bloomberg's word news. president trump says today's constructiveere and candid. will continue. talks resumed after presidents raised tariffs on $200 billion in goods. aging promised to retaliate. mr. trump said there is no need to rush a deal. sei did states and china try to resolve the trade dispute, philip hammond is weighing in. he was asked if he is of the opinion trade wars are winnable. trade warsthink that

produce a net benefit for anyone. we are all losers in a trade war. we recognize some of the concerns the americans have about some of the trading practices. the right way to deal with them them within the wto. we hope the u.s. and china can resume the talks, which seems to be going quite well. mark: hammond added that if the u.s. china trade dispute does not get resolved, i'm afraid it will contribute further to slower global growth in the future. the chairman of the house judiciary committee says robert mueller will not appear before his panel next week. nadler saysocrat negotiations continue with mueller and the justice department about the testimony and he does expect mueller to testify at some point. determine nadler says the panel will subpoena mueller if necessary. democrats are clashing with justice over access to the full report on the trump russia

investigation. charges will not be filed against the suspects in a suburban denver school shooting until next week to the suspects had been scheduled to appear in court today, but the hearing was delayed. an 18-year-old male student and 16-year-old female are accused of opening fire into classrooms highlands ranch. killing one student and wounding eight others. the district attorney's office is determining whether the younger suspect will be charged as an adult. no motive has been determined. 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 mark crumpton. this is bloomberg. ♪

scarlet: this is bloomberg markets the close. caroline: we are 30 minutes from the end of the trading day. what a week it has been. we are set for the worst five days and the s&p 500 this year. but now the nasdaq could have been an underperformer. apple still off by 1.3%. we've seen the biggest pullback to the tune of three points because it is waiting. technology front and center when it comes to the u.s.-china trade tensions. scarlet: there are certainly in the middle of it. since new and steady move higher in the indexes. we are basically at session highs. the president not so long ago saying china talks are constructive and they will continue even though tariffs in place. bitcoin has been up all along. caroline: it has continued to march upward. a tent straight day of gains. is going.20,000 it

we are still a way off. scarlet: uncoordinated asset clearly. chinese markets closed higher. the euphemism for state fund directed to support chinese equities. we continue to keep an eye on oil services companies. headlines that iran may target u.s. oil production because of threats to close the strata for most hitting that hard. uber down hard. caroline: it is odd you are seeing is not get a lift up by the sudden market push higher. why is that increase selling as market sentiment turns a bit rosy? scarlet: you wonder what a hard job some of the companies are tasked with supporting the share price. continuing our ongoing coverage of uber, weighing in on the timing. >> we are seeing a lot of

pressure in the broader market. important to recognize that while today is the first day for uber as a public company, they are in it for the long haul. we'll see how investor demand sets up for years to come. so curious, how long has your relationship with uber then? what when into winning the ipo in developing the relationship? >> our broader team has had a long-standing relationship going back several years. i personally have gotten more involved with uber over the past year since i stepped into this role. it is a long process. we work together to figure out how can we help them be the most successful public company? emily: what goes into willing the company? company? the >> understanding their goals and

leveraging resources and tools to help them be more successful. that is part of the process and talking to them, understanding what they need and working with them on delivering a date which gives maximum visibility and process. big first aid opening on the nasdaq. down below ipo price and below private valuation. how much of you been watching what happened with lyft to figure out how to run the day? >> every company is unique. each will have their own experience, investor base, and teams appeared i focus on how we can help them come over to my here now. long-term, 10 the years ago no one had heard of them. you have been working with them for 10 years. now it is hard to find a person who does not have the uber up on their phone. revolutionized ability.

we are excited to see what is going to come next and platform gets used. emily: some of the big ones said given the market conditions, how does it affect companies willingness? >> is when fourth quarter volatility picked up a lot, a lot of company started to get ready to become company steered it wanted to be sure when the time was right they would be ready. despite government shutdown, a lot of work went into getting that process ready. we are seeing the companies come to the public market paired some ,ig names come up interest uber and coming next will the the next wave. emily: the direct listing phenomenon, how to set impact you? >> it is interesting. the new york stock exchange is uniquely conditioned to

facilitate that trade. we are saying we will have the opening trade on the exchange the a price discovery process much like we are seeing happen here with uber. so, in conjunction with some of the interest in the market. we will scarlet: see pickups in the first two. that was emily chang. coming up come up, big retail earnings are now upon us. what to watch for next week as clouds darken over this actor.

