, being held on 17 counts of murder he is accused of opening fire inside and outside his former high school. the 19-year-old is an orphan who participated in paramilitary drills with a white nationalists group. 17th intimatethe of gunfire at american schools this year. was asked about the shooting, specifically how the u.s. asked other countries well having aence problem here. >> i'm not going to answer the of what on the heels

happened. in mying to keep them thoughts and prayers and we can talk about it later. >> the white house is threatening to veto a bipartisan immigration proposal. the white house says the undermine and keep economic growth. south africa's new president since -- says he will try not to disappoint the people of this country. jacob zuma resigned wednesday.

basically have become a servant of the people of south africa and i will seek to execute that task would humility, faithfulness, and dignity. >> he also said one of the top priorities -- telling and opposition leader that he prefers to improve the lives of ratherfricans on hope than grandstanding. global news 24 hours a day, powered by more than 2700 journalists and analysts in over 100 countries. ♪ >> live from bloomberg

headquarters, we are 30 minutes from the close of trading here in the u.s.. stocks headed for the best five-day run since 2011. >> the question is, what you miss -- what you miss what did miss?ss -- what did you forhe senate showdown immigration is underway. mitch mcconnell play hardball. a stimulus is coming, but it is not just from the federal reserve. george kurtz joins us in the next hour. five-dayts the best

run since 2000. we have the dow now at 1.3%, just breaking it down to see what is really driving this. sector 7/10 of 1%. that one only higher by 3/10 of 1%. >> in today's events, you have theing down up by 15% from moving average. the selling is a little bit more than average.

simply can'tollar catch a break. in the meantime, what would you miss? volatility is settling down, but it has created some interesting dynamics. great to have you on the show, samuel. talk about some of the interesting dynamics you have seen between markets. >> having me. what we have seen over the last is crosscan a half market dynamics. for instance, something that has never happened before and -- happened before.

the s&p 500 having a higher volatility is something we have historically never seen. >> when you say you have never seen it before, what is a tight about the nature of the market right now? tells us about the nature of the selloff we have seen over the last week and a half and how it has been concentrated or led by products -- >> it tells us about the structure of the market and i howk specifically about trade volatility on the s&p 500 is leading the market. the interesting facets , you did not get much help from the bottom.

treasuries did ok, but they do not particularly rally. in fact, i'm looking at a chart here of a classic portfolio. 60% equity. a pretty steep drawdown. one of the most intense we have seen in a long time. if treasuries are not going to work, how does that change one's thinking about portfolio exception. that is very important. i think what we are seeing is the change in correlation between bonds and equity is leading to managers to reassess how they are building their hedge book to their risk book, selloff,ou see bonds you are seeing them forced to on the s&p and i think that is one of the factors on the rise and volatility.

>> you also looked at the relationship between the vix and credit. we see the ratio here and i'm looking on the chart. a big spike that we have not seen since 1990. >> it is telling me that what we are seeing is financial market volatility which is not being translated into the economy. >> it tends to be the fact that credit spreads are more reactive to shrew economic volatility over the name turn and less to short burst of risk. i think what is interesting is that since the crisis, people have looked to credit instruments to hedge equity risks. what we are seeing is a breakdown of that relationship. is no longer a hedge

instrument. >> you said the wake how that people are hedging their reassesss, you have to what value your putting at risk or calibrate your exposure is a proportion of that. does that mean as we go through the adjustment, people take less risk? what scarlet is saying, lord volume in particular. -- lower volume in particular. they still have the same value at risk budget, so if volatility of their asset doubles, they

have to reduce the exposure they have indoor portfolios and that takes a long time to come back to a more normal scenario. cow volatility and i think that will impact. >> we are still dealing with the ramifications of the bottom spike. thank you for joining us. up, the company expected to keep on booming. this is bloomberg.

