that beat analyst estimates as oil prices climbed and they cut costs. adjusted. ingested -- besser aboutse and the ability to maintain the dividend without increasing debt. pimco ceo plans that 100 employees over the next year for increased growth. isanuel roman said instead just instead of focusing on cutting costs, they plan to spend on technology to become better. >> we want to become the best at what we do. we do not think we can be the biggest.

we think we can be good at managing a complex portfolio. there is plenty to do and we want the resource of the firm to be focused on -- nejra: twitter says it will not attribute a bump an activity to president trump's prolific use, but the ceo said they would love it if more leaders with use it to speak with their constituencies. as we said in the earnings call, we do not today have visibility on seeing the trend -- burning trend improve. we have driven and roi. when they made their decisions on what we would spend today. our prices are down 60%. nejra: that is the bloomberg

business flash. ken griffin has told bloomberg he would be really excited to see a breakup of big competitionrease and echoed comments of donald trump about bringing back a version of glass-steagall. griffin spoke from the annual milk in the institute -- milken institute conference in beverly hills. ken: it is way too early to tell. the move toeet remove regulation from the united state i applaud. this is the single biggest leverage they can pull to get our economy growing faster. i started my business in the and ioom at harvard, could launch a hedge fund in 1987. you cannot launch one today with dollars duemillion

to compliance and regulatory matters. that has discouraged new business formation and asset image meant, the burden of regulation. the energy space, the transportation space, it is everywhere in america, the weight of regulation is reducing new business formation and that is a tragedy. the administration's focus on reducing the regulatory burden on an american that has a dream, i applaud that. >> the last administration was interested in introducing more transparency to the bond market. what about this one? >> i hope they follow through. creates confidence you have been treated fairly, you understand what is taking place in a marketplace. it is the underpinning of a healthy capital market. in a market that is opaque

encumbrance and joy the information advantage -- enjoy the information advantage and that does not make for a good market. if they continue to shine light on how treasuries are traded that would be good. >> if they don't? >> i think that is unfortunate. the bill we are looking at, whether it is the bill for obamacare, tax reform, we are taking our deficit higher and i think it is important that we take steps to continue to drive the u.s. fixed income market and treasury market to be perceived as the most liquid, fairest market in the world. that will drive down the cost of borrowing which will benefit and save money for every american tax hold -- taxpayer. told my colleagues in washington he is taking a serious look to break up the big banks.

would you be in favor of that? >> i would. when a market becomes overly concentrated you reduce competition, and competition is the lifeblood of what makes a free economy work. when you have many firms that are competing to get ahead, that is when creativity happens, innovation takes place, and consumers win. in the financial crisis of 2008 a number of decisions were made quickly that resulted in a massive consolidation of the u.s. banking system. i do not think that serves the interest of our country. what i argued to break them into many small banks? no. should we separate the can investment -- investment banks from commercial banks? >> a new glass-steagall. >> i think it would be good for the economy. >> what it be good for your firm as well? >> it would be a mixed blessing.

we would have more competitors but that is good for america. when american investment banks are at the forefront of innovation -- not all innovation is good -- but over time the majority of innovation creates meaningful value for our economy. francine: that is the ceo of citadel. looking at live lecture -- live pictures of labor leaders in the u.k., jeremy corbyn is campaigning with people concerned about crime in southampton. we have some u.k. manufacturing growth surging to the fastest in three years. ♪

♪ francine: the great revival. donald trump tells bloomberg he

is thinking of a breakup of giant wall street banks. heading higher. the treasury curve steepen's after steven mnuchin tells us ultra long bond issuance makes sense. -- tim cook and many roman was the higher hundreds in the year. good morning. this is "bloomberg surveillance ." i am francine lacqua in london. tom keene is in new york. yesterday afternoon, the president driving the afternoon. he went on to another set of interviews, including walking out on john dickerson on cbs. it was an extraordinary day on 1600 pennsylvania avenue. francine: it certainly was. you see the impact still on european banks. we have to look at the treasury yield curve.

first, let's get straight to the bloomberg first word news. here is taylor riggs. taylor: trump says he is willing to meet with north korea's dictator. he spoke to bloomberg news yesterday. >> under the right circumstances, i would absolutely meet with him. most political people would never say that. but under the right circumstances, i would meet with them. taylor: kim and north korea have become the biggest foreign-policy challenge for the u.s. meanwhile, the president also told bloomberg he is considering whether to break up the giant wall street tank spirit that would mean bringing back a version of glass-steagall. glass-steagall was repealed in 1999. during the campaign, trump called for a 21st century version of the law. sayse u.k., theresa may

that brexit talks may be difficult after a clash with juncker. may has not denied the report. she says "as we have seen in recent days, it will not be easy." global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i am taylor riggs. this is bloomberg. tom: let's get to the data. i have a great chart before the ben bernanke interview tomorrow. futures at negative two. oil, $49.08. an extraordinary lack of bid on hydrocarbons. with a nine print yesterday. that is rare, showing the dampening and quiet on the street. the 30 year yield, that should be green. i will leave it there. francine: this is what i am

looking at. global stocks heading for a fresh high. 0.2%.at i want to talk about treasuries. the yen is extending losses. treasuries also maintaining declines. pound,need to look at the hydrocarbons. but on town, u.k. manufacturing unexpectedly grew at the fastest pace in years for the month of april. we are seeing more domestic demand. tom: i will be in washington tomorrow with michael mckee and talking to ben bernanke. he is trotting his new paperback. let me go to the chart i did for governor been thank you when he was governor 14 years ago. this is the tokyo speech. here is the success of japan and their inflation. the long-term deflation of japan. here is abenomics and a little

bit of a move up. bernanke spoke here. and he said go back to 1998 and reflate the economy. kind of gladse pass, and this is a massive failure of japan. bernanke spoke here. japan did not act until here. francine: i like that chart. it is a little bit picasso-esque. tom: i do not recommend it above the couch in the living room. francine: i am sure it is a great value. this is what i am looking at. maybe this is a chart for chairman bernanke he as well. here is what we heard steve mnuchin say about the 50 year. this is the u.s. average maturity. you can see that is what he is talking about. so i have 2024.

