opportunity initiative that will , among other things, make recommendations on policies that affect faith-based and community programs. office will this also help ensure that faith-based organizations have equal access to government funding and the equal right to exercise their deeply held believes. mark: members of the first baptist church of sutherland springs, texas, where worshipers were killed in a 2017 shooting, tended that event in the rose garden. the u.s. military has launched an investigation of wednesday's crash of a c-130 cargo plane that killed nine puerto rican airmen after takeoff in georgia. the national guard said it would use every resource at its disposal to find because of the crash. crashedn fighter jet today off the coast of syria,

killing both pilots. russia says the plane did not come under fire and that the crash may have been caused by a bird getting sucked into an engine. crash agency says the came shortly after takeoff from russia's airbase in syria where russia has been waging an air campaign in support of the shah al-assad. many dead and 300 injured after a powerful dust and rainstorm swept through parts of india. trees anddowned caused houses to collapse. it caught people by surprise because monsoon season is still more than six weeks away. global news 24 hours a day on air and on twitter, powered by more than 2700 journalists and analysts in more than 120 countries.

live from bloomberg headquarters in new york. minutes from the close of trading in the u.s.. stocks are bouncing off four week lows. joe: the question is, "what'd you miss?" scarlet: is there a trump card in trade negotiations between the u.s. and china? the earnings call that drove off the road. tesla ceo elon musk be rated analysts for their questions and now investors are responding by selling. and, president trump changes his story. he now admits to reimbursing his attorney for paying off stormy daniels, calling the arrangement

"very common among celebrities." house trade emissaries wrapped up their first day of trade talks in beijing. they're trying to tempt down on any expectations of a breakthrough. the chief economist of vice president mike pence describe the news as positive. from bank of america-merrill lynch, great to have you with us. the fact that these talks are even going on should be seen as a good thing. david: there's no question. my feeling is that there is already broad agreement on the broad framework. i think what they have been negotiating over the past couple months is really about details. believe, a year ago,

that we were literally a week or two from possibly a successful agreement over nafta negotiation? everything we were hearing out of canada and mexico saying we are close to a deal. once trump gets a deal with canada and mexico, i think that will increase his leverage with china. as agreements with countries, hep could very much pave the way into u.s. entry into tpp. to me, this is been nothing more , and inegotiating tactic think things are going in the right direction for this country for once. does the market appreciate the closeness when you look at how markets are priced? and you say we are just negotiating over details, i

think some would disagree and say we are spiraling toward a trade war. david: it is very interesting because the issues trump has brought up, about basically better protected intellectual property and china opening up foreign markets for investors. these are things the chinese have been saying are things they wanted to do anyway. you heard this from the prime minister, the president, the vice premier. course, if china is going to make a concession, you would want -- you would think they would want to make it look like that they are being forced to. make alikes to concession without -- it probably makes it easier for both sides to reach an agreement. it is a way to save

face. there were reports that the would change their goals to dominate certain technologies by a certain period of time. this was disputed by wilbur ross , the commerce secretary. having said that, do you think there are any hard red lines for either side that they won't cross? >> a perfect blueprint about how this administration approaches trade negotiation, which is with a lot of flexibility. originally, trump said he wanted to go from 62.5% country of origin to 85%. i don't think there is any redline. they have been very pragmatic, in my view. they make a lot of noise. the noise, again, is meant to be intimidating, whatever it is. i think the fact is that they are making progress on so many

different fronts. i think, ironically, that will put a lot of pressure on the chinese because they can no longer point to the u.s. and say , you are being protectionist. other countries are finding ways to reach agreements with the u.s.. why can't china? the europeans are basically calling up beijing saying, i think the u.s. actually has a pretty good argument here. these are issues the german seven facing, too. when china was basically a low-tech producer, it didn't matter. now, china wants to become a player in defense technology. trump has taken the lead, europeans have followed him, and i think there is good reason to believe there will be a reasonably good compromise. julia: europeans using the united states to negotiate better terms for them.