>> applied materials reported

its first quarter earnings yesterday. if bp highest estimates. it shows the electronic industry remains bullish about future demand. let's head over to bloomberg's emily chang. i'm here with applied ceo gary dickerson. you almost doubled sales since 2013. how long has that run continued? this is really the most exciting time in the history of electronics. transportation, health care, entertainment, retail. all of those different areas. that wille foundation generate trillions of dollars in economic value is applied sources.

they are really firing on all cylinders and it is never a better time to be a shareholder. >> how long do you think you can keep up that kind of growth? >> if you look at technology transformations that are happening, for the last three years for economist vehicles, there has been $80 billion invested in changing transportation. all of these industries will change in fundamental ways. processing,nguage eight ships and everyone of those devices. the silicone content is increasing as we go through the transformation. our business is fundamentally stronger than it has ever been in if you look at the trillions happening,of changes i've never been more optimistic

about the future i have today. >> a long time worry is that when things are this good, there could be supply crashes like you have seen in the past. should they be concerned? >> it comes back to fundamental changes. everyone remembers pc products back in 2010. you have a computer waiting for the upgrade on your operating system. then we went to social media. you have billions of users, everyone is carrying a camera in the pocket and now you are going to an even bigger disruption in the overall economy with transportation, health care, entertainment, retail. all of these things changing in fundamental ways. industry is going to continue to grow significantly over the next several years and what we are seeing.

>> but no supply issues? supply will be ok, but certainly demand. if you look at profitability, it has never been better. again, i think the whole industry warming healthy. the other thing is, i believe ai and the data are the biggest changes in our lifetime in that battle for leadership is the biggest battle. that will play out over the next several years, but no matter who ends in that war, applied materials sits at the foundation. we are providing information for new technologies. for us, the future has never been brighter. yourselves as an indication for demand for personal products. --

at theou look electronics industry as a whole, over the last four years, our percentage of total spending has doubled. andent is increasing inflection is also increasing. >> let's talk about china. had a you -- how soon do chinese companies could become rivals to the current giants in the industry? has been inaterials china for over 30 years. we had a very long history. share is very strong. last year, revenue was around $3 billion. china has the strategic focus. they want to have security in their data centers, so they will continue to invest some of that if you look at where they are investing they are

more in trailing geometry and of leading geometry. all of the smart devices come that is where the majority of domestic investing is going right now. if you look at leading-edge technology, i at the analogy of korea and japan back in the 1980's. in that transition, it took many years for korea to grow their memory business to leading-edge. i think that is many many years before happens in china. we do think investment will continue to go up, so we don't see any hockey stick happening anytime soon. applied ceo, gary dickerson, great to have you. thank you, emily chang back in san francisco. has objected bipartisan immigration plan that the president attacked this amnesty.s a giant

bring --ontinue to next up is the gop backed plan. of course, you have a problem with the house conservatives because they think it is too soft. the struggle continues. chuck schumer speaking on the floor of the senate. let's move on to the stock of the hour. after some rising it underwhelming. on the plus side, revenue was up 2%. 60% and per share fell missed estimates by a pretty wide margin. on the plus side, the company even be estimates. that is how the numbers should

doubt. chartsing at the longer cut in half, what is the story here? the business is being done has changed because a lot of the companies that tripadvisor contracts with our operating -- our operating their operatings -- are their own portals. the other problem is the migration to mobile because the ad rates are lower on mobile. turndvisor is trying to itself around and spend more on brand advertising, specifically on its non-hotel segment which includes vacation rentals, attractions, restaurants. they have a look on the bloomberg on the revenue growth. the non-hotel segment is the orange line and the hotel

segment is the white line. they want to become more reliant on the non-hotel segment. former south african president jacob zuma resigning yesterday. what does that mean for south african markets and the economy? miss.t you can't this is bloomberg.

>> the volatility scare of last week it is starting to fade. things are starting to return to normal if you look at the vix future curve. the green line is what we are seeing now. the spread between the second and -- is coming down dramatically. a normal curve start slow and then goes higher. the arch line is what happened

the week ago when there is massive stress. you can see the huge spread between the front. it is coming dramatically because of partly technical reasons. again, things are starting to normalize, although we might start to see a new normal when it comes to the vix as well. this morning, speaking of rates, we got -- the empire fed survey asked what is up with business and a couple things that are interesting. this is prices paid and prices received. as you can see, most are trending up. seew is the spread and you first priceid

received is at the-years. one survey of manufactures in new york, but it speaks to something a little out there. the question on whether companies will be able to pass on higher prices. >> it is one little data point. >> yesterday, we were talking about the recognition of the former south african president. all that optimism about his replacements, if he takes the and if you're just looking at the ratio here, ratio has not the been as expensive as it appears and actually, despite all the optimism, if you look at here

