reporters in beijing, president putin said "microsoft leadership has put it straight in stating that u.s. intelligence services had created the means for the attack and said that russia was not involved." his comments came after the president of microsoft blamed u.s. intelligence agencies for stock filing software code that can be used by hackers. began as in greece four-day debate today on whether to approve a new package of spending cuts. the package would extend the number of years reits have lived under austerity. ece have lived under austerity. german chancellor angela merkel's party won a decisive election victory and the

country's most populous state. the christian democrats beat the .ocial democrats the social democrats won less than 31% of the vote. it is their worst showing since world war ii, boosting angela merkel's momentum for september's national election. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. i am mark crumpton. ♪ julia: live from bloomberg's world headquarters, i am julie chatterley. scarlet: i'm scarlet fu. joe: i am joe weisenthal. the question is "what did you

miss?" companies hit by global cyber attacks. is this an opportunity to buy's security stocks. new french president and angela merkel are pledging to work together in the face of a troubled eurozone. onomberg is drilling down what tax reform will look like and how it will impact business. clerics now let's look for the major averages. ins, the dow and nasdaq higher. .his means more records the s&p 500 is narrowly close to a new record close. the nasdaq seems to have it.

they can maintain that potential new record close. gains, explaining some energy, the best sector for the s&p 500, up 2%. oil is up four days in a row. saudi arabia and russia favor extending oil cuts into the first quarter of next year. everybody is looking to see how it will come out at the opec meeting, but this could be an early tell of timing that could go right into next year. , andof the big oil names all of this matters for the trump trade. #80 33, and orange, the s&p 500 up of 11%. technology in blue. the financial sector had been a overtookr, but tech

last week. the energy sector down 2%, liking and dragging on this trump trade, so it will be interesting to see what oil does. there are some bearish calls. oppenheimer does not see the risk reward as favorable. it will be interesting to see how this plays out. is #56 18, a part of what has helped u.s. stock markets the expectation that tax reform will be put in place. s&p 500, these are companies taxed at a higher rate. theyf the election, outperform the s&p 500 by 4% to 5%, but then failed. less hopefule tax reform would be put in place. recently, those high tax companies outperforming again.

happen.x reform will time will tell. joe: thanks. "what'd you miss?" aoomberg television is taking look at the aforementioned tax reform with gas throughout the week and we will analyze what potential changes out of washington could mean for businesses and individuals. today, the tech sector. joining us now are two bloomberg reporters. all of the news out of d.c. has been related to the comey stuff and controversy around that. what has that done to the calendar for getting tax reform ?one whichde from health care, the senate is wrapped down -- upton right now -- up in right

now. the comey firing in the fallout from that has thrown a wrench into everything. it hit as -- it has sucked up the oxygen on capitol hill and has left room for a few other things. they are trying to inject a little momentum into a project that is fraught politically with all sorts of hurdles, the latest of which is the comey firing. what is the thinking on a one-time tax holiday or tax bill on companies and their overseas cash. that was not included in the one-page outline that was handed out. >> that is part of the wait and see game that republicans are playing.

there are certain things they are open to and discussing, but i don't know if they have any red lines on that ron. what kevin brady are and speaker ryan have talked about is moving forward with a plan that is permanent, revenue neutral, does not add to the deficit, and this is the commitment they have yet to get out of the white house, despite his release of a one-page tax plan last month. recent interviews make pretty clear that he and the white house have not decided on the most basic questions about tax reform, including whether it is revenue neutral, and if so, how do you pay for it. scarlet: there is also a cascading effect. offset one, if you save costs on one come you have to worry about expenses on the other. let's bring it back to the tech sector. the assumption is the more important aspect is not the tax

cut, because they have arrange their tax affairs and not -- enough, it is the ability to repatriate the cash they are currently holding a broad. how do you make sure that if indeed that does happen, they spend it right and don't push that cash out to shareholders, they investor do something to help the u.s. and their businesses internally? the reality is that it is almost impossible to do that. we saw this happen in 2004, the lacks tax holiday. -- last tax holiday. that a couple of years later, most of that money or buybacks and dividends returned to shareholders. the wasn't actually anything to say this will go toward spending on manufacturing facilities. there have been some

where they tried to give the impression they are investing in manufacturing. tech companies were close to the previous administration, the obama administration. how do they feel about trump these days? >> no one will say publicly they are not a fan of trumpian they can afford to do so. a lot of these big companies have senior members in the obama administration within their lobbying organization. it is hard to get this kind of people on board. we have seen pushback on things like immigration, but there is a whichwhich companies, topics, which policies are more important. apple, immigration maybe not so important. on the flipside, $240 billion outside the u.s. what extent they have to what extent they have to pick and choose their battles. scarlet: one person the does support donald trump is peter

