rapid conclusion -- china's xi jinping pushes for a rapid conclusion. disappointment. prime minister theresa may asks the eu for another extension to june 30. offer 12 moreuld months. david: welcome to "bloomberg daybreak" on this jobs day. we had ray dalio out with an essay about the problems with capitalism yesterday. alix: sort of mocked in the wrong withwhat is the economy and lower income workers, but when you look at it, there are charts and statistics, he ran research and it reports on the overall impact. research isame

applied to the overall economy. this is when he had to say. "i have seen capitalism evolve in a way that is not working well for the majority of americans because it's producing self enforcing spirals up for the haves and down for the ."ve-nots alix: you pair that with what jamie dimon say, blaming policy out of d.c. david: it is a little bit of enlightened self-interest. it is the right thing, but also the smart thing. it is the gilded age. if we are leaving everyone else behind, sooner or later it is going to catch up with us. david: it sets the tone and frame -- alix: it sets the tone and frame for jobs day. not a lot of movement on trade as futures try to get an upside. euro-dollar flat on the day.

crude flat. it feels like very much waiting for those numbers. david: now it is time for the bloomberg first take. we are joined by the chief u.s. economist for bloomberg economics and bloomberg's head of etf coverage. your consensus is the general consensus, but in fairness, you got there first. >> we were 175 before 175 was cool. [laughter] the main focus here is going to be to see whether february was waybeginning of a new trend below even the most pessimistic forecast. if we see more weakness, this is going to fan the recession concerns. however, our expectation is for a pretty healthy recovery. it has not been unusual to have a sub 1000 payroll. if we look at the last five

instances that happened since the unemployment rate dipped below 7%, the recoveries have been very fast and strong. the average recovery when we get a sub 100,000 print is 250,000 the following month. this proves the point that the consumer driven economy with a low and employment rate is very difficult to destabilize. david: the downside risk may be bigger than the upside. >> absolutely. david: if we get a really low one again, it is going to send off alarm bells. >> and larry kudlow will call for 100 points in basis cuts. [laughter] alix: still it feels like the cut is the bias. >> with the data coming in so poorly last month, we saw people reassess their expectation for interest rates and lean much more to the cut side of things. we've seen huge flows into fixed income over the last month or so. a lot of that has been going to be shortened.

even with bullish risk on tone in the stock market, i am going to be looking after this print to see whether we get any thing moving back into the stock market, if we are comfortable enough to go risk on, or if we see repricing within the fixed income prospects. david: there was a time when we are worried about what the wages did. this time we are worried about the actual number on the jobs. >> assuming we do get a rebound, the mistake of 2019 may be that people are really ignoring the early morning signs of inflation -- the early warning signs of inflation. averageally when we had early earnings at this pace, we've had core inflation above the fed target of 2%. david: it was all about china trade negotiations yesterday. we thought we might get a big announcement. president trump said that when it comes, it is going to be really something. pres. trump: we've never done a deal like this with china.

set ofery unique circumstances, but it is a massive deal. i guess it is, if you think about it, the biggest deal ever made. there can't be a deal like this wherever you look. this is the granddaddy of them all. david: ok, the granddaddy of them all. let's go back to flows again. alix: i don't even know what that means. david: are people responding in the market place? >> everyone is just wait and see. china is talking about four weeks to finish dealing with the details, and another two weeks to get on pace. you've got xi making a push to get something to come out as soon as possible. i was particularly taken yesterday with a headline that directorof the wto general who said there could be a challenge to the steal from other countries. i think markets will wait and see how this goes, and then wait and see what the repercussions are.

alix: i love that you brought that up because citi had a note out that said just that. if you have china buying more from the u.s. that comes at the , likee of other countries germany or taiwan, what do you read into all of this? >> what it seems like they have agreed on is china buying certain amounts of u.s. exports, mainly agricultural. , thisy, pun intended amounts to little more than a hill of beans because there is more trade issues remaining. the trump negotiating team says daunting challenges remain, including winter list -- wind to lift tariffs and intellectual properties. if those still remain we haven't even started the race yet. alix: to your point, corn and soybeans down, so it is not like that is reacting to any sort of optimism. >> i think we are a lot further

away than we think for a final deal. but atit is fascinating, the same time we are getting into a world of much more managed trade deals. it was going to be a deal to have a deal. is that going to hurt economic growth globally, or has it always been pretty managed? >> when we add tariffs into the system, it slows down the overall end result. trump is a tariff man, using his own words. he's threatening tariffs against european autos cannot against -- autos, against mexico once again. it is unlikely we will see him back off of these threats ahead of next year's presidential campaign, where this story plays very well in the rust belt economies. if he immediately has detente with the chinese, that is not going to play well with michigan, wisconsin, indiana, ohio, pennsylvania, minnesota. that is a significant share of the electoral college he needs

to carry. the soybean farmers in north dakota are not very much in terms of electoral college votes. alix: theresa may is sending a letter that she would like an extension for brexit until june 30. she says, "it is frustrating we have not yet brought this process to a successful and orderly conclusion. the house has, however, continued to express opposition to leaving the eu without a deal . this impasse cannot be allowed to continue." >> we are seeing this again, the extension of the brexit process. every day it seems like there is another deadline being talked about. this is what may originally asked for, an extension to june 30. july 1 is when the new european parliament takes their seats, so this is supposed to be a way britain can avoid being involved in the european elections. of course, having been turned

down once by the eu, it makes it harder for them to get to agree this time. i think the gamble is that may thanks having cross party talks come with disagreement about how productive these are being, not quite agreeing how much they are achieving in these, i think the hope is that having these talks on the table and parliament more involved in the process will be enough to get the eu over the line. david: look at this 5, 10 years down the road. as we look back, will this be a blip or will this actually do some damage? >> i think it impacts the entire european trade zone, and the british may be disappointed to see how quickly european supply chains reorient to exclude them from the flow of goods and services. alix: what is interesting still is the market is an optimist. the cable rate is up, short positions have been reduced when it comes to sterling. >> i've been watching it evolve

in sterling. we saw one and two week volatility pickup to the highest since the 2016 referendum, so there is uncertainty, but the bottom line is april 12 is currently the deadline that britain is set to leave the eu, and that is next friday, so we have one week to sort this out. >> one interesting thing, the votes for a second referendum keep losing by a smaller and smaller margin. alix: the sterling is taking a leg lower just in the last 15 minutes or so. coming up, more on what china hails as a new consensus on trade with the u.s. we speak with george magnus of the china center. this is bloomberg. ♪

david: we didn't get the announcements of a trade deal some had hoped for, but president trump says when it comes, it will be "very monument." the chinese vice premier -- "very monumental." welcome our chief washington correspondent kevin cirilli. kevin: yesterday, president trump, speaking from the oval office, saying that we are still a couple of weeks away from a final agreement, but that ultimately he will make that one off with chinese president xi jinping.

