participating in an interview. however, they say the president's attorneys may be reluctant to have him be questions without clear parameters. 11 princes and sonssts include two of the of almarai. has verified a voice message from a member of the royal family family, calling accusations against the princes lately false and not believable. election they say an will be held at the end of march. they have not announced you will seek a second term and he is expected to run and win. will hold their first high-level talks after

more than three years. they will be focused on north korea sending a delegation tonight month's olympic and south korea. at the same time, south korea will try to keep from undermining the u.s.'s hardline against the north. global news 24 hours a day. powered by more than 2,700 journalists and analysts in more than 120 countries. this is bloomberg. ♪ julia: live from bloomberg's world headquarters in new york. i am julia chatterly. scarlet: i am scarlet fu. joe: and i am joe weisenthal. the s&p extending its winning streak for a fifth straight day. hojoe: the question is, what you miss?

do they also point to inflated prices. farmers are hoping to reap the benefits of their support for president trump, who is said to address the american farm bureau federation's annual convention in nashville in about 30 minutes.will bring you his remarks . too much of a good thing could be hurting apple. arebig shareholders concerns about children becoming addicted to the iphone and they want apple to do something about it. julia: what'd you miss? goldman sachs financial conditions the easiest condition since 2000 after a big run-up in u.s. stocks. now, fed officials are starting to wonder if they will need to address asset prices in order to avoid overinflated consumer prices at some point in the future. joining us is matt vogler. great to have you on. we have talked about this endlessly. that the conditions continue to ease in the face of federal

reserve rate hikes. go, theyoint do they need to do something here are respective of inflation? matt: it is a really interesting debate because you can go all to the question of what asset prices seem they get too high, what is the right level and what should the response be? fed, at leastthe nowadays, is trying to sidestep that question and say regardless of whether asset prices are too high or too low, let us focus on the likely impact they will have on growth and how that will affect our full employment and stable prices goals. really goes to the question of what does it mean for the inflation outlook, and there's so much uncertainty surrounding at the moment that it does not become operative at the moment but it could become something in place later this year. joe: i thought it was

interesting president trump tweedy the weekend that the stock market is roaring and it will lead to more jobs. some people might dismiss it but it is not that ridiculous. neil was saying the same thing. if you have higher stock prices, you can be more credit worthy and it could create jobs is that the mechanism -- create jobs. is that the mechanism they were talking about? matt: yes. brought a great chart and it raises the question of correlation versus causation. when you look at, historically -- what we're looking at is the yellow line showing goldman sachs' financial conditions index. that is that a 17 year high. very good financial conditions. the blue line shows the year-over-year change in the unemployment rate, that that is flipped upside down. typically when financial conditions are better, the unemployment rate declined faster, and vice versa. the interesting thing is if you look at the end of the previous two expansions on the start, you

could see the correlation kind of flips. , we had improving financial conditions with a yellow line we did not get that same sort of acceleration in the decline in unemployment rate. there's a question of which i is causing the other. sometimes they say financial conditions are so good because of the economy and fundamentals. it is a question of whether the employment rate is causing financial conditions to be good or a financial conditions being good are going to cause the unemployment rate to fall further great there is probably .eedback in both directions scarlet: this is a philosophical debate. what will lead to a tighter financial conditions? we have seen five interest rate increases thus far in the cycle and that hasn't done much for it. is a going to be a reduction of those balance sheets, for instance? question. is a great one of the things that goes into

those financial conditions is when you talk about market volatility, a lot of that is a whispering for general uncertainty. to the extent that they sort of divorce the balance sheet stuff from the interest rate outlook, you have less uncertainty about the path of interest rates. so it should augur for less volatility. it does become a question of, you want to be clear about what you are doing and all of the signaling in communications the fed does, but on the other hand, if you also want tighter conditions may be cannot couple. julia: and the conundrum they have with rising stock prices and bonds. keeping the back end of the curve down. we're not happy about volatility, just low bond yields here. we're not getting what we would normally see in terms of tightening when you get tightening at the front end of the curve. matt: that is absolutely right. short-term interest rates have been going up quickly. long-term interest rates have not budged. i think that is giving them some concern.

part of the recent long-term interest rates have not gone up is because the inflation risk premium is low. they are kind of looking at this and thinking if we keep hiking, we probably want to see those long-term rates go up soon. joe: specifically, as we approach this year and the debates that the fed will have about rate hikes, tell us what you are looking at us ethically and how it will affect the base we will see. the important thing to watch will be the inflation data so we get the consumer price index on friday. if that starts a turnaround over the next four or five months, the financial conditions thing will be the thing to shift to. if we do not get the pickup in the ruby a lot of hammering about financial conditions but not a lot of fed response to it. is the question yellen posed. they cannot explain why we saw the deceleration.

they said we can explain it for the year before. if they cannot answer that question, or do they need to answer that question before they can start tackling the impact of financial conditions? making adjustments to the rate forecast. matt: i think it is right. talking about philosophical and existential. the link is between financial conditions in the unemployment rate. if you are not sure about the link, then you cannot be too concerned about incentives to the unemployment rate to inflation. scarlet: go back to the drawing board. back to square one. thank you so much for an enlightening conversation. coming up, the security issues affecting intel chips was cybersecurity researchers months before the big revelation. this is bloomberg.

