that makes three politicians with quit. whiledavis stepped down boris johnson resigned earlier today. may says she was surprised by the move. angela merkel and leak chain spoke against u.s. care of saying trade benefits everyone. they held a joint press $24erence as they side billion. she says china is making progress and opening financial markets to the world. amanda macron defended his policy record and said he has not forgotten about the nations poor. >> i am fully aware of the signs we started.

it takes time. sometimes a long time for the transformation to become reality. he wants france to become a power of the 21st century. remains under a .helter in place looters ransacked the haitian capital. global news 24 hours a day on air and on tictoc on twitter. bloomberg.

>> lives in new york, i'm julie hyman. joe: i'm joe weisenthal. raising to a three-week high. >> the question is what'd you miss? , jpmorgan andons citigroup on friday investors weigh the trade fallout. reshaping the high score in the united states. -- high court in the united states. he will select a nominee to replace justice kennedy. theresa may has a crisis on her hands. three ministers have stepped down within 24 hours. countdown to president trump's prime time address. the president will announce his pick to replace justice anthony kennedy in one of the most

consequential decisions of his tenure. he will have the chance to reshape the court for decades to come. it is one of two appeals court judges. for more insight we welcome shannon, and a former general counsel to dick cheney. these you know both of gentlemen who are the finalists. be a goodit take to supreme court justice? >> fidelity to the law. text of to the statutes. it doesn't hurt to be really smart. in the supreme court there is always the ability of the judges to convince others.

the intellect and capability these guys bring will serve them well. ofhow real is the phenomenon conservative justices drifting towards the left over the course of their time? is there anything that can be done at this point to preemptively avoid someone who is going to do that? >> you never know. just jumped to the left because they were not vetted properly. donald trump has promised conservative judges. he is going to deliver a conservative judge. is, what he is deciding on to much they can be trusted live up to his campaign promise. that is what, that is what this

decision is about. julia: how much of that will come through? asideill we really learn from grandstanding? >> it depends on how the senators want to play it. we have 12 years, 16 years of jurisprudence to pick through. with bret kavanaugh you get a clear sense of that fidelity to the context of the constitution. this could be a very elevated conversation about the role of the courts, the role of the president, the relationship between congress and the president. scarlet: will the democrats allow that? >> that is up to them. answer is absolutely not. they want to talk about litmus tests, roe v. wade. they want to talk about anything

they can get to get one up on this candidate. they want to take the candidate down. it is going to be difficult. these are guys who know their stuff and can defend themselves. >> merrick garland, they didn't have the opportunity to hear that person speak. >> this is a different circumstance. only one third of the senate is going to be elected. it is not nearly as compelling a case to hold this. joe: as you mentioned there is no doubt roe v. wade is one of the big issues that may reemerge and could be decided differently with a different composition of the court. what other big legal debates will this supreme court have to decide on? predict thatard to

question. this justice could be sitting for 30 years. if you think about what has happened the last 30 years it is remarkable. same sex marriage. issues of privacy. electronic surveillance. issues will -- we just can't know what is going to happen. based on how he would rule in a particular case. you have to look to the jurisprudence theories of the law and the fidelity to the text of the law. he is known as an outsider candidate. he did not go to harvard. >> he went to georgetown.

thee is someone who matches pennsylvania coalition that helped elect the president. the you think that will have any bearing on how he interprets the constitution? >> it should not. what should have a bearing is not the biography. the biography is interesting. it will likely get him political support. absolutely. people are going to make their decisions on if they support the personality as well. but we have to judge these guys on is what they have written and they believe about the text of the constitution. julie: but they are humans. if you're making a decision on roe v. wade or another issue that for many is a very emotional one it is difficult,

even for someone who is an amazing judge, trying to separate that from their own personal views. isn't that why congress tried to question them so deliberately? >> both of these guys have compelling biographies. both are top of their class. bret kavanaugh is ideally. they are both -- they both have a compelling story. joe: john roberts preserved obamacare. he has been criticized for drifting left. has he? was there a betting failure there? >> a lot of conservatives will say that was a surprise. that fell short of expectations. there was gamesmanship involved in that decision. i will also say this, john

roberts, with the exception of a couple of decisions, john roberts has been a solid justice for conservatives. is there a failure? you can't know. you cannot know what hundred percent with these guys. but you can get assurances looking at their records and their writings, taking them at their word. scarlet: thank you for your time. back to wall street. theony scaramucci discusses company he founded. ded.

