him after speaking on the phone with president trump. that's according to people familiar with the matter. reports that a member of the house democratic leadership has been hospitalized. his wife has suspended her bid for maryland governor as result. there is no word on the reason for his hospitalization. the washington post reports the nsa director admiral mike rogers is retiring this spring. he has informed the workforce of his decision, and expects president trump to nominate his successor, and the senate will confirm his replacement this month. the oakland raiders are set to bring john bruton back for a second stint as coach. the washington post cites a person with knowledge of the plans who says they plan a news conference to announce he is leaving the broadcast booth to come back to coaching. espn reports he will sign the

largest coaching deal in nfl history, reportedly a 10 year contract approaching $100 million. global news 24 hours a day powered by over 2700 journalists and analysts in over 120 countries. i'm mark crumpton, this is bloomberg. ♪ julia: live from bloomberg's world headquarters in new york, i'm julia chatterley. scarlet: i'm scarlet fu. joe: i'm joe weisenthal. we are close to the close of trading. the question is, "bloomberg daybreak: australia." -- what you mess? herlet: white house economic can -- gary cohn says the government may be pushed back.

drilling far and wide. the trump administration proposes to open almost all u.s. coastal waters to oil drilling, sparking environmental concerns. we get first-hand insight. a hiring cool down in the u.s.. as the economy added fewer jobs than expected, what does it mean for president trump's goal of getting growth to a sustainable 3%? julia: what'd you miss? more salt on the wound for taxpayers. states like new york, new jersey, and california have been forced to circumvent state and local tax deductions. gary cohn told bloomberg tv this morning that the federal government will be collecting on that revenue, regardless of what the individual states try to do. >> i understand what they are trying to do for their cities and states, and taxpayers. we still have to collect revenue, so we are going to have to evaluate what decisions they make in terms of what it does

for overall collections at the federal level and tax system. julia: with us is bloomberg white house editor alex rain. my first question should be how are they going to do that? can you take us through the options that these states are throwing around? one was paying property taxes early for 2018, that have already happened in a lot of places. a lot of people went to their local governments in december and figured out how they could get a check to them in 2017 to cover 2018 property taxes. i don't know how the irs gets that money back. they shift guidance after people started doing this. advising against it. also suggesting it would be ok. irs willnow if the perceive it further, regulatory steps to get that money back,

perhaps. ultimately, that is not sustainable, even if the states get to keep the money and taxpayers managed to write that off. it is a one-time thing. other things you hear about, such as state putting more of the payroll tax burden on the employer, can still write off deduction, setting up state funded charities so people can say i am donating to a charity that will serve state like functions. are these things that will be challenged in court by the federal government? >> i think the federal government can either regulate against those things, the regulations forbidding, state government backed charities. or congress can pass another law using the reconciliation process

that scores as a revenue producer. it would only need 51 votes in the senate. there are a couple of different approaches the government can do to prevent states from that kind of gaining of the tax code. you were talking about people prepaying taxes, my town the week before new year's, everybody was waiting in line trying to figure out their assessments. talk about the resources the irs has to do all of this, to push back against this and come up with guidance. they are just scrambling to give instructions of how to follow the 2018 taxes. how do they inform people of what will happen? t's a problem across the federal government. thet of agencies don't have staff they need to do a lot of basic functions. the trump administration has been famously slow making political appointments. they're not too many in the irs.

there are people at treasuries will haven't been appointed that are involved in tax policy. staffing is a problem across the government. think it will be a severe challenge for the irs, both to implement this law and try to crack down on loopholes. julia: what about last resort calling this unconstitutional. i have heard governor cuomo, the latest to use that term. is there any wiggle room? >> that would have to be determined by the supreme court. governor cuomo would have to bring a lawsuit against the government. he would have to probably pass a standing task that he has reason to sue over the law. eight't put a lot of w behind that argument. scarlet: speaking of longshots

and lawsuits, let's talk about the reaction by the trump administration to michael wolff's book "fire in theory." the president's mo has been to rattle cages with legal letters, lawyers, threats, all of that. how often does he take the next step to take legal action against what he feels is wrong? >> he has a track record of threatening but then not suing. these cease-and-desist letters, the statement attacking bannon over things he said in a book the white house claims is fiction, he may as well have just put a billboard on the front lawn of the white house with michael wolff's picture on it. the sales of the book are through the roof because of the tote house's actions to try stop publication, but also to go after people quoted in a book that they say is false.