they are hoping to do that in a way where they can wrap up the details and finalize the agreement and not have a situation like the president had in vietnam, where he walked out on north korean leader kim jong-un. the sticking points that are , as theyin the air continue those meetings today with steven mnuchin and robert lighthizer, include intellectual property, as well as enforcement mechanisms. on the issues of intellectual property, the u.s. is pushing to have access to chinese firms to make purchases over chinese firms, but the broader 3000 foot that these areis nearing the end of the talks. futures edged up following the president's remarks yesterday, and it is seemingly positive some statements from manufacturing groups in washington, d.c. crucial to the

president's political coalition speaking quite positively, and they have had some concerns about this tariffs. david: thank you so much for reporting from washington today. joining us on the phone is george magnus, oxford university's china center associate. as you watch this developed, does the methodical nature and the time it is taking indicate that they are having troubles, or that they might do something truly profound in the end? guest: good question, david. i think if there was something truly profound in the pipeline, i actually wonder why they would -- why the negotiations are still going on. if you remember, these were hatched at the g20 input of fairies at the -- in buenos aires at the end of last year. it was supposed to be completed in 90 days, but obviously is rolling on. there is something of substance,

obviously, but if it was that easy to reach an agreement, obviously it would have been done already. the fact that we get these deferrals that we are almost there, there's another two weeks to go, so on and so forth, i'm not saying there isn't going to be a summit. announcement of isummit, it is all over, but think as you suggested before, the really contentious issues of wind the united states might lift tariffs on chinese goods come of the circumstances when that might happen, the details of whether this going to be any relief on intellectual property, ch transfer and enforcement, both sides want a deal, but i don't think these contentious issues are going to be addressed properly. alix: part of the rhetoric overnight is that xi is really

wanting this deal to be done quickly. what do you make of something like that, if that report is true? guest: china desperately wants to avoid any intensification of this trade war. it is quite likely that the chinese economy is actually stabilizing at the moment because they passed tax cuts, quite considerable tax cuts which look like they are having an effect, along with some infrastructure spending boosts. but if the tariffs stayed in place, and if president trump's threats of further tariffs actually did come to the fore at some point, china's economy would really not welcome that. a very deleterious effect, i think. up ands everything tied nailed before the two presidents meet because i think he knows that if it isn't, then it is

quite likely that, to put it colloquially, the president or u.s. administration i pull a fast one on him, and then the summit might break up, and they may not agree on anything. he definitely wants to nail everything down beforehand. when it comes to purchases of u.s. products like soybeans and and whateverraft else they are talking about, i don't think that is the problem. i think that can be done pretty easily. it is really the industrial and technological issues which i think you're going to be quite sticky. alix: to your point, he wants to avoid donald trump walking out of the room when he doesn't get what he wants. thepoke to jim o'neill, former u.k. treasury minister and current chatham house chair. >> the biggest issue that has

been bothering me for the past six months is the slowdown of chinese consumption. is, sadly andy bizarrely, why europe is so weak. germany has almost become a derivative of china. looking at it slightly more positively, what we got out of china in the past week might be the beginnings of evidence that china is starting to respond to the policy stimulus, and i hope so, because if it is not, we've got further tough times ahead. alix: is that what you are seeing, george? responding to policy stimulus? yeah. y -- guest: every time the economy slows down, the government has tools to stabilize and bring it back up again. infrastructure spending, credit

stimulus, the usual suspects, really. but the problem is, as a number of chinese intellectuals have made public themselves when they've been able to, this isn't really the answer to china's economic dilemma. the dilemma is how do you transform the economy, and how do you re-energize productivity? this isn't really about six months worth of tax cuts or a break for corporations on their social security payments for employees. this is about much more radical reform, and the one thing xi --ping's chana stands for china stands for is not doing radical reform. david: thank you. coming up, we are going to talk bezos divorce and who controls amazon.

this is bloomberg. ♪

david: time now to look at three companies worth watching this morning. first of all, i'm watching boeing. we finally heard from the boeing ceo. this is what he had to say on twitter. we had boeing are sorry for the lives lost in the recent 737 max 8 accidents. as pilots have told us, erroneous activation of the mcas function can add to what is already a hostile work environment. david: he couldn't quite get it out without saying it is part of a larger problem because the pilots are so busy. alix: it is kind of like the apology that gets you think couples counseling -- that you get in couples counseling. theerday elon musk and

district judge said put your reasonable-ness pants on and let's work this out. ofy comical, but the idea let's do this, just comply. if you have a tweet, go through your compliance officers. reporters were like, can you work this out with the sec? he said most likely. david: in fairness, this is actually his position, that we should work this out without going to court. it was sort of a little victory for him. alix: most likely. someone else working things out is the bezos couple. they came out with the terms of ,here -- of their divorce settling who's going to run the company. brooke: obviously jeff bezos is the largest shareholder of amazon, and we've seen some of these divorce situations get rather ugly, and there is debate over who can control the company. steve wynn is an example i can

think of. in this case, mckenzie bezos is giving jeff 75% of her stock. of will retain about 4% amazon stock, and giving him voting control. this raises an interesting question for me. you think about these start up companies where the founders have so much control, and they are so essential to the company's success. what if jeff didn't have control? maybe not because of a divorce, but if something were to happen, who takes over? who runs this company and continues to make it successful? david: on the one hand, you have dual class voting. on the other hand, it is not very democratic if you let the founder run the whole place. brooke: which we seen is not necessarily always the best thing. obviously uber is a great example. maybe the ceo is not the best one -- the founder, i mean, doesn't have the ceo gene in his body.

jeff bezos obviously has been very successful, but it raises interesting questions when you have such a cult of personality. alix: look at what happened to apple. with steve jobs, everyone was coming down the pike, and tim cook in some ways has been a really good ceo, but that was a big switch and transition. brooke: right. no matter what, you need a succession plan. alix: thank you very much. coming up, where the jobs are in banking. paribas u.s.he bnp ceo. this is bloomberg. ♪ the biggest week in television is almost here.