scarlet: for 11 days last july

anthony scaramucci served as white house medications director. and sat down with erik to discuss his firm and his outlook on hedge funds. >> 90 some percent are in the fund it three years from now could we have 10 or 25% of our assets away from our core product? i think so. we have a good coulter at the firm. we have a good distribution mechanism. we can attract core money managers to that platform that are doing well for clients. i do think that will happen. are you now question mark >> a little over 10. we will be subjected to performance but i don't think there's any reason why we cannot double the size of the firm. a 15% growth. seven or eight on the market.

obviously growing organically through good distribution. >> are you raising capital in china? >> we are raising money in korea, in china, in japan. a person that works with us in the middle east. we are in touch with money for the middle east. we are going to be very active in the middle east but our core stuff is really here in the united states where we have a , 20 five-$50,000 minimums, sustainable performance, with a 90 day lockup, so it is an ideal product. >> your primary sales. >> primary sales channel. across different platforms,

whether it is morgan stanley or ubs, to have the product offering that they are able to sell to their clients. >> what are the economics of that? for every dollar of revenue you generate, you keep what? >> roughly 50-50. >> pretty good. >> i think it is good for everybody. it is fully disclosed. if you look at our net number after our fees it is a great value at for the clients. it's a number of hedge funds, hedge fund strategies and hedge fund managers have performed abysmally in the post crisis. what do you like now? thehe sectors i like our home loan market, structured credit. there is a piece and a website trup securities.

you can buy these bond products from communities and small regional banks that are doing well. ratesve high interest returns. it is a sophisticated mortgage. it is hard to decipher and understand. ,he thing i am proudest about , our entire team has done a good job of constructing a portfolio that is in an etf.ble it is important to distinguish, they should have something in their arsenal that is not etf light and something -- in case something goes awry. julie: what strategies do you think are going to come back into favor? prices reenter the market. the long short managers will

start doing better. you start quantitative easing. be longrd for people to something. that is where the journalists have been critical of the longshore -- long short portfolios. longshore, 50% macro. 60% of the exposure is tied to the interest rate cycle. those sectors don't do well. 10sky bridge over the last years we have avoided those sectors and stayed more in the event driven space, the structured credit space. lower volatility. obituary thathe has been written about the hedge

fund industry has been overstated. the reports my death have been greatly exaggerated. they are super smart, sophisticated people. i predict the industry will have a renaissance. there'll be another 800 that close this year. these are smaller funds on the margin. not doing super well. funds, the ones that bloomberg ranks, those are doing quite well. those are transitioning from the founder model to something that is more institutional. angelt about the fallen managers? what happens to them? the threed news for

of them is they have done well in this space for a long time. if they decide to stay in the business they are unbelievably smart people. if they decide to stay in the business, of course. of those third parties instead of just their own. what i would say about john is that he is a brilliant guy. he built a phenomenal institution, powered up business. even though he has been on the wrong side of certain trends there is no reason why given what i know of him and the institutional quality he cannot have a resounding comeback. i am rooting for that for him. he has been to our conference. i used to cover bill at goldman.

bille a lot of respect for . if he stays in the game he is a winner. david i have only met casually. i can't comment as much. >> he is a value guy as much as anything. >> yes. you get on the wrong side of something, you are super high profile. it can get very nasty. i experienced that and the political world. my heart goes out to these guys in the investing world. that was anthony scaramucci speaking with erik schatzker. news, theeaking turkish president has appointed his son-in-law as the treasury and finance minister. the former deputy prime minister who is the economies are of the

government is left out of this. take a look. you can see an immediate reaction. not good. this is the dollar spiking. ,> the worst expand on the day now at the bottom. they do not like the idea of the son-in-law getting that job. >> we will continue to monitor this for you. this is bloomberg.