julia: the president and his team have gone to can david to talk infrastructure plans, how likely are we to see some things concrete on either of these things? >> how concrete are you looking for? julia: pretty concrete. >> probably in the near future we are going to get a bare-bones proposal from the white house on infrastructure. back last spring, they showed a thin piece of paper on the tax plan. i would expect something like that on infrastructure in the future. i wouldn't expect anything more substantial, maybe not even in the first quarter. julia: wet concrete then. scarlet: might be an outline form, that's what we got for tax. up, we speak to kate

macgregor. we talk about the white house's plans about offshore drilling. this is quite a change. this is bloomberg. ♪

♪ scarlet: what'd you miss? the trump administration -- we are going to start with the stock of the hour. abigail doolittle is here, the stock of the hour is cbs, one of the best performing in the s&p 500. are sayinge analysts the bold case for cvs could mean more than 61% upside from

yesterday. this has largely to do with the aetna deal, that can bring the company back to the old trajectory. if we hopped into the bloomberg and take a look at what has happened over the last decade, we see a wild ride. we see out of 2008 and the financial crisis, a bull run hitting a high, then steadily down the last two years. a lot of competition, perhaps fears around whether amazon, but the growth has been slowing. it could bring the stock to a record high. if it doesn't go through, it could come down. joe: the analyst uses the word synergy. what is the mechanics of how the aetna deal would feed through to hire profitability, then return to rally? abigail: i think she is talking about how in 2021 the company could reshape the way health

care services are provided. it would take advantage of the cvs retail real estate and incorporate that with the aetna services in terms of the urgent care type clinics. putting it together in that way. the long-term picture. in the near term, it will be bringing on those numbers and growth from the members. scarlet: what is it look like when it closes? abigail: she seems to think it is definitely going to go through. they will upgrade the stock to an overweight and put a high price target of $70, then say it could climb to $121. who knows, it seems like anything is possible. julia: what'd you miss? the trump administration made announcing ity, will open nearly all federal offshore waters to oil and gas drilling. it puts 90% of the u.s. outer

continental shelf on the block, including the atlantic pacific, and eastern gulf of mexico. joining us is kate macgregor, secretary of the interior department. she is with us from washington. thank you for being here. this is a hugely ambitious plan. we are talking about leasing on 25 out of 26 areas. what is realistic? kate: this is reality. we are looking to start at this draft program stage with a bold plan that meets his goal of creating energy dominance in the country. joe: what is the impact? talk about this is going to open up new drilling, how much does this move the needle in terms of domestic production and by when? kate: right now, it signals we

are planning to move it quite a bit. the program has 47 least sales scheduled. a departure from the last program under the obama administration, which had 11. 18% of domestic crude and 4% of natural gas comes from the offshore resources. they are critical to the nation's. domestic production this is a plan that signals we are going to open the area and have a strong dialogue about where we should be leasing. joe: in terms of 10 years out, how much more domestic oil would you expect it to create? kate: we don't have a predictions on the actual increased oil production, given that is based upon who would show up in the future. productionl contributes one out of every five barrels in our country, that includes offshore. by opening leasing the two new

areas, we can only have a positive impact on production. producing. is if we can open up more, we could definitely increase production. scarlet: federal law gives you eight main factors to consider in deciding what offshore waters to lease, then give the interior department discretion on what to give these different factors. what is the most important factor to the secretary at this moment? how much weight would he give to what local politicians, environmental groups, or residents say is not in their favor? that they don't want it. kate: i think the secretary is going to balance the different priorities when we look at what areas to lease. the secretary came into the department wanting to restore trust with the american people, make sure we strengthen our

partnerships with the stakeholders and those we work with. as part of this process, we are going into a 60 day comment period. we will have dialogue with governors, local coastal communities, as well as congressional delegations. we are going to look to those comments to help dictate where we think they should be leasing. julia: one of the biggest prizes would be the eastern gulf of mexico. in proximity to florida, this could be a republican vote losing prospect or the people. it's more wonder that governor rick scott is up in arms. what is your message? kate: governor rick scott has reached out to the secretary and invited him to come down to florida to talk about this. we are currently working on the schedules to see how to accommodate him. the secretary has a great relationship with the governor. he is very respectful for the work governor scott has been doing. he wants to make sure his voice is heard.