let me play devil's advocate. you have a lot of noise and some hawks as far as trade is concerned. i think there are some people in the discussion what kind of nervous about his approach at how firm he remains at this point. what is the risk and what is the damage? last --l window we have we have left, especially for the mexicans to renegotiate. david: there is going to be elections in mexico in july. the candidate who should become the next president has already said he would rather walk away from nafta that renegotiate. that is why the u.s. wants to have a deal by the end of this month, so they could give the mexican legislature time. basically 50% of the

cars to be manufactured in the united states. the army gave that up. -- he already gave that up. the u.s. is already backing off , they wantedmple to be able to pull out. a lot of things that were sort of redlined at the start of the negotiation are being removed because they know they have to get this deal. what is the train here if we get these series of deals, nafta, china, the tpp, so forth? u.s.: i'm bullish on the dollar. the narrative in the market, this guy is aay warmonger, and on top of that, this tax return is a short-term stimulus that will cause the

u.s. economy to overheat and cut the fed to overtime. there is a reason the yield curve has been tightening. the dollar has been going down because people say it will increase between deficits. i think that is bowl -- -- that is bull --. now halfway through the first quarter earnings season. the reported investment year on 27%, theth has gone highest level since the recovery. seeing is companies putting their money where their mouth is and helping companies raise growth, raise wage growth. i'm so enthralled. we're going to dig into this in

more detail. scarlet: another person made the point that you haven't fully anticipated the tax cuts. it takes a wild before you see the effects. up next, we will hear david's reasons are not only why he is bullish on the dollar but why we should be selling the euro right now. ♪

scarlet: eight reasons for selling the euro. david is the head of currency research at bank of america-merrill lynch. you were just telling us how you are bullish on the u.s. dollar. part of that is how you are

bearish on the euro. the u.s. has a big interest rate differential with europe. over the past six months, it wasn't really reflected in the euro-dollar pair. when it shows is that the euro cap strengthening. now, you are starting to see that perhaps change a little bit. why was there a breakdown in ?hat correlation conundrum.s a huge fx guys think the only thing that drives fx is interest rates working. i think the reason why that relationship basically broke fxn is because what i call flows weighing on the dollar. two such flows are particularly important. saw massivee

foreign purchase of european equities. we saw no interest in u.s. equities whatsoever. the was a huge problem for dollar vis-a-vis the euro. months, moneyhree is now coming out of european equities back into u.s. equities. with the recent equity , u.s.tion in the u.s. equities are now less expensive and we will see revision of long-term growth potential for u.s. earnings. other point, a bigger story, we know investors have been heading back to emerging markets. people buying more and more euros as a result. up, mexicos blowing is blowing up, india is blowing up. the last month, we have seen the

longest stretch of underperformance by emerging-market equities versus developed markets. i think you will see more outflow. i think that removes huge headwinds for the dollar. traders overly focus on this rate differential. the story now has to be rate differential. europe is now rolling over and it doesn't look like it is just based on a temporary thing. david: 12 months ago, if you said european data had been that great, even i would be sympathetic of the polar vortex. numbers out of germany and france, the pmi numbers show they are up more than march.

ishink what is very clear that the euro is starting to bite into eurozone growth. basicallyf momentum, european growth, it can be explained from the past year. the relationship would explain that this weakness is likely to continue. i was in paris. france's on strike. the teachers are on strike, the lawyers are on strike, even the students are on strike. julia: the french like striking. david: yes and no. macron has year, mr. be in the honeymoon period with his unions. strikes only began in april and they are open-ended strikes. in the history of french

politics, it shows that it is very difficult for him to make concessions to one rather than everybody. him, undere fair to hollande as- under well. the emerging markets, you cited this is one of the big drivers as well. ago, there is huge opportunity here, the fundamentals are better, they can withstand tightening better. ast suddenly happened as far urging markets -- as far as emerging markets are concerned? david: the decoupling between the dollar-interest-rate differential. emerging-market with really struggled to cope with high u.s. dollar.

all of a sudden, just by breaking through 1.20, everyone is rushing for the exit. a higher dollar is a much more dangerous aspect for emerging markets. scarlet: we mentioned china and u.s. trade negotiations. let's mention outflows. we actually have one of your charts that you brought to us. a sensitivityis of chinese capital flows to interest-rate differential. talk about how this is going to work and contribute to a weaker euro and stronger dollar. 2015, chinese growth slowed so much that they had to cut interest rates. in 18 months, we saw $1 trillion leaving china. that is the reason why the

dollar staged a massive rally across the board. the chinese never matched the hikes because they were trying to protect the rmb. -- theeveraging in china compromise from here is very limited. interest-rate differential moves in favor of the dollar once again. you have to assume the outflows from china will increase later this year. julia: your enthusiasm as far as the dollar, i have to pop the bottle. david: if this whole trade negotiation were china, for whatever reason, this would

definitely be a problem. , it would be an even bigger problem for emerging markets. then inhe dollar smile that situation. scarlet: david, the always colorful and enthusiastic head of currency research. scarlet: are we allowed just -- julia: are we allowed to say bs? scarlet: we are like hbo. activision'st, earnings surprise everyone. why earlier than expected results actually caused some confusion.