1%.y, it is only up all the currency is benefited, equity is black. you have to bake that into the take here, but not everyone is that optimistic. yesterday, we sparked -- spoke to mark schroeder and asked him how long be honeymoon. as for south africa. >> listen in. >> he certainly has the confidence and the support of the community within south africa and internationally. him somehey will give fair amount of leeway, so things will look fairly positive. >> fairly positive for a bit and then reality will set in. >> the market close is next. if you are short, it might be painful for you as well.

the s&p gaining more than a percent. from new york, this is bloomberg. ♪

retail. under pressure like never before. and its 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. leaving every competitor, threat and challengretail. euvered. 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. [applause] >> major averages are in the

green. the dow up more than 6%. >> if you are tuning in live on twitter, we want to welcome you to our coverage. >> let's begin with our market minutes. u.s. stocks closing after session highs. more than 309 points. the s&p gaining 1.2% and if you look at the change in the year dow up bynow have the almost 2%. with flash is a good way to describe it.

let's talk about the individual names. a warren buffett hopes of transformation there. he moved in after the company pledge to cut u.s. health care ands, or brookshire jpmorgan did. >> up by 13%, management took a new position and find almost 10%. isn't this a crypto play as well? exactly. than 4.5%. by better the maker that carries most of the world internet dating gave a bullish forecast. andus are the shares lifted

promised 20% earnings growth this year. the earnings growth this year by keyway can iron out aircraft programs. >> let's take a look at the government bond market starting with the action we saw in the u.s.. not a whole lot of action here. it yields up a little bit. up notth african 10-year totally to mother was buying across south african assets all day. i will have to go back and check that number. >> noun currency land in particular, i want to show you what is going on. the yen actually rising to a

fresh, 18 month high. strengthening not to abruptly. climbing.y dollar the dollar cannot catch a break. i want to head over to what is going on in asia as well. bounced this week after falling over the previous two weeks. we have seen it in eight years, interesting to see what is going on. the asian currency system leading some of the gains. a stronger-than-expected fourth-quarter.

i'm also shown you what is going on as far as indian currency as well. >> let's take a look at the commodities in there you see the risk spilling through here. barrel now.ion per up.el and zinc those are today's market minutes. >> for more, let's bring in cameron price. julia highlighted that earlier. you would think that with the prospect of higher inflation, that would be a good thing for the u.s. currency. >> theoretically, it is bad for the currency to maintain a stable real rate.

more generally, i think the issue is for a given level of to pilehey are willing in an finance america's current account deficit. changederceptions have radically over the next six weeks or so. eventually investing will require a higher rate in clearly -- to fite's always a model the price action. then, if thisnt theory is correct, the compensation you need, at what

point does that kick in the u.s. dollar. >> that is the million-dollar question. less probably going to be than that, but clearly on the basis of history, given the external deficit. >> walkers through the big picture. a weekovery we have seen and a half ago it does not seem to be falling. the story was wage pressure, rate hikes, inflation,

goldilocks coming to an end. a hottest, we've had cpi report. several data points would confirm the old narrative and no back down in rates. the above phase question mark >> i think it is a phase at the tip the top. 5% don't happen very often in the affected did on the heels of a year when the total return when up everything a month would suggest there was some exuberance. then perhaps that, you overshoot a little to the

downside. imagine you shop for dresses or suits or something in your favorite shop says we are going might a percent the next day and the next day. when they say they are not going to cut the prices anymore. interesting to buy and said stocks. we are at the risk of the panic and fear we had. but we were saying at the beginning if you look at the breakeven, to what extent is the

inflation? that they are would be that is inflation or really a concern, investors would want to step up and by protections. context of the previous couple weeks we had. it is going to be an interesting study. basically, it reflects weakness for security. if people are worried about inflation, they are not demonstrating it. the rise in yields is by real

yields going up, which would excitement or positivity about growth or concern about supply. valuations in equities are back to help the corrections. >> indeed. >> bloomberg's global macro strategist speaking there. >> cbs shares rising by almost two point 5% -- 2.5%. ae consensus estimate was for dollar revenue.