julia: what are the big oil companies saying? exploration, it is down 60% on 2015 levels. prospects look bleak, they say they can't afford it. were they saying about the plan? this a lot of folks think is the plan that will change the dial today. when it comes to offshore energy development, it takes 7-10 years to get from leasing to production. a lot of that is permitting, it's environmental work that we do thoroughly, safety work, there is a lot of investment that has to come. these prospects are highly -- require quite a bit of capital. when you do a plan now, you are opening a prospects and economic developments for decades to come. that's why it is so important right now. 2016, theget back to

interior department justified the decision not to sell leases in the mid-and south atlantic, think it would barely make a dent in oil production. what has changed? kate: that's a hard one to predict. our production stays strong, but these are global commodities needed elsewhere. we now have an ability to export resources and play them at a geopolitical stage. when it comes to what will happen in the future, it is hard to predict. every study i have seen shows the american people will long be dependent on fossil energy long into the future. i use it to heat our homes, would like to turn my heat on and make sure i can get a car that can drive me to work. scarlet we are going to need ths en --kate: we are going to need this energy. when it comes to the atlantic, it is very gas prone.

there is increased interest in gas production on the east coast. ultimately, it will be up for decide where to and when they would like to have interests in leasing. we are doing our part by saying everything is on the table, we have a strong dialogue with the goal to communities and stakeholders to see where the final plan will end up. scarlet: you talk about increase production, it won't be a meaningful amount for the east coast. given the oil flowing from the deepwater gulf and onshore shale, what is the argument on why we need call -- coastal drilling on the east coast? kate: that is another point i am trying to make. this plan is not opening up the atlantic to drill tomorrow. we are planning 10 years from now. isot of things we are seeing there are different decline rates in different areas of the marsalis and other areas being developed.

today, to start planning replacing different geological formations that are depleting. this is not a holistic approach, the department of interior has a lot of opportunity to put on the table for energy production. julia: kate macgregor, interior department deputy assistant secretary. scarlet: coming up, as president trump is closer to finishing his first year in office, we look at his latest job approval. as his recent job -- tax victory hiked it up or has the drama this week brought it down? this is bloomberg. ♪

♪ scarlet: i'm scarlet fu, what'd you miss? new year, new record high, robust economy at home, the job reports today did disappoint. investors should brace or more disappointment.

my chart is from mark cudmore, our lead agent market blogger. he says this is an economic surprise index, buyer the line goes, the more data topping estimates. it was higher at the end of last year, now that everyone is upgrading estimates for upcoming data, we are likely to see surprises going the other way. a warning to u.s. equity, be prepared. joe: maybe the job report is a good example. it wasn't bad, the expectations have gotten so high, and it oscillates around zero because the expectations meet. scarlet: it has to come back. ppi, retail sales, people are going to key off of. julia: in the meantime, the bulls are going to keep smiling. why am looking at is the monthly return, the balance portfolios. equities versus treasuries. if you look at what we are seeing, the s&p 500 total return index and the u.s. treasury

total return. in the first three trading days of january, we have already returned more to the pro for real in the average month -- portfolio in the average month over the last five years. this little green bar is the performance on the week. we keep talking about the record highs in equities, but a lot of boats are floating. joe: it's a good reminder that because of that bond sale in november 2016 election, it underperformed recent. a lot of people's portfolios are working now. i want to look at the latest president trump' job approvals. past whened it in the it has gone down. it is only fair when i point out it is improving. and ae to put improving lot of context.

disapproval. -15% his job approval is up to 40%. it had gotten as low as around 36%. synnex may say he went on vacation, didn't do anything, others say maybe this is a tax cut. they study it more now that their taxes are not going to go up. this improving is a matter of fairness based on the data we collect. we should also point out when it is going up as well as downgraded julia: it was a popular tax overhaul. scarlet: the market close is next. we are looking at record highs once again. we start and end with that, because it seems to be the goal. the dow up to 12 points on the day, the s&p 500 gaining a third of 1%, the nasdaq up by 8/10 of

1%. from new york, this is bloomberg. ♪

" inwhat'd you miss? underwhelming december jobs report. chatterley. scarlet: i'm scarlet fu. >> we want to welcome you for coverage every day from 4:00 to let's begin. >> with market minutes. >> over 200 points on the dow, pretty impressive. ofwe are looking at advances .7% on the dow and nasdaq. let's get you a couple of things that were noteworthy. fortrading overweight morgan stanley. the purchase changes the narrative for cbs.

we had mentioned it as our stock of the area. revenue bank reporting -- securities unit 22% in the final quarter. there's even greater pressure from shareholders to rebound from a year earlier. secondwn almost 10%, the downgrade in his many days. -- the downgrade from citigroup is now at a cell. let's take a look at the government bond market, not a lot of action. two year unchanged, 10-year up a little bit, not surprising to see a little bit of selloff at the long end. we had a job report at 8:30. we take a quick look at the

intraday two year. the first headline was a mess. it's like a little bit of a buy on the short end, but the market has erased everything, didn't care that much about the report and we see two year yield ending on the day flat, but much higher than we have been. jonathan: -- in dollardid see canada, beating estimates lower after the u.s. one as joe mention there as well. we have had the bank of canada governor focusing on the economy being near capacity now, but remains focused on the rate hikes. banks both calling for a rate hike on january 17, our very own correspondent saying not happening. nafta negotiations will continue later this month.