another chart for chairman bernanke he. and the return of the glass-steagall act could be edging closer. trump thinks he is actively thinking of a breakup of giant wall street banks. speaking to bloomberg, he says years examining a revival of the 1933 law. >> we are looking at it. some people want to go back to the old system. so we are looking at it right now. is going to be very seriously changed so the banks can go back to loaning money. francine: to discuss all of this, we are joined by chris wheeler on the phone and geoffrey yu. thank you for joining us. is he serious? will this be at number 20 priority or if the president brings glass-steagall the priority, what does it mean for actual wall street banks? chris: good morning.

it is intriguing. what we hear from the administration is all over the page in terms of what they want to do to change bank regulation. more to come around. he said during the election, he was talking about a modern glass-steagall. i am wondering if they are still too big to fail issue. -- it is more likely than any wholesale, going back to the 1930's. francine: but is this just a way for the president to show consumers he is trying to look after them but continue with his deregulation of wall street? chris: i think so. i am pretty sure they administration does not want to get rid of the benefits of a universal bank.

have veryl say they good balance sheets and shape than they are there to lend money. it would be a massive distraction at a time when he wants the banks to help build the economy. sorry, we are having some technical difficulties. i think tom wanted to jump in, but was having trouble hearing. so let's assume that we will see something of a modern version of glass-steagall. would it mean that european banks benefit from this? last six months saying it is the end of investment banking in europe. does this mean the u.s. will get a leg up, that we could see a reversal? the stage theat

where there will be some reversal. there shouldn is be more activity in europe -- the suggestion is there should be more activity in europe. i do not think this would really trade a situation where the u.s. let go of their preeminent position. investment ranking income goes to the five u.s. banks. but again, a massive distraction , which would seem a ludicrous thing to do when you're trying to get the banks to boost the economy. tom: christopher wheeler, good morning. it seems nostalgic to go back to the banking act of 1933. how would you presume the structure would be, given global finance, the movement of money today? 1993, 1933, not what would a glass-steagall look like today? as i said, i think the

most likely outcome would merely -fencingerencing -- re of banking activity. if you want to protect their retail depositors and make sure they do not get sucked into major problems. tom: is goldman sachs a bank? a bank.t certainly is i think one of your competitors was running a story about how they are extending their banking business. they would not be completely immune. but compared to a jpmorgan or bank of america, it would be a considerably smaller issue for them. francine: thank you, chris wheeler for your time. atlantic equities. rey, when you look at the possible revival of glass-steagall, what does it mean? geoffrey: it reorients the direction of where some people were exiting the trump admission asian to be -- trump

administration to be slash and burn. just taking a step back in terms of where we are, what parts of the lending cycle should we be looking at cyclical regulation. you can sort of make a case in , in particular if trump inflation could extend boom times. we have seen how regulation is another form of tightening, and that needs to be unwound. francine: how do you look at what the president actually says? we need to take it with a bit of salt? a differentn dialogue with the president and his team members, where if you look at it, it is on the priority list? days, thethe past 100 investors are excited.

talk will be a lot of about when we come to the fine print and the execution phase and what can be brought in in terms of legislation is a different story. tom: geoffrey yu with ubs asset management. i will go to washington after the show today. tomorrow, look for my conversation with famer -- former chairman then bernanke enu -- then bernanke he -- b bernanke. look for our said coverage tomorrow but separately and before our said coverage. -- our fed coverage. from new york and london, this is bloomberg. ♪

♪ --taylor: imt taylor

riggs. let's get to the business flash. bp reported first-quarter estimates that the estimates. it was helped by cost cuts. the british energy company is struggling to cover its commitments, though. bp's stock has been the worst performer among europe's oil majors. -- plans to hire 10,000 american employees in the next two years. the trump admission asian has argued infosys -- the trump administration argued infosys and other companies like it are unfairly taking jobs from american workers. bernstein -- alliancebernstein fired nine board directors.

that is your bloomberg business flash. francine: thank you. highs -- hason create a pen's plan to french currency, calling it monopoly money. joined by antonio barroso, teneo intelligence's senior vice president. would a sense of what need to happen sunday for marine le pen to win. it a lot of people say it is almost impossible because emmanuel macron has 60% polling. antonio: it is complicated for her to win. it will have to be a massive abstention of left wing voters. i think it is unlikely. when you look at the polls -- a 30%, butem are at 40%,

half will vote for macron because they are scared of le pen. she is to clinically toxic for moderates. francine: how crucial is the debate wednesday night, which is really the only face-off we see marine le pen versus emmanuel macron. people excited, or do people know who they want to vote for, they just need to vote? geoffrey: it will be very important to confirm people's views and positions. this is a emmanuel macron's debate to lose. the best bet for macron will be going technical on europe plans. this will be bigger than people realize, and it gives macron a huge attack point.

tom: when you look at this away from the idea that the election is over, what will happen next monday? how will mr. mccrone govern cash easter -- mr. macron govern if he wins? antonio: it will be tough. it will be seven to 10 days before he is sworn in, and then he must choose a prime minister. but on the 18th of june is the italy election. emmanuel macron needs a majority in parliament to implement what he wants. if the center-right manages to majority, then they will have their own prime minister and emmanuel macron will have his hands tied. can play eachcron side against each other and pass measures based on alliances in

parliament. tom: what is an example of was inflation we would see from a raft child anchor in a massively polarized france? he will push forward made -- labor market reform. it will be controversial. in the last three years, there was a lot of resistance to the last reform. beyond what isn proposed in the law. it is also time for our morning must-read. this is likely victory of emmanuel macron in the french presidential election getting a global sigh of relief from the markets. but it is too soon for advocates of liberal market economies to celebrate. advocates of global banking should keep their champagne on ice.

an open big it and have it you a many votes as trump did in the u.s. -- have a jewel liar -- the fact an open liar couldabitual get as many votes as trump did and that marine le pen will be in the runoff should be worrying. i think this is a warning for the "establishment," who willt is macron have five years to show to the people there will be some improvement. otherwise, as in france and the u.k. and all around the world, -- is thats is lik people get pushed to the extreme. stay withrey yu will

us, and antonio barroso, thank you for being with us. coming up later today, a conversation with a guy at the milton institute global conference. i would really like to talk to tom barrett. i want to know about the wall around his lebanon. this is bloomberg. ♪