scarlet: what'd you miss? it has been a week since intel review -- revealed all of its modern processors and the tax by meltdown inspector. the chapter techniques can impose crucial data to password than encryption keys. the revelation did not come as a surprise for some people, as researchers have been looking at the security holes months earlier. joining us now to discuss from san francisco is boomer technology's ian king -- bloomberg technology's ian king. thank you for joining us. your story really take this in detail what researchers have been looking for and indicates this is a potential vulnerability that people had known about for a long time. what changed in the past week? wedded to become so urgent all

of a sudden? -- why did it become so urgent all of a sudden? >> became urgent because someone found out about it and went public with it. the standard practice is to find a weakness or exploit and then you try to fix it and say we found this problem but do not worry because we sorted out. what happened in this case, which made it more dramatic, was that word got out. julia: was quite fascinating in your story is that you talk about researchers that found these vulnerabilities and they thought they were so glaring that the chipmakers would have already addressed them in taken mitigation steps. how did they get caught offguard so obviously by this? raises questions about other vulnerabilities. ian: that is a good question. the backdrop to this is for years, since microsoft had all of those, problems with the software chipmakers have another thing trust us, put it on a trip, it is hardwired, much

harder to crack. there will be in the safe areas of the may come along and have to say actually, no, this is something that we have been doing to speed up and it works for years but creates a back way into it. as researchers, we had them swearing in disbelief. they thought a company like intel would never in a million years loss of thing like this to happen. joe: as you said, the exploit comes from the fundamental nature of the chip, anticipating what you are going to do next. that sort of thing. how serious is the risk that when all of this is patched, everything will run a lot slower? ian: that is a big concern. we saw the large technology companies, including intel, say look, we will catch it and it will be safe. the problem that might cause is by taking away, some of the things that speed up chips, we

slowdowns.we do not know yet because a lot of those patches have not been implemented. if you have been updated or apple products, -- updating your apple products over the weekend you see the security taking place, is it slowing things down? we do not know. the key thing is what it will do in the data center, where the bleeding edge performance is needed. that is what we will have to see. julia: from this article, perhaps they were more focused on performance here than they should have been on security. they were distracted, in some way. do think there is a risk that these companies knew of these vulnerabilities and did not do enough to address them? or do you think they were caught offguard here? ian: i think you just have to take them at their own words. they say they were focused on security. this is a separate effort designed to speed up chips, something going on for more than a decade.

they didn't think this would be a possibility. the researchers did not think it would be a possibility but turns out it was. scarlet: we're finding out a lot about what could be. we know these computer scientists have been working into these potential hacks for more than a year. is there a possibility that we have been hacked, people, companies that we are not aware of it yet? ian: what they said so far is no known exploits or examples of this. to go back to where we started off at this conversation, the minute you put out that there is akness or exploit, the bad guys crack open their laptops and create code and take advantage of this, so you better be flipping sure you have that mitigation in place to stop them. if you don't, we will find out about that pretty soon. scarlet: ok so beware. ian king joining us from san francisco. thank you so much. we want to turn out to gopro.

the camera maker is rebuffing the ports. sale came after the company announced it would cut more than 20% of its workforce and exit the drone business. oflier, we had selena wong bloomberg technology catching up with ceo nick woodman. innick: i can confirm jpmorgan --nick: i can confirm jpmorgan is our banker but we have not engaged them to help us sell the company. there were an, if opportunity for gopro to partner up with a larger organization that can help us scale our company, brand, and reached a consumers, that is something we would consider. it is not of the we are actively engaged in at the moment. do you think you will want to actively engage in this? other catalysts -- are

there catalysts you see coming? have people reached out? nick: would we engage in something like this?this is something we explore from time to time , as it is our job to grow the business and the most strategic way possible, and that definitely is one way to do it. ,t is not a new topic echo pro but i cannot share any more information than that. selena: you're the founder of the company. from herperspective, how are you evaluating the different options that hands ? this is not a new topic. is there something that is changing now? nick: the world's voice changing in our job is to align gopro with consumer behavior. sometimes, that is easier if it is done with a partner or acquiring company. the same time, we have to build gopro as though we intended to run it independently forever

because that is how you build a strong business. i cannot share any more information about -- other than we are building a strong business. already great selling hero we'reack is not $399, so expecting -- is now 300 $99, so we're expecting great things there. $399, so we're expecting great things there. woodman.that was nick shares down as much as 33%, currently now off about 13%. speaking of stocks this week making big moves, but is get a shares of dave and buster's for our stock of the hour. its worst day for the company since it went public in 2014. this comes after dave and buster's cut its fourth-quarter revenue outlook. abigail doolittle here with us for more details. this is much more than an ordinary chain.