caroline: let's get a quick check of the business flash headlines. jpmorgan wanted to help a lot the biggest lee terry deal of the year. it embraced a wall street

practice that fell out of flavor. coming up with the money to buy regional sports networks from disney. the price of the deal, $9.6 billion. shares of sam adams beer hit the highest price ever. they announced the acquisition of dog fish brewery. still, slowing down. are surging. low it a gave an outlook that was ahead of forecast. still not one was convinced. investors are overreacting and hello lost nearly half value between june and close of trading. that is your business flash update. almost new the tail end of earnings season. the way you know is most automakers have wrapped up their

results. the bellwether report still lies ahead. the big one that you will pay attention to is walmart. that could tell us the state of the economy and consumer. >> it tells us a lot about the state of economy, consumers and workers as well. are expecting good results from the heart. they are going from strength to strength. one big strength of their sister online grocery service. wonders for them. they announced a new high-tech store in long island where they have 100 cameras in every aisle checking for out of stock items and making sure everything -- even looking for spills. they're trying to match amazon, be a tech company. is way more insulated against impending tariffs because of the preponderance of

food. is that lunch and center? >> they have been front -- they been doing well all week. controller -- consumer electronics. -- not every product comes from china some of the big screen tv's come from mexico. a lot of electronic components are coming from china. shares are hurting. whenever we talk about retail earnings if the weather and how that affected sales. it's tempting to think of it as a copout, but it is more than that. >> they blame the weather, we make some of them but it does matter. wettest was the second february in 125 years. no one will be buying spring close or summer swimsuits if it

is horribly cold and wet. localities been in the works. and then at last year, may and this may has an pretty lame weatherwise. you have to look at that and say, retailers take this into account and blames the weather a lot but it does factor in purity will not be buying seasonal stuff or summer stuff, barbecue at stuff or outdoorsy stuff. it is not the home improvement guides. sometimes the weather can benefit them. record floods in the midwest. that is a tragedy. , that is aprovement tailwind for them. caroline: i want to go back to the china story. we are waiting to see how china response. have a great piece out there showing the impact it could have on future earnings. >> it could wipe out earnings growth this year.

was 10%, we are ok or we could make these adjustments. we're looking at doing this or that are the time is over to look here they need to know what they need to do now. 25% is here. talks are continuing. rings might change of course. but, i have talked to a guy who talks to walmart suppliers. where else do have production? it doesn't matter about barbecue rails or cosmetics, it is across the board here at impacting everything outside of finished apparel. they need to react. caroline: great perspective. thank you. a quick check on the markets. interestingly, as the s&p 500 rallies, uber does not. getting session lows here it we are below the opening price of $42. scarlet: close to the low of the

day which is 41.06. caroline: a story of dollar weakness today. and the turkish lira getting a bit of a reprieve.

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thousands of mattresses to those in need. live healthier. live happier by resting deeper. go to leesahybrid.com. caroline: this is countdown to the close. scarlet: joining us is joe weisenthal. how the broader markets have mounted a comeback. watching the uber ipo today was fun and riveting. different headlines coming out about pricing. though, that at no point did the general iteback in the market and

didn't help at all which is close to lows of the day. say close to the lows appeared point 3:00, there was a where they just went in opposite directions. all these ipos are idiosyncratic. but, it is surprising a little bit and it does speak to -- there is a lot of skepticism about the business model and profitability. you can just see it in the lack of enthusiasm at this price. has fared pretty poorly. i forgot that they rallied initially. that feels like a long time ago. scarlet: it is ancient history now. uber right now thinking a bit lower at 41.53. if you look at sector performance come it has changed.

early in the morning it was very much negative. right now there is a split. more defensive sectors. a buy better than 1%. treasuries have turned around. we are seeing selling in treasuries and yields are higher. interesting defenses stay on top. caroline: interesting headline. inb, the scandal ridden era asia, joe has been indicted for nimby -- four a donation to the obama campaign. and conspiracy to defraud the united states could put a story. celebrities and random people have been sucked up in this scandal is pretty remarkable. might be easier to find one thing the other. he is unlikely to come out of hiding. if you look at the markets, we are seeing gains in the s&p and dow.