get too excited about dollar weakness, because we did see euro under pressure as well. headline inflation raising 1.4 percentage deceleration from levels in november. energy prices accounting for much of the slowdown, but just another reminder to the european central bank that their job is far from done here. i want to show you what is going on as far as risk reversals are concerned. let's go to this chart, what i'm looking at here is an increase in downside protection. what is going on? they are incorporating the italian general elections over march the fourth and as you can see, investors hedging themselves here on potential downside risks surrounding the euro. a quick look at the margin markets -- emerging markets, mixed act, but you can see the

mexican peso is a stronger. eu currencies doing the same. >> let's take a look at the commodities. one of the big stories is a huge commodity rally over the last couple of weeks, finally a bit of a breather, not massive or anything. 61de oil down, still over dollars a barrel. .old is essentially flat one of the longest winning streaks we have seen tracking it down .3% today. those are today's numbers. >> for more on today's market let's bring in our cross asset reporter. let's start with equities. when you look at u.s. equities, they kept climbing through the day, closing at a session high. in the case of the doubt, we are looking at all human that is 12%

-- 13% above the average. is sohink the early story much enthusiasm about financial assets. and where you see that playing out around the world is relative strength indicators, so they --d of judge the persistent in the magnitude of recent market moves. basically what they have started showing you is the relative and for index everywhere except europe, the euro stoxx 600, it signals and overbought territory. the speedestament to and magnitude of the moves as we break into the year. scarlet: europe is the purple line here, below the relative strength index level, but the momentum is to the upside. yes, generally. all of this enthusiasm is grounded in something real. when we look at a report from bank of america this week they are talking met the earnings

revision ratio for s&p 500 companies skyrocketing and sales skyrocketing by even more. the strength is expected to continue affirmed by tmi data and commodities roaring and financial asset enthusiasm. that is the winner of 2018. scarlet: you also break it down and asset classes as well. i've a chart here that you call a curious cocktail. talk us through this one. luke: when you think about it rationally, as he saw this week, we are spending more on heating , burning aural gas record amount of that as the snow bomb hits. you would expect that in future months to take something out of domestic discretionary, however, the markets are not -- are saying they are not worried about that. crude oil and relative performance generally you see them move in an inverse

direction your right now, retail is outperforming and oil continues to march higher. amidst the enthusiasm there are still dichotomies that may persist for that much longer. julia: retail stocks have been so beaten up that there's a bit b balance -- a bit of ounce -- luke: more than that. we have seen short entrance absolutely plummet. there is an essence of short recovery to this and we did have a record holiday season, but even know it didn't lift all boats as expected. joe: the fly in the ointment that people would point to is what were seeing in the rates market. you have a chart here called not a bearish story and it looks like a few different spreads

here to tell me what we are looking at here. luke: i think this week was probably one of the best times we have had to show that flattening isn't necessarily bearish. the candle line there, that's the 210 curve and we saw yesterday it breeds 50 basis points in the first time for forever, but what is happening isd this, the rio curve actually steepening. we are confident we will get back to that neutral, something the market has been pushing back for years and years. at the same times, the commodities rally. put this together. as much as you can in for a real things from and inflation break even, the market is saying the fed is going to be at its target sooner and its long-term plan looks better than it did two weeks ago.

julia: that's all we like, silver linings on a friday. thank you for that. coming up we have a debrief with u.s. economist. from new york. this is bloomberg. ♪ . ♪

mark: i'm mark crumpton with first word news. a storm that counted the eastern u.s. and yesterday was more than an inconvenience, it was a ends it. the storm is estimated to have between $3 billion and $4 billion. it is in line with most other winter storms. the environmental protection agency is counting cleanups at seven of the most polluted

places as a signature accomplishment in the trump --inistration scarlet but records show it took place before he took office. average short of the pace set under president's obama and george w. bush. austria's new chancellor says the country should keep military ties with written after brexit. sebastian spoke to reporters with chancellor, both the people's party and freedom party have taken a hard line against immigration. global news 24 hours a day, powered by more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg. julia: today's jobs report underwhelm's.