abigail: this is what they're calling an entertainment complex. i have not been but joe said you were there, and you have the experience of going there as well. the mixture of winning -- joe: the results. abigail: chuck e. cheese for adults. joe: except without the animatronics, mechanical animals. abigail: in any case, they missed in terms of revenues. they're bringing down the guidance. they alluded to this on the third quarter call saying november and december were getting off to a weak start and this happens. they will be speaking at the icr conference tomorrow. scarlet: what was the likely problem here for dave and buster's?abigail the holiday is season because everyone is talking about the fact that this is the best holiday in a decade, so consumers may be shopping on gifts as opposed to experiences. interestingly, analysts are positive. if we happen to the bloomberg. jump into the gd function to see

the overall landscape of what is happening, first of all, here is the plunge down 22%. truly underperforming. the volume is above the 20 day volume. this is what i really want to point out. there are not a lot of analysts out there, but perhaps they are getting a bit of the past with the idea that the holiday season, and set of consumers spending on dave and buster's -- joe: everyone knew christmas is coming up so. abigail: i agree with you on that. joe: i am not even an analyst. abigail: if it was such a strong holiday season, perhaps there is extra funds that went away from entertainment. we will know more tomorrow at icr. that could be one reason why some are bullish. julia: forgive me. we talked a little bit about this but this is a new one on me. abigail: me too. this is very new. julia: actually goes? who is the customer base and can

you please that forward to about look is? abigail: i reach up to some of my colleagues and it turns out millennial's like dave and buster's. you can go and play games and drink and eat. answer.one also families. i know scarlet, you were saying you brought your son. however, there are some on wall street who do not like dave and buster's. about 175% since the ipo was finding this. julia: basically big kids. i have images now. [laughter] scarlet: forget the women and children. julia: move. my game. [laughter] julia: we did not predict that forward. meltdown, the market is already obliterating. analysts in 2018 targets. we have the charts you cannot miss next. this is bloomberg. ♪ loomberg. ♪

joe: what'd you miss? what'd you miss? the u.s. equity multiple is making a total joke of the 2018 estimates. days,like four or five the blue line, the bottom, or the teal line, that was your end of year outlook. nonetheless, we smashed through that. line, some other analysts. we are there. the purple line at 2800, that is what is left of city. even the strategists have to become bearish soon or revise and say it came out different than i expected. it does speak to have intense this rally is. the pop-up they could make ends of your forecast and we're already there. scarlet: four business days in.

joe: take the rest of the year off. i want to talk to you about -- about theant to talk focus we have had not only in the united states but over in china. do not missine is that at some of the old industrial shifts we are seeing, a.rticularly in china goo white line is the run-up we have .een this is normalized from december 2016. they added $101 billion in market cap over the last 12 months and it has held its own versus the likes of 10 trends and alibaba group there. these are all mutual points. they are attributing investments on online services and rising demand as the middle class expands. the messages do not look at the

new tech stocks, with the old ones that are adapting. quickly, i will show you another chart that i have on the valuation. it is trading at a valuation of 17 times reported earnings and it is tha at third. interesting comparison there. very what'd you miss? i think. scarlet: there's your opportunity because most people missed that one. i'm looking at commodities. they have been on a bit of a role. the bloomberg commodities index is the blue line and it made an 11-your-last week. 11-month-high, sorry. the big winner 2017. joe talked about it a lot. so what is not gaining here and commodities world? stocks commodities. look at the white line down there. we shaded it in red. little changes since december and they are being held back by too much global supply. coco is near a six-year low in

london. you cannot supply this. president trump also be speaking to the largest u.s. bombers organization in the next hour. next hour.

♪ julia: what'd you miss?

monday.re mixed this the s&p gaining for the fifth straight day. i'm julia chatterly. scarlet: i'm scarlet fu. joe: and i am joe weisenthal. if you are joining us on twitter, we want to welcome you to our closing day coverage. scarlet: let us begin with our market minutes. record highs here for the s&p 500 and the nasdaq. the dow turning negative at the end of trading. we have recovered from earlier losses. the equity markets meltdown continues in the new year. joe: another day, another record for the s&p.and i guess the nasdaq, right ? scarlet: that is right. we have nine out of 11 sectors in the s&p higher. two that the client, health care and utilities.but look at a few individual names. gopro down about 13%.

32%ad dropped as much as after the company hired jpmorgan to advise on a potential sale, according to person familiar with the matter. of course, nick woodman, the ceo, told selina wang that jpmorgan is gopro's banker. kohl's gaining better than 4.5%, rising the most in a year. strong holiday sales of the department store chain. it also raised its profit forecast and that all lines that the sale gains in the final two months of seven -- 2017. dave and buster's falling more than 1/5 of its market value. not all retailers benefiting here. -- what washe this?about caught up -- it got caught up and everything else. joe: there is a blog post that

says they own a lot of the ruble currency. julia: that is all it takes. scarlet: it does not matter what the original company was. if you say anything with cryptocurrency, the stock gets a bit. joe: nothing happens in treasury so we can move right on. julia: let us look at currency lands. i will show you the dollar. the canadian dollar and the euro-dollar, as well. relatively unchanged. you can see the dollar index stronger by 0.4%. i want to see what was going on in dollar. 86% priced for a rate hike when we get the decision on january 17. a lot of domestic banks are saying they expect a hike. we still have two filtering through the works. one of those saying not so sure about that. that is going to be one to watch. also the euro dollar falling for a fresh blow. it did tried -- a fresh low. it did try to get a 2017-.we also have italy paying for a general election, as well. that is putting a bit of weight.