♪ francine: this is "bloomberg surveillance." london.ncine lacqua in tom keene is in new york. i caught up with bill ackman.

of persian square. the company announced it has launched a share buyback and is working on two potentially large investments. he is in london because he is putting part of his company on the london stock exchange. he had this to say about his now infamous holding in valeant pharmaceuticals. 40% and we about have recovered 20% from the bottom. at the market is still not recognized. it is still impaired with the discount. francine: so he is listing in london because he thinks it will attract more liquidity and make the discounts he has shorter. i try to ask about valeant. he did not really want to talk about that but said that he will probably stay away from pharmaceutical companies from now on.

ckman recapitulating his track record and moving forward with style. here is the "new york times" with alexander stevenson on mr. paulson -- i can do that. course, john paulson having a tough time with investors. you wonder when these guys will make alpha in this tumultuous market. francine: it is a very challenging market. he wanteded whether to diversify. at the moment, he has about 10 holdings with big bets. he says it does not work with his business model because that is how you get around some of the taxation issues. he was a little talking about his book, but what he said and how he said it completely made sense. tom: 10 is a difficult number. the statistical norm is 30.

and there was a lot of work 20 to 30 years ago about 50 being a more valuable number to get to investment success. that would be a cocktail conversation with mr. ackman. maybe you can do that this afternoon. francine: maybe later. coming up, a conversation with elaine chao, live from the milkman institute global conference. this is what your markets are doing. the pound on the move after we had better than expected manufacturing growth. in fact, it was the fastest in three years. this is bloomberg. ♪

♪ always entertaining, washington. you cannot make it up. i did not think yesterday would occur. i have no idea what will occur

with the president today. we will speak to kevin cirilli in a bit on andrew jackson and maybe health care as well. with your news update this morning, here is taylor riggs. are sticking with washington. trump says he is considering whether to break up the big wall street banks. he spoke to bloomberg news in the oval office. >> we are looking at that. some people want to go back to the old system. so we are looking at it right now. and dodd-frank is going to be very seriously changed so the banks can go back to loaning money. taylor: during the campaign, he called for a new version of the depression era law that called for the separation of consumer banks. and trump says he would meet ifh north korea's dictator the circumstances where right. he said he would be honored to do it.

>> under the right circumstances, i would absolutely meet with him. most medical people would never say that, but under the right circumstances, i would meet with them. north korea and its nuclear weapons program is the biggest foreign-policy situation facing trump. and steve mnuchin sending a message that the administration is serious about ultralong bonds. tosaid it would make sense finance the government with bonds longer than 30 years. the u.k., their main business lobby listed its demands for the next government. the british chambers of commerce says a good brexit deal is important, but only if domestic policies to back it up are in place. they want no new business taxes, better infrastructure, and an immigration system that gives them access to skilled labor.

global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i am taylor riggs. this is bloomberg. francine: thank you. the mostand of influential leaders are in beverly hills for the milken institute global conference. we have been talking with top names, including pimco's new ceo. he spoke with john micklethwait. first thee risk is political risk, such as north korea. something we do not really understand and do not really know, not to mention the situation in the middle east. sectorsaw the energy under significant arrests in 2016 in the space of six weeks and the stock market reacting very strongly, something few of us had seen company. it turned out to be a good

investment opportunity, but that could change, and you could see a collapse of one sector, just or 2001, to look back further. is it really sustainable? maybe, maybe not. >> are you worried about the rise of protectionism? you have donald trump, you have the border tax, you have some people thinking of a nasty trade conflict with china. does that worry you? to secretary mnuchin, it seems less of a risk. the protectionist argument we think is weak. john: so they will not put through a border tax? >> no. and there is a whole sector of it.economy that depends on we all acknowledge that globalization has had profound

impact in terms of the labor market, the local label markets in america, and have potential dramatic outcomes for some of the workforce in the states, but the other option is even worse. so a lot of sympathy but no easy solution. john: you are from france. you have the runoff. what kind of presidency would you imagine another emmanuel having in france? emmanuel: it looks like mr. macron will win the election, which would be good for france and for democracy. he will need to form a government can enact laws in parliament. annual need to find a prime minister who has enough of a majority to get that done. the logical choice would be someone from the center-right. that is the way to get enough votes to pass through house reform. john: is a possible that the

franco german machine could come back and work again? emmanuel it is possible. and it is possible that if mr. schultz works well in the next election, there will be a strong franco-german alliance. where people would want to have a strong political alliance. that would be a positive thing. a do not know is what will have been in the italian election. you are feeling slightly more optimistic about europe in pimco? emmanuel: we feel slightly more optimistic, especially after the first round. francine: this is the concern that so many people think -- i do not know if he was cautious or optimistic that macron will win. but many people think if you look at the polls, if the polls are right, that we are looking

at a president macron. but we need to remember that people need to turn out and vote. so next monday is also a long bank holiday for the french. they may decide to go on holiday and not vote. tom: alliancebernstein is a huge deal. affects it directly pimco and everyone in asset management today. you really wonder where mr. roman will be with pimco in six months. kraus islowing up, out. i understand it is important for france and all of asset management in london and new york. this alliancebernstein thing is a massive deal. it goes back to the merger of alliance capital in 2000 with bernstein. it ended yesterday afternoon. pimco is front and center in this raging battle.

francine: i think he was asked about it later. i would suggest that there is no other topic for asset management. geoff yu, you are in the crux of it paid i know you cannot before ubs asset management. help me with where you guys, as a general statement are, in adding value 36 months or 60 months from now? will he be in foreign exchange analysis? geoffrey: on foreign exchange, i think we will have another debate about whether that is a proper asset class. we are still comfortable with our own equity position. it is a question of where the new flow is going. right now, we are still identifying the markets. tom: on a theoretical basis, and i do not want you to speak for ubs and to get in trouble, can side prosper given

the great distortion? see bond prices normalized before they get to some form of asset flow stability? geoffrey: i do not think it should be a purely passive reaction. if you do not innovate and become more dynamic -- economic cycles are dynamic. we could get a sub-normali zation. no one talked about deflation last year, but then the dynamic cycle came through. that, managere for actively, there can be a case to deliver alpha. but not on the product side. 10% of our strategic asset from clients of ours who have the choice of passive and being active when necessary. francine: i like the fact that you are not talking on the half