>> twitters efforts taking its toll on its shares. pollen the most since march after a washington post report said the company's rate of account suspensions has doubled since october 2017. twitter is our stock of the hour. talk us through what happened here. totter's own disclosure came

weeks ago. we are seeing the dramatic reaction today. >> this really amounts to a delayed overreaction to the disclosures reported two weeks ago. they have been finding three times the mat of spam and automated accounts. that number has risen to 10 million. this is part of their ongoing effort to root out manipulation. they have been under fire from congress for allowing fake and automated accounts to run rampant. the reaction is misplaced. it does not really have much of an impact on monthly active users and disclosure numbers. most are dormant. it is important to delete these accounts because many accounts we saw active during the campaign were in fact long dormant accounts activated at keim moments to change the conversation on the platform.

time know that for a long investors have put a lot of weight on those active user numbers, sometimes more than profit losses. when twitters specifically releases that number it is not , however manyever garbage accounts it believes are on the site at any given time. >> the amount is estimated to be relatively small. some researchers have said it could be as much as 15%. the vast majority are not active on a regular basis so they are not counted in the active user number. , whathis disclosure is they do show is the extent of the vast amount of fakery in manipulation attempted to occur on the platform. it brings into question whether that number is correct.

>> the numbers sound big here. 50,000 spam sign-ups a day. the fact that there are so many attempts is unsettling. >> absolutely. it brings into question why twitter didn't do anything to stop this earlier. we saw that during the campaign there were networks of thousands of bots read tweeting tweets from trump, propaganda, what is interesting is that last year are reported from information that in 2015 twitter had discovered a vast network of dormant accounts from russia and the ukraine. the company did nothing and decided not to delete that. the company was prioritizing user growth and revenue over safety. this shows that attitude has

changed. thank you. the market close is next. stocks near their session highs. the dow adding 315 points. this is bloomberg. retail.

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scarlet: "what'd you miss?" stocks rising to a three-week high. breaking through a key technical level. julie hyman. joe: i'm joe weisenthal. if beginning in life, i want to welcome you to our coverage from 4:00 to 5:00 eastern. julie: and more news out of the u.k., jeremy hunt has been appointed the new foreign secretary of the united kingdom. we been seeing significant shakeups in the government of theresa may after an agreed-upon so-called soft brexit plan over the weekend. johnson said he could not supported. could the brexit secretary. the gentleman who will become the new u.k. foreign secretary, jeremy hunt, ends the longest serving health secretary, he's a conservative in the for

southwest surrey, so little bit on his background as we continue outollow these developments of the u.k.. for now it seems as though government will stand. the pound falling after the forest johnson announcement, but recovering from its lows to let's get today's market minute and talk about what's going on with u.s. docs. , thegthening on the day dow up more than 300 points and the s&p 500 rising to its highest in about three weeks time. we have some individual news, pushing things around as well as what's going on in the bond market, so let's break it down a little bit. we talked about twitter and the decline there are reports that the companies getting a little more aggressive about pruning its member base. the reaction is overdone because it's something the company has announced a few weeks ago and has been doing. 11%, reporting

that the company has approached several public companies to try sale,m up interest in a citing to people who were briefed on the effort. a classic interest rate trade, with rates rising, not by very much, but creating a ripple effect in the equity market come utilities broadly down, ppl down 5%. financials the best performing group, led by jpmorgan group, up 3%. take a look at the government bond market in the risk on day comes so not surprisingly we did see some treasury selling. , just sittingtic there in that range. 10 year yields up three basis 2.86. to

a touch of steepening after that flattening trend. scarlet: let's take a look at currencies, the risk on days played itself out. i want to start with the british pound. julie mentioned this earlier. an eventful two days of trading for cable, the pound reversed friday's gains, theresa may saying her entire cabinet was on board with her soft brexit plan, but this morning forest johnson resigning. you could see the pound made a little bit of recovery but all this perhaps setting up for a challenge to theresa may's leadership. for now, she is still in place and the government stands. on one month basis, sterling is off its three-week high. euro-dollar up, giving up its gains after mario draghi, president of the ecb, said you

must be patient, persistent, and prudent. i mentioned risk on, that means weakness for the japanese yen, which is love -- weaker versus all the g10 currencies. and the majority of the major currencies with the exception of the peso. here's a chart we are watching the last hour, dollar-lira. there's a spike in the value of the dollar versus the lira, the afteraken a new leg lower president erdogan named his son-in-law, the former minister energy, as minister of treasury and finance. they met the former deputy prime comparablee could be to the economies are of the government. he was left out at the new administration. julie: he was viewed as being more favorable to some markets.