i want to take a deep dive into the terminal. if it has got anything to do with the south korean exchange rate, the currency rates are at the highest level since october 2014 at we are questioning now we will see the 2008 hi. -- high. the nation's first interest rate increase boosted this. that is want to watch. an interesting chart i wanted to show you. this is looking at the hedging costs in some of the asian currencies. that premium dropping to the lowest level you have seen in almost five years. you have investors bullish on the long-term outlook for asian currencies.

i thought those also worth noting. joe: finally, on the commodities, oil and gold, not a lot of action but oil creeping up above or near the $62 level. still a lot of buoyancy in the oil market. gold basically doing nothing on the day. those are today's market minutes. scarlet: those are vast parking minutes. -- market minutes. the white house the center will out rich clarinet for the vice chair position, and advisor to pimco at the moment. other names floating are mohamed el-erian. both market experts and commentators have been floated, but for now rich clarinet has been ruled out according to people familiar with the matter. we want to stay with this topic dennis.ofring in jeff ubs who joins us from boston we will get to your emerging-market strategy for 2018 shortly. i do want to get your reaction first to central bank personnel

and the topic of fed vice chair. firm -- from where you sit, does it matter if we get someone who is experienced in the markets, who knows how to deal with markets firsthand as the fed vice chair? >> i think it doesn't matter. i think it depends on which policies were followed. we're assuming that with the transition of fed chair to powell, the policy will not change very much. i do not think the policies will not change for a much of what they would have been. i do not think the appointment will make a lot of difference to that. our general view is we are on a study fed tightening campaign here in 2018. we argue for many months that what is the big driver of em equities? not the short end of book or but the long and. we're -- and. we're watching the bond market a

bit more closely. julia: from the rate rises we have seen from the federal reserve from the impacts we got from the tax overhaul that the administration management has at the back end of this year, the weaker andn fact that i can have gone nowhere. do think that is sustainable, particularly in light of what we have seen? as he put out, that will ultimately be how it trades going forward. >> a lot of points to make. first of all, we think that equity move in the u.s. is primarily an earnings-driven move as opposed to being an economy-driven move area that is the first points. i think you hit the nail on the head. 2016, the election trade, you had a big move out of the year and that is what bond moves rose sharply. that limited any damage that we had when the bill was going through congress.

my view is the role on be much of an uptake in u.s. growth. maybe 0.2% in 2018. we still think the theme is the same. the dollar is going lower, perhaps not falling as much as last year. bond yields will stay relatively contains. you're right, you could see a nastier scenario for the em, but it is in line with what is going on now. joe: let us talk about some of your sectorial views within em. you said you like energies relative to materials companies. how come? >> the concern we have with materials is one of the in 2018s we came about was the slowdown in the chinese economy. it was supposed to happen last year and did not. will slow from 6.8% to 6.4%.

were has gone up in the last six months, 20 bucks a barrel. . it may be overshooting i the short term with oil prices much less stressed. the sector energy is much cheaper. that is really what is behind that particular trade. scarlet: plastic look at technology because it led the way in 2017 and that means the gains were concentrated in a couple of markets, whether was china, korea, taiwan, or a couple of sectors and big names. for 2018, you say technology is in a strong part of the cycle but not in a super cycle. what does that mean? quantify it for us. >> we do not think you have reinvented the cycle for the technology sector. our concern is in 2018, you may well start to see some reduction

in dram prices and memory prices, which would impact some of the hardware names. we are nervous about being aggressively overweight in technology in 2018 because it had such a good run last year. most investors appear to be overweight. you can get that happening but still if you keep moving, you have the two very different subsectors within tech, which makes it a more complicated sector. overall, we are not expecting technology to outperform the emerging markets the way it did last year. hence our usual rating. julia: obviously we have a lot of election risks coming up this year. brazil, mexico. do you prefer result in mexico? ce nations over turkey? explained upon this -- expand upon this. give us a sense of the wares and

what for here. election uncertainties are mainly in brazil and mexico. we will have an election in malaysia as well. the presidential election in russia. i think it is clear who will win that. i think most em investors will focus in terms of election risks on brazil and mexico. we like brazil a lot and we think it is benefiting right now . a sharp pickup in the economy to about 3% growth in 2018. , it the dollar being weak is still a carry currency. frankly, we do not see the markets pricing anything into the election right now because nobody really knows who will the outcomene what will be. the will be plenty of time reader in the year to factor in worries about the brazilian election, if that is a we need to have.