-- behalf of ubs. talk to me about where you see european value? geoffrey: value comes in two forms today there is a price value. coming from an fx background, there is a positioning in the value as well. in conversations with our clients throughout the year, people did not want to engage in a conversation about europe. but we saw the reaction after the first round. people found themselves under positioned in europe. i think in emerging market and income, we fixed need to talk about that. tom: we have an immense treat in the 6:00 hour for you. he is the definitive expert on free trade. douglas erwin -- douglas irwin dartmouth in the 6:00 hour.

this is bloomberg. ♪

francine: "bloomberg surveillance" with francine and tom from london and new york. let's talk about brexit. theresa may says brexit talks will not be easy as she alluded to the elite details of her disastrous dinner -- the leaked details of her disastrous dinner with jean-claude juncker. the business parties in the u.k. want an immigration system that

do not block companies from getting skilled workers. let's get more from sven o'donnell. what did we learn from the leak from the f.a.s. the just the fact that we will get a lot more leaks? is thebiggest story here denial, which was the biggest --denial from a politician dismissing it as gossip does not mean it is not true. we have a disconnect in terms of what the u.k. government once and what they are setting up for e.u. isnd what the thinking. i think negotiations will be pretty tough. francine: but we need this. when you start with a position when you are negotiating, it is almost like a chess game. svenja: sure, but you have to start reaching compromise at

some point. this may be posturing, because we are on the campaign trail. but tension early on is never a good thing. we have to somehow hope that common ground can be reached find the scenes. tom: when -- can be reached behind the scenes. tom: when i look at the nascent debate, what is the support in europe towards mr. juncker? does he actually speak for europe? is he the voice box for germany, finland, whoever? svenja: no, i think you make a good point. from the talks i have had with a couple of ministers who are certainly involved in negotiations, they see the germans as having a pragmatic approach to this. it is not in germany's interest to have a massive risk here. however, there are certain european countries who will be playing hardball, who will be

posturing a little more, and who will have different objectives here. really, forknow, another six months how much agreement will be reached. but the question mark being raised is can this be done in two years? the answer is probably not. tom: i still do not understand who prime minister may or the government of the united kingdom speaks to. do they speak to a committee? who are we going to speak to? that is what i would like to know. svenja: officially, they speak to the e.u. 27. mr. juncker, among others. they have to speak to the european commission. they speak to people appointed chief negotiators. but these things never really go

without being behind closed doors. we have a lot of trips to governments like poland, because he have to win all of these votes. but they cannot be seen as european -- individual european governments pursuing their own line. francine: what do you make of what people view as pound strength or pound weakness? does it depend on how much support theresa may gets, which means how tough she will be able to negotiate? geoffrey: if the election results in june have a strong expectation of a majority, then the prospect of domestic instability around 2019 and 2020, when it is time to think about a transitional deal, that gains inoad -- erode sterling. but the jury is out, and it will be tough. francine: what happens to the pound the day the market

realizes it cannot be done in two years, if it, in fact, cannot be done in two years? needsey: that is where it to be nuanced. with the market pricing already with the bounce, it will not be done in two years. whether the deal would encompass the two years, it is not an extension of the two years. there is a positioning angle as well. a lot of risk has been priced into sterling, if you look at the options market, for example. monday with happens this election? or is ite be a pop already counter that macron wins? geoffrey: compared to the first round, it is much more limited. i would be comfortable looking at the equity markets. the euro was not as short as sterling was heading into theresa may's announcement. if you look at european

equities, how high do you want to drive the euro before it starts eat into profitability. rather than fx, look at the positioning. francine: thank you, sonia o'donnell -- svenja o'donnell. customer, a bloomberg go on to tv on your terminal screen. you get some cool charts, some of the analysis, and also, in closed captions, follow what our guests are saying. directlyu want to ask a currency question, fx question , to geoffrey yu, you go on to "ask the guest a question" below the video screen. this is bloomberg. ♪

♪ i am taylor riggs. let's get the business flash. twitter has been working to reverse a slowdown in user growth. now it is looking for advertisers. we spoke to twitter's cfo. >> we do not today have visibility on seeing the revenue trend in prove. first, we need advertisers to recognize the significant increase in r.o.i.

it is much more attractive than six months ago. it is accelerating for the fourth consecutive quarter. noto says he wishes other world leaders would use twitter the way trump does. and ken griffin says he is in favor of breaking up the big wall street banks. he spoke at the milken institute global conference. market becomes overly concentrated, you'd reduce competition. and competition is the life blood of what makes free economy work. when you have many firms vigorously competing to get ahead, that is when creativity happens, when innovation takes place, when consumers win. taylor: trump also told bloomberg he is considering whether to break up the banks. that is the bloomberg is newsflash. francine: thank you. we have been to the treasury

secretary steve mnuchin at milken. he told bloomberg it would make sense to sell ultralong bonds. >> we are studying ultralong bonds. that is something we are considering at treasury. we have a working group looking at it. we think it is something that could absolutely makes sense. let's get back to geoffrey yu, ubs asset management head of u.k. investment office. is is the right message for investors now? geoffrey: we just have to be careful about ultralong bonds. you want to issue them because you are confident you can finance them at an attractive you think interest rates are low and your economy, what are you saying about your economy? francine: like japan. geoffrey: exactly. is not like japan. japan is self-funded. they can go out to 100 years and demand will not be an issue. but the dollar is still the

global currency of choice, so that is an issue. if the fed has a yield curve projection that goes out 50 to 100 years and is pointed at relatively low rates, what does that say about growth in the united states? francine: but do you think these things are what they're looking at and have to dismiss? geoffrey: the u.s. has long data liabilities. is one case. secondly, if you do targeted investments, for example, issue ultralong data bonds for infrastructure, that can be sort of accessible. but be careful about the message you are sending about growth. tom: brilliant. peter fisher is the best i have heard about this with his public service in treasury and his work for years at lack rock -- blackrock. the basic idea that any liability's matching

has nothing on the the depreciation of, say, an aircraft carrier? geoffrey: an aircraft carrier is not really a return generating asset. in terms of government investment, what are you doing that with? if you are financing investment, which generates returns over the medium to longer term, there is a case for that. but it is more the interest rate angle that is making bon -- long bonds attractive. tom: to avoid the mathematics -- we could go all day on this. we will harass you to death, geoff yu, when you are on again about long maturity. read all of when he was fibozi studying. you will need to read it again. yu, thank you.