he had a background with merrill lynch. it's unclear if it's the son-in-law's appointment that is more damaging to the lira at this point. joe: let's take a look at the commodity market. not a ton of action today. oil ticking back higher, west texas back about 74. zinc is interesting, one of the bigger losers today, industrial metals kind of out of step with the rally we saw in china, maybe something to keep an eye on. and those are today's market minutes. scarlet: strong business --damentals should outweigh second-quarter results, according to analysts. joining us is brian who covers strategist,r equity joining us from boston. that, you recently made the point that we shouldn't read too

much into equities rally of last week and we've seen pretty thin volumes because of the holidays and the summer. if anyone was in -- was tempted to interpret the trade war is not be inconsequential to equities, maybe this is not the best time to draw that conclusion. is that still the case? >> i think so. we've had the 2.5% rally in just three trading days. volume too see better give you more confidence that this is something that's going to take us another leg higher. the problem i worry about is, a lot of people are talking about the trade war and were concerned about whether that will be picked trade war or just a skirmish, etc. if that was the only thing we had to worry about, i would be a little more positive on the market, but there are other things going on. the fed is shrinking their balance sheet. it used to be $10 billion a

month, now it's $40 billion a month and that will go to $50 billion in the next order. in we have the situation in china where there stock market is close to a bear market. and weakness in the chinese economy and in europe. and the issues on the political side, whether turkey or germany, venezuela. that are several issues makes it complacent here in the stock market and we need to be careful with this recent rally. scarlet: how much do you read into the moves are seeing in the bond market, given that boeing is not back to where it should be? do we read a lot into the fact that bonds have decline today but last week were a little bit firmer? >> we are in the midst of the longest rally of 2018. it's been a pretty dramatic reversal since mid-may, and all of a sudden you are wondering if

this is trade tensions manifesting itself in the bond market and equities are shrugging it off, i think into do with any sort of risk event. it is unclear right now. there's a question of trading volumes, but the curve flattening trend keeps continuing, and clearly the people are buying 30 year treasuries, they are getting a little worried about things. obviously identify quite a few things for the market to potentially be concerned about, but we've also seen some pretty intense selling in many areas of the market, perhaps reflecting some of that. most notably in the u.s., the industrials have really gotten hammered the last few months. is there a point where some of these beaten-down sector start to look appealing? ,here are some major concerns but also maybe some of it is reflected in the price. >> that is the thing you are always looking for. we saw at about this time last are in the energy sector where it had gotten washed out and it

has obviously had a great rally since then. right now are seeing the industrials trying to make a bottom, and we saw a big rally on the financials, a little too much given the small move in the bond market, so we still have to let that layout. one that i like is the health care sector. itsas broken above trendline from last year and is now trying to make a higher high. we did get a tweet from president trump today, but he seems to focus on one issue at a time. i think that was more a throwaway issue than something is really going to focus on. if you have more of a followthrough upside in the that could sector, gain a lot of momentum in that could be the surprise for the summer. with you talk about the

earnings reports coming in strong or particular troops dancing, perhaps, is there a feed through to the bond market? in other words, we always talk about flow going from one to the other. if we continue to see strength in stocks and people are allocating money there, does that mean less for the bond market? >> there's always a concern in the treasury market, treasury options coming up in the next few days, they will be as large as they have been in a long time. if there is a risk on appetite, there will be feedback into bonds. the question is with the high earnings, were expected to have really solid reports. we just saw the jobs report last week and the fed is on pace to keep going. the question is, how long can this last? it's great times now, but if europe on investor, what's he going to look like five years from now? that's when you will be wanting to get higher yields.

the question i'm wondering about personally is, looking down the line, there's not a lot priced in for the fed past 2019. you, andian, thank matt, thanks so much. shall me stumbles on its trading debut. will have the details, next. this is bloomberg. ♪

>> let's get to first word news this afternoon. british prime minister theresa may wasted no time replacing johnson as foreign secretary. jeremy height took the post just hours after johnson submitted

his resignation. even with resignation of three prominent u.k. officials in the last 24 hours, european union resources are struggling to find a silver lining as the brexit process drags on. may's on theresa government would know into negotiations insight. politicians come and go, but the problems they have created for the people remain. in the mess caused by brexit is the biggest problem in the history of e.u.-european relations. >> it was called unfortunate that the whole idea of brexit didn't come together with david davis. erdogan was sworn in as the

executive president and his noun control of turkish monetary policy. he has already named his son-in-law as the country's new treasury and finance minister while the deputy prime minister was not appointed to the cabinet. and here new york, harvey weinstein was rain on charges alleging he committed a sex crime against the third woman. the indictment includes two cans of predatory sexual assault, which carries a maximum sentence of life in prison upon conviction. he is due back in court in september. global news, 24 hours a day, on-air and at tictoc, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. "what'd you miss?" the securities and exchange commission has proposed a pilot system and the debate between

