86% correlation between how good or how about the stock market is in the fourth quarter and christmas sales. remember, the stock market, the s&p was down 20% in the fourth quarter, 9% in the month of december alone. our biggest concern waiting for the christmas number was that the market would do exactly what the historical analysis suggested. that is exactly what happened today. has advancedsenate the border deal and will vote on its passage as well. things are moving on that front and it looks like the government will remain in business, nothing will get shut down. we are waiting for president trump make good on his promise to declare a state of national emergency. >> the markets are down and it was a day where we managed to recover a lot of these losses despite the head winds come interesting emergencies being

declared, we understand, despite negative headlines surrounding the u.s.-china trade negotiations and that dismal retail number as it continues. it's one they want to shake off the losses. >> it's striking how little the government shutdown affects the markets. it's a big story and important to -- for all kind of reasons, once again evidence that it's just not a big party market. >> it's the fed. >> as we saw when government was shut down for 35 days, kevin told us, we lost about .1% in g.d.p. so we lost a half percent of growth. maybe government officials are not smart. they are not one trial learners. they realize taking additional g.d.p. away from the market probably not a good idea. i think there was motivation here to keep the government opened and try to find some common ground. >> let's get more analysis now. dive into the action when the close. abigail? abigail: i am looking at that 200 average on the s&p 500. i would like to bring in the

detail data and what phil was talking about relative to the idea of the fed. perhaps bad news is good again. look at the longer term chart. in blue we have the s&p 500 they say the stock market is six months ahead. you see the huge dip for retail sales. last year we had that massive volatility. then the fourth quarter. now we have this bad data coming out, the s&p 500 rallying, closing just above that 00 day moving average, suggesting with that retail data that the fed may just stay on pause. that could just mean that we'll have the stock market hold current levels. maybe go higher. we'll see. >> that actually dove tails nicely with what i'm looking at. this is a $16 billion fund that invests in international government bonds. bndx, the vanguard fund. it has seen it's assets swell by nearly $3 billion. take a look at the total assets

under management. the question is why are investors in the us us in particular interested in investing in a fund where 30% of the assets are jeaps and german bonds which yields nothing or less than nothing in some cases? and the answer is, frankly, the easy money policies over there have generated bigger gains in international bonds and even u.s. treasuries, even though an absolute basis yields in the u.s. are higher. if the u.s. does take a dove -- can fed does stale on hold, a lot of traders are speculating that will only give more confidence to central banks around the globe to continue with their easy policies and their easy money policies. making it sort of a tossup to know which area is better for bond investors. >> we have to talk about cobalinga coala. the shares falling the most in a decade and closing decisively below that closing. giving a lackluster forecast for 2019, saying adjusted

earnings growth would be minus 1% and plus 1%. a lot has to do with sales. when you look at the volume of cases of beverages that they sold, we're seeing a lot of weakness that that growth. sales in north america dropping about 1%. sales in latin america drops about 2%. and while sales in asia did actually rise 2%, that's a significant slowdown in growth that we saw in the previous quarters. object top -- on top of that you have a company grappling with higher transportation cost and aluminum cost. this is a company that gets about 75% of the revenue from outside the u.s. the most recent quarter is the company's gross margin dropping to under 62%. that's well below where analysts were expecting. it was the biggest miss they had a gross margin basis since 2009. >> thank you. meanwhile, talking about fizzing out, the shares of materials falling biggest maker of equipment to make chips. second quarter forecast that

has missed estimates. this is coming very low guidance out there already because concerned about exposure in terms of the overall demand for its equipment come interesting chip makers. they have beaten on the first quarter numbers but only just. they have been downgraded of late. then the second quarter looks like about a 5% miss from estimates. >> right now that 1%, you wonderer if that will stick and lead to pressure tomorrow. still with us phil orlando, bloomberg's luke. as we're looking at the different sector performances here. rell state invs.ments trusts doing well. financials doing poorly. talk about financials under pressure here. so many people had expected this group to get a bid here as investors look at how the market is in a different stage of its cycle. and financialing are show the value people have seen. >> i'll put ourselves at the top of the list. we were looking at the market with that 20% correction down