see hishere do we influence as a relates to the tech sector? of the go to people president trump is looking at. he has a number of people surrounding him that are whispering different things in his ear. gary cohnmnuchin and steer this ship, which is why we see conflict between them and house republicans on things like the border a just ability tax and whether to allow businesses to deduct net interest on future loans. that is creating a situation where the president is conflicted. i'm sure peter thiel will be an issue or figure on one another, but what is lacking is an overarching vision by the white house to set the parameters and steer the house and senate in a particular direction. hope republican leaders

this happens, part of the purpose of kicking off the project this week in the midst moment,ange political but they want to keep this alive. without guidance from the white house, it is unlikely to happen. the direction has to come from the president himself. scarlet: how likely is that? , it is uncertain at the moment. no one really knows. it is hard to predict what is going on in president trump's mind. people here are not entering to gas. they want to create the conditions for him to think about the issue more, and for him to arrive at some decisions, which have not been done yet, again, key decisions, revenue , reduce the deficit, but he has not decided one way or the other. you have to make decisions to move forward and have a clear, consistent message come and steer the ship in a particular direction in order to get things done capitol hill. are noters, they

accountable to anyone but their constituents, so it is a difficult project in the best of times. these are not the best political times. it is a next her challenge. julia: well said. that was an unfair question for me. sorry. about love that point this being really come a difficult complicated things, even in easy times. scarlet: the interview trump and steven mnuchin did with the tyingmist infrastructure with tax reform. all sorts of things are being thrown into the mix. we?e actually are what democrats need to

accomplish moving ford? this is bloomberg. ♪

scarlet: "what'd you miss?" thecrats keeping up pressure on trump over the firing of james comey. bloomberg spoke with tom perez, and he began by asking for his take on the uproar over the dismissal. theywill tell you what have to do if they want to earn the trust and respect of the american people is make sure that they appoint an independent prosecutor to take a look at what happened. doj,secuted cases that the over a decade of my life, prosecuting cases under

republican and democratic administrations. last week's tweet is an example of a piece of evidence i would have used in an obstruction of justice case. we need an independent investigator, prosecutor, who can look at the truth. i can handle the truth to the american people can handle the truth. i don't understand why donald trump can't handle the truth. chancent to give you a to respond to something republicans have been saying for quite some time since the firing which is, democrats had argued that director comey was doing a bad job repeatedly. inis hypocritical for them this case. >> i absolutely had issues, serious issues, with what director comey did, but the fact of the matter is that had absolutely nothing to do with his firing. when we heard president trump say i fired him because he

missed treated hillary clinton. that doesn't pass the laugh test. clear, he was fired because he is the investigator in an investigation that could implicate the president of the united states. that is an affront to our democracy and our independence, and that is the point i want to pick up on. >> as whomever president trump dominates, if no democrats support whom ever that nominee is, is this fbi director legitimate? fbi director to command the respect of the american people. having democrats to do that would be helpful, but more thertant which you need is appointment of an independent prosecutor, because you know what happens. if you get the best fbi director, but you are reporting up the chain to a department of justice that donald trump seems

to have in his back pocket, then the best director in the world doesn't get you anywhere. any namesere been that have been made public that are on the short list for fbi director, john cornyn for example, that you could get behind. theenator john cornyn is perfect example of what not to do. he is a partisan republican. he has been defending donald trump come and you're going to put him in charge of the fbi where they will be investigating the interaction between trump and putin? that is beyond the fox guarding the hen house. that is why you need an independent counsel looking at the investigation. there are plenty of people out challenges -- challenges

with the president did last weekend firing james comey -- you have a tough job as chairman of the d&c. you are having to unify this democratic party. how is that going, what are you having to do, and what are some of your objectives now? >> we are making progress. we starve work to do. we have to get back to basics. when we put our values into action and it lead with our unity and values, we do very well. i will give you an example. the health care efforts of this administration to repeal the affordable care act and put 24 million americans in jeopardy and tens of means of americans with pre-existing conditions in jeopardy, and seniors who rely