the nasdaq still declining. underperformer of the day. even as we have seen a steady recovery since noon. caroline: tech has been front and center when it comes to u.s.-china trade tensions. the mentum -- momentum up. scarlet: moments away from the close. seven minister to. what reporters happened monitoring as we head toward the close. >> this week i have been monitoring volatility. i will try to take a stab at explaining why it has had the weird ebbs and flows. if you look at earlier in the week, essentially we were only 2% off all-time highs. in q4, we were 5% off the highs. correlations spiked in a way we did not see until december. how can we explain that kind of hyperactivity in the vix? is this isplanation an earning report for the s&p

500 the traders had a number of days to price in. if you look at the implied volatility of a certain stock, of course it goes up like tracy. abigail, imagine if you had one week notice from apple that it was going to report earnings and the results are probably going to be a bit at. the deflation the day in the vix is traders saying they got this event has passed. abigail: i'm thinking about apple in one week that i'm thinking about the worst week an s&p 500 of the year. take a look at the two biggest laggards. the ceo resigned and outlook was bad. week., on paper worst , apple andrrisome amazon both on pace for worst week of the year. nothing changing for high-quality big tech names. that tells you some investors

may be throwing the baby out with the bathwater and it could suggest we really are in a fearsome environment where investors are selling high-quality stocks. interesting to see what next week brings. stock people are buying his adrs. the second largest he retailer. coming in much stronger than expected. a realpany forecasting acceleration and revenue growth. this was a hot stock for a while. early 20.in the earnings report out. hit seems to give credence to the idea that revenue growth is improving, margin is improving, and people are piling act into the stock a bit. the second straight date this is up. dayseport comes a few before we get alibaba next wednesday. scarlet: a great spin ahead.

let's bring in sarah ponczek. when he to start with the turnaround in equities. it looks like we will continue to see the selloff a six straight day of declines. sarah: it is pretty amazing when you look at the strength and breadth of the turnaround. just about the time of the bottom, just about the time we heard the comments coming out saying talks had con constructively. looking at the s&p 500, only 10 stocks, less than 10 stocks are in the red eared this is a really they get. a huge amount of participation from the index on the sector level. industrial tech, still the worse. same thing. looking since noon those are clearly the areas. joe: in the grand scheme of things come as a comeback is pretty mild versus what we had seen this week. selling exhaustion, so to speak?

sara: it absolutely could be. heading into the weekend usually investors might want to do risk. we hope higher tariffs in place. yes we have heard from both sides that the talks were constructive, but we heard china has vowed to retaliate. have also been talks of putting tariffs on the extra $325 billion worth of goods. you would imagine investors might want to take less risk into the weekend, not putting more on. especially in trade sensitive areas. in the grand scheme coming look at the weekend it is obviously the worst week of the year. caroline: as we head into the close, we are joined by scott rang seen a -- scott ran sine. >> really, we have had such a small pullback from the record high. you could easily -- after this huge run since the panic is

receive a low, the s&p could easily have coughed up 5% to 7% on no news we clearly have news this week. a lot of volatility. -- it looking for wouldn't surprise at all if we traded close to that level. it's a bit early to step in today and a lot of this week was squaring up coming into this week you didn't know what was going to happen. i seriously doubt there were a lot of take that's people made people made her do could get no news, positive news, or negative news. right now you want to be patient. not much of a pullback from the highs. i will be a good chance we will see some slightly lower levels that will give people an opportunity. scarlet: we might be looking at today as a pause in the spelling

-- and the selling. give us your read on uber. a broaderh we see market off the lows, they continue to falter. what is going on? >> i am no expert on uber whatsoever them at all. that stock was very volatile. it disappointed a lot of people today. it really did not track as you had mentioned. we did not track with the market holding longer it it just did its own thing. i don't cover that stock and i probably would be the wrong person to give you an educated opinion on that it i will say i watched it most of the day and found it really interesting. one of the biggest anticipated and -- didong time it ever traded 45? i don't think it did. very interesting trading there today. scarlet: a brief trade scarlet: i think a brief trade i-45 revisiting the session lows.