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get ready to watch with xfinity x1 or the xfinity stream app. xfinity watchathon week. free starting april 8th. boop! alix: this is "bloomberg daybreak." happy jobs day. nothing really happening in the markets. we are about one hour away from

those numbers. dow futures up modestly. so is the s&p. the dax lags even though industrial production came in not as bad as everyone thought. in other asset classes, a little bit of a dollar bid underway in just the last little while. cable reversing earlier gains, up 1/10 of 1%. that is still very much a brexit story. headed for its longest weekly winning streak since november 2017. if you are going to look for a growth trade indicator, is that it? or is that a supply story? david: sue are calling it, we are going -- we are growing? alix: no, i think it's supply. sorry. david: let's turn to viviana hurtado with the first word news. viviana: theresa may asked to delay brexit until june 30. the british prime minister making the request to european

council president donald tusk. she cites ongoing talks with opposition labor party leader jeremy corbyn, but the eu says if there is a delay, it should be longer. may is desperately trying to get an agreement approved by parliament. talks to in the u.s./china trade war. chinese president xi jinping is a resolution. the chinese vice premier said the two sides reached consensus on the text of an agreement. the ceo of germany's commerzbank 's backing a proposed combination with deutsche bank. bloomberg saw a memo written to the bank's employees that set a deal could help commerzbank scale for necessary investments.

the alternative of doing nothing is not an option. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm to be on our kado. this is -- i'm viviana hurtado. this is bloomberg. alix: for more on consolidation in european banks, as well as growth and u.s. jobs, we are joined by ent party by u.s. ceo u.s. ceo.paribas thank you for being here. guest: thank you for having me. alix: so, european banks. a deutsche bank/commerzbank merger. what do you think? guest: if you create a stronger institution, it is all going to benefit the whole european banking industry. however, when you do this type of transaction, i think it has to be for a reason. it could be because you've identified very specific economies of scales, you want to play market share gain.

having said that, the complicity of merging banks today, we should be candid. let's not undermine it. and making work together istems, data, cultures something that is quite challenging. the platform in the u.s. has benefited from organic growth. he built this platform between retail and wholesale over the many years, and we've remained because what we do well and what we do first as a bank is serving clients. david: as you suggest, the environment right now for banking is quite different from europe. we heard from the commerzbank overnight. he said we will take further steps -- if we could rolet please -- in order to increase our growth and profitability. at the end, the question would be whether it makes strategic and economic sense, and how such

--odel could alix: -- look like. [laughter] david: my point is, we have a very different situation with the fed. s has done better than many european banks. why? guest: the ecb has kind of mirrored what the fed has been doing in terms of providing qe at one point in time, unwinding ecbbalance sheet, but the has really used qe and provided stimulus in many different ways. what is different in this situation is the economic status. there is less growth in europe, and negative interest rates have been very beneficial to the euro zone in terms of gdp growth.

your point is to say negative interest rates is sustainable over the medium-term, and probably not. having said that, if you look at , it is quitees important to continue to support and stimulate the economy. this is exactly the status we are facing. alix: is the ecb finally looking of thesegative impacts rates in europe? what do you want to see the ecb do? guest: the ecb actually has different tools in their toolbox. tiering is going to be one way to deal with it, to try to not disadvantage too much the banks that have significant deposits and larger activities. they are resurrecting for the third time tltro, which is another way to inject liquidity.

they would probably unwind the balance sheet, unlike the fed has been doing, at a slower pace to make sure stimulus continues. david: you are responsible for the united states in particular, and spend a lot of your career in the united states. as you look at european clients, french or otherwise, how do they regard the united states is a place to do business and invest? guest: this is one of the most vibrant economies in the world, and it has been very attractive to european clients and investors. we have managed to support it quite well. a few years ago, a very large cable and media company is acquiring two large companies in the united states in the cable industry. they needed to raise around $22 billion. raiseribas managed to this in just a few weeks when the market was down. that is what we do in terms of

financing the cross-border situations. it isposition, fascinating having retail on the west coast and wholesale here. the spectrum in the u.s. is quite important. revenue,6 billion in and for us the largest balance sheet allocation after france. california is one of the most vibrant states in this country. york, andt in new international banking across the atlantic. it is quite an interesting position to benefit from these various economies. david: this is a time when we are seeing a fair amount of retrenchment from european banks , deutsche bank most of tory asleep. how do you compete -- most notoriously. how do you compete with the big u.s. banks, the jp morgans and bank of americas? guest: that's an excellent point.

both u.s. and european banks have become stronger. this is the case here. it is an extremely competitive environment. what explains our success and the fact that we've managed to grow is that we've been more couple of entry to u.s. banks -- more complement three to u.s. banks. domestic companies .ere when it is time to support these companies outside of the u.s., we lie on the european market. reliantly, we've been in supporting european companies and distribution kit abilities -- distribution capabilities. alix: are you taking on more

risk as a bank? are you retrenching a little bit? it feels like european banks retrenched to their home base. how much risk are you willing to take? guest: back to what we were discussing earlier, i think developed an organic business model here between retail and wholesale. retail provides the deposit ability, provides good capitalization, provides the cabkiness of revenue, and is a good complement because it is a different type of risk-taking that provides higher margins and could return. what we managed to do because of this balance model is actually to continue to be stable and invest in the segments we believe we have some advantages, or in the vertical we have some , like inue as well media, telecom, technology.

we can develop and support clients around europe, asia and the u.s. if you look at the stability we and, we have 14,000 people growing over the last few years. david: it is jobs day in the united states. is that number going up or down? the united states has been retrenchment and employment in initial services, but some banks are coming back -- in financial services, but some banks are coming back. job cuts in the back office? have, over banks ,ime over the last few years probably eliminated some j obs, but recruit more actively because they require new skill sets. david: are you doing that? guest: we are one of the most active banks to close the gap,

and this is why we've kept and slightly increased our staff in the united states. it is all about adaptation, for sure. automation, ai is putting some jobs at stake, but there is somewhere that we need, particularly in computer science and motorization, that it has actually created a very positive dynamic in terms of jobs. we have very skilled people in the banking industry at bnp paribas. andation and training making sure some of our skilled people can basically evolve into these new activities within is very important as well. alix: what about investment banking? globally there is retrenchment in terms of employment. what does that mean in terms of the u.s. business? we haveeographically europe, the u.s., and asia.