it is always a joy to talk to howard ward about not losing money. but we like to do that whenever apple trots out earnings. do you know tim cook and apple is a total failure? they are going down in flames. howard ward will push against that theory. bonds, currencies, commodities. oil, $48.98. maybe we will ask about bigocarbons and going long oil. howard ward joins us and ogre win from dartmouth as well -- and doug irwin from dartmouth as well. a stormy day in new york. ♪

♪ president trump wants to break the big bank.

in a bloomberg interview, he demands that 21st century of the depression's 1933's glass-steagall legislation. meanwhile, the president rewrites 19th-century america. why was there a civil war, he asks? the france-germany spread tilts evermore. tim cook and apple are so done. apple is yesterday s story -- apple is yesterday's story. i do not get it, howard ward does. he will join us. this is bloomberg surveillance. we are live. francine lacqua in london. apple is out again. the covent garden apple store, is it ever not jammed? francine: not as much as the one on regent street. luckily, you will be here next week. we will go look at apple stores

together in covent garden. would i think is more significant is what donald trump told us yesterday. we were talking about glass-steagall. and of course filtering through what it means for european banks. carol: you also wonder about the -- tom: you also want about the fallout. right now to our bloomberg were\/ first -- bloomberg first world news. >> president trump says he is willing to meet with north korea's dictator. under the right circumstances, i would absolutely meet with him. most political people would never say that. under the right circumstances, i would meet him. >> kim and north korea have foreignhe u.s.' biggest policy challenge. meanwhile, the president told

bloomberg is considering whether to break up the giant wall street bank. that would mean bringing back a version of glass-steagall, the depression-era law that separated consumer and investment banking. >> there are some people that want to go back to the old system, so we're going to look at that. we are looking at it right now. and dodd-frank is going to be very, very seriously changed, so the banks can go back. during the campaign, president trump called for a 21st-century version of the law. is trying tocron extend his reach five days before the presidential election. intold far rights backers the far left he understands their anger. polls indicate macron has a double-digit lead over le pen. withsa may says the clash jean-claude juncker says the -- shows the brexit talks may be

difficult. may has not denied reports. she said "as we have seen in recent days, it will not be easy." global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i am taylor riggs. tom: thank you. equity, bonds, commodities, let's get to it. oil, at 49.03. screen, a little bit of euro strength. 1005, which means it is a bull market. japanese yen.he francine: i have a similar data check. i'm looking at treasuries and we see that rally in european stocks continue. what i'm also interested in is that manufacturing pmi. the highest in three years,

beating estimates and driving pound up 1.20 913 -- 1.2913. charthis is the bernanke 2003. here is 2003. this is one of the great bernanke moments. he went to japan. they had inflation, and here is the agony of the japanese deflation. ics with ais abeno attle -- abenomics with little bit of stability. go back to 1998, and they said, try to reinflate the economy. that's enough happened -- that did not happen. we will talk about that with german bernanke tomorrow. francine: i'm looking forward to that. wh so on his thoughts on ultralong bonds.

if you take it back, this is a 2016. if you take it all the way and look at 2028, i like what geoff rey was saying about this. let's go to washington. i put out on twitter last night, i have no idea what the president will did today. i had no idea 24 hours ago. kevin cirilli has his head spinning. he is are cheap washington course -- he is our chief washington correspondent. then we start with health care. mr. longe missouri is a conservative and voting against trumpcare. votes right now if they cannot get the congressman from the conservative seventh district of missouri? right now, they do not have the votes. that is where we have not seen a vote scheduled this week.

house speaker ryan saying he is -- going to bring the house bring the boat to the house floor unless he has the votes they are looking for. president trump saying they will not do this until the end of the year, but the white house is pressuring lawmakers to get some deal. it is unclear if they will be able to do it this week. tom: i know francine wants to talk about banking. let me bring this up, i read three volumes on andrew jackson. you have to explain the civics and history lesson of our president. this is a critically important article from cumberland university. at times, the president treated his slaves decently and tried to make certain his workers were not abuse. severe,was also however, as in the case of that and and -- case of betty,

had little mercy with runaway slaves, such as gilbert. still, he admitted that jackson and his supporters believe that slaveholding is as american as capitalism, nationalism or democracy. what was the reaction of the white house press yesterday to mr. trump's revisionist 19th-century history? kevin: i think it was somewhat -- there were a lot of questions. any time you have a situation in which the president is going to be commenting in a controversial way, there are going to be a lot of questions. spent a lotknow you of time with the president. what to do make of his comments about the breaking up of the banks? is it something on the priority list or is it something he has remotely thinking about? kevin: this was a great interview by margaret and jennifer. with the issue of glass-steagall, i would say i think this is what candidate donald trump said on the campaign trail. however, this is also to appeal

to the conservative and republican parties for more socialist bernie sanders' wing and the grassroots' growing of the jew -- link of the gop. -- link of the gop. thatlicans believe big banks will get smaller if they are provided in offramp for d regulatory policies -- four gulatory policy. it is different than what people like elizabeth warren are advocating. another day enjoy in the weeds of the swamp. seeingforward to you this afternoon. right now, howard ward with us. he has been a persistent bull through this bull market and we will talk about apple later. , and iswn the banks