activision's earnings were supposed to come out after the bell but they are actually out already. here to explain what happened is julie hyman. julie: this usually happens to somebody each earnings season. a computer fires or somebody pushes the wrong button. the numbers came out a little bit early. the stock went down, then activision halted it and decided to release the numbers themselves. they did so after 3:00 p.m. earnings beatter estimates but the forecasts are below estimates. 304 millioney had active users in the first quarter, down from 384 million

last year. what is hovering over not just activision but the other -- ogame makers is scarlet: the bane of every teenage parent's existence. julie: do your kids play fortnite? my kids are not yet teenage level. is this fortnite we are looking at here? you can plant across different platforms, and it is one of the first games to successfully bridge that gap. it is a group play game. you can play with your friends, there is a social aspect. it is free but you can buy stuff within the game too fancy up your weapons, outfits.

of 3.4 million concurrent million of february, 45 overall as of january according to the company epic games, which is privately held. there is now this sort of adjustment period. many of these stocks have fallen. activision down about 12% since its march high, take 2 down about 60%. joe: this is an independent gaming game that is so popular that it is sucking away energy and time from other games? that is the concern. in the past, when you have seen a big new game come out, it helps all of the gamers because maybe you migrate to a new one. scarlet: full on addiction for a

certain subset of people. thank you so much. the market closes next. we are way off our lows. the dow and s&p down 1.5%. ♪

♪ >> the new stocks are in the

s&p is back above its 200 day moving average. i am julia chatterley. scarlet: i'm scarlet fu. >> i am joe, and if you are tuning in live on twitter, we want to welcome you to our live coverage every day from 4:00 to 5:00 p.m. eastern. scarlet: our markets minutes. we did not get much headlines on the china trade negotiations today. julia: that was the whole point. they promised not to say anything. scarlet: saw stocks with a little bit of relief. >> we are off by about 1% at the lows of the day. scarlet: absolutely. once the 5% the -- declines for the s&p and the dow . now, the s&p closing down about six points and the the

nasdaq off by 2/10 of 1%. , not a banner day of the conference call. it was very odd, he was very combative. defensive. he dismissed the law of the questions the analysts with insisting that there is no need to raise capital through debt sales. he also told investors, do not buy the stock if you cannot handle the volatility. aig shares dropping more than 5%. the assurance -- of the insurance results were hurt by decline in net written premiums. the midpoint of the guidance missing the average analyst estimate, so not measuring up. activision blizzard, as julie was telling us, the results were due out after the ballot but

they were accidentally released during the trading session. the numbers for the quarter that ended were decent. the outlook with tepid. -- was tepid. itreinforced the fortnight, is taking over the videogame industry and leaving people with attention and appetite for more traditional games. joe: bond markets in the u.s., rates lower across the board. of 3% fading.eld it was down to 2.95%. it was inching a little bit slower to 2.48%. i want the spotlight turkey. we were talking earlier in the show about all the emerging hotspots, one being turkey. turkish assets being slammed today on inflation gathering steam. five year yield shooting up to 5.39%.

mixed currencies o, a bag. we were desperate for good news on sterling, we did not get it. q1's adjusting the weakening may be fleeting. it echos what we heard from david. asm pointing out euro-yen well. noio draghi hinting significant speed and retracing stimulus and putting pressure on the euro in addition to week data. i'm also showing a euro check as well. the fastest-growing growth profiles in europe right now, the country may need monetary types by the currency in interest rates. it is higher by 5/10 of 1%. you as well,show keep an eye on these nafta

currencies and what is going on in mexico. buttively unchanged, watching closely headlines from both countries. just want to keep an eye on those in case. quickly, pull up scarlet's chart. about to raise the point the weakness, the selloff we are seeing in the argentinian peso. tumbling the most since december 2016. what we have seen from the central bank is raising interest rates for the second time to try to stave the temporary decline. david was saying, even a month ago, three months ago, this was a monk client -- among client's top trades. what we are seeing more broadly in the emerging markets is people running for the door.