investors and exchanges is heating up. erik schatzker talked with a guest about the exclusive debate. order is a pension fund order or asset management order, the broker keeps the rebate. public data now shows that the exchange that pays the most in rebates has the worst execution the largestare exchanges. people are starting to question whether the rebate system, paying people to trade come is the best system for us. so a pilot has been proposed to test the elimination of rebates. you have huge support from investors, support from some brokers as well. you have the same camp of exchanges in certain traders that are against it. >> it seems as though the rest of the exchange industry and for that matter, some market, and

i'm talking about the nasdaq, they are all lined up against you. is there no, ground at all? brad: in this case, i don't think so. rebates, theor exchange is so important to their business model, they don't make a lot of money from trading. they make money by selling high-speed data technology, the biggest buyer that is high-speed traders. all this stuff, who am i going to trade against? rebates toes pay attract people into their exchanges, which increases the value of speedy data and technology. it really underpins their business model. >> the language used by some of the common letters filed by the sec, particularly on the part of

the exchange operators is pretty strong. going to quote one, not only callshe proposal, what it irreparable to the national securities exchanges but it also risks undermining investor protections a diverting substantial market share. do you agree with any of that at all? brad: i don't agree with any of that. it's amazing to me that they quote investor harm and talk about the investor if it is important to their argument, when investors are supporting the transaction fee filing. on the basis of the comment letters. i think they are grasping at straws. they are talking about a party being aggrieved when that party is actually sporting the pilot. >> here's what ultimately will matter. if push comes to shove, whose favor, theill be sec

interest of the issuers, or the interest of the investors? brad: it's a great question, and i think that was happen here is at the new york stock exchange issuer, istor, the heavily lobbing them to oppose this pilot. erik: and a number of issuers have written comment letters against the proposal. brad: i've been forwarded the notes they sent around. they talk to these companies saying your investors will be harder. investors will be less likely to invest in your company if you are included in this pilot. do you believe that companies are being misled? brad: absolutely. erik: then that means the general counsel's are dumb enough to be misled by the sec. brad: i don't blame companies

that trust that the new york stock exchange, who is their regulator from the listing standpoint, is going to to servermislead them commercial business interest. i think some people trust the new york stock exchange, and in this instance, that trust has been abused. if the sec issues guidance, do people question the nature with which they are issuing that? they are, they are a self-regulatory group. julie: that was our exclusive interview. from new york, this is bloomberg. ♪

julie: "what'd you miss?" but itomi ipo was hailed

was a rocky start for the company's first-ever trading, going down as much as 6% in hong kong. we had a little glitch in the first day chart, but it was not a happy debut. but the expectation and the hype were huge going into this, so what happened, there was obviously a disconnect. with thisnot discount company has managed to do. they been around for only eight years. the problem was they came out swinging, saying we are and internet company worth $100 billion. a lot of that was driven by the executives their themselves. they just weren't willing to buy it. idea that they're not just a hardware but also an internet company, explain this. i think people just think of them as cheap phones, happy to make electric scooters.

what is the internet part? the whole idea's creative phone and are going to buy that she, and on top of that we will sell you cloud services, music streaming, all the other apps you use like netflix and spotify. of verizon and apple rolled into one. >> exactly. the idea was we will sell you this pretty cheap, still make a tiny profit, but pretty cheap, and then we will make the real money off services. julie: chinese media have compared the founder to steve jobs. shelly: we spent about 10 days in beijing and shanghai with the executives and spent a lot of time with him. there's a lot of similarities, he's a very type a personality,

everything has to be exactly perfect and as prescribed, but some of the creative thinking there might not necessarily be the same. joe: obviously the market has put incredibly high valuation on the chinese internet stocks. there's a handful of them, and up until the last several weeks they been the most amazing performers in the entire work. if xiaomi they're medically join that club, it would be quite bullish. on they showing traction data or services side, or is it still just on the roadmap? is such a small part of their business. do you believe it could become a tencent or alibaba? or you don't. as the company is valued today, it is not an alibaba. could become in the next 20 years? that's for investors to decide for themselves. obviously xiaomi phones