on the mexico side, it is not that we think the election will be a negative with the left wing candidate winning, it is more that we are still concerned about high valuations, vulnerable peso, high inflation, and so the risk that something unusual and negative could come out of the white house in terms of trade, nafta. in terms of the wall, of course. julia: absolutely. head of global emerging market strategies. thank you. president trump is taking the stage and beginning to ache at the american farm bureau's annual convention in nashville. pres. trump: all these rooms all over this beautiful building are packed but you are here with us, right? [applause] and i say packed with our people, so it is great. but thank you for a much, secretary perdue, for the kind introduction. there could be no better person to bear secretary of agriculture. a man known, trusted, and respected by your industry, that

is for sure. i'm thrilled to be back in the amazing state of tennessee. [applause] here, as the state slogan goes, we see america at its absolute best. and you are doing well, you're doing a lot better since november 8, i might add. [laughter] [applause] pres. trump: at the same time, it is true of the people gathered here today in our mers are the most incredible people and we're doing a job for you. you are seeing it like nobody else. tax, so much.at you're a big beneficiary and producing like nobody else so i want to thank you for that. [applause] why itrump: and that is am so honored to be the first president to address the in more farm bureau

than 25 years. what happens? where are the? where are the -- where are they? what happened? this is your 99 year. i was very disappointed to hear that. you understand. 100 is so much cooler, i have to be honest. so i will be back next year. i will come back. [applause] pres. trump: welcome back. haslam,o thank governor theg with members of tennessee congressional delegation. some of us came in and air force one. corker.bob bob?

alexander is here. senator pat roberts. thank you, pat. oh does he love the farmers. does he love those farmers. stand up, pat. [applause] pres. trump: he will come in. we're talking about a different subject and he is like, what about the farmers. that is good. that is why they love you. diane black. terrific woman. marsha blackburn. desjarlais. i love that name. thank you, scott. right from the beginning. chuck fleischmann. representative david gstaad, thank you david. phil roe.

cities -- zippy's so i do not to mention 15 to bow. duvalle. and state senate majority leader. i have done my job now, all right? i have done my job. did i do a good job? did i leave out anybody? i hope not.you're a struggle when you do that. you left out one person. for the rest of your life, they never speak to you. it is always very dangerous. thank you very much. i'm also thrilled to see one of my good friends and early supporters, and that is tom. i just said presidency tom nasa. i want to thank the american farm bureau. i said i was going to mention you and i am going to mention you because you have been there for the beginning and that tractor that you drove during

the inauguration was a very special moment. it was a special day. from that day on, we have been working every day to deliver from -- for america's farmers just as they work every single day to deliver for us. we know our nation was founded by farmers. n byindependence was wo farmers. our continent was paved by farmers. so true. made of theave been farmers. throughout our history, farmers have always led the way. are you surprised to hear that, farmers? i do not think so. you have led the way. great people.

the men and women in this room come from different backgrounds and from all across our land, but each of you carries the same title that has been proudly borne by patriots and tiny ears, inventors and entrepreneurs. proudly, of, very american farmer. thank you very much. [applause] you embody the values of hard work, grits, self-reliance, and sheer determination we need to make america great again. has anybody ever heard of that? [applause] pres. trump: and we are seeing already -- it is very early, 11 months -- the incredible results. we have created more than 2 million new jobs since the election. substantially more. economic growth has surged past

3% on a something that was not supposed to happen for a long time. we are way ahead of schedule. unemployment is at a 17-year low. by the way, african american unemployment is the lowest it has ever been in the history of our records. great. [applause] pres. trump: i told you. hitting onerket is all-time record after another. boosting your 401(k)s and retirement accounts for every day americans. everyone happy with your 401(k)? if you are not, there is something very wrong. i had a policeman in new york, to me and say, mr. president, -- do we love our police and our uniforms? he came up and we're taking

pictures at a nice event. he said sir, i want to thank you for my 401(k). i never thought in terms of this. 39%aid my for a one k is up . it is so good, my wife thinks -- do not forget, this was in nine months when i met him. my wife thinks i am an investment genius. thank you, sir. thank you. stocks, you on the are not doing that good. that is not doing well. do not tell your wife that. the american dream is roaring ink to life we just signed the most significant tax reforms america has seen. [applause] ofs. trump: it is a total $5.5 trillion in tax cuts with most of those benefits going to working families, small businesses, and food. [applause]

the competing party wants to raise those taxes. you cannot let that happen. we worked too hard to get them. businesses across america have already started to raise wages, and more than 100 companies have already given bonuses and other benefits to hundreds of thousands of workers as a result of these massive tax cuts. you see it happening every day. today they announced more. $1000, sometimes more per employee. hundreds of thousands of it employees. overall, millions of employees. we have over one million workers that have already received a tax cut bonus. think that nobody even thought when we made the bill nobody thought of that. at&t, another one, another one and they started copying. the ones who didn't get it,

everyone is saying, where is mine, so they will have it. frankly, that worked out fantastically well. even before the february date, we will see a lot more money in your paycheck. every democrat in the house and every democrat in the senate voted against tax cuts for the american farmer and the american worker. republicans came together and delivered historic relief for our farmers and our middle-class. it was not easy. we cannot let anything happen to that. do isrst thing they would get rid of it and raise up your 50% are 60%imes by higher than what you are paying right now. we cannot have that.