joe: let's wrap up with oil and gold. not the busiest day, but oil gaining a little bit under 1%. west texas under $69 a barrel. gold gaining half a percent. scarlet: joining us now for more on the market is dan arbets. great to have you. >> always good to be here. scarlet: we need perspective on earnings. first-quarter earnings growth, double-digit percentages, yet, investors do not reward the companies the way you might expect. what is your reaper on this. -- you read through on this? >> remember the adage? what i did is i sold in april to chill. april 13, earnings kicked up with jpmorgan and then blew the doors off. stock was sold.

april 17, totally different sector. great numbers, stock sold off. what is that telling us? cap performance is no guide for the future. , earnings reports are lagging indicator. what markets are telling you is earnings have is been growing on average over to the percent this quarter. that rate of growth is set to decline to 8% next year. it is a matrix of challenges. where past the stage people are worried about the foundation of the economic system and the financial system. .e are withdrawing the net short term

phillips of tax return and people are going to focus on what a long-term consequent is of all of this stuff? where are we going over a longer horizon? one things been too good short-term fixes. joe: is there an opportunity are you are concerned as well? dan: i am absolutely concerned. i think it multiyear horizons not unlike elon musk. but i'm not going to buy all of your stock in tesla if you sell it, like he told his investors. when i look at the long-term, i worry a lot about the sustainability of the fiscal situation. we have an administration here that has done some good things for the short-term and economic

policy and foreign policy. -- in economic policy and foreign policy. vot toeed to pi long-term achievements. i hope secretary mnuchin has a successful trip in china. it is not going to result in anything dramatic immediately but if we can stabilize the situation and get on a positive negotiating track, and fixup naphtha, and turn our attention -- which i believe the of administration will do -- to the fiscal situation, we need entitlement reform to couple with tax reform. tax reform helps corporate earnings this quarter, maybe next quarter. the fiscalunding challenges which really need to be addressed. scarlet: that may be the case. we being too premature?

-- they gety not that one-time boost in their results, but the investments they make may not happen right away. dan: that is all true. but if you remember, the stock right went straight up after christmas, right after the tax reform was passed into the very beginning of january. andstors are ready -- already anticipating that their best a sense of what is going to happen with the tax reform. now gets executed and people are like, we already bought that, time to sell now. about this andd other investors, this idea of borrowing future growth in terms of performance overall in the equity markets. when you said you have taken a chill pill and you have sold, what are you doing with the cash even if it is about thinking strategically and the long-term?

where'd you invest your money for that? dan: i have sold entirely out of public markets. i go in and out because i have the luxury. i just took the gains, wereposition that vulnerable and this earnings climate, maybe we will come back, and have a couple of things. the earnings season has been completely unforgiving. if you beat to the extent that people expected, you are stuck with sold. if heaven for bed, you missed by two pennies. i've got one company, that should have an -- if heaven forbid, you missed by two pennies. got one company that sold up 25%, that is a bargain. by the way, i'm still short treasuries. i'm still short investment grade credit because i believe the

next really big opportunity is going to come on the heels of a rotation of the credit cycle. scarlet: got it. julia: perfect. always a pleasure to chat. dan, thank you. scarlet: we have breaking news. cbs television network reporting first-quarter results. of $1.34.sted eps eps of- we have adjusted $1.34. billion look at 3.76 , that is 12 billion more than what analysts have been looking for. coming up, we are keeping an eye on shares of has love. tesla.es on after a earnings call, this is bloomberg. this is bloomberg. ♪

♪ >> i am mark crumpton with first word news. says it cannot confirm the validity of the reports of the imminent release of three american prisoners in north korea. press secretary sarah huckabee sanders said if the north were to release the men, the trump administration would view it as a sign of goodwill ahead of the planned meeting between president trump and kim jong-un. has issued a formal complaint to the chinese government over the use of high grade lasers near the military that wereibouti directed at aircraft and resulted in minor eye injuries to two american pilots. is pentagon says the u.s. confident that chinese nationals are responsible.