on the affordable care act for prescription drug benefits, our unity has been our greatest strength and we will continue to fight. >> there is a palpable anger, you know this. you have been all over the country as chairman and as department of labor secretary, i have interviewed activists all of the country during the campaign, there is an anger. how do you as you head into midterm elections cultivate that ?nd channel that 2017,'s start with because we have gubernatorial elections in new jersey and in virginia, and i am confident we can pick up the governorship in and retain the governorship in virginia, and what we have to do is make sure we are leading with our values. that is why we are together on health care. when you see what the president tried to do to enact a budget

that would have eliminated meals is a morallyat bankrupt budget. people understand that. come his effort to appeal the aca, it is not tax reform. it is a massive tax cut for wealthy people because the way the aca subsidies were financed was a tax on wealthy people, and what the aca repeal is about is first of all an age tax on people over 50, and secondly, a massive tax cut for wealthy people, so that's why when we are out there fighting and leading with our values come articulating clearly what we stand for as democrats, we are the party that stands for economic security for everyone, not just for a few at the top. perezt: that was tom speaking with bloomberg. it tomorrow, you will want to stay tuned because we have an interview with mitch mcconnell joining a bloomberg daybreak

america 9:00 a.m. eastern time. ♪

joe: i am joe weisenthal. "what'd you miss?" news today on indications that some of the major opec players are inclined to continue cuts, though nothing specific. if we look at this chart of technicals, oil breaking through some fibonacci levels, through its 200 day moving average. it is starting to break above those lines in april as it was falling through those things. right now it looks like things are looking good again, breaking above some levels, so perhaps we will get a situation where the

technicals and fundamentals line up, and that is what macro traders love to see when you have that confluence of news and charts. royal is that a two week high. you mentioned the drivers behind that. forecastommodity price , charting 35 analyst views on oil price and where they see it headed. this is for wti, pay attention to the green of a shows the bullish sentiment. it has been climbing. income ofat the very 71% of analysts are bullish on wti. the bearish sentiment as the red portion of the chart, and that has receded to less than 10%. a week ago, bearish sentiment was 27%, and a month ago at 41%. the neutral trunk as well to where as a-- 19%,

month ago it was 25%, so are a lot of change in sentiment driven by technicals and fundamentals where you have opec , saudi arabia and russia and non-opec users discussing the prospect of extending price cuts. scarlet: good news in the price. julia: i only want to talk about oil. strategist believes other commodities may drive the rally from here. this is the relationship between the dollar index and exports. the dollar traditionally hasn't happening affect on grain exports, but if you look at what is going on in the 2016-2017, a strong dollar. our we need as we head into the season is to have a blowout dry weeks in july and we could see prices come dramatically down, particularly if were at a turning point for the dollar and

the dollar comes down to that would be supportive, and if the oil prices here are going to stay around these levels are move higher. a number of things to watch on this one, but the trade angle is also critically important. we have the market close next. ♪

♪

julia: the s&p and the nasdaq closing at highs. if you are just tuning in, live on twitter, we want to welcome you to our coverage every day from 4:00 until 5:00 eastern. begin with our market minutes. the s&p climbing to a fresh record high. in the absence of any bad news or even mediocre news, stocks are melting up even more. close over 2400. julia: the rally we are seeing in oil prices as well is pretty critical. scarlet: i am glad you bring that up. at the returns for the s&p 500, energy is up there. materials were even higher.

you talk about commodity prices and it is translating into gains for the company's that produce those commodities. on the downside, telecom stocks are down. including discretionary which includes beleaguered retailers. little change on the day. let us look at individual movers. one is an etf that tracks cybersecurity firms. there is that leg up at the end of the chart. this is a glimpse at how it has done over the last year. the global wave of cyberattacks that began friday and is extending into today, the first business day of the week, pushing investors to take a fresh look at those companies. if you look at home builders, as a group, they are at their highest level since march 2007. this is a 10 year chart. it has come right back out. that is because homebuilder confidence has returned as well.

one reason why is because there is shrinking inventory of existing homes. turning a lot of potential homebuyers to existing stock and increasing confidence. joe: taking a look at government bonds in the u.s., not a lot of action today. 2.34e 10 year yields up to percent. i want to look at a longer-term chart of chinese government bonds. this is a five year yield. we do not talk about chinese government bonds that much what we are starting to more because this is quite a move. a lot of interest in the financial tightening in china and a lot of flattening with the sharp move up in the last six months. we are going to keep an eye on this. as long as this keeps rising, it could put pressure on chinese assets. commodities and so on. julia: looking at the foreign exchange market. i always start with the dollar.