last year. we thought there would be a bounce in the areas we thought would lead were financial services, energy and industrials. the areas that have gotten hurt the worst. we like the fundamentals in the financial services industry. we think margins have widened. we think the economy is still strong. we to not see a near term recession. we think lending volume will still be pretty good n that environment, we -- it's our belief, the financial service stocks will do well over the course of this year. >> luke, something i i was thinking about after that retail sales number. everyone is trying to figure out whether it's a signal, blip. did we hear anything this quarter on corporate calls that would suggest that things -- the wheels fell off there rapidly in december? presume bring a number of companies would have identified it if it was such a big downshift. >> not a lot. you did have pockets of weakness in retail. macy's comes to mind. i think macy's and target one morning in january release

rults concurrently. i remember -- results. concurrent can. going one of these is a lot bigger than the other. tell us one of them to about consumers bigger than the other. that was target. one thing that through people off was the heating oil and prices went down f it looks like internet sales were week, that was a heating thing. >> great point. internet has been the star for certainly the last couple years while the macy's and jcpenney's and sears of the world struggled. even the nonstore retail, internet component of the december report was hugely negative. consumers were literally buying nothing. >> let me jump in here. cbs has reported its results. for the fourth quarter adjusted of $1.50 missed the estimate by two cents. a market increase from the same time last year. even though it's an increase, it has missed the mark when it comes to the bottom line.

top line, cbs reported revenue of $4 billion. analysts were looking for 4 $12 billion. this miss on the revenue line is also a miss of the lowest estimate among the numbers that we got from analysts. you are looking at a drop in cbs shares at the moment of about 1 3/4%. >> new leadership, and the advertising segment after the midterm elections. . the moment down .9% great tie. what are you loving to create your heart sny you believe financials will get there at some point. what about some of the other factors? >> energy and industries were the other two we thought were disproportionately taking up out behind the wood shed. the fundamentals are still good there. you look at energy for example, over the course of this year, underlying crude, w.t.i., is probably up 20%, 30%.

the stocks have started to work. we think there is more room to work there. industrials, again, we don't expect a recession. we think that those stocks were pricing in a recession in the fourth quarter of last year. the rebound that we think we have started to see there is one we have legs. those are three areas we would continue to focus on. >> just to keep you up-to-date, anyone keeping score what's going on on the floor of the senate, the senate has enough votes to pass the border deal. it will avoid the government shutdown. the vote is ongoing. but it has sufficient votes. >> luke, you are looking at today's action, the other thing we see, nasdaq joust performance. as we get back into erasing a lot of these losses from last year, is there anything to suggest that tech can't just go back to the races and outperform again like it was for so long prior to q-4 of 2018? >> the thing that suggest it is can't would be the expectations even for the heavyweights are for not as much growth as they have in the past and not as

much of a growth gap as in the past. even on a day like today, you have the s&p high data, slig outperforming the lower volatility stocks which i think tells you there is a penchant for risk year names. at the same time igcbx narrow tafmente even on bad days there is a lot of appetite to assume risk. >> we have been talking the last few days whether you should be in small gaps and large caps and international exposure. when we have so much eyes averting to tomorrow and the china-u.s. trade talks. do you want exposure do international? >> you do. the area we like is meerging markets as opposed to -- the dollar we think is one of the reasons to buy it. if you look at -- we like d.m. two years ago. we didn't like e.m. last year, we like them this year. currency is an important part of that. over the course of the last year, u.s. economy did very well last year. our central bank was tightening and the dollar got stronger.

went from 126 to 112 against the euro. as we look to 2019, we think the economy is slowing down. we think the fed is either done or largely done. we think the dollar's probably topped out here at 112. oil prices are working. and meerging market stocks down 30% last year. you look at that basket of valuation metrics, that suggests e.m. ought to have a much better 2019 than 2018. >> phil orlando, chase equity market strategist, thanks you so much. along with bloomberg's luke. that does it for me and the closing bell. lorraine is stepping back for what did you must. amazon's change of heart. why a tech chinetginte is scrapping plans to build a second headquarters in new york city. this is bloomberg. berg.