>> this activity poses a threat to our airmen. hed the formally demars chinese government and we have requested that the chinese investigate the event. the chinese recently built a base near the american installation located in the horn of africa. sudan is reconsidering its dissipation and a saudi led coalition fighting rebels in yemen. the benefits and drawbacks of sudan's dissipation are under evaluation. the coalition has been fighting rebels in yemen since 2015 and a war that is killed more than 10,000 people. a reunified cyprus may not become a reality. that comes from a turkish official who said yesterday --

his remarks good signal a major shift from long-established parameters that have guided negotiations for four decades. cyprus was split in 1974 after turkey sent in troops following a coup of supporters of a union with greece. global news, 24 hours a day on air and that tictoc on twitter ,700red by more than 2 journalists and analysts in over 120 countries. julia: elon musk does not take boring questions. analysts in he told an earnings call before wrapping it up in a half hour. >> where specifically where you be? next. boring questions are not cool. next. >> can you let us know what percentage have actually taken

steps to configure? >> we going to go to you too. -- youtube. sorry. these questions are dry. they are killing me. more: shares at tesla fell than 8% today. we are john -- joined by analyst brian johnson. how surprised are you? time, talkspective us through. >> the point we made his jeff himself was not spending any time was wall ,treet for six hours a year fine braided it is part of the baggage that goes with it. -- fine. it is part of the baggage that goes with it.

since its founding, there is want her twice the late 1990's that amazon had to go to the market. finesse itsgoing to plans and then debate getting through the model 3, it has to come back to the capital markets. we are demanding a higher degree of transparency than for a company that is fully self-funded. joe: there is a pretty real cost to annual in -- alienating the people. you see the market reaction, not favorable. ignoring the call to hat tricks, the numbers themselves, you see reason for optimism? >> maybe not, you put them in the category. before the call, we had hoped maybe there was

evidence of adult supervision or intervention. down, maybe marketing more sensible growth plans. you saw better gross margin coming out of the quarter. better price discipline. all of those hopes that maybe there was some financial voices, i personally like the cfo, that were talking some sense in two divisions. julia: is now the time to be fiscally rigorous? i get the concerns, the financials, the risk, they have to go back to the markets. at a time when there is so much 3, is now theodel time to be pulling back on the capx? to the firstespect

analyst who was cut off, that was exactly the question he was trying to ask which is what are you doing with your cap x? are you differing semi trucks. that would make sense. are you pushing out model y? the crossover segment is much hotter than the sedan segman -- segment. look at what etron is doing to audi. there are some very legitimate questions. mr. musk called one of my the strategy of the company and what we are likely to see on that. many of the analysts were trying to get on that. julia: you either love this or you hate it, and you can look at the shorts that are out there. you can look at the equity markets understand how extreme the views are on this. does this change anything?

-- do the fundamentals the fundamentals favor the bulls or the bears? and for those that alternately by this, are they changed in any way as a result of the call? >> money answer the second one first, it is easier. -- let me answer the second one first, it is easier. you have to admit, they are not going to self-fund. is that -- minimum, the kind of management team that is going to be able to go out and continue to raise money at a non-diluted level. in terms of changing the debate? no. , may be some pause, but fundamentally believing the vision and wasting his time on the conference calls and should delegate it to us financial staff, what is left of them. the bears, many of whom are on twitter pointing that this shows

there has been the rational hands-on process oriented team leadership we see in some of the major oems that you need to see eight to execute -- you need to see to execute. scarlet: brian johnson, think you for joining us from chicago. coming up, president trump said he repaid the stormy daniels hush money and it is all legal. this is bloomberg. ♪

♪ scarlet: president trump has changed his story about stormy daniels. in a tweet today, he said he reimbursed his personal lawyer for daniels. the president also denied that

the arrangement was in proper. -- improper. this is a reversal from what has happened earlier, and it comes on the heels of rudy giuliani's interview where he says the president was aware of the payment. we had a news conference at the white house that sarah sanders posted. did we learn anything new? >> the president certainly changed his story after think he did not know about the stormy daniels payment. we now know that he de facto n ew. he reimbursed his lawyer. talks to reporters every day also did not know that. that indicates the tight knit level of the operation as far as this issue. do we know why rudy giuliani went on television theerday to tell everyone payments was perfectly legal, not campaign money, and the

president paid it? it seemed like a complete 180 for the strategy previous and it raises questions about legally whether this puts the president and more hot water -- in more hot water? >> that is the question everyone is asking, where there a strategy. -- was there a strategy? at fourth the president to issue a series of tweets this morning trying to clarify that it was not a campaign violation. now what is constituted as a violation could give prosecutors room to disagree. it is more problems for the president and the white house. the people around the president's orbital do not know what the endgame is here. scarlet: the president's legal team is also changing as well. ty cobb is being replaced.