protectedittle more from those trends. that is the way to mitigate when some sectors and activities might be more challenged. alix: thank you so much. it was so great to catch up with you. of bnpes fillion paribas, thank you. david: coming up, march madness comes down to the final four. this is bloomberg. ♪

viviana: -- renita: this is "bloomberg daybreak." coming up in the next hour, drew

ceo.oy, transfix ♪ viviana: this is "bloomberg daybreak." decline inorst profit at samsung in more than four years. the latest quarter, operating hurt by falling memory chip prices and slowing smartphone sales. microsoft vowing to focus on gender harassment following an uproar from employees. complaints about sexual misconduct and discriminate and against female employee s. last night, tennis champion naomi osaka was wearing something different. oosh.ike sw

the star dumping adidas and signing with their rival. that is your bloomberg business flash. david: as a tennis fan, you will know that is a really big story. remember when she beat serena williams in the final last year in the u.s. open. she is an amazing up and comer. and now she is switching from id does over to nike. alix: and a huge -- from adidas over to nike. alix: and a huge win for nike. do we know how much they paid? david: no. there was speculation that it was a $.5 million. but she is a real star -- was $8.5 million. but she is a real star. firstthis year marks the

march madness where betting is legal. sailingll been smooth when it comes to march madness and legal betting? reporter: it depends which state you are in because the u.s. is slowly rolling it out state-by-state off the heels of a supreme court decision last may. if you are in a state like new jersey, you are really happy. a number of them have pending legislation, but we are seeing it start to trickle out. but yes, there is massive appetite. here in london, it is something that is just part of the fabric. we are beginning to see what that might look like in the u.s.. david: your story is not so much about the bookies taking the bets, but the pipeline of how it gets done. ?s there real money to be made reporter: that's right. one of the stories we looked at his this company called action network that has basically said we don't want to be in the business of gambling, but we do

want to provide people with data , analysis and content that can help them make decisions. that has been fun to watch, especially during march madness. as you know, the final four unfolds this weekend because there's always enthusiasm, especially in offices, yet no one has ever been able to actually bet on things. this year a company like action network is really well-positioned to come to market with a product that gives people the information they really crave from a betting standpoint. david: do you have any money in the game? soorter: i'm here in london, i get to go see and everything. [laughter] david: thank you so much for joining us from london. hear more from the magazine's writers and editors on bloomberg television and radio. for more we welcome the cohost of "bloomberg business of sports report" on bloomberg radio.

welcome, michael. guest: thank you. david: there's a lot of betting going on, but also charity work going on through bloomberg. looks likem janice he's going to win it. david: this is brackets for a cause. michael: exactly. it looks like he's going to get away with it scot-free, unless something bad happens in this leg. david: who's in the finals that he has winning? he has virginia winning, and isaac there was only one other in the top four that has michigan state. if michigan state wins, that could change. but he has such a big lead it is tough to catch. david: i think dan gilbert has michigan state, which would surprise you, being from the state of michigan. northwestern is not in it. alix: so virginia is going to crush it? david: i wouldn't say that.

i think michigan state is going to win this. [laughter] david: i think michigan state's got it. look at what they did to duke. it is pretty extraordinary. michael: that game alone took my bracket and shattered it like a glass coke bottle on cement. that was it. but if it had to happen, i'm glad it was michigan state to do it. david: just remind us of the numbers. how much is at stake here? how much does jim chanos give her his charity -- get for his charity? something like $250,000? michael: everyone puts up $10,000 for this. david: it is a great because. -- it is a great cause. manael: winston is the

to watch out for for michigan state. virginia forget about because remember, last year the horrific moment that happened? they were the one seed. they lost to umbc in the first round. alix: i remember that. michael: that never happens. bloomberg's michael barr. you can listen to the "bloomberg business of sports report" at 8:00 tonight on bloomberg radio. coming up, los angeles' very loud economic boom. why la's economic expansion is performing that of its peers. this is bloomberg. ♪

♪ david: we talk a lot about the strength of the u.s. economy, and because we are in new york, we tend to talk a lot about new york. but it turns out the growth on the west coast is where much of the story is. our bloomberg editor chief emeritus is here to tell us. so, los angeles. tell us about it. reporter: los angeles is, for a lot of people, including me, a big surprise. it is an economic locomotive. what people forget is there's 10 million people in los angeles. that has a lot to do with it. but there are a lot of 21st century jobs in los angeles, and that is why personal income in los angeles has outpaced personal income in every major city in america, and it is not stopping. alix: so it is not just a lot of actors who make a lot of money? reporter: that is what people think about los angeles, that it is entertainment.

and aerospace and biosciences. what will people forget is los angeles today is one of the leaders in health care. that is partly because you've got more research institutions in one place than probably any other metropolis in the country. and what is the industry-leading every under industry -- every other industry in the 21st century? health care. david: the mayor is eric garcetti. alix: and he happens to be -- reporter: and he happens to be a road scholar -- the rhodes scholar. he wrote the ordinances for commercial buildings and the water bond in los angeles. he's pretty much ahead of the curve. david: when we look at the growth in l.a., is he lucky or smart? reporter: he would say always better to be lucky than smart, but it takes a smart person to say that. that is the convergence of policy and people's preferences.

this guy has been really aware. he's promoted the minimum-wage increase. los angeles was one of the first cities to get to the $15 an hour, next year. but he cut taxes at the same time. he would say you can't do that in either party, so that's smart. david: fascinating. matt winkler, thank you very much for that great report on los angeles. alix: coming up, we continue our jobs day coverage. our head of u.s. rates strategy will be joining us. 30 minutes away from the jobs report. this is bloomberg. ♪

♪ alix: trade wars. a new consensus.