are sold in china. what's the growth trajectory outside of china? shelly: they did a really good job in india but india is a very hard market, and other competitors have already gone in xiaomi is in western europe, southeast, 70 plus countries. they had been talking about coming to the u.s. for quite a long time, but he does not look like that's going to happen anytime soon. forlet: china as a market smartphones has kind of flattened. they're going to have to have the rest of the world to be able to achieve -- achieve the kind of growth that they want and it will be interesting to see how they do that without the u.s., markets like india and south east asia get even more saturated. julie: are there any other effects in terms of the supply chain? shelly: the don't really do

anything in the u.s.. they sell a couple of little things through amazon and walmart, battery chargers and things like that. but it's unlikely anything immediately is going to affect them. from a supply chain perspective, they don't produce -- dte is not affected. shelly: there's a google component they have to maintain, and qualcomm makes their chips for their phone. that is one thing they will have to maintain if they go the way of zte. we will see what happens. scarlet: thank you so much, shelly. that means little rice in

japanese. this is bloomberg. ♪

>> that get to first word news this afternoon. tonight president trump will pick for anthony kennedy supreme court seat. hardiman was runner-up last year when the president selected neil gorsuch preview can watch the president supreme court announcement at 9:00 p.m. eastern time. we will be reporting from washington. the trump administration said it will soon release at least 50 them children under the age of five back to their parents. the american civil liberties union said 102 children were supposed to join their parents before tomorrow's court ordered deadline to reunite families. a justice department lawyer said

the government still conducting background checks. isic us president elect planning his own border police force. the future chief of public security said his goal is to stop undocumented immigrants, drugs, and guns from crossing the border into from central america. employed to be mexico's northern border with the u.s.. in thailand, eight never so that boys soccer team have now been rescued from the flooded k. all of them are recuperating in a local hospital. the other four players and the 25 euro coach are still trapped inside in authorities to say it may take more than one more operation to get them all out. there is concern that heavy rains in the area could lead to more flooding. global news, 24 hours a day, on-air and at tictoc, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg.

let's get a recap of two mark -- the market action. the nest that up by .9%, pretty much felt like a risk on kind of date. joe: pretty solid all-around, starting with that big rally in china, setting the mood for the start of the new we. julie: we've been talking about volume being below average. today's volume in the s&p about 13.5% below the 20 the average. some people still not back from their weeklong holiday for the fourth of july. the nation'ss now foreign secretary. he takes the position after the resignation this morning of force johnson and david davis has brexit secretary after prime minister theresa may's plan to keep the e.u. closely aligned following brexit.

it's like theresa may is facing a battle of survival for the second time in her pretty brief premiership. is this as dire as it seems? >> is it only the second time? of course this is a new quagmire for theresa may to fall into. important thing to distinguish is that david davis and boris johnson, whether leading lights in the brexit referendum campaign, they were not actually that close to the negotiations. david davis famously came out earlier this year that he only spent four years negotiating with his counterpart. what in reality happen is that number 10 is taking back control , to coin a phrase, of the brexit negotiations and they were really doing most of the work. nonetheless, this is bad news for theresa may, because it is taken two years, the cabinet finally agree on a position and

it did not even last 48 hours before two of the main ministers in the cabinet resigns. we still might see more going. minister resigned and for theresa may, it's a question of will be hard right be able to launch a leadership challenge? and if they do that and potentially topple theresa may, what does that mean for the country? the thing is the hard brexit like people like boris johnson said they want, there is no parliamentary majority for that hard brexit. so interesting times with the clock running down very quickly. joe: so the question is, that agreement that they came to last friday, which is some sort of soft brexit on the good side of things, the reason these guys are resigning, can theresa may now credibly take that proposition to the rest of the e.u., or do you think she will

be torpedoed before then? >> that is of course the interesting question, whether that compromise been at home remain -- remains to be seen. let's say was somehow ok with the british cabinet and they could take it to the e.u., do not forget that would've probably been to cherry picking, for was an opening gap theresa may. before she presented it to her they were doing nature of europe, like can we make sure you guys don't shoot it down as soon as you see it? repeatedly theid four freedoms of a single market are indivisible. what we would have seen if everything was going to plan, it would've eventually chipped away , specifically on the issues of free movement of people, the jurisdiction of the european and these arece,

all conservative breadline. the at analogy here is if you remember the complete capitulation during the greek crisis, that is the direction in which the u.k. was heading. this makes it even more difficult. earlier we talked to -- talked about the absolute lack of clarity that resulted from this latest turmoil, and is difficult to see an in game to these negotiations. we should make clear that he is a hard-line remainder was not in favor of brexit at all. nonetheless, what kind of scenario could possibly play out at this point that would allow britain to meet the deadline? >> that is the question on