♪ >> bloomberg's head quarters in new york. >> here's now u.s. stocks closed mix on the day. the tech was the -- >> the question is, what is it? >> ready to compromise. president donald trump is expected to sign a spending bill and will declare a national emergency to get additional funds for a border wall. ow backlash. we speak to a new york city councilmember ahead. this drama retail sales plunged

the most in nine years. why some economists were skeptical about the accuracy of he december numbers. let's take a look right now. national political reporter who is on capitol hill with the latest on the shutdown. we understand that the vote will pass. >> yes. very likely that this piece of legislation will pass the senate and the house. there is a bipartisan consensus in favor of the particular provisions in it. and with the fact that president trump has indicated that he will sign this bill into law. i think that eases most of the republican concerns. the big news is that the white house is also announced that it plans to declare a national emergency to find extra funds to build a border wall. this is something the president could no achieve through the appropriations process in congress. this is going to be a highly controversial move that is already splitting members of the president's own party. there is deep unease about the idea of a president's tossing aside congressional authority

when it comes to the appropriations process. essentially governing by fiat. this is going to be a battle in the coming weeks and months to come. >> the assumption has been an executive order would be responded to with a lawsuit and years and years tied up in the courts. who might bring that lawsuit? how long could it go before any of that apportioned money turns into wall construction? >> it's early -- it's early stages but i did speak to a number of democrats who said it will be challenged in court. there are issues about the legality, national emergencies act, why is it an emergency today but not an emergency three weeks ago or three months ago or one year ago? especially when the president by his own reckoning that the border is more secure now under him than before. the white house will have to make that case. it's not clear just how much fact-finding the white house has to show. the national emergencies act is broad in the powers that it grants to the president. even its power has not been used on politically divisive issues.

it's been used in the past on things like troop deployment after 9/11 and by president obama on readiness for beebowla. none controversial things. in terms of what would happen with a lawsuit, unclear. congress may -- the democratic house, for instance, may say this is -- they are subverting congressional prerogative and file a lawsuit. it would seem to have standing because this is a separation of powers issue. >> i'm going tointrupt you for a second we have breaking news on oracle. berkshire hathaway showing it exited its steak in oracle by the end of the fourth quarter. we're seeing oracle shares fall on this news. berkshire hathaway, warren buffett insurance and investment company, was one of the largest holders. now turning back to the government shutdown. can you give us some sense now that we have a deal and presumably it gets signed by the president. what is sort of next in the budget fight? this is going to take us

basically through the end of the fiscal year. what's next for congress to deal with? >> takes us through the end of the fiscal year. the government will be funded through september 30. keep in mind what happens right after that is the 2020 presidential campaign will heat up. it will be few months before the primaries. i think there will be a large field of democratic candidates. many of whom are members of the united states senate. but are going to be jockeying for position. i expect what will happen is something very similar to what happened this time. the appropriators in the house and senate and the republican and democratic side worked very well together on 99% of the government funding issues. there is overwhelming agreement on most things. only disagreement was on the border wall. it looks like that fight will be now pushed away from the congressional arena to the legal arena with the president declaring an emergency to find funding for his border wall elsewhere in the budget and the democrats challenging that. of course republicans are concerned about the precedent that it sets. can a future democratic

president declare a national emergency in the area of health care and fund single payer system that way? can a democratic president declare a national climate emergency and fund a green new deal? can it declare a national gun violence emergency and ban assault weapons? the possibilities are limitless once you go down this road. that will be a challenge for the white house and court. what about enough money you? >> that's one of the questions democrats have. kim cane said he would be opposed pulling money from disaster. that part of the budget that's used for disaster aid. that's an issue for republican senators as well. d.h.s. funding. d.h.s. funds a lot of things that conservatives support. they are not going to like the idea of the president pulling money elsewhere. the president probably can can do it or attempt to under the national emergencies act. that's going to be yet another contentious area. another wrinkle. what does the president defund to get his wall? >> always good to get your