i cannot help myself. it is pretty important to justify myself. the data was interesting with the dollar rally losing steam. last week in at 11 months. the most since august. we will have to see what the real money is doing. what is the real money doing? a quick look at what is happening with the commodity currencies. we have talked already about the russians and the saudi's seemingly on port to extend the cuts. this is an interesting one. dollar-hong kong. i saw a headline today saying it is up the most since february 2016 on a daily basis. no improvement. was sitting at a one year

low. how exciting when we get excited about a move that size. last week we talked about the slow shifting from the offshore market to the onshore market and the impact that will have. that investors are unwinding short positions to invest in stocks. a lot of people were short and they were also short at the hang seng index. the weakness in the currency due to outflows. if you were on the wrong side of that trade. joe: and a quick look at the commodity french. starting with cotton, two days in a row, big gains with strong data -- export data fueling cotton's move up. again of over 2%. cutsews of more likely from russia and saudi arabia helping. only $49 a barrel on west texas intermediate.

silver has been pretty quiet lately and gold not moving very much. and those are today's market minutes. taking a deep dive into the bloomberg. guess, we arely looking at volatility of again. i apologize. if you're sick of talking about this. vix volatility at levels not seen since a decade. what i am showing you is that people are protecting themselves. this is looking at the open vix,est in s&p 500 short-term futures. the most traded vix linked securities. i am showing you that the number of options that people are betting on have followed -- have risen to a record high. we keep talking about it and investors are saying -- ok fine,

we will hedge against the pickup. scarlet: it may be painful when it does. the economic advisor to allianz none of this would be particularly remarkable if the decline in volatility was not coinciding with notable fluidity in the global economy. the disconnect is attracting greater -- greater attention. muchake is that too stability is too much of a good thing. it breeds instability down the road because people take bigger positions and they feel ok taking on bigger risks. when the house of cards do come down, it will be quick and violence. julia: you have to do more. the question is are we talking about it so much -- o saysatt levine people are not worried if they

are not worried. the index is on pace for its strongest growth since 2011. invest -- analysts are in improving their enthusiasm despite that. the chief equity strategist is joining us. what do you make of this vix debate? amazed about how much people are talking about this. >> vix goes through regimes. right now with interest rates as it is they are, reflecting low average daily trading ranges in the s&p 500. i think, very typically, when stocks are rising, vix falls. and the stock market has been stuck in a rut but generally over time been rising at a relatively rapid pace. and that keeps vix low. it is not unusual in a broad

bull market for vix to remain extremely low. the more we talk about our concerns with the vix, the lower it will stay. a lot of this is reflecting the worried. if you look at the risk premium for stocks, it is still well above long-term averages. the reality is that the investor class is still quite scarce. still quite worried about the next turn in the equity market and still worried about the geopolitical situation. scarlet: what about participation? we know a lot of investors find u.s. docs fully valued or possibly overvalued and they are looking to put money somewhere else in the world? it is an interesting point you make. part of the recent that stocks are so overvalued, u.s. stocks look like they are so overvalued, is because investors are hiding in u.s. stocks fearful of what may happen

geopolitically. is historically the most defensive equity market in the world and investors, over the last few years, fearing geopolitical turmoil elsewhere, fearing the commodity collapse, fearing potential election turmoil as a result of european elections, have hid in u.s. stocks. massive green engagement of risk tolerance and investment flight into the equity market, u.s. stocks probably like in that environment. when you have someone talking about evaluating risk and people trying to offset volatility --is that something we should be worried about? >> this is all relative to what happens in the bond market. if you continue to have bond prices remain where they are,

you force investors to find other opportunities for yields. other opportunities for returns. if we see the real action in the bond market, that could shake things up. this chart shows the relationship between the vix, the blue line, and low, and s&p three-month realized correlations. the degree to which every stock trades like every other stock. which drives which? higher volatility resumes where people buy and sell everything together, or are there periods where things move differently that pulls the vix down? people herd in one direction or another. stock prices would go lower and that creates higher volatility. longng p -- over

stocks willime -- crash and the vix go higher. i think vix is a lagging indicator. it simply is reflecting what is happening in the price. asia: great to have you on always. coming up, since amazon debuted as a public company 20 years ago today, the shares have skyrocketed. about tech darlings and where there are more opportunities. from new york, this is bloomberg. ♪

>> i am mark crumpton. time for first word news.