when you go through the business line, the only business line that is disappointing when it came to revenue is local media. otherwise, publishing, cable networks, entertainment all doing better than expected. >> there was a great moment there. we do have breaking news there on the senate. the senate just voted down the grassley amendment that was supported by the white house. every immigration plan rejected. we will give you all the details next.

attorney representing a 19 your old florida man accused of killing 17 people at a high school says their client is sad and remorseful. say that nikolas cruz was arraigned on 17 counts of first-degree premeditated murder and fully aware of what was going on. >> he is a broken child. of this community, .he feeling i feel horrible for these and mr. cruz feels that pain. >> he is accused of opening fire

wednesday. for governor rick scott says he will sit down with state leaders and work on how they can make sure people with mental illness on able to access firearms. the government spoke to reporters today. >> we are going to have a real conversation. out of the make sure that a parent knows their child will be sureand how to we make individuals with mental a mr. not touch a gun? illness do not touch a gun? house rejected a to provide a path for dreamers.

they describe the proposal of -- as having the most bipartisan support. the power company could begin shutting down as soon as tomorrow unless it receives a $1 billion loan from the government. it will allow the authority to keep running well it waits for the trump administration to release disaster recovery loans approved by congress. global news 24 hours a day, powered by more than 2700 journalists and analysts in over 100 countries. i'm mark crumpton. this is bloomberg. >> the senate hitting the wall for 60 votes, failing to advance any immigration plan today. joining us from capitol hill with the latest. chuck schumer tweeted that this

that trump would stop torpedoing bipartisan efforts. talk to us about what got torpedoed. >> there were four votes in the senate. all of them ended up failing. none of them got the 60 greatest there were to bipartisan buddy so-called common sense coalition . the senate got 54 votes. there was another one by senator thatmccain from arizona got 52 boats. have issues -- they would billion for$25 trump's builder wall -- border

wall. 60 senators opposed it. republican leaders are not going withoutrt a bill .resident trump's support democrats don't want the legal immigration cuts. we are stuck. >> you put it perfectly. when you look at the different options here cap there are certain aspects in clearly given the few votes, we have a real problem here. what next? what, if any of this is salvageable? >> it is far from clear what

happens next. i think president trump is the key. he has to support a proposal that can get more than 39 votes in the senate. seen, a daca fixed border security. president trump has said he wants to protect the people who were brought here as children and allow for 1.8 million of them to gain a path of citizenship. be sliced and away the present trump supports, then the senate can get 60 votes. attached these has dance to eliminate sponsorships, which democrats said they are not going to allow. if you do that, they will want a solution for all 11 million

people in the country illegally. >> is there any mechanism to get the two sides closer? the democrats briefly tried to use the budget, but went back on that pretty fast. could they just not have a deal? isthe only forcing mechanism this deadline that president , after which about 700,000 young people who are currently protected will lose their status and become eligible for deportation. dhs has their names and .ddresses there's a very real threat that if the march 5 deadline comes or extends to june, these people could be eligible for

deportation. the prospect of ice roundup young children under in all republican government might persuade the white house and republican leaders in the senate to aouse to move closer potential compromise. that is the only forcing .echanism forissue is too explosive republicans to negotiate why they feel like there is a ransom on the other side >> from capitol hill with the latest on -- the congress is >> coming up, more from the markets jury did is bloomberg. -- more from the markets.

this is bloomberg.

>> the spike in volatility has not just affected by -- jason began by asking about the returns of volatility. >> generally, we have more deals when the markets feel good or are confident and prosperous for their own business. you seldom by someone else's business is your business is having trouble. business confidence remains high. you'll probably see more activity. >> the one area you are personally interested in his china and when it comes to dealmaking, certainly there is a

lot of activity and interest right now. are you a buyer here? always a buyer at a certain price and we are not a buyer at another price. [indiscernible] we have sold both of those companies and what we thought were good properties. if they want to sell, we will take a look. $800 billion of management under blystone, almost double the now. starting things for it you keep your own culture, that is an it is best. it is hard to buy things -- fun

things to buy and be the best in .he world thatverybody operates like on ourdon't compromise core principles. if we find things in an area that would be of interest to us, like we do with our secondaries business, it ends up growing like three times in three years. -- be a special thing. i think the opportunities for us to start things and grow them which is basically what we have done, 60% of those products we

offer to the investment market, didn't exist. publics ago when we went and there's also going to be changes. thatnk it is inevitable there will be access for the retirement market to our products. quite when that happens, the scale of what we do, just doing the same things is limited by our ability to buy great investments, not by capital. i never worry about getting activities, i always worry, can we be the best performers in the world and everything we do with absolutely minimal risk. >> ceo speaking there. up next, the economy is getting

a dose of stimulus. this is the bloomberg.