, almost 60,000 less than expected. .3% from been earnings growth. to talk about the money we have harm bandholz. we were describing it as tepid. what do you think? -- a bit more moderate, for sure. what we have seen over the last it up months, the labor force is growing, we are at full employment. obviously these payroll gains were not sustainable. joe: that's basically what i was going to ask you, is it about a slowdown or there aren't many workers left to pull into the workplace? i think that's eventually the reason we weren't able to sustain the table games.

we were getting excited about these fluctuations. saying there's a slowdown or a boom, but if we just smooth it out like six-month averages, or 12 month averages, we see that it has really reached peak dynamic since 2014. since then it has slowed steadily, but gradually, but consistently. in 2017 we had about 170,000 per month, still good, but we have come down a bit. scarlet: so if we've seen this deceleration, why we haven't -- why haven't we seen the wage gains pick up? harm: you're right. that's really the question. that is the debate at the core of the tech monetary policy outlook. and even the fed is -- about the explanations. i would like to stress despite

disappointment we have to stress -- core inflation measures have all gone up over the past several years, just not as much as we got. the phillips curve still exists, it's just flatter. --ac as long as wages aren't just not accelerating? harm: right. not accelerating as much as we'd like. julia: if are looking at highly cyclical sectors, doesn't it take a more clipped curve? harm: there are reports that there are some regional areas with low employment rates, some higher in wages. we have been following the base were the last three to four years, it has always stressed guild labor shortage. that's what we are looking for, that's what we expect at this point of the recovery. but most of the aggregate wage numbers don't show it.

3.2% increase that looks better than average earnings, but not if i were. yellen gave a good speech several weeks ago lining out all the possible factors behind it without saying which one was responsible. it's probably a combination of several of them. >> in terms of trade deficit today, wider than expected, but at the margin, what does that tell us? is that going to make it harder to hit these gdp goals? -- righth, probably before the holiday after we had seen 3% growth in the second and the u.s. is not a three percent growth economy, i think the trade deficits have surprised on the upside. we had a positive contribution from trade to growth, which is

on u.s. like. there are no structural changes and i think as what we have seen with a job numbers today, just a collection of the too good trade numbers in the third quarter and now we see in normalization. joe: will the dollar mitigate that somewhat? harm: yeah, it helps a little bit or hurts a little bit. the u.s. is a poster child for a big closed economy if you want compared to smaller countries which do more trade here at it's not that much of a support factor for the u.s. scarlet: put this all together. you're likely going to raise interest rates in march, will that be your first move or hold off and wait to see how things shake out? harm: the overall approach looks right given the uncertainties that we have. we have ramped up the pace of rate hikes last year. we look

for another three hikes this year. that is our forecast. i think it makes a lot of sense. the question is, do they raise in march? i don't know. scarlet: why? harm: i think they want to wait for inflation to pick up a little bit weird we have seen in the minutes and also today that -- let's see what's going on. we have a forecast for the inflation rate, but we have been disappointed for several years now. let's wait a little bit and see if inflation picks up and do a little more. but doing the hike in march, it's mostly about pulling the -- or not. do we want to end with a bang or a seen as dovish. it doesn't change the outlook, but once they bit -- one statement or another. julia: we have seen that this

was a deeply unpopular tax overhaul, to what point do you think people say actually i have gotten paid a little bit more this month. what are we going to see in the data? harm: the reason why some popular is most people won't have that moment here at we have been looking at distribution -- independent thing tanks and they all came out with the same verdict. it's good for the stock market, high earners, a lot of mergers, acquisitions -- scarlet: what about those one-time bonus payouts? that will show up in the numbers? harm: yes, that will affect the short-term weird if you look at the approval ratings you have a record high stock market, 3% , 2.5 percent employment gains and approval rating is a 40%. that is concerning, must be

concerning for any incumbent, because it doesn't get any better than this. >> good point. coming up, rebekah mercer cutting ties with steve bannon. what that means for the rift between the president and his advisor. this is bloomberg. ♪

scarlet: steve bannon's high profile participation in the wolff book. -- says she continues to

support the president. where does it leave the populist revolution? let's bring in that finer, who has been following the story. bannon was kind of the populist force that helped propel come to the presidency and he hasn't always governed as a populist. it is an open question. been in's project he pursued -- bannon's project is really in tatters right now, his efforts to take on primary republican senate candidates next year doesn't seem to have gone anywhere. he is losing financial support and now trump is -- joe: it's amazing because month ago people were like he's so brilliant, and now he's just sloppy steve. he lost donald trump and the

money behind him, the mercer family, at the same time. neither has the ability to tell the people he is the voice for trump on the outside, nor the financial muscle that the mercer's provided him with. julia: and that's what we were talking about ages ago, if he went back to bright -- thing you know, you broke with the mercer's, you broke with the president, we are not sure what you're doing around here. >> he essentially created breitbart how it is today. when he took over and infused money into it became a powerful force in politics in the united states and you really have to credit bannon with that. the mercer's are minority owners.