let's move on, the same time that the president's team are in beijing to hold trade discussions. joking, no were news is good news here. is there any kind of rollout process they have in mind? >> many things are up in the air with this trip to the beijing that the president's economic officials are on. there is been a back-and-forth on trade issues. the president putting tariffs on chinese products, china retaliating, and this trip is an attempt to reconcile the president's desire for some trade restriction to protect domestic trade industry. these two countries are extremely interdependent. nationalbloomberg

political reporter joining us from washington. this is bloomberg. ♪ this is bloomberg. ♪

♪ >> i am mark crumpton was first word news. the national transportation safety board has released a preliminary report of last month's incident aboard a southwest airline flight. the ntsb said a war in a down fan blade is snapped off the engine that re-shattered the window at the plane's 30,000 feet. one passenger was partially sucked out of the window. the last inspection of the blade was back in november 2012. the white house is responded to reports that north korea plan to release three american prisoners there. we cannot confirm the

validity of any of the reports currently out about the release, but we certainly would see this as a sign of goodwill if north korea were to release the three americans ahead of discussions between president trump and kim jong-un. that rudy giuliani said three u.s. prisoners would be released today. isopean commission president appealing to belgium to grant nationality to british citizens who work at the european union it -- some of the lived in belgium for years and have european pension plans, and bear for their future after. leaves the block next march. hisnd's president wants citizens to vote on whether they change the constitution. his senatewill ask to approve the referendum for

november 10 and 11, tying it to coincide with a 100 anniversary of poland's national independence. his political opponents say they are skeptical about his party's motives. global news, 24 hours a day on air and at tictoc on twitter powered by more than 2,700 journalists and analysts in over 120 countries. i am mark crumpton, this is bloomberg. let's get a recap of today's market action for it stocks were declining earlier. the s&p and the dow were off by 1%. we have made a huge comeback. by the close, we were little dow.ed for the the s&p down by six cents of a quarter of 1%. reportst recent earnings , earnings per share of beating the average analyst estimate. $1.34 was the reported number.

revenue also coming in better than expected, $3.76 billion. as you can see, the stock is gaining by almost 3% in after-hours trade. activision blizzard was supposed to report after the bell, but there was a mistake. ofther news agency released the results during the trading session. the reported number was fine, but the outlook was disappointing and the stock closed down on the day by 2.3%. i'm going to hand it over to joe. joe: what did you miss? a hot and dry summer coupled with a geopolitical tensions and divergent strength versus the dollar could be just a recipe for the perfect storm and commodities. an.e to explain mike mcglo commodities of already had a great start to the year. before we talk about what they could do, what has driven the commodity gains?

>> the first thing is lower prices. the key thing to remember is the rally, it is less than three years old. the stock bull market is over a decade. it is just starting. prices are down for so long are starting to come back. a key factor is the dollar which you mentioned earlier. -- at a bit of him reflection thing the dollar in april. joe: with a soft commodities, how much is weather? mike: it is a key factor. , it isn and wheat june, and august that are going to matter. last year, there are three weeks of extremely cold weather that saved the crop. this year, if we get more ,ormalization in weather prices are ready to jump because up, and thecking

dollar is weak, if we do have too much issue in china, prices are ready. robust. mike: yes. be seen inly soybeans. we are exporting more than 50% of the crop. corn, not so much. joe: the stock what the industrial side. oil has taken people by surprise. strategists are starting to wonder maybe we could see oil drivers -- what are the key drivers? mike: cuts from opec and russia. it is offsetting u.s. production which is increasing higher prices. but it is holding. that has been driving it, demand versus

supply, lower inventories and -- most of those drivers are over . the key thing that shifts it is positive carry. they aret hold oil, getting positive carry. we have not had that in four years. joe: explain this a little more, what is it about the current environment that is so bullish? >> the term structure is indicative versus demand and supply for it when up -- demand versus supply. for those that buy and hold crude oil, they will hold that contract. you can beat the spot return. joe: let's talk some supply and demand fundamentals. you talk about the major producers holding the cuts. why have they done a good job holding the line? mike: that, we are all impressed with. of russia and

saudi arabia were picture together, and why they are doing it -- the fact that they are, that is the key thing. the market has not adjusted yet. u.s. production should continue. it has taken off. i'm her a few weeks ago, we were talking about the bottlenecks -- i remember a few weeks ago, we were talking up bottlenecks on the show. has that been resolved? mike: it is an indication of increased supply. crude oil has been a big driver. an area oft resistance. bottlenecks? it is because of all that supply. mcglone, love your take. bloomberg intelligence, thank you so much.