that would undermine everything they have done. we cannot let anything happen to what we are doing. under the really large tax cut, i was calling massive, sometimes they say huge. not a bad one. huge tax cut. americans will be playing less in taxes and keeping more of their own money to do what you want. you can save it, you can spend it. it is all good for our country. lower tax rates, nearly double the standard deduction and the child tax credit. [applause] pres. trump: it is a big thing. law, the typical family of four earning $75,000 will see an income tax cut of more than $2000 each, slashing

their tax bill in half each year. american businesses are going from the highest tax rate in the .eveloped world last year, the highest in the developed world. inc. of it, to one of the most competitive this year, from 35%, which is unacceptable, all the way down to 21%. on top of that, you have a lot of advantages. small and mid-sized businesses will receive massive tax cuts. a lot of the folks in this room. they will be able to deduct 20% of their business income. all-america businesses, including american farmers, will be able to deduct 100% of the

cost of new equipment in the year you make the investment. that is something that is tremendous. that is something that i think will be the sleeper of the bill. you deduct it all in one year as opposed to over many years. that is a tremendous thing. from now on, most family farms and small business owners will be spared. it really is the word punishment. you can keep your farms in the family. [applause] pres. trump: [laughter] that was a tough one to get. that was a tough one.

you love your families or you standingbe for that. not going to help you much, going to help them a lot. and what has been happening is you have a farm and it does well, but its value is more than the income would justify. what happens is families were forced to take these farms and sell them out a fire sale price. they end up losing the farm.it will not happen anymore , folks.it is not going to happen . congratulate you.

that is a tough one to get a proved. of all of them. in every decision we make, we're honoring america's proud farming legacy. years of crushing taxes, crippling regulations has never been worse than it was before i got here. it was horrible. corrupt politics left our communities hurting, or economy stagnant, and millions of hard-working americans completely forgotten. but they -- guess what -- are not forgotten anymore. no more. i used to call them the forgotten men and women, and when everyone saw them coming into the polls, the other side that had we get some of them. they were unbelievable. they are forgotten no more. remember that, you are forgotten no more. we are fighting for farmers --

thank you. [applause] pres. trump: and we're fighting for our country, and for our great american flag. we're fighting for that flag. [applause] we want our flag we want our flag respected. we want our national anthem respected also. [applause] [chanting u.s.a.] pres. trump: there is plenty of space for people to express their views at the protest, but

we love our flag, we love our anthem and we want to keep it that way. [applause] pres. trump: as we put money back in the pockets about our americans, we are putting an end to the regulatory assault on your way of life. indeed.n assault, for years, many of you have been endured burden us finds. an army of regulators at the epa, fda, and countless other federal agencies.is that right, by the way ? that is why am truly proud to report within our first 11 months, my administration has canceled or delayed over 1500 planned regulatory actions or more than any

president in the history of the united states. [applause] we have cut 22 regulations for every one new regulation. think of that one. you remember when i went -- when here in talk different places and said for every new regulation i would cut one. we did better. one and we cut 22. instead of two, it was 22. we are very honored by that. if the democrats got their way, they would reinstate every single regulation that we are cutting. and adding many more burdensome rules that do not do anything but hamstring our economy and burden our people and farmers. my administration is in the process of rolling back in rule that hit our farmers and

ranchers very hard. the terrible waters of the united states rule. you know about that. it sounds so nice. it sounds so innocent. it was a disaster. you know that. it sounded so good. the title is so beautiful. that is where it stopped. i have to say this, when i signed it i said i'm going to be killed on this one. you know what, people came to me and they saw me and they were crying. men that were tough and strong, women that were tough and strong, they would see me with tears coming down their eyes because i give them back their property and farms. they could use them. [applause] we ditched the rule. [applause]

pres. trump: we're streamlining regulations that have blocked cutting edge biotechnology. julia: we will leave the president talking there. he is addressing the farm bureau federation's annual conference in nashville. he is the first sitting president in 26 years to do so. he has made some comments about the taxs impacts of reforms. how if they were democrats, they would be raising taxes rather than flopping them. think made a big focus the impact of the regulations for the agricultural sector. usdae joined by a reporter. this is the biggest body

the cultural sector. halpenny is the audience? >> this is a friendly crowd. it is very republican leaning. have a great scope but if you are a democrat you will join another organization. joe: fairly standard trump themes. , deregulation tax cuts, all that. from the from the perspective of the farmers, is this on their mind these days? willow bay the interested in the steering -- what would they be interested in hearing most about? >> tax>> reform is popular. deregulation is popular, especially the idea some of the folks on the epa who visit farmers and tell them what not to do. you will not hear him talking about trade. this organization has been very

supportive of the north american free trade agreement. you do not hear him talking immigration -- immigration. a lot of farmers say policy toward migrants would choke up their worker supply. if you have a reason to want to like someone, you want to hear those reasons and that is what they are sharing today. scarlet: let's talk about nafta. this crowd would be supportive of nafta. by and large, it has been beneficial. is that a fair assessment? >> it is very fair. canada, aat with trade surplus, and with mexico. he saw issues with corn prices earlier this year because they're going for other customers. they have gone back to number one, but those pensions, that has altered -- agriculture nervous. if there is one thing that could make this audience turned sour, it would be a withdrawal from nafta. scarlet: combat -- julia: combine that with cutting

crop insurance payments. quite frankly, stocks have not participated. it has been a challenging period to cut insurance payments. julia: they really have -- >> they really have not had good times. than half ofess previous levels. .ou have to be looking ahead joe: one of the things that make talk about cutting the estate tax -- oh, we have a chart here. scarlet: this is the commodity spot index in blue. languishing is a good word for it. >> that is what is going on. if you look at the closing price for corn at the end of 2017, it was down two cents. not a way for a traitor to make