everyone's lips. as i mentioned, the interesting question for me was always whether the hard right in theresa may's party, and let's not forget there are some mps in the conservative party you really believe that the no deal, nuclear option is the better outcome of brexit negotiations for the u.k.. i was always wondering whether or not that hard right flank of the conservative party would cause so much domestic turmoil at home that it would be the only inevitable outcome. i don't think it's in anyone's interest not to have a deal, so if the turmoil continues, let's not forget that if there is a leadership contest, that takes three months. we were supposed to have the last european capital summit in june and that was meant to be one of the final summits.

maybe if this continues wrongly on for a few months, will see an extension of article 50, the formal exit mechanism of the e.u.. it gives the u.k. two years to negotiate out. in order for that to happen you need all the e.u. member states to agree to that. perhaps some people are observing the political turmoil in the u.k. and thinking, let's just let this one play out. he knows, perhaps the referendum could be overturned. it's anybody's game. david davis has said that whoever is brexit secretary should be an enthusiastic believer of theresa may's approach, does she have a different approach to brexit or is she a pragmatist here, basically doing whatever can be done? >> she has been through a very steep learning curve.

if you look at the executive feature she has made on britain's position in the brexit negotiation time she has been clean been -- basically been mugged by reality. having presented her plan beforehand, she's trying to get her cabinet on site. she's trying to be pragmatic in i would call a fantasy that simply does not exist. there has been a lack of clarity by the government, about the inevitable trade-offs that brexit will entail. what is interesting is that those who resigned felt they could not sell the vision that theresa may has now espoused him a but that's like pushing the narrative that this brexit is not going to work if it is not done in the way they would have wanted. i expect that is the narrative we will be seeing for a long time to come in the u.k..

forlet: thank you so much staying late and joining us on the breaking news here in the u.k. joe: coming up, a cloudy future for utility companies. ahead. the forecast and get involved in the conversation. what are you eating their? joe: some charts, some headlines, other stuff. what do you want to hear from our guests? let me know. this is bloomberg.

joe: "what'd you miss?" electricity, natural gas, and

water are as important today is the were centuries ago. but the times are changing. willamette utilities industry be able to change with them? joining me is nathaniel bullard. thank you for joining us. utilities, just sort of think they are basically the same companies 50 or 100 years ago. are they on the verge of major changes to their business model? it's a good question. is highly regulated and of course everybody needs electricity, water, and gas. so they have all these attributes of long-term stability. we look at the margins where there's a lot of change to see what rules the -- what rosie century-old models might have to play. one of the ideas you bring up in your piece is the idea of

maybe some energy, batteries in solar, maybe not all energy systems will be one centralized power plant. what are the ramifications of this? nathaniel: you've got to find callody to do what you technically balancing. you got have someone is able to meet supply and demand but also do transacting and things like that. there's a lot of questions around how that might go. if you got solar and a battery at your house and you want to sell some heat, it still has to go through some entity. a typical clearinghouse would be the best way to do it. it's going to be an interesting thing to see develop. it's an application that has some potential to it. we see a lot of people talking about it. it's not something that's been done with a lot of deep activity. it's a sort of thing that would toentially -- someone has

own the wires through which those things flow. they're still a common carrier so to speak. an opportunity for utilities are electric cars? getorically they did not their power through the electricity grid, but now you have people charging their cars at home. is this an opportunity, or is there a risk here also? we have a thing called document search and i pulled all the different mentions by utility name of the term electric car or electric vehicle, and it's like 300 utilities have mentioned it this year alone. have an affinity to -- i'veintensive already got a customer relationship, maybe this is the sort of thing i can get into long run. i bet i know you're going to ask

me, what about competition with somebody else? i can give them the ability to move a vehicle, so maybe i will make my own move. i was going to ask a different question, but i'm glad you brought that up. vehicles taketric on a substantial share of the market, the utility companies currently have the capacity to increase their distribution and production of energy? or would that require a pretty substantial capital investment on their part? nathaniel: it's a good question. is less about why them of power. demandct more than 5% of to come from electric vehicles by the year 2050. is less a question of that 5%