a reminder, and subscribe to our weekly podcast on itunes. miss called what'd you this week. from new york, this is bloomberg. ♪

♪ >> the brexit battle continues. innering of theresa may's circle ended in crisis yesterday when a majority of ministers rejected both the compromises on her eu customs union. may suffered another defeat in the house of laws to prevent a hard border in northern ireland following brexit. we are now going to get some

advice an explanation from a global director on data and polling, mina. explain to us the importance of the eu customs union and explain why theresa may enter fellow cabinet members were thrashing out the details. >> that is indeed the interesting question because when we talk about the customs union, britain has said they want to leave the customs union because they want to have their own independent trade policy. this crystallizes around the question of the irish border. be leaving the customs union, there has to be a hard border at their exterior. that is impossible so they are trying to find workarounds. theresa may's adjusted not staying in the customs union but striking a custom partnership i what she proposed was that the -- a custom partnership.

eu said,proposed, the we do not like that option. they also said, why don't we have the max backed option which is using technology, technology aat does not exist, to have border. the problem is that none of these options are workable. text, we have a back stop which would keep northern ireland in the customs union and the rest of the u.k. out. that is not acceptable to the prounion's party in northern ireland. it is impossible to square the circle. scarlet: it is impossible. you also said whatever decisions the u.k. makes, it is kicking the can down the road or it is

agreeing to some kind of charge for it theresa may continue to delay decisions? ae is going to run up against hard deadline without decisions being made. nina: absolutely. thus far, theresa may has been able to kick the can down the road, but the fudge has to end. it crystallizes around the issue of northern ireland. the u.k. will be leaving in march 2019. before then, if there is some kind of deal to be put in place, legislation needs to go through the british parliament as well as the european parliament -- the fudge has to end. the only two viable possibilities is a border in the which is unacceptable to northern ireland and the british government, or the entire u.k. have to stay in the customs union. to cashtain has

out with no deal. joe: what is the deal with the house of lords vote that theresa may keeps losing and what impact do they have? the house of lords is overseeing the legislation that is passing through the parliament. the domestic legislation to make sure the u.k. can leave the eu. haveouse of lords is not the final say. they make amendments to the legislation and they will pass it back. for theresa may, she looks really weak when she keeps losing votes in the house of lords. ultimately, what matters is the vote in the house of commons. there will be a vote in the house of commons and that is whether or not to u.k. should stay in the customs union. here, labor has already said that their position is that the u.k. should stay in the customs union. the question will enough of her

own party rebel against her? that would be a crisis. is, will an next government collapse. we have a few months left until leaving day and that would be the worst outcome for the u.k.. julia: hand-in-hand. form of government dysfunction to another dysfunction, minus a government. let's talk about italy. is progress being made for the government or are we looking at some sort of interim solution and fresh elections -- in fresh elections? nina: we are not having much progress in italy, either. [laughter] we discussed how the markets had factored in a messy coalition outcome and since then, the talks have been starting and stalling. the big question on the table was if the two euro skeptic pa

rties, those talks have broken down so now the five-star, the largest party without a majority, is trying to scramble something together. it is not coming to much. -- a long period of uncertainty politics. joe: nobody seems to care. is it that so many are expecting italian this function? nina: that is true to an extent. people expect italian politics to be messy and they will muddle through. long-term, you have this makeup and parliament the weather are two parties that own the most seats, who are intrinsically euro skeptic and in the past, had in their agenda that they or reformave the euro the relationship with europe long-term, that is not bode well.

we should not be complacent about what is happening in italy. this year's election changed dynamics in italy. scarlet: we should also not count out silvio berlusconi. is he out for the count or should we expect him to be meddling are playing a central role? nina: do not ever write off berlusconi. after everything he has been through and he is still in politics is quite astounding. let's not forget that the reason the coalition talks between five-star and the other party is because the other party for gifted to give up -- refused to give up to him. i would not write him off yet. he is still going to be around. scarlet: he has been for a long time. nina, thank you so much for joining us from london. coming up, the wheels of justice whenslowly it, especially

it comes to addressing gender discrimination all wall street -- on wall street. perhaps some encouraging news for the plaintiff. this is bloomberg. ♪