mark: the senate this afternoon rejected for separate immigration proposals, further delaying the chance to provide 1.8 million dreamers a chance for citizenship. to 45 on as 54 bipartisan measure to address daca, six votes short of the 60 needed to advance the bill. chuck schumer did his displeasure with the outcome, saying that the president should stop torpedoing bipartisan efforts of a good bill. sake human error caused a collision between an amtrak train and freight train in south carolina earlier this

month. the national transportation safety board said the switch was up in the wrong position at set passenger train, and the crash killed two and injured more than 100. the final report is expected later this year. european union foreign minister is in bulgaria are meeting on talks about the north korean nuclear threat, and the syrian conflict. we are preparing for the future of syria and the region. first of all, from an italian point of view, the war is still it ison in the country -- still a dramatic one and we aim at mobilizing support for syria inside the country and the neighboring countries. mark: she added that partners are committed to putting strong pressure on north korea for what she calls a tough sanctions system.

the u.n. commissioner for refugees is praising turkey's generosity and hosting more than 3.5 million refugees from syria. in a meeting with turkish president, he expressed his for turkey's hospitality towards syrian refugees and its policy of inclusion by providing access to education, health care, and employment. global news, 24 hours a day, powered by more than 2,700 journalists and analysts in more than 120 countries. crumpton. this is bloomberg. let's get a recap of today's market action, u.s. stocks rising, the best five-day run for the s&p 500 since 2011. so much for market volatility. the exact volatility is in the upwards direction. joe: up volatility, the good kind.

progress has a plan to appease everyone, provided for military and domestic spending to trillionsd up of dollars. by more, we are joined george perks, is the global strategist and he joins us from winston-salem, north carolina. that start by talking about the gdp impact, the net gdp impact. is tax cuts, spending as a result of the budget, we have disaster relief there too. george: thanks for having me on. cuts and the tax loosened caps on

domestic spending is going to have an impact on gdp over the next two years. between 1% andre 2.5% in the next fiscal year, and the fiscal year is spending in december 2018, 2019, 2020, and 2021. the economy is close to full employment, but at the end of the day we are certainly closer to what looks like a late cycle economy than an early cycle economy, so it is relatively unusual to see an economy go ofough an aggressive about stimulus. -- the chartow shows the increase, and for several years stimulus growth. joe: the irony is that for years economist said more fiscal stimulus is what is needed because the economy is not at

full employment or operating at below capacity. will it help, is this good? there is partisan issues, but in your view, given where the economy is, is this good? think it is worthwhile to consider what we define as good. will it have a positive impact on employment, yes, it well, it will have a positive impact on growth, on inflation? yes, it will. is that combination of different outcomes the best in for the economy? it is hard to say because we can't be extremely sure of how much slack there is, the government fixed there is -- that we are running out of slack, but the major population ratio is not indicating extremely high labor markets, so what we're going to see is an interesting experiment. we are going to see inflation go higher, it is relatively low,

and where going to stick late and economy that is up to potential pace. joe: we are looking at a chart fed'sing play lands year-over-year, and the inflation gauge in the last 12 months -- what is that inflation gauge because it looks like indicating we will see higher inflation. the new york fed gauge is designed to take a look at both price indices that you see and market like cpi indicators as well as other stuff thrown in to get an idea of how strong the underlying innd in an nation is -- inflation is. some adjustments to consumer spending over time -- maybe the underlying inflation gauge signals back price pressures will continue rising we think it

is a good chance that the current trend will be higher and the cbi is something we will keep seeing. because ofian cpi different outcomes, and it is important to note that in this past months inflation report, was marketable -- it was remarkable because it was quite something, we saw the highest and month over month, three month, and six-month changes since 2007, so that is a big deal. it looks like that was exactly right, janet yellen now to another economic addiction that pressures will fade off and would see rotter price growth, and that is what we are getting. you doesn't mean we are in a world of stagnation, he looked sick relative to the low-inflation environment where been in exam picking up a little bit. scarlet: i like the phrase he used, interesting experiment. if wees the fed tackle

have gone through this extraordinary -- uncharted territory? will those tools be as effective? in terms of siding inflation, the fed is going to run merely focus on raising the fed funds rate. i was a bit unpredictable happens -- that is going to be operating in the background. they have been consistent in saying that, so it is unlikely. happen, butit won't it is unlikely. the post crisis experience with monetary policy indicates that the size of the bounce sheet -- there's other stuff going on, it is a function of labor markets, the u.s. dollar, pricing power at various -- varioussinesses types of businesses.