federal judges questioned a lawyer for president trump about whether the administration's travel ban discriminates against muslims. this is the second time in a week that the issue has been in court. jeffrey wall toward -- told the panel that on the night he was served the court of appeals in seattle, that the executive order halting travel does not say anything about religion. he was then asked if president trump has ever is about campaign statements calling for a ban on muslims entering the united states. >> he has said several things approaching that. the best one is probably the southeastern legal foundation brief. part three walks through the comments great overtime time, the president clarified that what he was talking about were islamic terrorist groups and the countries that shelter were sponsor them. >> the u.s. supreme court says collection companies cannot

be sued for trying to recover years' old credit card debt from people that seek bankruptcy protection. -- the judges ruled in favor, 5-3 -- european union governments are tightening their negotiating position as they prepare for talks with the u.k. over its departure from the block. that is according to the latest draft negotiating directives obtained by bloomberg news. -- the eu has transitioned the language on the arrangement. it has specified the rights of citizens and clarify the role of european courts. global news 24 hours a day powered by our 2600 journalists and analysts in more than 120 countries. crumpton. this is bloomberg. 20 years ago today,

amazon made its debut as a publicly traded company and since then, it has skyrocketed. or is an article in the "wall street journal" that highlighted this. 36% compounded annual game. pretty remarkable. the chart shows us how unusual this is. julia: i was looking at the chart earlier. at some oflooked these little choppy bits you can see and one was down 19%. a bit of a roller coaster. is crazy timmy is between 1998 and 1999, the stock had an eightfold move. and then, people thought this was unsustainable and now, it has grown thousands and thousands of percent since then. finding someone that actually scarlet: but at

that price. more recently, other tech snapped, listed in march. shares at 21%. these look at some of other names, twitter, facebook, amazon -- after their first ipo earnings report, things were not necessarily so great. who is to say that snap will not snap back? julia: an interesting question. the executive vice president of listings services joins us now. thank you for joining us today. snap -- doesg like that form a turnoff for a company looking to ipo, particularly if they can stay in the private market and get cash other ways? >> many companies in you referenced, their first earnings report, had some choppiness.

i do not look at this as an event that will stop the ipo market. you also want to consider that some of these companies do not fall into the category with snap. many are companies that have done the cost of going out. we do not expect a negative impact on the markets. julia: what seems to happen fairly company is the tech companies go public below their value. does the likely discount valuation that we see for these companies or for broader appetites for those wanting to own these shares? sometimes, the reported valuation in the private marketplace is not the actual valuation price based on the terms and conditions. is .1. that

the second point would be that at some point, companies would say -- i do want to go into the public market and i recognize the valuation might be lower ian the last round, what if can perform, quarter after quarter, four years to come, i can go back and grow as a public company. is a strongk there appetite for companies to go public. if ayou mentioned that company performs a quarter, they can have access to equity markets and the stocks can rise up again. there seems like a big cultural shift. where up are executives say that i would never want to be public -- do you find that to be a challenge and do you think that is changing at all after several years of fairly mediocre ipo activity? raised $55 million.

even with inflation, that would still be seen as a smaller sized ipo. that is something to look towards. what a successful company can do. there is a perception among private companies that once i go public, i need to be prepared to execute quarter after quarter. i cannot be in position to change my business model or change how we look at the marketplace because investors can be punishing when you do not hit or exceed those numbers. i would say there is still a cautious tone among the private companies. i do know that in our position, that there is still a very strong desire among companies to hit the public market but the timing has to be right. scarlet: the nasdaq in the s&p 500 are closing at record highs. does that create a sense of urgency for companies that may want to list? that they should do it now while

the window is open? great point. there are kinds when it is more opportune to go public in windows do open up. where the market levels are now with the low volatility environment, that now is one of those times. we do see companies picking up the pace in terms of preparations. we do anticipate the rest of the year to be fairly active. and a very active fall. the public comparables are strong and it is a great environment for companies to go. julia: we spoke earlier about the lack of relationship between tech ceos and the new administration. if i look at the overall numbers for ipos, they are largely down. 206. were what do we need from this administration in order to incentivize companies to come to market and go public rather than

seek private areas of cash? week published a report. we do think there are key opportunities for the administration and the echo system to provide a better company product. we are focused on the regulatory aspects. there iso make sure plenty of transparency to investors. make it to challenging to be a public company. there also needs to be structural changes in the marketplace to improve liquidity. this will be a broader discussion. there is a lot of focus today on the short-term nature of the marketplace. and the role that activists are playing. and that is a challenge or a turnoff for companies to go public. we do think it is time for a broad discussion. we believe the administration of along with congress -- that they are a willing ear.

big source of job creation. once a company goes public is when the majority of the jobs are created. scarlet: thank you so much. coming up, the relationship between chinese producers and american consumers is tight. we will show you the recent history of that relationship and how it seems to be depressing on both sides of the pacific. this is bloomberg. ♪