china's xi jinping pushes for a rapid conclusion. markets take any trade optimism in stride. jobs day pay back or disappointment? the fed maintains a high bar for a wage number that could lead to a hike. and please, sir, can i have some more? u.k. prime minister theresa may asks the eu for another brexit extension as they try to agree on a timetable for legislation with the labour party. david: welcome to "bloomberg daybreak." there is news out from deutsche bank, meantime. dwa asset management is cutting some jobs. alix: including about 10 managing directors. the question to me is why. do you want to drive costs down and cut costs so they can spin it off or merge it with a ubs

kind of thing? or are they trying to retrench and do it themselves? david: or is it that they have a new ceo taking a look at it? you are right, it could be positioning for a deal if they need to raise the capital if they merge with commerzbank. alix: we will definitely track this as the day moves on. we are about 30 minutes away from the jobs numbers. there was no movie pun in the jobs title. s&p futures flat on the day. euro-dollar flat on the day. you did get positive ip out of germany that boosted the market in a meaningful way. yields up by two basis points. crude a little softer, but you are not going to be a lot of positions taken on. an rebound yesterday. but trade and jobs on hold. david: those nice china numbers gave crude a boost up. right now we are taking a look at how markets are positioned.

we are joined by bloomberg's taylor riggs. taylor: this jobs report is taking on increasing significance because of the disappointing data we've had recently, as well as inversion of the yield curve. here we are back up to about 12 basis points. did gete know, we inversion for the first time since 2007. the good news is, as we mentioned, the 10-year is that 254, in the year-end forecast is still around 296. i do want to take a look at how dollar and oil are trading ahead of the jobs report. we know that oil is on track for its longest weekly winning streak since november 2007. you are getting small year-to-date gains within the dollar as well. dollarstanley says the will drop 6% year-end.

the demise of the dollar might be overblown. you are getting a little bit of dollar strength again this morning. towe know, it all comes down rate cut expectations. we are only pricing in about a 10 basis point cut. recessions,three you've actually had the markets pricing and 100 basis points of cuts. for now at least, that should give us a little bit of relief that a recession is nowhere on the horizon. again, and 30 minutes we will find out a little bit more. alix: thank you so much. we will stay with jobs. economists forecast the u.s. added 170,000 jobs in march and the unemployment rate stayed at 3.8%. joining us is stocked in -- iscked -- joining us of u.s. rated

strategy. movingink we will get a average around 210,000, but we don't expect that to last through the 12 and -- through the remainder of 2019 because there just aren't the workers to keep filling jobs at this pace. alix: what does the market want to see? where do you see the >> --upside or downside or downside? another below 100,000, i think that would spook the markets. a weakthat if we get number, you are going to see a meaningful rally, but if you see a strong member, we could see a selloff come whatnot -- selloff, but not an outside selloff.

david: as you say, most people expect this will rebound, but lets the could but that asymmetric risk to the downside. suppose it were to come in below 100,000. what would it say to the markets about possible cuts? >> i think you will see the market starting to think about maybe this is a more meaningful slow down in unemployment then we initially envisioned. if you think about it, you should see a slowdown in the jobs created as we get to the end of the cycle. we've been punching well above our weight with an average of over 200,000 jobs any given month for the last couple of years, and that is an anomaly for this late in the cycle. i think if you start seeing numbers consistently at or tound 100 k, that is going indicate risks towards the end of the cycle. alix: how high is the bar for fed cuts?

if you look at the chart taylor had brought up, we are far from recession, but we are still looking for a cut. the market is still looking for it. >> i think it is that gravitational pull from overseas. domestically, we are doing ok. we are moving towards trend growth, about 2% gdp growth for this year. if we can maintain that, if the fed can maintain a soft landing, i don't think they are going to be cutting anytime soon unless we get a shock from overseas. the yield curve inverts, bernanke waited almost 18 months before cutting rates. here we have the fed saying they are going to pause before the curve inverted. the curve invert it for a nanosecond, and it is flirting with inversion. i think the fed wants to get a soft landing out of this. david: you talk about normal gdp growth. but what about trend growth in

terms of employment? this shows where we have been since 2014, hovering around 200,000 jobs a month. they yellow line, basically, is the number. constance: if you see a three month moving average, you will see it smooth out a little bit. david: we are getting late in the cycle. at one point -- at what point does that have to come down? constance: i the end of the year we expect monthly job gains of about 140,000, and the next year we are looking for that to fall to about 75,000 a month. in that case, is it going to continue to be a search for yield? /is that the trade -- is that the trade? that seems to be in play. the fed is on hold.

typically what happens is the equity market tends to peak about six months before a recession. i think the risky assets in general are going to run for a lot longer, and the bond markets tend to be leading indicators within the markets. so the bond market is telling you there's a potential for two'sion in a year or time from now. at is what i am looking sustained inversion in that part of the curve. but there is some signaling that the markets should be paying attention to. david: ok. please stay with us. now we are getting an update on what is making headlines outside of the business world. viviana hurtado is here with first word news. viviana: theresa may asked to delay brexit until june 30. the british prime minister making the request to european council president donald tusk. she cites ongoing talks with opposition labor party leader jeremy corbyn, but the eu position is if there is a delay,

it should be longer. may is desperately trying to get a brexit agreement approved by parliament for the european elections next month. progress in talks to end the u.s./china trade war. president xi jinping pushing for a rapid conclusion. president trump talking about what he calls a monumental agreement, "the granddaddy of them all." it could still be some weeks away. the chinese vice premier meeting with the president, later saying the two sides reached consensus on the text of an agreement. former nissan chairman carlos ghosn will wear marinate chinese -- will remain in a chinese jail until april 14 to be questioned on new allegations he funneled millions of dollars from the automaker for his own purposes. ghosn had been freed on bail for almost a month. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm viviana hurtado.

this is bloomberg. david: thank you so much. readg up, we get an inside on one of the biggest payroll processing companies in the united states. live from new york, this is bloomberg. ♪