the widow of andrew breitbart also owns a stake. if they are done with bannon, are they going to be afraid that breitbart isn't going to be what it has been. who will they replace them with if they decide not to give him money going forward? >> that the question. he could turn to another billionaire. he has been making the rounds trying to get some people to set up $100 million to go after senators next year in -- >> it's having the opposite effect? >> now a lot of donors are going to care is this a guy who can really speak for trump and he doesn't have this and he doesn't have this original financial support. >> they'll pay him 100 million to stay away. e: robert mercer had already

extricated himself from the breitbart thing, of active finance. int is the mercer's future terms of active engagement in conservative politics? >> that's a terrific question, because the mercer's were never the biggest donors on the right, but made them so special is this interlocking series of institutions they were involved with that helped, trump when. breitbart, the clinton cashbook, cambridge analytical program, those are essentially steve bannon projects. if there's a horse -- if there's a divorce with a bank, are they just another wealthy family or do they find a new way of eating relevant? scarlet: steve anbang may be on may bes -- steve bannon on outs for now, but does he have more in washington? has think if anybody

secretly a soft spot in our heart for bannon, they're not going to make it in the west wing for a while. julia: now what the establishment republicans, if they use this antagonistic influence away from the president, perhaps it's an opportunity to bring him more into the fold and use that, more mainstream, right? mitcht's certainly what mcconnell and his allies are hoping. the party can unify and yeah, turn him into a more conventional president. julia: got you. thank you. an apple a day won't keep the security -- away. macs, ipads, iphones have all been affected by the security problems reported this week.

this is bloomberg. ♪

m the knighteda nations a security council is holding an emergency meeting on the protestrk: taking place in the iran. nikki haley says the international community can't let iran silence protesters messages. and people are rising up in 79 locations across the country. it is a powerful exhibition of brave able who have come so fed up with their oppressive government that they are willing to risk their lives in protest. ifk: i had of the meeting

foreign minister said it's an american attempt to disrupt the -- pruitt said he would be willing to leave the justice department should a position become available. this comes among speculation of jeff sessions' tenure. sessions excused himself of the investigation of russian election meddling. the attorney general once to review immigration judges closing cases without decisions. it allows people to stay in the country without legal status. a have been a lifeline to immigrants who have applied for citizenship, permanent residency, or other be says. politico reports that maryland hasressman elijah cummings

been hospitalized. and his wife has suspended her bid for maryland governor as a result here at there has been no on the reason for the hospitalization. emmanuel macron admits that talks with turkey remain stalled . at a joint news conference in paris, erdogan, president macron entered said stringing turkey along was critical. he maintained criticism of president garside's regime. global news 24 hours a day, powered by more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg. ofrlet: let's get a recap today's market action. it was another plus a for today.

the dow jones is closing shy of 25,300 yard aims of at least .7% for yesterday. julia: tech stocks incredibly resistant to top headlines. apple users have not been spared in the great chip debacle. all iphones, ipads, and mac --puters are affected by the joining us now from san francisco, mark, talk to us about exactly what is vulnerable and to what extent updates have mitigated the risk. sound --'s break the this down. there is meltdown and specter. apple says all devices excluding

the apple watch are affected by meltdown and specter. touch, ipad, apple to be have updates that mitigate the problem your mitigates is a keyword. they are not saying they solved the problem. i think this will quickly become a cat and mouse game here they have been no exploits designed to go through the security flaws, but that doesn't mean that hackers aren't working on it as we speak. often when you hear about security exploits, intel, windows computers, mac can be smug about how they never get viruses and all of that stuff, is that changing over time? through the web, the chips themselves, that the security gap is not as big as people like to think? mark: absolutely right. a lot of the platforms across

the different companies, they are very similar. they are all moving to boys, ar, the art, but in this situation is not really apples to apples comparison. we are talking about hardware chips, underlying processes that underlie the whole technology industry. that's speculative execution. him move thechips same speed, you can't tell how much windows are faster than mac computers. if it thinks you're going to open this up next, it's going to start opening it and that's where the exploit is possible for hackers to break into your stuff. scarlet: like joe was saying, this is may be a trend toward apple products being more vulnerable now and what might have triggered that.