there any concern that republicans in washington could unbank the banks? howard: i own one bank, first republic bank, and i have some jpmorgan bank, but by any measure, underweight the banks. tom: why? howard: banks are not a growth industry. you can find a bank that is going through a growth phase. i would argue first of public is a growth, but we have too many banks in this country and we are selling commodity with no pricing power and it is a struggle for banks to exhibit any time of growth over any period of time. francine: what are you saying? they think the president will not go through with glass-steagall? or what is a modern version look like? was not commenting on quest to go at all. i have no problem with that. i feel that philosophically, the underwriting trading aspect of

banks should be separate from commercial banks, as it had been under the quest to glare. whether -- the glass-steagall era. whether the trump administration has the conviction and wherewithal to make that happen or not, i think that is to be determined and may take a wild. francine: it may take a while, how long? and does it change i position yourself? howard: it would not have any impact. when you go back to the era of glass-steagall when we had individual investment banks, this is a business that is unpredictable. it is a low pe business. you are talking single-digit tos, made high single -- mid ofh single digit pes because the risk. that is generally not the kind of investment i'm looking to make. tom: let's look at the bull

market. do you maintain that enthusiasm? howard: you are killing me because you are correct. bullish.en i am a specular pool, but when i look at the met -- bull, but when i look at the mathematics today, which is a market selling times,5 times -- at 18.5 which i think might be a reach -- i am that sure those innings are attainable -- i do not seen the upside. the market is selling below my target price, below where i think it should be selling -- i mean, above where i think it should be selling now. i do not see the extra return that investors should be banking on. we have had this tremendous run in the market. we have a label of complacency that is extremely high. i do not think we should be lulled to sleep.

i do not think the trump administration is capable of drinking legislative victories to the table in the near term, especially on corporate taxes. you need that in order to give earnings and next to boost. tom: we will talk about that. howard ward, styling today in his new york rangers' tie. there are snowing that disappoints like the dreaded new york rangers, down to games to the auto was of canada. -- two canada. they had no chance. are a brewer fan. i think the rangers are in this. tom: dream on. we will continue with howard ward. we will come back. tomorrow, i will be in washington. my conversation with ben bernanke. look for that in the 12:00 hour. this is bloomberg. ♪

this is: breaking news, a convoluted story, but this will be the second time in liaost 10 years that alita have to start proceedings for bankruptcy. they had exhausted all options after they index salvaging the italian airline, so we know the time government has said they will not privatize or they will not take it under the heavy the --tell you -- have

this is a cannot want job losses, which meant that the only did they could do is start legal procedures. we heard from the chairman last week saying this was their only option, so the legal part of it is underway now. tom: well, it is interesting to me. let's bring gupta bond. this is a look at -- let's bring up the bond. 5.25%,es up three years, which is a huge deal. is 100.00 -- here this is typical. within finance that usually in distress, a bond ends up 18 to 23 on a 100 price. francine: sounds about right. we need to mention that carriers week, they -- last said if parties involved do not want to agreement, that is what

he will have to do after the employees' rejection. tom: there it is. talia beginning bankruptcy proceedings. .any good conversations look today for tom barrick in support of the president. this is bloomberg. ♪

this is bloomberg surveillance with tom keene.

says he would be excited to see a breakup of the big banks. p stuck with erik schatzker. -- he spoke with erik schatzker. >> i applaud. greatesthe single lover they can pull to get our economy to go faster. wasarted my business when i in a dorm or met harvard. 206 to buy thousand dollars and i could launch a hedge fund in 1987. you cannot launch want today with less than several hundred million dollars given the high fixed cost of compliance and other regulatory matters you need to deal with. that is discouraging new business information and active management. it is a burden of regulation. assethis outside of management, the transportation space, it is everywhere in america, the weight of regulation is reducing new business formation in america

and that is a tragedy. the administration's focus on reducing the regulatory burden on the american who has a dream, i applaud that vision. last administration was interested in producing more transparency in the bond market and what about this administration? ken: i really hope they follow through on that. it creates confidence you have been treated fairly, that you understand what is taking place in a marketplace. transparency is the underpinning of a healthy capital market. the incumbents enjoy the information advantage of that. that does not make for a good market. this administration continues to carry that forward and shine light on how treasuries are priced and traded, that would be really good for the entire market. erik: if they don't? ken: i think it is unfortunate. whether we looking at bills for

bill, we arex taking our deficit higher. i think it is important we take theseto continue to drive u.s. fixed income markets, treasury markets to be perceived as the most liquid, fairest market in the world. that will drive down the cost of borrowing, it shall save money for every american taxpayer. erik: president trump told my colleagues in washington he is taking a serious look now at steps to break up the big bank. would you be in favor? ken: i would. when a market becomes overly concentrated, you reduce competition. and competition is the lifeblood of what makes a free economy work. when you have many firms that are competing to get ahead, that is what create -- that is when creativity happens, innovation

takes place and when consumers win. in the financial crisis of 2008, a number of decisions are made it clear that resulted in a massive consolidation of the u.s. banking system. i do not think that serves the interest of our country well. to break these banks into small banks? no, but should we think about separating the investment ranks from quark commercial banks? a new glass-steagall? i would be excited to see that. it be good for your firm? ken: it is a mixed blessing. we would have more vigorous competitors, but it gets good for america. i think when american investment banks are at the forefront of innovation -- not all innovation is good -- but over time, the majority of innovation creates meaningful value of our economy. tom: ken griffin said it all. to theto bring this back

challenges ken is talking about. you are living it would prior to the early -- with mario, offering lower fees. what is the future of your business after what you observed yesterday? howard: there's no question the asset management industry has a lot of challenges. i think companies have to review their business models. i think there has to be an intense focus on security selection, fees, the value of proposition to the customer. firms have to decide what their specialty is. you cannot be all things. tom: let's see. a huge body of money is most like the s&p, where is your are squared relative -- r squared relative to that? howard: dataset share is a

istle -- that asset share about 50. we have about 45% of the assets in the top 15 holdings. the big mass of money that is trying to justify fees? howard: no. the industry got that way is risk aversion -- customers really do not like -- tom: we are going to have to go. howard ward will come back with us. i got ironed up. excuse me for that. coming up, douglas irwin of dartmouth college on free trade. this is bloomberg. ♪

bloomberg surveillance in london and new york. tom, you had pretty good day that added u.k. manufacturing.