perspective. we're looking at more headlines oming in terms of the -- berkshire hathaway cut its apple steak to 5.3%. still a key holder of apple overall. warren buffett. it is downsizing in some technology space. >> we know what a rough quarter it was for apple. we know one of the sellers. >> reiterate on oracle 40 million shares is what's up. >> we have a video coming out with the numbers. fourth quarter adjusted earnings per share, 80 cents. remember they preannounced $4. billion. coming up, jamie diamond c.e.o. jamie morgan. we'll look how his bank -- this is bloomberg.

>> so many braking news now on fedex. their president and c.o.o. is said to retire. that's an announcement coming directly from the company right now. they did name a replacement for david who is retiring as president and c.o.o. radge will replace him. that's come interesting a statement out of fedex. >> the political headlines, u.s. senate is passing the bill to avert the shutdown. we know it heads to the house to vote next. the question is when that emergency declaration will be made by the president. as expected, it seems as though this vote it avoid a shutdown has passed. back to the numbers. hedge funds. abigail has the details. >> caroline, it is shaping up

to be an exciting filing season. at-away out. re we recently had third point, dan along with viking capital. look at details. berkshire at-away. they have added head -- at-away. -- hathaway. looking at .72. exited shell. they added cigna, they added big names including microsoft. and dan has been a big fan of pay pal. they cut that stake sharply. it will be wlorned he's changing his tune or because of redemptions. and then viking global, they exited g.e., a $1.5 billion position. here is a chart of g.e. last year, the worst year in quite some time on record. but this year up more than 30%.

perhaps that selling pressure not being on g.e. any more. a reason why that stock has been able to rebound. looking ahead we're looking at green light capital, pershing, among others. exciting times. >> we thank you. >> j.p. morgan kind of testing o out the crypto space. the bank has developed a prototype digital currency called j.p.m. coin. let's go over what this means with tom, principal of delphi digital. thanks for joining us. he of people today said, called bit coin a fraud and they are getting into the digital currency space. is it anything comparable? is that the right frame for thinking about this? >> you're on the money. it's different things. bit coin's a global curn cancy. what they are trying to do achieve is basically speed up their global payments business. they want to streamline the process. they want to do it for institutions. they even want to go after

swift. but the real people in their headlines tide is not bit coin. >> what does this mean for ripple. >> they have been working to create products using x.r.p. for international payments for the last seven years. what it does is basically dismisses all that work in creating their own coin to do this based on quorom. >> i'm interested in the fact that x.l.p. is down a tenth of a percent. the reason behind that -- >> crypto is an extremely inefishen market. news does not move it one way or another. >> in your view, i'm looking at your t-shirt i think it says -- i'm gemming you you you are skeptical in any blog chain. i get it. that being said, in your view is there a role for enterprise blog chain in the financial system to speed it up? or do you think the promise -- premise is flawed from the

beginning? >> there absolutely is. we'll reduce speed from one day to second versus swift. and costs significantly. the problem is this is not going to happen tomorrow. this will take years. >> to you foresee other large banks and institutions following j.p. morgan's lead? >> they can either join them or be left outside. they have to join j.p. morgan's coin now or left out. >> in terms of areas of coming together had been, there had been one called r-3 which is where j.p. morgan pulled out and coming together of banks working towards some sort of general use case. will j.p. morgan win out by having started, or is it actually there is no winner per se? or is the winner be the underlying block chain end up adopting. are they going to use one being flagged. >> other banks are going to

have to join this network because network effects will take over. we'll have people that want to use j.p.m. coin. if their bank doesn't let them, they'll leave that bank and go to an institution that supports it. j.p.m. coin has a lead. whether or not it wince out over ripple or x.r.p., we'll see. >> talk about bit coin itself. obviously kind of all of 2018 unrelenting gloom, it feels like we're at the stage where it's starting to go from people being negative to people being apathetic about it. you don't hear people talk about it the way you did in 2017 and most of 2018. even though there are developments in the space and still people building on top of it, in your view, what catalyzes the long bit coin part. >> there is a long-term shirt. don't think bit coin -- the bear market is done for crip toe this year. we still have some down side. >> what's that based on? what would ultimately turn