♪ the s&p 500 has been profiting off the come down in u.s. economic data. let us take a deep dive into the bloomberg. you can find the following charts at the bottom of the screen. this comes as economic data has been disappointing.

since mid-april, the s&p 500 has been melting off. it is up about 3.1%. it has retreated. it was at a five-year high at the end of march that it has been coming down. it is not growth. it the data disappoints and the line goes down. the two.lation between and it is currently negative. -0.6. the question is how long can it continue? are two sides to economic data. there is the data and the expectations. it could partly be unrealistic expectations rather than a deceleration. i am looking at a chart having to do with inflation. the blue bars line is chinese producer price index. it had surged in the last few

months but it is starting to decelerate in the last few months. this inflationary impulse coming from china is starting to wane a little bit. after many years of being negative. there are a lot of aspects to the inflation story. tight labor markets. spare capacity out of china. the question of whether they are exporting. a little bit of a comingationary impulse out of china lately. it lines up with u.s. core cpu. another reason why the inflation trade may be diminishing a little bit. julia: markets are not worried. president and.s. weighard member way in -- in. why they should be in favor of it.

this is a tough one. this is bloomberg. ♪ the show's about to start! how do i look?

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♪ >> i am mark crumpton. the trump administration today accused the syrian government of carrying out mass killing's of thousands of prisoners and burning the bodies at a military prison outside of the capital, damascus. the state department today released commercial satellite photos showing what it says is a building in the prison complex that has been modified to support a crematorium. >> we now believe that the syrian regime has installed a crematorium in the prison complex which could depose -- dispose of the remains of >> detainees with little evidence. the state department believes

that about 50 detainees a day are being hanged at that prison. antonio guterres is condemning the latest north korean ballistic missile test as a violation of the security council resolutions and a threat to peace and security in the region. they had called on the north to fully comply with its international obligations and " return to the path of denuclearization." the security council has approved six sanction resolutions. the united states and china are reportedly working on a new, even tougher resolution. u.s. and european union officials will meet wednesday over u.s. plans to extend an on laptops.n homeland security wants to include transatlantic flights. european authorities and the travel industry are concerned over the idea. we have a breaking story.

multiple buildings are on fire following a plane crash in new jersey. it happened in an industrial area. according to the federal aviation industry, a learjet 35 crashed while approaching runway one at the airport. the aircraft went down about a court or mile from the airport in a residential area. the flight departed from philadelphia international airport. we are now receiving word that to flight crewmembers are reported dead in the link crash. court has dealt a surprise blow to the voter identification movement. justices refused to reinstate north carolina ballot restrictions that a lower court said targets blacks with almost surgical precision. state republican leaders supported the restrictions which would require voters to show a photo id and reduces the number

of early voting days. global news 24 hours a day powered by our 2600 journalists and analysts in more than 120 countries. crumpton and this is bloomberg. a recap oft us get today's market action. s&p and nasdaq closing at record highs. the crude oil is at eight 2%. julia: the case for the border adjusted tax. the former ceo of omar u.s. and board, spokehe candidly about why he is in favor of changes in our current laws. system isritorial tax really critical to the reestablishment of an industrial base, a manufacturing base in the u.s. without it, there is no possible way that we can have the revitalization of the middle class and middle class jobs through manufacturing that would come about and that is primarily

why i am a strong advocate. >> you are a minority because the head of pbh spoke with us and he is strongly opposed. tax. is a hidden the strategy, and again, there is not a lot of data, a 27% price increase on goods coming in -- the only alternative we have would be to turn around in increased prices for the consumer. with the consumer representing two thirds of the economy, we do not think this is a good idea. it is a job killer. scarlet: he says it is a job killer. you would expect ceos to say that. this are critics -- negative pr campaign is diminishing the odds of a comprehensive tax reform. you agree with that? >> yes. i have seen their analysis. in the comments we just heard

would be reflective of that. what they have done to try to make this look worse than it may be is taking the proposed tax and overlaying it on to their current business practices. meaning they would not do anything. we know they will do something. good retailers and good businesspeople will respond to the new sets of laws or rules. i liken it to a puzzle piece. the puzzle piece the government gives us today in the form of labor policy and tax laws have resulted in the off shoring of manufacturing and that has been going on for 20 years. inle that has been wonderful building an emerging middle class in asia and other parts of the world, it has effectively hollowed out the middle class in the u.s. as we do not have the job progression that people need. that will not change until we get new puzzle pieces. and when we do, smart retailers like the gentleman we just heard from and those that will talk to the treasury secretary tomorrow,

will sit down and figure out how to put the new puzzle pieces together in the way that is in the best interest of their shareholders. it is a little bit of a self-serving, has terrible perspective to say it is a jobs killer. it will be a job changer. it will be difficult and challenging but good retailers will figure out their way through it. julia: that was bill simon. just one of the topics they will be that we will be picking up tomorrow with mitch mcconnell on daybreak america. that interview will be on at 9:00 a.m. eastern. from new york, this is bloomberg. ♪