sarah: people are closely focused on uber. it was so much hype surrounding this. over the past year there have been 60 stocks that close below the initial public offering. since, 2/3 are still below that level. it is not bode well. well.ne: it doesn't bode it didn't bode well at the opening of trade today, but we have risen higher. s&p 500 up .4%. clearly some buying opportunities their bank. scarlet: pick up in volume as well. compared to the 30-day average, gains of 13% for the nasdaq, the underperformer. caroline: let's dive deeper into the action at the close. abigail, what are you watching? have you: this --

abigail: thinking about the weekly close. not just the s&p 500, look at the nasdaq, russell 2000. all of these different areas getting hit on the trade tensions. as our guest was just talking about, the s&p 500 last week was up 18% so it makes sense that some chips would be taken off the table. the volatility did not necessarily start in the u.s. in yellow, the nasdaq. the shanghai composite, that rough week in december. we are looking at the worst week since then. the shanghai composite in the middle of april, had its worst week. inn nearly 6% pregnant week december. keep an eye on what could be next for u.s. stocks it is a global relay race between the equity indexes. >> thanks, abigail.

what i am looking at the close of trading was a theme of this week was asleep with one eye open. we were worried about domain on treasuries and what that might mean for price when the stories that the pajama traders and people overseas have been waiting on the s&p 500. if you look at the reasons we pointsn this week, 90 worth of outcomes in the overnight rate from open to close, all of those big caps. when we talk about how it was an earnings report, gap flow on monday was the biggest since amazon lived on earnings. during the trading day, romaine, 20, 25, 30 point on the week depending on where we close. you could read it a number of ways. one is a testament to futures from not very good. on the other hand, we have heard a lot that there was so much money on the sidelines in the u.s. ready to buy a dip, and the price action intraday suggests

that might be the case. romaine: thanks, luke. i'm looking at gopro because it had a pretty wild day today. earnings came in above forecast. forecast came in above estimates. stock was up as much as 7% but then it plunged 4% into the close and still had a pretty good week. pretty big run-up in the stock, would for a name like gopro was significant. there were a lot of analyst updates and price target moving higher, saying there is a growth story here and there are new products in the pipeline. as you can see -- you can't see, but the price action for today seems to suggest that some investors are not completely sold. caroline: good way to finish, romaine and the markets team. what investors are also not sold on today is uber and its listing. closing down about $41.57. day to not a very easy

come into the market. even as the market rallies, that wasn't good enough. joe: pretty surprising how divorced it was from the markets. still with us, scott ran from wells fargo and bloomberg's sarah ponczek. i want to go back to you. next week are we going to be talking about trade, and will the market be dominated by trade, or will we get a few more weeks until the next deadline and will not allow us to focus on something else? scott: i don't think we get much of a reprieve. everyone will be watching over the weekend for any headlines that come out. as much as i would love to think that there is a chance we get a solid deal over the course of the weekend, i think the probabilities are against that i think that the markets -- certainly the market is still present in some positives in terms of these trade negotiations over some type of timeframe. whether that is two weeks, two months, something like that,

hard to tell. we think we will see positives out of these trade negotiations will stop we think it will take a little bit of time. i would love to be surprised and have something solid on the books signed within the next couple of weeks. i'm not sure that is going to happen, but it will be the that will the tweets, control the day-to-day action. scarlet: we still see what we can is ahead. i want to get your take on this report we got this morning which showed weaker than expected consumer price increases. we have seen how that is increased the odds of a rate cut. fold that into how you see achieving the markets going forward. thet: right now i think federal reserve gave a sense that they were going to cut rates when really in our opinion the economy is moving ahead at least at a modest pace, i think the market might take that negatively. we do not think that the fed is going to do anything with rates,

certainly over the balance of this year or next year. for us, and i know that the fed funds futures are pricing in a rate cut, or a good probability of a rate cut. we don't think that is the case, and for us, we think -- as much as i hesitate to say this in the 35-plus years i've been doing this, the fed has never engineered a soft landing and i'm never one to say that this time it's different, but i think possibly the federal reserve may have actually engineered what could be a pretty soft landing here and i think they are in a good spot where we could have some modest growth with modest inflation looking forward. the fed has tried to get inflation of for 10 years. it hasn't worked. than wheres lower they wanted but i don't think that is going to cause them to be part of a rate cut. caroline: interesting, julie

emmanuel was telling us that there are not one but two rate cuts this year from which is phenomenal. in terms of what affects rates within the bond market, we are difficult week for u.s. treasuries in terms of buying from the options. they are buying at this level? sarah: we still have seen flows out of equities and bonds funds. but something else that is worthy to ponder after this week, especially as it relates to trade, i got enough woman economist this morning and the subject line read "no inflation yet but there will be tomorrow." we have to remember that the last time around, over the past year, we are not seeing inflation -- if anything it has come down. the fact of the matter is that the next tranche of $325 billion worth of goods from that is when you start getting into the real consumer goods. some are actually thinking about

inflation rising, and the fed potentially having kick back into gear. scarlet: sarah ponczek, thank you so much. scott wren joining us from st. louis, we thank you as well. that does it for the closing bell and for me. romaine bostick is stepping in for "what'd you miss." this is bloomberg. ♪