♪ viviana: this is "bloomberg daybreak." won a profitable job and what could be one of the biggest ipo's ever. its role as stabilization agent comes with the potential of more

share on trades with uber. investors can relax over who will control amazon. when the world's richest person gets divorced, ceo jeff bezos will retain 75% of his stock in the company, plus his former wife gave her voting control over her 4% stake. they remain the per one on the bloomberg billionaires list. the commodities hedge fund firm's has closed his new york office and will focus the business on his offices in london and malta. he is famous for his bullish calls on oil last year, when duhon lost when he percent. that's when and around -- when andurand lost what he percent. you talked to a lot of hedge fund guys, it is so

trader.be a macro oil you have to adjust to the short cycle trading of shale, and that is unlike anything we have ever seen before. plus, president trump tweeting. it is too hard. david: but when there's a lot of volatility, traders mick money. -- traders make money. alix: that's where your bets are. it is hard to say if it is that, or if this is i can't deal with this, we are going to go trade something else. david: interesting. now we are getting back to jobs. we are about 60 minutes away for the -- from the new jobs numbers for the month of march. the market expecting 175,000 additions. joining us is the ceo of one of the biggest payroll processing companies in the country. always good to have you here on jobs day. what are you seeing in terms of the number of jobs, as well as payrolls, from what you service? guest: we are seeing that on the

small, particularly 50 employees and under, a little bit of a drop off in the jobs rate. the hardest thing is that small businesses are having a harder time finding employees. it is their biggest concern. while there's jobs there, the good news is the work is there, but people are very difficult to find right now david: -- right now. david: let's take a look at some numbers you provided us about wage increases, which seem to indicate the west is going up more than the other regions. why is that? guest: there's more minimum-wage changes in the west, particularly in the arizona, california, seattle wage increases, and a couple the last few years are going up a little faster. the best job growth is still in the south around energy and construction, to some degree. florida, texas and so forth.

think of all the small jobs around construction, residential or commercial, or around energy. these are the restaurants and contractors that help around those industries. alix: what kind of money do those people make? guest: a lot of them are at the minimum wage level, so the biggest increases are coming at the minimum wage levels. you are seeing states increase minimum wage levels from eight dollars or $10 an hour to $15. also, small businesses, the smaller they are, the harder it is for them to handle wage increases. they are not able to hire. they didn't gain as much from tax reform. they don't have the pricing or recruiting power to get employees. smaller businesses are probably feeling the pinch in this low unemployment time more than anything. be on feeling the may cost. are they optimistic about the demand -- feeling the pinch may

taxes, maybe on cost. are they often a stick about the demand -- are they optimistic about the demand? finding more of what is referred to as fringe hiring. now i am hiring them and trying to trade them in trades or some of the skilled jobs. it is an interesting kind of change. with the mortgage rates coming down and slowing down, you may see this bump in housing that's been down a little bit year-over-year. sales of new homes being built. that could drive small jobs around that. everything around housing could pick up the job demand as well. alix: do you get the impression that small businesses can't find qualified workers because there aren't any, or because walkers don't -- or because workers don't want those jobs? martin: a little of both, but more so they are not available.

that is why the south probably has more job growth. there's more people to take those jobs, so you are seeing better job growth. small businesses don't have the benefits package or ability to sose wages quite as much, they are having a tougher time in this kind of market. they are positive about the demand, but they are a little concerned about how to hire. plus, regulations are up on small businesses, and that makes it difficult. david: a recurrent theme is the lack of specific skills. which skills are we lacking? tech skills, accounting? if you were going to go into the business of training people right now, what business would you go into? martin: definitely the tech skills. it is difficult to find laborers, even plumbing and builders that are technical

trades. more people are not going into those come at you don't have as much of a skill set there. especially if things like housing come back, it is going to be tough finding those people. these businesses are getting creative in finding more ways to train them, and you are finding more community colleges going into that technical training as well. alix: thank you so much. it was a real pleasure to talk to you today. coming up, it is progress in trade talks. we will look at how market participants view what both sides are counting as progress. this is bloomberg. ♪

david: we didn't get the announcement of a u.s./china trade deal some people hoped for, but president trump says when it does come, it is going to be "very monumental." pres. trump: we've never done a deal like this with china.

it is very unique set of circumstances, but it is a massive deal. could be one of the -- i guess it is, if you think about it, the biggest deal ever made. there can't be a deal like this. no matter where you look, there can't be a deal like this. this is the granddaddy of them all. david: still with constance dnter of kpmg and sue by rajappa ofadra society generale. >> i don't think it is a restructuring. i think we've got a situation where we've probably gotten china to agree to purchase certain things from us from the agricultural front, on the energy front, and our bilateral trade deficit with china will then be reduced. it is not going to reduce our overall trade deficit. we are not addressing some of the major things that the ustr regard to with

intellectual property and access to markets. when we see real progress, it will be when you no longer have to have a 50-50 partnership with a chinese company to enter certain markets. it will be when there is more intellectual property right protection. versusue this time previous negotiations is twofold. one, we use to use pressure from our allies and all negotiate together to pressure china. going the bilateral route weakens our negotiating stance. the second thing is a used to be china's view was it was in their interest to pursue these types of reforms, and there is the big question mark about whether china still believes it is in their interest. alix: on the flipside, you had xi jinping wanting to get a deal done quickly, and that was a difference to me this morning. subadra: i think for the first time, we've heard from china that they are making progress on the deal front. to me that is a very optimistic

sign because they've been very quiet in trying to communicate anything on the trade front. as far as the markets are concerned, i feel like the china optimism is more or less priced in. so where are you going to see the speed threw two broader global growth is actually that china growth lagging is really impacting growth in europe. it is impacting growth in asia. to the extent we have some optimism on that front and china growth starts to pick up, i think that is going to be a real positive for growth in europe, as well as asia and the u.s. david: play it from the chinese side of the aisle. what is the upside for them in getting this behind them? they have other issues in their economy they need to deal with. constance: i think you hit the nail on the head. they want to focus on rebalancing their economy, dealing with some of their debt cut their value added to

help get that going. really, the problems in the chinese economy are not because of trade. trade is sort of a red herring everyone can focus on. if they can get this deal going, perhaps it ignites some animal spirits within china and sort of helps consumer optimism and spending. alix: citi had an interesting thert that talked about u.s. doesn't have the facility and infrastructure to get it done, and therefore will have to pour a lot of money out or outsource to third parties. is a recurring theme, especially after the apple story, trying to bring manufacturing to the best but not being able to do some of the things they china facilities are able to do. that is definitely a concern, that we just don't have the bandwidth that we use to just a few decades ago on the manufacturing side to be able to

accommodate some of the needs of the modern world. alix: interesting. do you agree? constance: i would 100% agree. will constance and rubadra be sticking with us because we are four minutes away from the jobs report. we will have that for you. markets on pause as we await those jobs numbers. s&p marginally higher, the dollar getting a little bit of a bid, but either way, wait and see. trade optimism not reflected in the market. it is all about jobs and wage numbers. this is bloomberg. ♪