♪ cyberattacks that

swept across the globe over the weekend. affecting nearly 200,000 computers. they have been infected by ransom where -- ransomware. in the latest, let us bring the supporter of the bloomberg investigations team. only make 70,000 dollars a year in revenue. been a lot have worse. in speaking to investors today, it is bad. but the ransomware is not very well written. this will open up in a sandbox. the next -- the best kind of malware will not. the president of microsoft says this is a warning and a heads up.

who is it a heads up for? the government or for companies? >> it is companies. areyone says the basics that companies need to patch. it is hard for them because it is hard to take computers off-line and patch them. it is hard in health care and manufacturing but it is definitely a heads up because you definitely have to do it. of the reason this happened is because of the leak from the nsa. the person writing from microsoft took a shot at the nsa. explain the connection. >> one could say that the nsa should not be writing exploits. they should be warning microsoft when they spot a flaw and tell them how to fix it. now, a lot of people could say that microsoft could have patched this faster. they did patch it but they did

not release a patch for their older systems. which they have released now but it took a few days. scarlet: thank you so much. cyber staff were affected by the attacks. you can see shares of several jumping today as the governments work to contain the damage to their systems. let us bring in cory johnson who joins us from san francisco. give us some perspective. ransom where has been rising in terms of incidents. >> it is the hottest trend in cybersecurity. there we look at this -- is a big change in what is going on in the world of hacking. one of the biggest changes has been the rise of ransomware. ibm has done an interesting study. agoly 1% a year and a half

to 40% at the end of last year. that is to say that there are boatloads of spam all with a common denominator of ransomware which has been the tool of choice for cyber hackers in the last year. a cybersecurity company rallied over 3%. many individual names ravaging further. things like this happen and people throw a bunch of money at cybersecurity stocks. are some of the companies more specifically focused on combating this threat? point to one of the biggest risers today in the s&p 500, symantec's. up 5% for the day. tot is certainly in response this notion that all kinds of companies and consumers will start to focus on this as an their stuff as a figure this out. there is another small company

out of boston that has done quite well. ransomware protecting small businesses. they have seen sales up strongly over the course of the last few days. over the course of the last year. that is reflective of ransomware. talk about the price to reestablish computers. hackers have only asked for $300. what does that say about these guys? >> it shows the notion of the long tail. by asking for a small amount of money, they are more likely to get it. ibm did a study that showed that businesspeople that had been victimized, 70% of them paid up. and they were paying some big sums. $20,000them paid over to get access to their data. it shows how successful

ransomware usually is. ware writers have an expectation of tens of millions of dollars in payments. maybe they screwed up or maybe their numbers will get bigger as time goes on. certainly not smaller. and we think about how it works, typically, people pay up and they pay up a lot of money. a small dollar amount makes it more likely they will get paid. cory johnson, bloomberg editor at large. i am sure that we will have you back soon to talk about this topic. percent of business executives paid up. how many of those were asked to pay in bitcoin? i think that is pretty prohibitive. joe: some of the experts at the bloomberg news reporter have said that some of the slow

payment is due to the fact that bitcoin is difficult. the french president and the german chancellor met in berlin today. one day after emmanuel macron's inauguration. we will discuss the political , set for the two countries next. this is bloomberg. ♪

president hadnch his first official meeting with the german chancellor, angela merkel. the two leaders hoping to reset the relationship between the two countries. our reporter filed this report from berlin. the most one of anticipated meetings on the european calendar of the year.

emmanuel macron rolling up to be chancellery in berlin to received by angela merkel, the de facto leader of europe who has been in office for almost 12 years. there were cheers from the background of the chancellery offense. a sign perhaps other relief felt in germany and across europe after manual macron's defeat of marine le pen. thatwo leaders kept up tenor in the news conference that followed their first talks. angela merkel made a concession to emmanuel macron saying -- why not talk about changing european treaties if that is what is needed to strengthen the eu which is a departure from previous positions. the french president said eurobonds, in other words, sharing the debt of the euro area which is a taboo for many in germany, is not on the table he is concerned.