money or a farmer to make profit. joe: the estate tax. critics of eliminating or changing it say it is just a tax cut for the rich. others, they always point the farmers. what about the family farmer that will lose the farm because it is worth more than the threshold. whatever. how accurate is that in terms of a major issue? >> if you look at the number of farmers affected by the estate tax, you can count on -- count them on maybe two or three hands. it is very little. scarlet: but they're all there in the audience. >> they probably are. it has been a big issue for them. you have to understand it not through the idea of reason for a motion. a lot of farmers might even if they are not affected by the estate tax have to plan for it and they still have the sector having to break up their lands. this is not selling acids or a hedge fund this is getting rid of where you wanted your kids to grow up. because of that, this has been a big issue for agriculture, even though it does not affect them financially and anything

proportional to what you think you would see. something that is spreading is perhaps we're underpricing the benefits of deregulation. this is something the president had reiterated on a number of occasions in the speech here. to a expense is deregulation played into the hands of what we're seeing in the agricultural sector? cuts for it farmers, deregulation will play an important role in terms of business planning and the idea that you will do what you want to do with your land. allows you to buy that john deere tractor but it has been going on for several years. he spoke to me about the environmental protection agency. for most of these farmers, that is the interaction they have with government officials. to what extent is that being held back by the president to allow him to do what he wants to do? >> if you're the local epa official dealing with these

farmers every week and you know the president does not have your back, are you going to go out there and do the paperwork and go through the trouble? that is the question being asked across the u.s. every day. julie made a point to say this is the first president to address the farm bureau in more than 25 years. this is hugely important for this audience. how much time have president trump will he spent talking about and to farmers? his nomination of agriculture secretary sonny perdue was the last one on a long line of nominations and it's ago while for him to get conference. >> he was the very last and there are still tons of unfilled positions at usda. this is what i can recall the second time he has spoken to the administration. it is interesting because even that is more than what a lot of tosidents give attention agriculture. this is his face and has to acknowledge their there.

on things like nafta, their votes can be shaking. julia: what about subsidizing in terms of campaign contributions. ? >> it may not be one of the largest ones but in terms of lobbying, it is surprising. they spend more than the defense industry.the american farm bureau federation is the biggest servicing company after monsanto. these folks have very organized operations. you see single commodities like sugar in their government program spending hundreds of thousands of dollars on lobbying and that is because of the importance of the federal government. these guys know where the checks get written and they write checks too. scarlet: you're a fountain of knowledge -- julia: you're a fountain of knowledge. i love that. scarlet: president trump is giving them what they want to hear, as well. thank you. coming up next, apple addiction. some major shareholders are

pushing the tech giants to investigate if their products are causing a public health crisis that could threaten children and apple's bottom line. this is bloomberg. ♪ g. ♪

julia: apple addiction to large shareholders are cae voicing their concern that it could be fostering a public health crisis that would hurt children and the investors' bottom line. can't help feeling like this is a high-class problem. people of our products too much. to what extent do you think this matters to apple at the moment? saying we do have certain restrictions in place. what is an issue here is the

amount of time children spend on their phones. the scaling of it. what apple is saying at the moment is parents are able to turn features on or off. it does not say for example, you can only spend 90 minutes a day on a smart phone. that is the sort of thing these investors are looking for.one thing i think is wepping back a little bit is have seen complaints about the behavior of big tex from governments -- big tech from governments or agencies. people without something in the game. that is the kind of seachange and people addressing these issues. scarlet: it is interesting to see investors urging companies to make changes like this. usually financial, personnel, are operational changes. my question to you is why apple? couldn't or shouldn't google, facebook, snapchat, twitter,

samsung, which makes andrew phones be held just as responsible? alex: i think they are targeting apple first because one point of rightist it is socially responsible and that is the standard tim cook has tried to play from his version of apple. equally, apple is a company that makes its money from hardware. two thirds of its sales come from the iphone. that is not the case with facebook or google or any other companies you mentioned. for them, it is about engagements. they want people to be using their services for as long as they can on any given day. the argument these investors say is that is not the case with apple. joe: it still seems kind word to me that this is an investor issue. can you think of anything similar you have seen ran investor takes on something? alex: you do often see activists

take a small share our stake in i certainly cannot think of an example where someone has really -- really is in the business make money, not just a voice. that certainly is something that seems new here. joe: the they claim their demands would be better for the business or do they make no pretense that this is about improving the bottom line? is abouthink ist s apple's business. they are saying this would not damage you, this would help you. one risk is the fact that apple growth at the moment is coming from services. it has accelerated more than any other. i do not know how much of that is coming from children, it is impossible to tell. that might be the only risk in the whole spectrum. julia: you still have to restrict it down to the 90

minutes. you still have to buy the problem -- projduct. thank you so much for that. you are alleging the splash in the headline is better for the investors making these comments them for the company themselves. joe: it is a good point. it is very cynical. scarlet: there was an article in the journal that said they're looking to draw attention to a fund raising money for that. companies that believe it can be better corporate citizens. mib the first step toward that. julia: 30 go. scarlet: -- julia: there you go. scarlet: we will tell you about a marijuana focused etf that is really lit. julia: 90 minutes on your phone is more than enough. this is bloomberg. ♪