you think the cloud has something to do with it, the fact that we use the cloud makes it more vulnerable? your point,e with but in this particular case it's very much a hardware thing. is acrossare thing all kinds of chips, game console, smartphone, tablet, but also the chip used to process out applications. the cloud we like to imagine as a mysterious item in the sky, but it's actually a server farm. apple has one in north carolina. those are processed by chips that have this exact same issue, so this is a cloud thing as well. long been talking about the dispute between apple and qualcomm and this is a tangent, but we know that apple has been trying to diversify chips away from well from -- from qualcomm.

they are trying to shift their business. underlyingchip is an technology. in terms of the dispute with qualcomm, that's on the modem chip, a different kind of chip. what were talking about here has to do with the brains of the devices while the modem has to do with cellular connectivity, phone calls. it is giving and intel a name, they are getting a lot of negative press right now that apple won't want to associate with and that could be a deciding factor in the future. let's talk about the consumer electronic show coming up in las vegas. from engadget perspective, what is one to be the big thing? will talk about next week mark: ar, vr, ai --

to useen i might going this stuff? what am i going to come to work with a big helmet or a hat on my head? mark: is going to happen soon. you guys are going to ask what's going on. you're going to have a big oculus here it were going to see backdoor deals. today we saw a company that is up 18% on our story that they are working with amazon and alexis to make glasses coming out for thousand dollars in the second quarter. the big companies are the real question, that'll be in a couple of years. we will wait to post that picture of the two of you with your helmet. thank you so much. within the greater themes of today's labor market data, but you can't miss from the jobs

reports and of course wage gains. this is bloomberg. ♪ this is bloomberg. ♪

scarlet: mungo tepid job numbers we got this morning, some industries and demographics did better than others. our economy reporter is here to discuss and we will go beyond headline numbers. we have to start with wages. wages specifically for different sectors show a different story. >> absolutely. when we talk about the phillips curve it seems like the real connection in wage data is in the lower end of the labor

market, things like restaurants we are showing wage growth. the amber line and retail is the blue line. both were trending up through the expansion that has kind of leveled off and decelerate it recently. we saw a nice pickup in both of those in december, so that's a good early sign that may be these things are starting to turn around again and maybe we will see that typical elation chip between low unemployment and faster wage growth reassert itself. joe: you have done a lot of work raking down wage growth at different income levels. we were talking yesterday about this very thing. but in terms of higher end wages do we say a trend? >> there are certain industries in the higher end of the labor market doing pretty well. for example, there are some areas in health care.

when that caught my eye this month was outpatient care centers seeing a 10% wage growth, but for the most part stuff at the high end is not doing well and wage growth is decelerating if anything. we are seeing that broad-based lack of wage pressure across distributions at the moment. joe: here's the year-over-year to 44.for men 35 massive spike this month. tommy what is going on. about prime working age workers, typically defined as 25 to 55. if you really key in on this it is a cyclical demographic, 35 to 44 and specifically for men. growth for year-over-year was fastest in 1977, a huge growth.

there has been speculation that male participation has been low but we are starting to see it turn around as the manufacturing industry comes that over last year. joe: all of last year looks good on this front? >> absolutely. scarlet: is this the reflection of the construction industry as well? >> absolutely. back to the chart you are showing with regard to retail, wage gains, when we saw when heber come out thousand down on retail, there were immediate headlines in terms of what this means on online sales and whether or not we can point to an amazon affect. was that just a level of hysteria? the last three months have been putting volatile in the retail space. isretail employment decreasing on a year-over-year

basis. obviously, retail is having a tough go of it here to there's a lot of talk around the holidays being shortstaffed because of that and we saw some ratcheting up in the length of the average work week and a little bit of wage growth like you see in this chart, so it there seems to be some bottlenecks there, but overall the trend has been definitely down. julia: there were reports of people struggling to higher people in december -- hire people in december. >> that could be geographical effects. when you dig under the data there are certain areas accounting for a lot of the drop like general merchandise stores and clothing stores. it could just be that retail workers aren't as expendable as you might think. joe: we saw a drop in the number of people getting new jobs. is it a quirk, slowdown, or a

sign of will employment? >> i think it's probably going to be a court as far as we can tell, because we are seeing that deceleration in the service .ector, which tends to lag maybe we'll see a pickup in services six months down the line. julia: thank you for that. coming up, bank of india governor sat down with mike mckee in philadelphia. what he sees in the defense labeled and global spillovers. next. from new york, this is bloomberg. ♪

julia: waiting for wage growth. how central banks are making sure that growth trickles down to areas that needed most. mike mckee sat down with former bank of reserve indian governor earlier today to tackle the fed labeled and global reverberations. >> central banks obviously are forward looking. they have to ask is this going to stay the way it has been going forward. the one thing that is changing earlier in a slacked somewhere in the world. today with unemployment coming down, there has to be less slack. as a result, the comparative pressures that kept wage growth down may not show up as much going forward. wage growth may possibly pick up, you already see inflation in