the two governments will start to work on a roadmap for french-german relationships which include a cabinet meeting that will be happening in july. all in all, angela merkel summed it up by saying -- of course we have differences and we have to work on those and there is a road ahead, that this was a good start. joe: the meeting came one day after the german chancellor's vote in west fail yet. toning us now from london discuss the latest in european politics is nina. thank you for joining us. do you see an opportunity for emmanuel macron and angela merkel to work together and continue the project of european integration? >> there is a huge chance for

the relationship to advance. everyone in berlin was watching the match of marine le pen with a lot of fear. they were extremely relieved when emmanuel macron won last week. euwever, aside from his pro- views, when it comes down to the details, there is still a lot to work out. it comes down to the question of what the future of the eurozone will be. germany's vision will not change. they do not want a permanent fiscal transfer union. they are of freight, especially with the reforms that the french president suggested, that they are heading over to that. scarlet: they refuse to relinquish more cash without more budgetary control. we know that german -- scarlet: we know that the germans are going to the polls

later this year. president will be up for reelection in 2022. how much time does that give them? >> we know they have to do something. and poor david cameron lost that referendum last year was probably watching with his head in his hands. they know they have to change something in the status quo because the rise of skepticism across the continent is rising in their minds. it is essential to his reelection, emmanuel macron. faces a bigger challenge from ream the pen -- from marine le this yearhan he did if that does not change. angela merkel is the only contender. there will be some potential for some grand bargain between paris and berlin but the devil remains

in the details. before we can get there, we have to first wait for the french president to put together his parliament. we have the elections in june. and whether he can even put forward and be successful with his reforms domestically and at the eu level. it depends on if you can get support in the french parliament. perspective, the queen of julia: europe remains very much in her seat. let us -- and find they cant us assume coordinate some support, how conservative will they be? angela merkel is going to step 40, you needy -- to behave. those tensions could be on the rise. first, they need to sort a

lot of domestic issues. there are labor market reforms and others. through, iet that think berlin would be able -- would be willing to cut him more leeway. fiscalre will be no pulling of debt. a eurozoneals for budget and finance minister -- we are still a ways out. and merkel also spoke about the reopening of the treaties. germany is quite afraid of doing that and will only do that with more budgetary oversight. joe: you mentioned that if the french president is not successful, that we could see in 2022.esident le pen >> it is important to remember supportersof le pen

were very young. that is not the case in france. france still has a lot of economic problems, a very high unemployment rate. unless there are domestic reforms -- in poll after poll, france shows as a more eurosceptic country. unless there can be a real change, whatever that reform is you could have a very cerebral atmosphere in france. scarlet: you gave us an image of david cameron sitting with his head in his hands. the u.k. will be negotiating with the eu about brexit. successor, theresa may, leverage macron off of

merkel or vice a versa? has a challenge on her hands. had it been president le pen, it would have been very difficult for her. with the manual macron -- with the french president and presumably merkel winning the chancellorship again in germany, they will remain united and stamp out euro skepticism. they will take one line negotiating with the ok and it will be difficult for her going forward. we did not mention the other countries like italy, and the netherlands. merkel will have an easy time of it but who knows what is going to happen. julia: other complications coming up.

joe: coming up, what you need for tomorrow's trading day. this is bloomberg. ♪

♪ the s&p and the nasdaq setting new all-time highs. do not miss this.

president trump hosting the turkish president in washington tomorrow through the 17th. at u.s. economic data. industrial production -- numbers tomorrow. julia: dick's sporting goods reporting first-quarter earnings. miss a hugenot interview with mitch mcconnell who will be joining bloomberg daybreak: americas at 9:00 a.m. that does it for "what'd you miss?" joe: thank you for watching. have a great evening.

>> you are watching technology. white house press secretary sean spicer declined why to address where president trump hasn't

disavowed his travel ban. but he said the executive order will be upheld in court. judges from the ninth u.s. circuit court of appeals in seattle heard arguments over the ban. supreme court justices refuse to reinstate ballot restrictions that a lower court said targets black. state republican leaders supported the restrictions which required voters to show i.d. and reduce the number of voting days. putin says the worldwide cyberattacks lay with the u.s. intelligence community and microsoft to prove. brad smith blamed u.s. intelligent agencies for stockpiling codes. two people are reportedly dead after a leer jet headed to new jersey's airport from philad