around when you look at the history of bit coin or crypto bear markets, are there any rhythms you can infer that say, ok, this is what a sign of a turn around is? >> adoption is a big one. whether or not e.t.f. gets approved. are potential catalysts. the reason why i'm bearish we don't have a clear-cut one tomorrow. > great to get your opinion. to mark compton. >> the senate has passed a bipartisan compromise spending bill to avert another government shutdown. that gives president trump less than he demanded for a border wall. the white house says the president will sign the measure, but will declare an emergency to get additional funds for the barrier. house speaker nancy pelosi says if the president declares a national emergency at the border, he's making what she calls an end run around

congress. the speaker said there is crisis at the border with mexico that requires a national emergency order. >> did i say i was filing a legal challenge? i may. that's an option. we'll review our options. >> the president is prepared to invoke a national emergency to build the u.s.-mexico wall. congress refused to provide $5.7 billion he was demanding as part of that budget compromise to avoid a federal shutdown. the british prime minister has suffered an embarrassing parliamentary defeat on brexit. lawmakers remain resistant to her e.u. divorce plan. the house of commons voted 303-258 today against a motion reiterating support for the prime minister's approach to precksit. >> i was going -- brexit. >> i was going to ask her to come to the dismatchbox now and admit that her strategy has failed. and come forward, bring forward

to the house a coherent plan. a coherent plan that can deal with the stresses and anxiety that some people all over this country are feeling. >> prime minister may is struggling with little sign of you awk sess to win backing for her deal from both pro-brexit and pro-ex-u. lawmakers in partly. which reject the the agreement by 230 votes last months. the leaders of russia, turkey, and iran have discussed the planned withdrawal of u.s. troops from syria. russian president putin and his iranian counterpart said in a news conference after today's talks that the syrian government must take over the regions where u.s. troops are currently deployed. president rouhani said quote, must definite be evacuated and the terrorists must be pushed away and must return to syrian national sovereignty. that's a quote.

president erredo began said the u.s. should not pull out and leave a power vacuum. he reaffirmed turkey's intention to create a safe zone to secure the turkish border from the kurdish militia. global news 4 hours a day on air and on twitter followed by more than 2700 journalists and analysts in over 120 countries. >> thank you you. now pulling the plug. amazon has announced they will not be moving forward with their plans in new york city after being met with opposition from local politicians. not all lawmakers shared their sentiment. >> i didn't know behind the scenes of what was happening in new york. i i would say you are welcomed in detroit. detroit is the happening place right now. >> we'd love to have them there. only in a place like new york, maybe coy throw california in

there with it, would they shun or turn away somebody like amazon wanting to come there and do business. who was member jimmy an active voice in the opposition. let's go for you. clearly you'll be delighted by the outcome i'm sure today. what of the investment in queens? what of the jobs that were meant to be coming? what of the restaurants and business that is would have benefited? >> the truth is there were other investment opportunities before amazon. hq-2 superseded some other plans that were on the drawing board. there will be other opportunities after that. the truth is, amazon chose to pull out rather than fight for this deal. the mayor was right. this is a tough town. you have to take some criticism and fight for what you believe in. i was surprised that they pulled out at this early

juncture. instead of actually dealing with some of the very real issues that we raised. i saw the republican senator from indiana talk about what he cares about. but in new york, we do care about workers' rights. we do care about workers' being able to unionize. we were stunned when amazon declared once and for all we will fight the rights of workers to organize. we're not just talking about h 2 q employees making 4d00,000 a year. we're talking about the distribution center and warehouse workers. that's who they didn't want to organize. that's why they chose to leave and abandon the deal. they don't have to deal with these issues nationwide. >> are you worried this might send a message to other can companies that were looking to relocate here or expand here? >> i think new york is the corporate capital of the word. -- world. if a company wants to come to new york city and declare themselves anti-union, so much so that they will say, before