some countries, canada example more strongly. the second aspect of this is really central banks are also in the back of their mind thinking about financial sector risk. if not the front of mine, that's inflation, but if financial sector risk is building up we should not surprise the world suddenly with an inflation report that shows we are way behind the curve. i think that would suggest so long as there is uncertainty, steady slow removal of accommodation makes sense. talk about people emerging markets and say there is a concern here that they will not be able to withstand a sudden removal of cash if things go pear-shaped in the economy. is that a major concern? are we looking at a 1997 or tequila crisis situation? >> many are in a better position than they were four or five years ago. they have focused on inflation

targeting -- got inflation down. to that extent they are in a better position. it doesn't mean they are a meehan. there is a huge amount of capital flowing towards emerging markets and i have seen a substantial portion of it is as a result of easy monetary holocene in the advanced countries. as policy reverses, there could be reversal. the hope is with stronger growth and that her policies, they are in a better position to withsstand reversal. i think governments are relatively unprepared, in a better position, not a new one. mike: we talked about the fact that we are seeing synchronized global growth taking up. do we need debt fueled stimulus as we have in the u.s. tax plan? >> i don't think we do.

announcerse of the of the tax plan suggest we will get strong growth next year, but you have to ask with the level of unemployment where it is, what you really need is a we distribution of growth towards jobs people need and aren't able to fill right now because jobs that are available are not the jobs with skills. naturallyat happens with stronger growth, but the question you have to ask yourself is with this level of unemployment, is there more space in the labor market as we get stronger growth. gete don't, you will stronger growth from a fiscal side, but you have to get the fed moving faster and off set that from the monetary side. we have to wait and see, but that's a danger moving forward. mike: from your experience as

governor of the central bank of india, is the ed he central bank of the world? sets thek the fed tempo across the world. there is no market immune to the dollar, independent of the dollar. the dollar has an enormous effect and the fed influences the dollar. showingferences are papers showing how dependent countries are on the exchange rate vis-a-vis the dollar which is determined to some extent by said actions. we are in a very integrated world. i think the fed has been very measured but very clear where it's going. mike: you're speaking on banking and you're going to make a unique argument that maybe people are being too tough on banks? >> i think we needed to get tougher during the financial crisis and after that, but i do

--nk regulation tends to be follow a cycle. in bad times it gets excessively tough. in good times it gets excessively weak. i think we have put a lot of pressure on banks and it's about time that we look at them and decide is it enough. and is it spread well enough across the system. there are specifics i want to talk about today, but broadly the question is how much is enough. i would prefer a level playing field across the financial sector, don't over regulate one side and leave the other side relatively under regulated because then the risks transferred over to the under regulated side. i think we may be in some danger of doing that. and that wasrajan

speaking with michael mckee. it's time for the bloomberg business lash. former securities and exchange commission enforcement chief will take the number two post at years of spent three the security squad unit. before joining the sec work for general -- worked as general counsel for deutsche bank. theses will debut at convention in las vegas next week. it is based in rochester, new york. they say integration is part of amazon's push to expand service and generate greater revenue. roby is is retiring january 31. the cochairman says he kept most of his money in templeton funds and became one of the most recognized authorities on market investing. he joined mobius in 1987.

mark is going to do a report for us wearing them. >> coming up, what you need to know for next week. this is bloomberg. ♪

scarlet: u.s. stocks climbing to record highs. i feel like a broken record. coming up, talks for the first time on tuesday since 2015, the subject is the winter olympics. joe: i will be looking at economic data. watching the retail sales. julia: also on friday, bank earnings here at j.p. morgan and wells fargo before the bell. joe: have a great weekend. this is bloomberg. ♪ ♪ retail. under pressure like never before. and it's connected technology that's moving companies forward fast. e-commerce. real time inventory. virtual changing rooms. that's why retailers rely on comcast business to deliver consistent network speed across multiple locations. every corporate office, warehouse and store

near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver. you're watching "bloomberg technology." more fallout about steve bannon

about the book behind the scenes in the white house. rebekah mercer cut ties with with trumpr speaking on the phone. and taking a fresh look at the clinton foundation. agents are investigating to see if any donations to the foundation were made in exchange whilelitical favors hillary clinton was secretary of president trump and congressional republicans have made repeated calls for an investigation. launched today -- sessions is challenging the use of "administrative closures" which allows people to stay in the country without legal status. they have been a lifeline to immigrants, but critics say judges let people stay in the country longer than they should. plus the washington post