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here as we debate politics on set, we are to take a look at the market spirit we are minutes away from the jobs report.

is getting a little bit of a building, but still on hold. paring losses. up by two basis points. we want to send it over to the labor department where michael standing by. the consensus is 177,000. michael: 179,000 jobs were created last month, a league rebound from february. unemployment stays at 3.8%. the labor force did contract by 224,000, but more people got jobs then lost them. the participation rate does drop by .3% and earnings a little this appointment, up just attempt in march, the annual rate at three point 2%. hours worked up though, reversing last month decline. health care led the hiring, 49,000 jobs for professional and

.echnical services but intriguing places added 427,000. intriguing places added 27,000. we also saw retailers lose the most 12,000 jobs during the month. we were joking when we went in, wishard sake of a long people, there's nothing to see here. about theriking report is how strong hiring is 10 years into an expansion. this stage offor the economic expansion. i will put it back to you with the cliché this is kind of a goldilocks report. david: goldilocks. i love that. thank you so much, mike. don't go anywhere. coming out.

what do you make of it? a solid report. as far as the bond market we will not see a big rally. i want to dig deeper into the wages, where we see the wage gain. is it coming from low-paying jobs or are we seeing more middle and higher wage jobs because that would indicate there is wage pressure, and that is what i want to look into. david: so is this a perfect report for the fed's point of view, because wages did not go up as much as you think, not as much a warning, but does not as much a warning for inflation, but jobs to go up. >> yes, i think is perfect for the fed. wordsan powell's famous -- it might be resting. there is very little indication of wage inflation.

fair and will shift square to cpi next week and trajectories for the remainder of the year, which seem to be to the downward trajectory and that's were the focus needs to be, not on wages. alex: like you said, equities love it. if you are a bond bull, you also love it. is this also part and parcel of things are inthat low income jobs, minimum wage, and that prevents the bleedthrough to inflation? >> is a combination of things. it is that the jobs rn the minimum wage jobs, but we are seeing more middle and high wage jobs. we are getting strong headline numbers, but not getting good jobs, right? that has shifted in the last

year and a half. we are getting more of the middle and high paying jobs. as part of the wage pressure, there's a huge demographic component. as baby boomers retire you are getting rid of the high base wage and you are replacing those with younger workers. you're not getting the wage increases we would normally see in this part of the cycle. all this would rather have higher pay rather than lower pay, but talking about jobs, is a better for the economy that the greens are at the lower end of the spectrum? for two reasons -- they are more likely to spend that money camusso is more likely to go into the economy, and one of the criticisms of capitalism right now is it's all going to the higher end. talking about wage gains. i was talking about job gains. david: ah. 100%.gree with you

when we of expansion where we can pull up the people at the bottom part of the distribution dust which is a wonderful thing -- but one thing we did not see the beginning of the recovery medium andvolume of high wage jobs. now those jobs are being created at a faster pace, so that's a good thing for the economy. alex: does this take the heat trumpen they knew that wanted them to move away from the rate hike, and now they can say, it wasn't him, it was the data? >> the pressure will continue. people arrived he of from each of administration golf rope 50 basis point rate cut. -- we have heard multiple people from the trump administration call for a 50 basis point rate cap. yes this is a goldilocks report. does this relieve some of

the talk -- it's just been talk -- about an imminently approaching recession? we are talking about u.s. growth, gdp growth, but when jobs are growing this fast, that indicates we are in pretty good shape. yes, but if we look at a variety of recession indicators, whether it is the shape of the yield curve, the number of quarters we are below national unemployment, as the indicators build up, we are getting closer to a recession. we use the indicator how many quarters we are below unemployment -- it's usually 12 quarters. we are at nine now. the fed is doing a good job of trying to get that soft landing. it's not imminent. it's not good to be next week. but these labor shortages will

impact the pace of growth. was a goldilocks report, the economy added 196,000 jobs and wage growth slowed on a year on year basis. mike, you have more details. what have you god? michael: you're talking about the wage gains and it's interesting because there's no real pattern to it. gained during the month. construction workers added 16,000 in the month of march, theeverybody else pretty same. manufacturing goes down a little bit. they earnedon jobs, significantly more. no pattern whether it is the low-paying jobs or the high-paying jobs in march. david: interesting. so there's a data point, it would be what -- was talking

about, skills. >> and skills shortages. if you want them to work for you, you have to pay to more than your competitor. we have made the herman cain -- what is your base case for the politicalization of the fed when you still have a goldilocks economy? >> they still have to be confirmed by congress, so that the hurdle to get through. have two -- potentially two new fed governors, but besides that, the confirmation will remain pretty much unchanged. and thethe governors region of fed presidents and i think that dynamical keep the status quo going forward. david: there's a lot of talk about the qualifications on the

.ed, and concerns were raised as far as i can tell, we do not have any when the fed right now who is actually run a business, who is actually met a payroll at all. your on from goldman, a banker, you have jay powell himself worked at carlisle. is there a sense that we need some people on the fed who have actually met a bottom line and employment? i would argue jay powell had to worry about the bottom line and appoint people at carlisle. i don't know that having a small business person on the fed is necessarily be right altercation unless you have a macro economist -- david: but the federal reserve itself, mr. kane himself -- mr. cain himself -- fed has that channel of

information gathering through the local boards of the regional federal reserve banks, the 13 federal reserve banks. they have identified this is a need and that is why those people are on the board of the regional fed. but at the board of governors when you're talking about and interpreting all of the economic signals, this is very technical work. i think that's an important thing. another interesting thing i do not know the people have pointed e are atn and moor opposite ins of the spectrum. herman cain is the gold bug, we have to go back to the gold standard. cuthen moore is, we have to . they are really opposite people in terms of ideology. it's interesting -- want tou probably do