the city council, as amazon executives did, we're going to fight to crush any organizing opportunities that come our workers' way, then we want those companies to rethink those values. we want them to come here and adopt our values. they can can come, but they have to talk to the values we have in new york city. >> david, come in here, how much do you view amazon's the way they handled this? with a general problem of perhaps not realizing the backlash. big companies and big tech. that sort of appreciating the power of that given that in many cases we haven't really -- with all the talk we haven't seen much organized opposition. >> clearly they didn't figure what they were heading into. i think amazon has been highhanded from the beginning of the announcement that they were going to search for a second h.q. the secrecy of it. the idea they were gathering data from all these cities and who knows what they were going to use that data for. that was a subject of a lot of criticism. i think they didn't really

engage with the community. i think what the councilman has said, everything i agree with. the idea they should declare they are not going to allow any unionization, period, is just idiotic and counter to the spirit of new york. that was not going to endear them to people. also it's so funny to me and emblematic of the moment. maybe two of the most, the two most famous americans right now, jeff bezos and alexandria casio cortez going head to head. this is not a time wrt established powers tend to win. it's not -- it's emblematic moment. >> the unionization issue aside, should new york city get out of the game of competing with other cities for big investments by offering more and more generous tax abatements? >> we certainly shouldn't engage in charades and reality show tight competitions like this one was. i think cities and states all the time want to talk about why

they are good places for people to invest. that doesn't mean you have to engage in this nondisclosure agreement, secretive environment where cities and states are pitted against each other in a race to the bottom. amazon insisted on this. i think we should say we're not going to be doing that kind of economic development going forward. it was bad. the city of pittsburgh offering $9 billion in tax incentives is absolutely insane for the city of pittsburgh. it was wrong for bezos to pit us all against each other. when we knew what he wanted and had an idea where he wanted to go. >> former c.e.o. after the goldman sachs is out with a tweet. killing amazon's new york headquarters by progressive democrats, this move was anti-progress, and anti-democratic. a victory for progressive lawmakers but not for n.y.c. how do you respond to that? this is a sentiment among a lot

of corporate leaders. >> it's a victory for people who care about workers and workers' rights. that is a progressive core value i have come interesting a union family. no one killed amazon. amazon chose to walk off the field. amazon chose to take its marbles and go somewhere else. amazon could have actually chosen to engage. amazon could have actually chosen to negotiate. but amazon chose not to do that. yes, we were opposed. i'm proud of the opposition and the values that i raised. at the end of the day, if you are telling me, the local city councilmember elected in western queens forced the richos and most powerful man in the world to abandon his plan and i forced them to retreat, i don't think that's true. they chose to retreat because they didn't want to change their ways. >> david, to that extent, we haven't seen san francisco and seattle leaders be all that

good at engaging. >> that is an understatement. >> is this something that is being learned? >> something that hasn't yet been learned. i absolutely think they could have made this work if they had come in here with more humility. one thing i would love to ask the councilmember, if i could, isn't it true, though, that any business that came in with a project of this scale would get massive tax incentives? that's just a given in new york city. maybe what it has drawn attention to is just how many snacks incentives there are that are thrown around routinely. >> absolutely true. most, not all. there was also a $500 million cash reimbursement to jeff bezos for building of the buildings tucked into the deal. $2.5 billion. but you are right. we as a city need to take another look at these incentives. which at a time were meant to encourage smaller corporations and companies to invest in the outer burros. i don't think anyone could be

tell plamented someone as big as amazon would choose to take advantage of these particular tax incentives which then ballooned the payments to an object seen level. >> i -- obscene level. >> i wish we could carry on the debate. coming up, the hedge fund bail on u.s. stocks in rocky fourth quarter? rebreak it down.