as the economy generates more inflation than we have seen recently and above the fed target, it is important to note that we are not at the fed target for inflation. watching the dynamics between the cpi indices are some of the other inflation indicators is important. isre is no sign that fed going to immediately start hiking rates super aggressively we saw in the middle of the 2000 cycle, and create financial issues for the rest -- not real economy, which is what happened last time. they are trying to avoid that and, slow, steady, persistent, dependent on the data is what we are likely to see from the fed. julia: very quickly, because this is an important piece of what isaw puzzle -- going on with that breakdown in relationship with the rates in the u.s. dollar?

is it a burgeoning deficit? george: post crisis we saw good correlation between the value of the dollar and the interest rate spread versus other currencies. so ithe last year or hasn't been true, and we see the opposite of positive correlation versus a negative one. with that means in terms of the deficit, we don't know it is relevant, but we see a strong growth in places like europe that haven't seen strong growth in a long time. the dollar is a function of a risk-taking appetite and people loans, realund new economic activity, or are there things in the dollar, and that is what i think is responsible for what has happened in the u.s. dollar versus a narrative around the deficit. george, thank you. theng up, harvard alums say

school is taking their strategy. this is bloomberg. ♪

scarlet: harvard is making less money using hedge funds than it would have invested in isn't the -- if it invested in snp. let's begin michael mcdonald, burke endowment reporter in boston, and the group of alumni taking this argument are from the class of 1969 and they have been a thorn on harvard management company side, and what exactly are they proposing? interesting is that it is about the timing.

there is a new president coming into harvard and that is who the letter is addressed to. he is going is how to interact with the head of harvard management company oversees the endowment and what kind of thoughts is going to bring as one of the members of the board that sits on -- that oversees the endowment. another thing interesting here is the timing around the debate of active versus passive management. there is a debate going on in the world of endowment and foundation and that sort of goes to the heart that question. joe: i am curious what the debate looks like because we have to active versus passive when itll the time comes to investors, but there is another world of endowment and long terms, and everyone warships at the altar of the yale guy. whether people saying

endowment should go the passive route? there is debate going on about that, and the s&p 500 outperforming hedge funds and diversified portfolios, it make sense there is that debate going on. 52ever, it is the smaller $100 million endowment when you get into this world of multibillion-dollarmultibillion. they are the actively manage portfolios, that being said, you look at harvard management and they are investing more and passive strategies because the smartest and dow make managers are looking for ways to squeeze out costs anywhere they can. it is it going to be half of the portfolio as the alumni once, but it is more than it once before and it is something they are talking about and thinking about places like harvard management. as you know, harvard

has the most in its and dow meant, $37 billion, followed by the school in new haven at $27 billion, but at returns, you don't see harvard up there. through your returns, harvard there is aot there, lot of turmoil at the top there of harvard management company -- what have they not been able to figure out the right recipe? the right group of people to manage this? for the plugk you for the endowment function which i have been involved with. harvard has a series of issues in the way they run their management company and they are trying to address those. they are cutting hundreds of people from their staff and are looking to manage the endowment more like yale and columbia, where the ceo is from. the timing of that, look at the timing of this letter. i don't know how these things

land, but i think they saw this as something interesting to think about because they are thinking more about how to get lowest possible cost, and my understanding is that they are taking a look at more passive strategies on the way of getting better returns on columbiashe yales and of the world. julia: how receptive is the new president going to be? michael, thank you so much for that. up next, why he sees more volatility coming in the united states and opportunities in china. from new york, this is bloomberg. ♪