-- good day out u.k. manufacturing. to theet straight bloomberg first word news. here is taylor riggs. taylor: in washington, president trump says he is considering whether to break up wall street banks. the president spoke to bloomberg news in the oval office. people want to go back to the old system. we are going to look at that. we are looking at it right now. be dodd-frank is going to very, very seriously changed so banks can go back. taylor: president trump called for a new version of the depression era ball that requires separation of consumer and investment banks. that was repealed. trump said he would meet with north korea's leader if circumstances were right. the president said he would "he it."ed to do

north korea and its nuclear weapons program has become the biggest foreign-policy challenge facing donald trump. steve mnuchin is sending investors to wall street. the trump administration is serious about ultralong bonds. he told bloomberg tv it would make sense to finance the government with bonds having maturities longer than 30 years. critics say finding enough demand issues could be an issue. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i am taylor riggs. tom: thanks. let's talk trade. right now, it is important to begin with the president of the united states. here is donald trump on nafta. now,xico wants to start and so does canada. they are set. i am going to keep waiting for congress? our system is archaic. tom: the president of the united states. we have howard ward with us this

morning on investment and blue-chip stock. it is important to talk to our number one expert on free trade. themember an article on card is still him up from some 23 years ago. about that time, douglas irwin theartmouth was writing classic against the tide. he has a new book coming out clashing ofear, commerce, a history on trade. he joins us this morning. tot a perfect time to speak your. what does the president get wrong in his zero-sum theology? first, these trade agreements take a long time to negotiate trade we did renegotiate nafta, it was called the transpacific partnership, but few scrapped it. he has never said what is a new and better nafta. that is one thing congress is looking for. they want to see, what are you going to negotiate if fully give you permission? i think is macro policies will lead to a larger trade deficit.

we have a big fiscal stimulus and tax cut and monetary policy continues to tighten. the dollar will go up and we will get a bigger trade deficit. is hard toricardo figure out the mathematic geography of comparative advantage. if you are to teach david ricardo to the president in the oval office, what we do emphasize? douglas: basically what you said, that trade is not a the tradeame and balance is not the scorecard. both sides benefit from trade. be benefit from exporting and importing. we get there all the card is from mexico. we get cheaper automobiles in -- part ofe some of the process is done in mexico. we prosper when mexico prospers. we are better off having a rich neighbor to our south than a poor neighbor. trade is a beneficial activity that should be encouraged, not

badmouth. badmouthed.-- toncine: trump seemed understand this better than six months ago. he is soft and his stance, is that fair? douglas: he has. we have had a lot of executive orders and trade cases initiated but no moves yet. it is early. we have to see what the new agreements will be and the actions he will take. be most: what we do concerned about in terms of actions he could take? we have seen things are blamed -- bubbling with the glass-steagall, are you worried about a border tax? douglas: a lot of trade people were worried last week when there were rumors he would sign an executive order throwing aside nafta and some other

countries intervened and he pulled back from that. there is a learning process going on. hopefully, they will tend down tradehe space of big deals early on and do something constructive for the rest of the world. our best practice on versus bilateral negotiations. we came out of world war ii, we did the atlantic charter, all the good things in a multilateral way, are those days dan and it is a bilateral negotiated future for the u.s. on trade? douglas: it looks like there's not a lot of future for the multilateral system. in judyis useful catering trade disputes, but multilateral rounds of trading negotiation's do not seem to be going anywhere. they have not been the past 20 years. it is not just thailand role, it is regional and plural -- bilateral.

were really told why it was a bad agreement and have to be scrapped. try to pute going to together the pieces bilaterally. professor, prime minister may is swimming against the tides now with some flavor of hard brexit. what is your response to the idea of london and the united kingdom eliminating tariffs and recapitulating a 19th century british trade empire? i think that would be relatively good move for the british economy in terms of opening up trade, but the problem for britain is they need market actions from other countries. their owntting tariffs to zero does not guarantee market access in the european union, and elsewhere. when you still going to -- britain is still going to have to be proactive in reaching

trade agreements with other regions in the world. you need to worry about exporting, not just free imports. francine: we are hearing one of the spokespeople for mr. -- saying real brexit negotiations will start after the elections. what a most concerned about? the timeline? you said the u.k. needs new trade agreements with multiple countries but they need to do it within two years. that is almost impossible, is it? douglas: it will be difficult because they do not have the staff to negotiate a lot of these agreements. they have to worry that the europeans the of the prime minister and the british government as not being up-to-date in terms of what can be realistically expected from these brexit negotiations. they are expecting a prelunch and i don't think the europeans are in any mood to give them that.

be hard the next couple of months whether they can replicate their market access and with the price will be because the british public was told they would have millions of dollars coming into paper nih expenditures and now looks like it will not be that easy. tom: douglas irwin is at dartmouth college. with us in new york, howard ward. u.s. multinationals have a deal with trade every day. a huge body of your portfolio is international. howard: yes. global trade is about 60% of this is an so enormously important topic. it is important that we do as much as possible to avoid hurting global trade. gdp, andl hurt global as you mentioned, a lot of u.s. multinational's are significance exporters and we own a bunch. can weren we talk up --

talk about apple when we come back? howard: sure. tom: this will be a wonderful conversation and well-timed. out with a new paperback with an afterward. a look at the past and a forward view of american monetary policy tomorrow at the total clock hour. -- at the 12:00 hour. this is bloomberg. ♪

francine: this is bloomberg surveillance. daybreak, bloomberg with jonathan ferro and alix steel and david westin. what are you most looking for two?

jonathan: regulatory overhaul, i think that is the big takeaway with their interview with the president of the united states. will it be a breaking up with the banks or something like the u.k. version? that with skyto bridge. river,am stuck on the and the only place to go is a new radio program, drivetime evening in london. how are you surviving this ordeal? jonathan: i am loving it. it is wall street meets the square-mile. remarkable me, the resilience of the u.k. economy, never mind the drama with politics, the manufacture day-to-day at a three-year high. tom: you see how this british accent has slotted right back in when he does his radio program? francine: i saw that. see why. the candidates for the french

presidency are laying out races for the future of the country. in an interview, micron mocked pen's plan.cked le >> the national front party has not changed. it carries hatred and carries it concretely. that is what i fight against and what i said this afternoon during the campaign rally, it is a project of weakening of the country of the purchasing power of our fellow citizens and workers. and industrial beginning because the exit from euro is a weakening for france. francine: in france's business newspapers, lead french companies have written to warn. bloomberg'sre from caroline. what do the polls tell us? what are they saying for the second round?