>> hedge fund in the fourth quarter investments. abigail has the breakdown. >> this is the last date for hedge funds to make the filings. major investors updating what the position changes were in their portfolios as of december.

so who is out already? erkshire hathaway. you-all just broke it not so long ago. berkshire has exited oracle. the software maker. entered into red hat. and of course they reduced their apple position. they were reducing in that brutal quarter. the worst quarter for apple since 2008. recovering on the year, it's important to note still their largest portfolio holding. taking a look at point 7. they exited shell. and then third point, they made interesting moves adding cigna. exited mi crow soft, netflix. also for third point, dan has been a very big fan of pay pal. that stock has had a huge move over the last couple years. last fourth quarter down about 11%. they reduced their position more than that. we're still waiting for other

big names. such as pershing square and green light capital. >> thank you. now let's turn to the u.s. economy. u.s. retail sales took a surprise dive this december. the question now being is this a one off slump or start of a longer trend of weakness? discuss that now. a senior u.s. economist at bloomberg economics. and joining us from washington is our bloomberg opinion columnist who writes about the retail sector. i'll start with you. a lot of people were dismissive of this report saying it was a glitch in the matrix and shouldn't get too concerned about it. i saw you and the folks at bloomberg economics lowered your g.d.p. forecast for the year because of this. >> whether it's a glitch or not, this data will be g.d.p. numbers. e had to look at the numbers revise our estimates for g.d.p. 2.8%. red it 2.3% from

that means slightly lower growth for the year as a whole. we now expect 3% instead of 3.2%. it's possible that it's a glitch. it's possible that data collection were impaired by the government shutdown. and we might see some provisions in the january retail sales report. nonetheless, some of it must be true and makes sense because if you look at the details of the report, the weakness is so broad based. if it was one sector, for example, that was affected, i would say, yes, maybe. but it's all across the different sectors of retail sales. >> in watching corporate earnings so far this quarter, have you seen anything that corroborates the official data that u.s. consumer tailed off that fast? >> i haven't. that's why this feels like a big mystery to me. from the holiday results we have seen so far, target was

strong. five below was strong. kohl's was fine. and the retailers that struggled were one that is had been struggling generally. jcpenney and macy's. they are in the department store format that's incredibly challenged. i don't think that's that'sly a -- that's necessarily a great barometer. it's also worth noting we got earnings from ralph lauren, underarmor, capri holdings the new name of michael kors and no one mentioned consumer weakness. this does just feel a little bit of a mystery to me. >> remind us if we -- how quickly will we see any changes or reassessments of the numbers? >> we'll get another report in a month. and we'll get january report together with the december revisions in about a month or so. i would say that also this weakness stands as a stark

contrast to acceleration in income growth. look at the latest report. wages are growing. so that means people are getting more money every month in a paycheck. i think whether it's statistical aberration or weakness in one month, we might not see that continue this year. we probably see a rebound as soon as the second quarter of this year. first quarter could be still weak because we're going to get smaller refunds. and some delays in -- that could affect q-1 numbers. in the second quarter we should go back to really robust consumer spending. >> if we're sort of looking for a rebound or trying to see if one is out there, what are you looking at going forward in terms of whether it's corporate earnings or retail reports that would catch your eye? >> i think bellwether retailers

are target, best buy. they are companies that are companies that are healthy not suffering from a lot of other retail apocalypse ma lace. it shows -- m lays -- p malaise. >> great to get your perspective. now to asia ahead. progress in beijing. u.s. and china trade negotiators are far from a eal. we bring in bloomberg trade reporter in washington. daybreak asia here in new york. set the scene for us. it seems we have some mixed reports. >> what we're hearing now at bloomberg is the u.s. has not really relented on demands to reward china on those structural reforms. we have seen a really not a lot

coming out of these negotiations in beijing. right now sources telling bloomberg, elaborating on this, potentially president trump could be looking to an extension to the tariff deadline of march 1 for another 60 days. >> talk to us about the different factions within the white house. some people are hawks on china. some people may be just want a deal. which side feels that they are in a good position with this march 1 deadline? >> i think that's something that feels like a it changes all the time. bob, who is traditionally seen as a hawk, from the prag a matic wing of the hawks if we want to invent a new faction here, is in charge of these talks. he's clearly pushing hard for some structural forms. the big factor we have emerging here is time. march 1 is coming up really close. we have got the national people's congress in china that