buy gold. it is cause and effect. help us wrap this up when you take into effect the goldilocks world. what is your favorite trade? where do you still find value in the bond market? >> it's a struggle, to be honest. paying to 50, people very much and carry trades. from our perspective, we think the u.s. economy is potentially going through recession next year and if that scenario plays down, and we see a meaningful slowdown in growth and inflation -- we are already seeing that with manufacturing in germany. there's a technical recession in italy. the global growth picture does not look positive urine we think the u.s. economy could going to recession by the end of next year. -- the global growth picture does not look positive. we think the u.s. economy could go into recession by the end of

next year. right, our guests and bloomberg about three is michael mckee -- you will be sticking with a spirited ladies, it was wonderful to have you on set for the hour. let's recap the numbers. it is goldilocks. the wages did not move as much as we thought and the average hourly earnings came in at 3.2% and markets responded in kind. a spike in equities. less buying -- less selling, i should say in the bond market. yields are pretty much flat. the dollar has a slight moved to the downside. david: rowley will we do without that fairytale? -- what would we do without that fairytale? alex: goldilocks. it's a bizarre fairytale. don't go into someone's house and mess up their stuff. [laughter] david: coming up, the fate of the trade.

transformingy is the trucking industry. this is bloomberg. ♪

>> this is "bloomberg daybreak." the next hour, larry kudlow, the national economic council director. ♪ it is time now for follow the lede. id dive into the u.s. markets. today, the trucking industry. to get started we start with michael mckee, who, of course, is down in washington for the

jobs report. michael? interesting situation. we see unemployment continuing wages only rising a little bit. you see as unemployment drops, wages.watching the phillips curve is not completely dead. where we categories are seeing a lot more wage growth, and trucking is one of them. can jobs have been up and down. we saw a real plateau as transportation companies could not find workers. that reversed and started to go up. you can see what happened. they started to pay more money and that brought people back into the industry. hourly wages came higher. a decline in pay. the biggest pay increase for almost all of the categories in

the month of march was transportation and warehousing, up .5%. that is the kind of thing that gets people's attention. it will eat into profit margins. tocking companies will have raise their prices and that will feed into the entire economy. alex: michael mckee, thank you. , the transfixed ceo joins us. truck drivers with shippers using ai technology. michael was talking about the trucking industry, the hiring increasing and wages increase in but earnings actually following -- falling. what is the situation on the ground like? >> trucking is a difficult process -- profession. one thing that can drive wages -- if wages are part of it, but also the utilization of trucks, and the degree to which

platforms like ours and other technologies about truck drivers to get more miles than are loaded on a daily basis. paid on aers are only daily basis. it drives the increases to the drivers as well as the owners of the assets. talked to owners who say they cannot get drivers. part of it is wages. part of it is lifestyle. >> correct. david: is it better when you do not need as many truckers? >> i think we definitely improve the lifestyle of the drivers we have and would make the procession, frankly, more attractive to those you may want to enter. can becally, trucking attractive for a blue-collar person. you can get out on the road and earn a premium.

opportunity exists. .e help them all of that waiting time and lost production through our mobile technology can be solved. you go somewhere and you would and make phone calls to find your next shipment. without technology because we know where you are where you're going and where you will be tomorrow, we can get you another shipment before you even deliver your last shipment. the personal experience goes up, as was the actual utilization and therefore the revenue. historically companies that use trucking services, some of your bad actors would do things like ande truck drivers' time say, if you like it, that's too bad. scorecardare able to large companies in singapore facility takes an average of five hours to load -- large

show aes and we will facility takes an average of five hours to load a driver and your point competitor takes an hour -- years ago if i was on one route i would makes x amount. with your technology, now i would make a much? wages isse in somewhere between 25% and 30%. 64 billion miles driven empty by trucks in the united states. it is a massively wasteful business. to spending -- depending on the geography, we are cutting those places in half, in some as much as 90% in some places southern california. the truck driver can see their take-home pay rise on a week on

week basis. david: what is your penetration now? >> we are in our for the are business. to be blunt, it is send in the ocean. trucking spende is a $200 billion -- $600 billion industry. we will do a couple hundred million, maybe approaching 1% market share on the aggressive side. thefact of the matter is, thing that is not inhibiting us, the opportunity for us as we continue to scale, like any good supply chain, scale helps us eliminate the waste to capacity poor deliveryir and the downstream benefits to our customers who are large retail, large manufacturing, the utilization of those services

benefit from the overall system efficiency we are driving. just got to keep scaling. alex: really interesting. thank you for joining us. transfix.oy from next.n what i am watching you can interact with us on bloomberg tv go. this is bloomberg. ♪

i'm: all right, what watching is deutsche bank. this is a story will be watching the rest of the day. the asset management group is cutting jobs to reduce costs, but i was wondering the why behind it. i'm trying to imagine a business that of the current use tell it? -- are they going to sell it? david: there are all of these stories you do not know if they

are connected or not. do you know if it's related or not? they could be confidential or they are trying to get some capital to put into a deal. alex: and you have allianz and ubs, maybe there could be a tie up? sounds like there's consolidation european market. .ou have ubs, allianz maybe some people will get together. alex: next friday we kick off bank earnings -- david: ah. alex: and we get a really clear read on where the weaker spots are in the u.s. banking industry and overseas. it will be a fun comparison. all right -- david: it is good. alex: it's good if you are on the bed -- fed. david: or you want a job. alex: the jobless rate is

holding steady and labor force participation rate for working age white men -- really it does not move higher like it has the cycles. you can guess what happened in the market. it will be buy equities, do nothing with bonds, do nothing with the dollar. we had a little selling on the back end of the yield earlier in the session. that obviously has reversed. david: does president trump called jay powell and say thank you? the last time he said, you know what -- say, or does larry kudlow you still want a rate cut? the greater the lineup. this is bloomberg. ♪

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jonathan: from new york city, i am jonathan ferro and the countdown to the open starts right now.

relieved, some concern about a week february and the s&p 500 on the longest winning streak of the year, the enthusiasm continuing to build as the chinese president pushes for a rapid conclusion of trade talks. 30 minutes away from the opening bell. good morning. we may have seven days of gains, futures up. the dollar a little softer. 52 on a u.s. 10 2 year. joining us from the labor department is michael mckee. break it down for us. relax, itnvestors can is a bond br