>> we have seen a little bit of macron losing some momentum he had after the first round. some show he would only take the lead by 59% in the runoff on sunday, so still a lot of work convince those electors, especially those who deal victims of globalization who might still be tempted by le pen in this runoff. francine: it is important to remind everyone that branch historically always have a turnout of 69% to 80%, but it is important people vote this time. it is also bank holiday next monday. >> it is a bank holiday, so all the french people will have to deal with nominate some of their voters to vote for them if

they are somewhere else spread this holiday weekend. the concern also comes from candidates. he did not clearly endorse macron for this runoff and there is his campaign on twitter saying, ask me on may 7. .hose people who might abstain tom: i know mr. trump was not going to win wisconsin either. what does madame le pen need to do in the next five days? what is her to do list to make people not boats, you know that the left votes, whatever, what did she need to do? >> what she is trying to do is forget that her plan is to leave the euro and eu because she is well aware that 70% of french people do not want to leave the euro, to not want to leave the eu, and that is what she did

this weekend when she rallied another nationalist with plans on leaving the euro. at least it is not a andequisite in the picture, they managed to get 5% of the votes. this helps her to gain some more votes, not necessarily from the thoseght, but also from who are working for -- you are voting for fillon. nearly one third could vote for her in the runoff. tom: let's turn to pharmaceutical blue-chip. pfizer, a 2% revenue miss. to a positively affirm of 2017, the revenue is flights. there is noise on acquisitions. there you see the revenue.

tv , let me bring it up. you can see live tv. forget about that. you can come over here and come down and you can find any of these charts, see the previous segment. this is the bernanke chart. you can see that segment and you can steal that chart from the team at bloomberg surveillance. it does have elements of picasso and it, but i think it has got nt field, as well. -- feel as well. ♪

bloombergthis is surveillance. taylor: that's get to the business flash. the ceo of capital management has appeared to learn a lesson. >> we made a mistake in the past and knocking on the board we cannot see what was going on. that was the big mistake. >> does it mean you will stay way from pharmaceutical companies? >> probably. taylor: ackman says they are working on two large

investments. he declined to identify. pimco's new ceo plans to hire employees after a renewed push of growth. at abooklet bloomberg tv global conference. >> we want to be the best at what we do. we can deliver returns and it gives us plenty to do. that.t to be focused on taylor: pimco's assets have stabilized. they had withdraws following the departure of bill gross in 2014. and twitter has been working to reverse the slow down in user growth and is looking for advertisers. he spoke with twitter cfo. not have visibility

today. i am seeing the revenue trend improved. first, we need advertisers to recognize the increase. we are much more attractive now been told months ago. -- then 12 months ago. growth.had 14% our prices were down 60%. taylor: he says he wishes other world leaders would use twitter way president trump does. right now, we have howard ward with us. talking and we all know bill ackman, he has made a lot of money and lost a lot of money. we do explain to me how many holdings you have to have to be diversify? there was a fidelity 50 fund and others years ago for johnson, and this guys doing it with 10. can you make money over time with the lack of

diversification? are going to have 10 holdings, most people -- it is a matter of time before that will blow up. it is not to say it cannot he done, but -- tom: over time, it does not work. can have ahink you well diversified portfolio of 20 holdings. if you do it right, i think 10. those are big bets. you better get it right. francine: how did you get it right? how would: [laughter] i do not -- howard:: [laughter] i don't know. i have never had a 10 stock portfolio. for most investors, i do not think that is appropriate. your personal account, that is fine. people who are hiring professionals -- if they are hiring that professional, they want diversification. tom: my answer is you have to do it with sector diversification. let me bring up this chart.

backd ward bought this here. it is going to be terrible. apple, once again. howard ward was screaming -- load the boat. why does this guy get so much -- he gets more on love bendable -- unove than the bull market. he is following steve jobs, so he is held to a different standard than ceos and he has done a fabulous job. every time, there is a down cycle. he gets, apple is not created enough, and then one year later, the stock is up 30%. like microsoft did years ago, or they take a corridor between and handed to howard ward? howard: they will raise the dividend. that will be announced soon. they will increase share buyback. if we get repatriation, where

they had $220 billion offshore, they bring back $200 billion, that will improve capital return but most will be in the form of buyback, accelerating the buyback as opposed to dividend. tim cook has been measured and prudent in his capital allocation. i would think that would continue. i do not think there will be any massive sort of dividend increase based on that capital repatriation. francine: when do we need to worry about the chinese manufacturers? manufacturersof that will start selling western economies that can take on apple. howard: it has always been a competitive business, and it has reached a point now where apple really has most, if not all, of the prophets in the industry. they have a 45% share in the u.s. in the smartphone market. that has been edging up.

sampson has had its problems in has had itssamsung problems. apple has had a pair of erosion and the growth margin around 40% now for a number of years. the fear is they will have to cut prices to grow that and that will hurt the stock. it has not happened. will it happen at some point? yes, but who knows when. tom: thank you. let me do a foreign exchange report now. to not forget the ben bernanke conversation. we will speak of the dollar. owa might speak the new york rangers. this is bloomberg. ♪

jonathan: wall street braces for

regulatory overhaul. donald says he's actively thinking of breaking up the big banks. steve mnuchin is serious about launching ultralong. -- ultralong debt. from new york city, good morning. we are looking across the keepsic at the day that on giving. i am jonathan ferro alongside david westin and alix steel. futures down two points for the s&p 500. europe up .4 on the stoxx 600 and a firmer euro. alix: time for your morning brief, we had people u.s. auto sales expected to fall. at 9:30 a.m. eastern, the house and fisher should committee will hold a hearing on oversight of u.s. airline customer service. the united continental ceo will be