♪ a gender discrimination lawsuits against goldman sachs that is 13 years in the making. only one class action status. what exactly happened to the me too movement on wall street. a chronicle story for the special edition of bloomberg businessweekwhat exactly happene too movement on wall which is do the business of a quality. read, tellreat me about what happened. >> an enormous a shout out to my

it together wrote and halfway through our reporting, we sat down with this woman who started her fight against goldman sachs in 2005. while we were reporting the story, a judge out of nowhere -- we were not expecting this -- a judge of said, you can represent a class of 2000 women at goldman sachs. all of a sudden, a story about this 13 year fight against goldman sachs which is what we would thought we were writing, turned into the biggest gender us action lawsuit going on wall street. joe: 13 years is incredibly slow. what is the precipitating incident that catalyzed this whole thing? max: the way that me and the cowriter were thinking about this -- people wonder where the me too movement is on wall street.

julia, you and i have talked about it. this is what happens when you try to speak up on wall street. it is really hard. you are sometimes forced to go into a private arbitration, where people do not your about it. i will tell you about christina. in 2005, she quit goldman sachs. she'd been a vice president in convertible bonds. eeocccused goldman to the of being a victim of dissemination. it took five years before the eeoc said, you can bring this to corporate and 2010, she sues with a couple of other women. she says a couple of month into wastime at goldman, she sexually assaulted by a colleague, but the case is not about that. it is the ways that she was treated differently because she was a woman. she says that women are systematically treated differently. i want to clarify, goldman sachs says absolutely not true to

everything. scarlet: not just assault, but the lack of opportunity afforded to her because she was a woman. it exactly right. they fought back-and-forth to get as much data and anecdotal evidence. it is really out of the ordinary. the kind of thing you do not see at all. thathave data, they say their statistical analysis shows that women vice president at goldman sachs are pay 21% less than men who do the same job and the only thing to explain the difference is biased. julia: what is goldman sachs saying about women in the workforce? this is going into a legacy situation. what are they saying now? will deny this.

but what really speaks loud and clear to me, they will brag -- goldman sachs will brag and say, in 2016, our partner class was great?en, isn't that butnot that great at math, 22% to means like three out of four new partners at goldman sachs were men, and that is the positive news. we should not just call out goldman. reporting shows, this is wall street wide. it touches wall street, but also journalism and all sorts of fields. it is a story about how power looks and acts. julia: do you think me to movement made a move to the judge to push for this class action? too.this precedes me it is a small step that helped allow some of that to happen. julia: great work.

we will have much more on this topic and many others. tuesday, wednesday that is bloomberg -- bloomberg the future of equality and what is at stake. now time for bloomberg business flash. a look at the biggest business stories and -- the company's investigation shows no indication of misuse, but twitter is advising users to change their passwords on all services. former chief executive officer mike martin has been charged in a scandal. accused of violation of the clean air act. he step down from his role in 2016. that is your business flash update. joe: coming up, what you need to

know for tomorrow's trading. this is bloomberg. ♪

fourth-quarter results before the vote tomorrow. joe: i look at the jobs report 8:30 a.m. eastern. york fedng new president joins our bloomberg editor-in-chief for an exclusive one-on-one exclusive interview as he prepares to leave the most informative federal reserve bank. 12:30 a.m. hong kong tomorrow. don't miss it. joe mr. elliot, what's your wifi password? wifi? wifi's ordinary. basic. do i look basic? nope! which is why i have xfinity xfi. it's super fast and you can control every device in the house. [ child offscreen ] hey! let's basement. and thanks to these xfi pods, the signal reaches down here, too.

so sophie, i have an xfi password, and it's "daditude". simple. easy. awesome. xfinity. the future of awesome. mark: you are watching "bloomberg technology." the white house says it can't verify reports by nbc that federal investigators wiretapped

the phones of michael cohen in the weeks leading up to raids in cohen's offices. housesociate in the white has also been intercepted. the white house responding to a claim by rudy giuliani that north korea plans to release three imprisoned americans. >> we can't confirm the validity of any of the reports about their release. we certainly would see this as a north koreawill if were to release the three americans ahead of discussions between president trump and kim jong-un. mark: the president celebrating the national day of prayer by signing an executive order creating a white housemark: theg the national day of prayer by signing an executive order creating a white house faith and opportunity initiative that will, among other things, make