scarlet: the largest marijuana fortune is rolling in green. julie: gnome or ponds. -- ns.: no more pu scarlet: they have been on a high. let us ask stephen hawkins. great to have you here with us. clearly, there's a lot of confusion right now over the status of marijuana. medicinal, recreational in the united states. let us begin with the legal

landscape and canada, where your etf is listed. the federal government intends to legalize recreational marijuana by july. when he before then and what does it mean for your etf? >> much like in the u.s., there are different governments but federal is that overriding regime. medical marijuana has been approved for many years now so we have many medical marijuana producers and canada. it is those reducers that will be providing the marijuana underlying product to the recreational once it comes along. given the undertaken to how it will be distributed at that point. joe: how is the industry structured? vertically integrated green have farmers in logistics and retailers, or is it all different players?

>> it really is governmental controlled but you have one toity, which has a license produce, cultivate, and distribute from there, who they distributed to under medical licenses, they can sell it to the individuals. once it becomes recreational, -- theyl create the will be fixed stores controlled by the province themselves and that will be the only place they can buy recreational marijuana. julia: predictions for just how quickly this will grow. with his alike even over the next 12 months? >> the cannabis sector is on fire. we raised a most $800 million in the past eight months. alone, we are several analysts that will be well over $1 billion by the end of this month.

there was a new etf that came online in the u.s., which has many of the underlying holdings we do on december 26. that added 11 spotlight to the sector, as well as the california recreational approval that have come online. there is so much spotlight on the cannabis sector right now. we have no idea, but we are ready for it. julia: even the last week, we have seen uncertainty in the controls we have a federal level and state level and how they choose to operate within the confines of what the federal government has now decided. retracting the coal memo. how do you think that is going to impact the environment? >> there is a lot of uncertainty. it has been great for it -- gray

for a long time but there have been degrees of white and black. they are taking steps to make the black significantly larger than the white. california coming on line, it is , but willalifornians be distributing it how to produce will make money and get a steak they ever wanted to. there are so many uncertainties. the bank they have to deal with, they are dealing with corner store credit union. joe: is the regulatory framework still so far apart and there will be many years before conversion that just getting counted of for now is enough? >> many of the companies we are invested in our canadian-only companies that they have some minor operations in the u.s..

they have been trying to grow and invest more into the u.s. but they're under the guidelines of the coal memo there. now that is all up in the air. even medical is up in the air. it is really a gray area. our companies that we are investing in, they'll coal memo does not affect them because they're canadian only. canadian producers. there are active in that marijuana space right now and they're building a production to be ready for recreational approval in canada. they are not concerned too much in the u.s.. scarlet: it is a way to trade that marijuana industry right now. how much of your investor base is counting on that growth to the united states versus the space in canada?i cannot talk about the investors are >>. primarily the investors in our canadian etf part canadians. extent do you think the canadians now will

benefit from the uncertainty in the united states? if you're saying i really want to get involved in this, there is great uncertainty in canada, we will go there. >> absolutely. canadians can very easily invest in u.s. etf, but americans .annot it has always existed in the etf world. our investor base is primarily canadian. the canadians themselves are very optimistic for the canadian marijuana -- julia: so much of the features. scarlet: is why the growth we have seen in canada is why they have high ambitions of a can be done in the united states. >> some of the numbers from colorado and state like that have already improved recreational has been astronomical. the state revenue generated has been great. we see that forecasting into canada and we see it as very popular. julia: that is why they will

fight the federal government. ofrlet: president and co-ceo etf. thank you very much. it is now time for the bloomberg business flash, a look at some of the rig's business stories in the news right now. a stock sale could come under scrutiny from the fcc. the transaction to place in the fourth quarter of last year after the discovery that modern processors are vulnerable to hackers. intel says the move was part of a prearranged plan. toyota wants to become a leader of the driverless car economy. . toyota also announced several partners in a new driverless delivery economy, including amazon, uber and pizza hut. bill gates is calling on private companies to focus on public health. speaking at the jpmorgan health care conference in san francisco, gates said "industry has the experience and capacity necessary to turn this into

viable products." almost $12ions that million on global public health projects over the past five years. and that is your business flash update. joe: coming up, what you need to know for tomorrow's trading day. this is bloomberg. 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. alisa: you are watching bloomberg technology. here's a check of your first word news. the washington post is reporting special counsel robert mueller will likely seek an interview with president trump. the president is reportedly

comfortable with an interview, believing questions well end wi th alleged collusion is with russia. his legal team is discussing how to set limits. believing questionsoprah winfret considering a white house run in 2020. winfrey's speech at the golden globes fueled rumors about her interests, but after accepting the lifetime achievement award, the billionaire media mogul says she does not plan to run. the united states is ending temporary protected status for immigrants from el salvador. said thenielsen humanitarian crisis stemming from the 2001 earthquake no longer exists. protections for tens of thousands of salvadorans expire next year. pressure cap and after a high pe