♪ caroline: live from bloomberg world headquarters in new york, i am caroline hyde. romaine: i'm romaine bostick. joe: i'm joe weisenthal.

caroline: the markets staged a late day come back. is, what yoution miss? caroline: whipsawed markets, president trump say they will continue. uber'seas the ipo's, long and winding road to going public comes with a rocky debut. the race to 2020 heats up. we take stock of presidential contenders. romaine: uber finally made its trading debut on a day when the rest of the market was seeing a selloff. the ceos but the bloomberg about going public today. control when you go public but you control how you execute as a company that are you bringing in happy consumers all over the world.

we are going to focus on what we can control. we raised a lot of capital to invest and grow for many, many years. that is what we are focused on. romaine: joining us is the founder and managing partner a t structure capital and he was also one of the early investors in uber. we had a little clip of the interview there with dara and he talked in the interview quite extensively about the idea that uber was going to be profitable some day come that this was a big mission of his. i guess the question is when you consider the trajectory of the company so far from houston can they achieve profitability? >> thanks for having me. i appreciate it. i don't really have an answer to that. my hope is that they put the money to work and potentially increase pricing and profitability, and i think that the consumer market can sustain that because there is still such a big gap between the cost of a and ubernd an uber,

provides in most cases a better experience. i'm hoping they can use some of that to increase pay for the drivers, because the drivers are such a critical part of the equation. joe: let's get into the question. obviously, there is a lot of people who like taking ubers and it is a compelling experience for the user, that we know drivers -- a lot of drivers come anyway, are unhappy the rate they get. we know that uber would like to take more money itself and get their profitability. do you think there is a sweet spot where all of the parties can be satisfied and it is a compelling product for the rider while the drivers in the company get the cuts they need? mike: i don't know the internals of the business at all, but it seems like a simple equation. you test a couple different price points and see what works to satisfy both of those things

and still maintain the drivership or consumer ridership you need. caroline: you are in the seat around for uber so i'm sure the company has got to a $60 billion valuation-plus has more than exceeded the expectation of what this company is going to become. but the picture now assisting the sort of valuation and grow is that it will become an amazon-like platform, it will grow into alternative elements of transportation and into food and none of us will need motor transport. your perspective on how autonomous fits into that and how realistic it is. -- yeah,er chris thanks for having me again, caroline. i was an early investor in salesforce.com. like the exchange from salesforce, the platform components and multiple businesses of uber provide a

huge differentiation. they have an incredible platform to build on. one example that i learned last week in talking with dara is .5t the average rider does ride -- 4.5 rides for months. it shows some combination of loyalty and network effect, which i think is impressive. cars, is driverless think that is very far away, but i don't work in the lab, so maybe it is sooner than later. romaine: give us a little bit of your knowledge. i just evil mobilities -- i guess the whole mobility space and how we get around is changing in one way or another, whether uber is the one leading this or not. where do you see all of this going? are we all going to be sharing cars and no one will own anything anymore? mike: i don't drive my car very

often unless i'm bringing my kids to school. my favorite mode of transportation in san francisco is more enjoyable than sitting in the back of a car. i will take uber if i need to respond to him else and stuff like that. we are investing in something called wheels, a rapidly growing -- it is like something between an electric bike and a scooter. it is smaller electric bike with an exchangeable battery so it is easy to service, feels safer than writing a scooter. it has larger wheels. i think that has real potential in the future. we are investing in something that is like uber for kids. we rely on that to get our younger get back and forth to school. -- our younger kid back and forth to school. there is a huge upside for these platforms. joe: i'm disappointed we don't have the scooters in nyc, and i like coming out to san francisco

and getting to ride them. i know these are part of the comeaps of these companies other forms of mobility. but it doesn't select any of them are profitable, either. thesegreat that there all of these opportunities for the companies and they have their scooter lines, but are the unit economics any better for them, or is it just new avenues for them to make losses? : i don't know anything about the others, frankly, but wheels is on the right path to profitability. it is reported today that the three quarters favorite mode of transportation for the scooter company. keep an eye on that one. caroline: i'm interested in the respect that you were a seed investor and put money into travis, a notable absence standing up there at the top of the nyse ringing the bell, for obvious reasons. many have said that lyft has