rather than when it gets delivered and where, and to what. the big question there is, is it going to be delivered to people's houses when a charging overnight, or does it need to be delivered to maybe a place of work where it can be done over the course of two hours. are you going to go to the equivalent of today's filling station and you need to charge super plus for 15 minutes and then you take all. as we mentioned in the beginning, investors in utilities think of these ultimate yielde plays, very safe, business models don't change, very predictable business. are we seeing the changes coming anywhere yet in today's results, or in your view is it all phil started -- still sort of

speculative? ithaniel: as far as seeing in today's result, i would not say quite yet. most of it because you can look out and see the forecast an expectation within a decent couple of years timeframe. that's probably what most investors will be looking at. it's more like an existential question about the really long-term future. i'm not sure markets will be able to rise to that sort of a. stuff nathaniel bullard, thank you very much. talks between the u.s. and north korea stumble. for costs will it come north korea to give up its nuclear weapons? from new york, this is bloomberg.

scarlet: we'll north korea denuclearize? president trump said kim jong-un -- he's confident or three will stick to its promise on nuclear weapons. the comments come after the demands were called gangster like and said the regime will not respect them. bill, put this into perspective for us. you've been doing some reporting on my pompeo and how is he proceeding in these discussions with north korea? we know he has the respect and trust of the president. does that mean he is in a position to change the president's mind on things? or is he merely a messenger for the president? bill: he's in a really tough position. he's taken on the north korea

portfolio and is been to pyongyang three times now and has an early successes with return of prisoners, but he really has to balance the u.s. president who is famously and will for results focus on other things when things are right going his way, and on her north korean regime that's equally famous for dragging things out. they've been stringing along the international community for more than two decades on their nuclear program. this demand balance from the president to get results quickly and north korea's interest, which are, frankly, not on denuclearization so much as perhaps getting sanctions lifted and getting a peace deal for the korean peninsula and seeing u.s. troop levels decline. so it's a very tough needle the secretary of state has to thread. we saw some of the challenges over the weekend when meetings really didn't go as the u.s. probably wanted them to. story onu edited a

witnessing some of pompeo's interactions. there were some good tidbits. talk about some of what he saw there and what that tells us about the negotiations? amazinge of the most things from next reporting was when the u.s. plane landed in town and, u.s. delegation really didn't know what their agenda for the next 36 hours was going to be. they didn't even know were they were going to be staying. they were surprised after landing to find out they would be staying at a guesthouse that they had not previously been to. they had gone in expecting perhaps a meeting with kim jong-un and that never materialized. north korea really set the agenda during these two days of talks. that was something that perhaps wasn't as much the case in previous meetings. so pompeo was put in a very altered position of being delayed at very long meals and being put in a situation with

reporters that usually we don't really get to see him exposed to. so the talks were a little rough. he left saying he had a productive meeting, they had a lot of issues to work on. two hours later, north korea put out a statement saying that the u.s. had a gangster like approach, that the u.s. strategy was cancerous. so pompeo was put in the awkward position of trying to explain what happened behind closed doors with what north korea was saying publicly. joe: in the run-up to the singapore summit, there were a few pickups. at one point it was canceled briefly, some angry words on both sides. big picture, or incidents like this to be expected and not necessarily to be read as a sign of the whole process being doomed? bill: absolutely. these talks were always going to be very difficult and take much longer than probably the president himself would want. that's something that people who

have a lot of experience dealing with the north koreans warned the administration to expect. i think the most positive sign we've seen on the u.s. side today is a president trump signaled that he will be patient, he's not going to get frustrated with the north korean criticism of this weekend's meetings. he said we had a deal, we had a handshake with kim jong-un. i trust that would will be going forward with denuclearization. the north koreans in their statement said they still continue to trust president trump. that was a sign that the leaders on both sides want things to go forward, even a some of the public rhetoric maybe took a little bit of a nosedive. much, bill. you so joe: coming up, what you need to know for tomorrow's trading day. this is bloomberg. ♪

>> the financial higher pushing the dow up.

lots coming up in the days to come. president trump is picking his supreme court nominee tonight. don't miss our coverage with david. >> i will be looking at economic data, u.s. jobs reports coming out. >> investment bank allen and company, the annual conference in sun valley, idaho. heavy hitters will be out there. ♪ phones have made our lives effortless.

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emily: i'm in san francisco and this is "bloomberg technology." shares drop on its first day with escalating trade tensions with its valuations. plus electric scooter has a global expansion with a massive new funding round. we will speak to the co-founder. and