mcveigh, seized the u.s. helping stimulus for another, and he spoke with bloomberg earlier today. our view is that we inered a new regime, and 2016, china was slowing and you wanted to get long duration stay in the u.s., and today we think we are at the cusp of interest rates automate thomas started to move up, but in a widely aggressive way but clearly there is a signal from the fed that they need to do more. to theadding stimulus u.s. economy at a time where unemployment is at 4%, so typically you're actually narrowing your deficit at that point, and today we are increasing the deficit. i think investors are taking notice to that, and some of what

happened in the last week was related to volatility funds. people were overly aggressive, but i think there is a regime change. i think started with the u.s., we ultimately think that will be something that transcends and goes global. >> murtaugh at the steve schwarzman earlier, and he says this level of volatility feels pretty normal. you agree or is this an aberration? you get agree that volatility in the market, and what is changing as you are losing the cover around interest rates. we had the fed protecting us for quite some time, and they are clearly now the lead horse changing interest rate policy. europe,'t seen that in but we are hearing heads of that and in japan we hear the opposite word they are accommodative. the slight difference to me is there is a shift of monetary policy and that will lead to more volatility.

we are seeing it in interest rates are now, not necessarily in credit, and that makes sense given that this is more about change in the risk rewrite than the conditions around the world. corporate tax rate in the u.s. probably makes corporate profits stronger this year. >> let's talk about credit because it is a theme yet been writing consistently about for a few years. it feels like there is a fundamental shift in the appetite for credit, especially in private credit. where are we now in that? henry: generally we would argue that it is expensive, and we traffic more to complex areas like high-yield and private credit, but globally around the world will we see in india is real growth in asia in this private credit. corporate's want access to capital quickly. transactions are complex and it will typically partner with a firm that can help them.

at the start of the financial crisis and the u.s. when the banking system contracted, you think about the assets and the banking system, we took the equivalent of five morgan stanley's out of the system so folks had to step in and provide capital. has become a more mature business today and we see growth in the u.s., europe, but i would say we are spending more time today in asia where we see interesting opportunities in werging markets as well as participate in areas such as australia and other developed market where there is interested things as well. thing in your report as you alluded to in india and china -- china seems to be rather fascinating moment right now whether it is the broad economic story or the stories of what appeared to be for sales of real estate assets. how does that play through in the market? our view is that china

crashed from 2011 and 2015, and people are wondering if china is going to fall apart, and what you saw is that essentially nominal gdp went from 20% to 6%. today it rebounded to 12%, so that is a good environment for growth. whether you do good business in china or not, you have to know about china, when you include media trading partners, it is 75% of gross, so we are focused on that. in helpinge active chinese companies abroad, and we are focused on technology within china, and they move towards consumer experiences. in thes a huge growth middle class to has been interesting for investment opportunities. mcveighhat was henry with bloomberg's jason kelly speaking earlier today. scarlet: is now time for the bloomberg business flash.

planned ipok's remains on track for the first quarter according to people familiar with the matter. 25%sche plans on selling for uber $5 billion. the spike in volatility has raised concerns about potential delays in investment banking activities. fcc isad of the under investigation. whether he improperly push for changes that help clear the way for sinclair broadcasting's proposed purchase television stations. there with the determine a pattern of preferential treatment of the broadcaster. $2.75 millionld shares this week, and repertory 200ngs show it generated

$11 million, and is the first time wilson hassled stock since december of 2014 at follows the resignation of lululemon's ceo. the money will be used to fund other ventures. and that is your business flash update. joe: what you need to know about tomorrow's trading day. this is bloomberg. ♪

julia: the cap for january being released tomorrow. scarlet: that does it. joe: have a great evening. this is bloomberg. ♪

quick let's start with a check of your first word news. a federal judge in florida has ordered a suspect in wednesday's deadly shooting rampage at a

florida high school to be held without on 17 counts of murder. authorities say 19-year-old cruz opened fire in the same school from which he had been dismissed. he also reportedly had ties to a white nationalists group. a member of the militia group called the republic of florida told the associated press that the 19-year-old previously took part in paramilitary drills with the organization. the senate has rejected a bipartisan proposal to provide 1.8 million undocumented immigrants brought into the u.s. as miners a path to citizenship. the measure was six boats shy of the 60 needed to advance -- six votes shy. the bill themselves as common sense coalition. health officials say the flu vaccine is not effectively protecting older americans and others against above that is causing most illnesses.