more power to drive through a lack of profitability for longer because of the overall power of the founders have. this now public uber does not have the founder as a leader, does not have him with voting ofhts, and more to the will an investor base that wants profit. does that worry you? how do you think about the treatment of cap's -- travis today? mike: i am a huge fan of travis. i saw him on the floor and i got stories in advance of the rigging of the bill. i was pleased to see austin up there ringing the bell. givingd a great job recognition to garrett and travis and brian. i do not -- i did not meet travis before i invested. i made them after i invested. i met ryan in january 2010 and i

invested in ryan -- i had met gary previously but did not know he was involved in the company. i took the that on the opportunity and are ryan and was used to know -- please do know that death pleased to know that travis and garrett were involved. i wish you were up on the podium, but i don't know all the politics. -- i wish you were up on the podium, but i don't know all the politics. i've been busy running companies. romaine: appreciate your perspective. mike wallace of structure capital. president trump calling the latest trade talks between the u.s. and china constructive, without a deal. we are talking trade and tariffs next. this is bloomberg. ♪

joe: no deal, yet. talks between the u.s. and china without an apparent deal, but president trump struck a more positive tone, describing the talks as constructive and leaving the door open for further negotiations. let's welcome a council on foreign relations senior fellow. great to have you back. what is your read on what happened in the last week? >> i think we don't yet know precisely how far china tried to walk back previous concessions. we don't know what was on the table of the negotiation. certainlyll accounts, lighthizer was disappointed when china appeared to be pulling back on something he thought he had locked down. the president reacted more strongly than i think anyone expected more strongly than i expected.

we ended the week with tariffs that went from 10 to 25% when no one was expecting that. as you just noted, talks continue, hope is kept alive, unclear what happens next. romaine: is there some sort of sense that the chinese underestimated, or maybe overestimated how much or how quickly the u.s. wanted to make a deal? brad: that certainly is possible. it is possible that the u.s. overestimated how much scope china's negotiator had to really move. it is difficult to know precisely who miscalculated, but it does seem that the chinese took a gamble. romaine: why are we seeing more communication between xi jinping and trump when it is clear that on the chinese side xi is the one calling the shots, and in the u.s. -- brad: china's top leaders don't

personally negotiate the details of the trade agreements. typically the u.s. president doesn't personally negotiate the details of the trade agreement for the president xi is not going to negotiate line by line, law by law, detail concessions. he may make a few last-minute concessions, but china works through process. it isn't just xi jinping. there needs to be a consensus that xi can help generate behind any major concessions. caroline: you are not only a senior fellow at the council on foreign relations but a former treasury official. if you were there now, what we do say they should brace themselves for coming from china next? brad: the talks are ongoing, i don't think china rules out the heavy artillery, so to speak. caroline: that being? brad: letting the yuan to appreciate. -- depreciate.

i am anticipating that the china -- that china workers the modest concessions -- china will reverse the modest concessions it provided. soybean purchases, those are going to stop. on a modest level, china resumes oil purchases. those will stop. mercedes, suv production have not fallen that much. they were down more last fall. i would not be surprised if those go close to zero. china will respond to the increase in tariffs in some white, but as long as igotiations are ongoing, didn't expect the talks would break down this week -- my gut says that china will hold off. joe: there is always a question of who has the leverage at any given time, and if it is true that china walked back on some indications that it made agreements and they are not in

that much of a rush. people talk about it is china desperate for any minute deal. is it -- could it just be that overall people left overestimated the position of strength the u.s. is coming from? brad: i don't know that the u.s. is in a substantially better positioned than it was before. i think what people may have overestimated how president trump makes his own personal calculation about the cost and benefits of the deal. but cost of tariff escalation from points of -- from trump's point of view is the risk of a stock market selloff and a slower economy. joe: let's say the tariffs go in and they don't talk for a long time and it becomes the status quo. how big? brad: going from 10 to 25 on 200 billion, 15 basis points off u.s. gdp. the bigger impact would be if trump goes forward with attention to 25% on the remaining trade.