launches on march 5. it will run a couple weeks. no way we'll get any substantive negotiations while that is happening. that takes us into the second half of march, potentially, maybe we don't see a summit between trump and xi until april. these things look like they are going to drag on a while. that's why we're hearing that at the white house and we're hearing this from the chinese side as well there is real talk of 60-day extension in the truce. >> when you talk about what you are hearing from the chinese side, how much of this is really contingent on them? we talk so much about trump. the chinese have been relatively quiet through this process. i wonder, when do we get to the point when we hear from them what they are willing to give up to make this deal? >> the answer is they are the reluctant party. they have been pulled into these negotiations by trump. and by his tariffs. if you go back to may last year, there was a list submitted by the u.s. side that a lot of experts saw as a surrender or die list.

to the chinese. had more than 140 demands. and the chinese have been managing that list since then. and trying to figure out how to close these talks. and how to satisfy the u.s. side. they are the reluctant party. the u.s. needs to find a way to make them feel that it's going to be a win-win deal of some kind. we're not there. >> shery, you'll have a keen identify on that. >> we're going to be watching for what we expect this week to be am bam door's meeting with president xi. both sides want a summit with president trump and president xi ping. we don't know when that could happen. but to your point on how china has been quite muted, is that really we have heard from president trump calling him a good friend. president xi hasn't reacted that much to that.

a lot of speculation right now because of the slowing chinese economy perhaps the u.s. has an upper hand here, but yesterday we saw a data traded from china showing exports have rebounded much more than expected. recouping some of the loss that is we saw in december. gaining more than 9%. perhaps a little bit to o do with the lunar new year holidays. but still not showing exactly all that weakness we have been talking about. >> the power plays continue. more on all of these stories don't miss shery on daybreak asia. ♪

>> leadership is about you human nature. are you able to build a team that's got diverse opinions? people that can argue with you and question your assumptions and yet bring that team ogether. ♪ >> hedge funds, fourth quarter investments and filings. >> two new hedge fund filings have come through. big ones. green light capital and pershing square. green light capital david

einhorn. they have made some changes. they have added hilton and echostar. look at hilton. they put up a very good quarter. they have exited i.a.c. and recused the -- reduced the g.m. position. pershing square, they added starbucks. that chart looked nice going in the right direction. the buyers very much in control. they cut can restaurant brands and reduced the position many think of bill and pershing square, c.m.g. some of the other big one that is have come out. >> now of course on this romantic valentine's day, a reminder from the u.k. that love can bloom even in the most hostile of places. maybe not. before parliament, m.p.'s on opposite sides of the house shared poetry in the spirit of the holiday. have a listen. >> it's valentine's day. so i thought a little poem might be in order.

labor's red, torreys will blue, our future is bright. with a good deal in sight for the u.k. and our friends in the e.u. >> given it's valentine's, tories are blue, the message from scotland is we're staying in the e.u. >> perhaps a little bit of love loss there. the sister of boris johnson was on sky news, getting into the spirit of things. >> i just liked after the announcement, you heard that grown. which is like pretty appropriate. >> not exactly man booker prize material. > think about it, the s. and p. -- >> pro remain. against her own brother, boris johnson. seemingly feeling she has to get her voice heard by stripping on national television. >> ok. >> meanwhile -- the ongoing

battle continues. we never seem to be closer to a deal. that's all. >> "bloomberg technology" is next in the u.s. >> have a great evening. ♪

♪ this is bloomberg technology. york, pulls out of new scrapping its plans to build a second headquarters in the city after backlash from some residents and politicians. we will speak with local officials who opposed the deal. plus, amazon had pledged to require thousands of new workers but was it a size $43 billion in

an financial incentives. will this impact help