between that -- if that happens i would be looking for a drag of half a point. caroline: from your perspective, is no deal better than a bad deal? brad: yes. caroline: because you need to see full, proper, fully fledged deal coming with china? brad: i think if you are going to put the world economy through this kind of uncertainty, you probably should walk out with something significant. i personally put more emphasis on the really difficult things. the modest improvements in ip protection are already on the table. we're debating to make them law through regulation. they are hard but viable, difficult issues, those around china's industrial emissions and aircraft and semiconductors and the like. caroline: great to get your expertise. council on foreign relations senior fellow brad setser. coming up, we are talking south

africa. this is bloomberg. ♪

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>> i mark crumpton with bloomberg's first word news. president trump says today's trade talks between the u.s. and china were constructive and candid and they will continue. talks resumed after the president raised tariffs on 200 billion in chinese goods and beijing promised to retaliate. in luxembourg, where he met with officials to sign a memorandum of space copper -- cooperation, autos shared by with china for the u.s. trade deficit. >> about half of our trade deficit comes from a single product, automotive.

the other half of our trade deficit comes from the geographic area called china. our tradeo reduce deficit, one of the big objectives in this administration, we need to deal with china as an entity, then we need to deal with automotive as a product line. mark: secretary ross gave trump a report on the auto situation a few months ago. ross said he expected the president to make a decision on the contents of the report by the 18th of may. is pentagon says it reallocating $1.5 billion to pay for construction of 80 miles of wall at the u.s.-mexico border. the money is being drawn from savings in numerous defense programs, including one that supports the afghan army and other security forces. in march, the pentagon fromferred $1 billion

personnel budget accounts to support wall construction. global health officials are warning that attacks on health crews on congo don't stop, it could get much worse there. escalated,s crippling efforts to vaccinate those at risk, treat those who are sick, and bury the dead. more than 1000 people have died in this most recent outbreak. global news 24 hours a day on air and on @tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. >> the votes are being tallied in south africa. know if the current president will remain in office. he has reversed the steady decline in support for his party. the african national congress is nelson mandela's party. for more, let's welcome stephen friedman. he is a research professor and

faculty of humanities for the politics department at the university of johannesburg. he joins us by phone. looking at the root election results, -- at the election results, how much does this seem as -- support for the president and the anc? >> it's important for the political section of the anc. it has become more about the sectional battles than it has been between the anc and the opposition. if you look at the opposition battled, the anc has it's in each region. it has been about the battle between the president's section and the one that supports former president jacob zuma.

his election is for people who are dependent on the market economy, and are therefore concerned about the market economy. supporters are more concerned about using the state to distribute. from a market perspective, is far moresection involved in the market and supported by people in the market. the issue is with sections of the anc, versus the anc itself. it is not concerned about the investment in environments.

joe: we have seen the brand strengthen in recent days. what are the big challenges for this new government? we understand that ramaphosa's weighing -- wing represents a more market friendly faction. what to do further? the rand has been stable, but not a star performer. the first one is to deal with the corruption issue. they misuse of public forces. it has began to put in a program to deal with that. he gave the national prosecutor the prosecuting authority to go after people. that will continue. is structurale

reform. the economy needs structural reform. many people are excluded from its benefits. as you all know, it's not an economy that has been well taken care of. to implement that is another matter. the end view is that the only way you can do this is starting a negotiation product -- process. whether he has the stomach for that or the support of the party we will see. caroline: from your perspective, at what point will we see some significant opposition being

belts to the anc? is it not even necessary if there is discord within the anc itself? steven: our politics are not where they need to be. election, where there have been lots of problems, the government and agency are on the cusp of 50-50. cusp ofre on the 50-50. years ago where the anc would get 60% of the vote in some provinces. anothery don't have credible government. in other words, another opposition party with enough credibility to face the anc. don't see that happening in

the next two years. caroline: thank you. news on the house committee issuing a subpoena to mnuchin for trump taxes. we know that the chairman of the house and we's -- house and ways and means committee has been subpoena knowing -- subpoenaing people. for the the candidates 2020 election may be focused on policy, of what is inside their personal portfolios? we will discuss who stands out, next. this is bloomberg. ♪

joe: the federal reserve message that muted inflation will last,

was true. consumer prices rose less than expected. to .1%. rose jpmorgan wanted to help pull off one of the biggest media deals ar the year, so embraced practice that fell out of favor after the financial crisis. they wanted to take a $1 billion equity stake using its own money. it wanted to buy regional sports networks from disney. occidental has a few corporate jets it would like to sell you. the winner for the battle of anadarko wants to cost cut. for planes would be on the hit list. become arate jet has symbol of excess. for others, it might be interesting to find what occidental is selling to who, next. many 2020 democratic presidential candidates filed

financial disclosures, offering a rare look at actual individual folios. eric balchunas of bloomberg intelligence joins us to break it down. buye my best, whether they stocks, mutual funds, etf's, reveals something about their interworking's -- inter--- innerworkings. let's talk. that's over, he invests old-school. >> i don't know what is going on. when you look at betop his filings were interesting,. we are always looking at slows and top-down. he had a lot of active funds. he might have bought them in a 401(k). there are so many different ways they can be used. i don't want to make judgments. he had an average fee of 92 basis points even using the institutional class. a lot of that is why some of

these underperform. the bigger takeaway is that this is why you are seeing a transfer of money from high cost active to low-cost passive. beto's is surprising, because the younger you go, the more likely you are to have passive low-cost. he might've gotten this rate as he got out of school. i'm around his age and that is how i invested in the late 90's. romaine: the foot side is you have jay inslee from washington, a slightly older generation. he is slightly opposite. eric: his portfolio looks like a millennial. it is mostly all etf's. he is really into commodities. gld.s he also has the microcap etf. he is a bunch of microcap's. a wide variety of etf's. we only look at the funds.

if summary had a money market investment in cash or stocks, we ignored it. bernie sanders and elizabeth warren, on the left-leaning side of the pack. they are like all of the cool young kids. they have gone big in terms of low-cost etf's. eric: elizabeth warren in particular. it would be odd if they were into all these high cost actives. if they were trying to reign in wall street, why would they give them a ton of money? , especiallyrren because she has so much money, scored the best. 28 basis points for all of her funds. know if it is her or her advisor, but her for polio is lean and mean. joe: the most interesting one is eric swalwell, who is no one's heard of. i don't know a single thing about him. he has an interesting mix. he has one very -- very boring

fund and one extremely risky fund. what does he have? eric: he has to funds he reported. one is the vanguard value fund. can't get more vanilla than that. the other is the proshares trust altra vix short-term futures. i like this guy. td ameritrade reports the way millennials invest. they do something like this. they do a boring vanguard, then they will go crazy with gambling, triple leverage oil -- leveraged oil. if that is your only investment, that is probably not good. 99.9% since down inception. romaine: what about trumps fund? all office rates -- reits? wemp had a lot of -- eric: did look at trump's.

you could probably replicate half of his holding with as the wind -- spy. clinton did that. pretty much her whole thing is in the vanguard 500. my theory is buffett told her to do it. buffett has advised reach out to buy the vanguard 500, don't touch it. joe: this is the best way to analyze. everything else is involuntary. caroline: we have to do more of this when it comes to political decisions. make sure to catch etf iq wednesday at 1:00 p.m. now time for the look at the stories treading. we're talking about russell clark. during each of the last three years, more hedge funds have closed then open. yet he remains convinced a crashes near. if he is wrong, this could be my farewell interview, he said.

congress created a task force to address the industries harassment problem. more than a third of flight attendants say they have experienced sexual harassment with one in five suffering physical assault. tictoc on twitter is reporting that the nba is making a big move to get into rambling. it must require a commercial deal. the nba believes it should be compensated at many believe these -- the move is a step too far. you can find all the stories on the terminal. romaine: if you're an art lover, this is the best time of year. some of these, christie's and philips, all the big auction houses, gearing up for their annual new york spring sale. koons, allzanne, of them expect it to earn $10 million each.

we spoke with ceo ted smith. >> $1.3 billion, that is how much hundreds of works have been expected to sell when they go under the hammer at some of these, christie's and phillips -- some of these -- sotheby's, christie's and phillips. year'seby's, this blockbuster is a monet. it's an amazing piece. it was painted in 1891. there are only 25 in the world. for that event sold in this century. this should do externally well. >> when you say extremely well, >> in excessfigure of 55 million. >> my view is 55 million is great value. >> who is a likely buyer?

>> it is likely to go to from an american or the eastern rent. i wouldn't rollup europe or the middle east. y's has gone further to attract buyers and sellers. a 55 millionpleted dollars renovation of their public gallery, increasing the space by 20,000 square feet and domestically -- drastically altering how work is displayed. >> if the art is lit well and the narrative, around it is told well. the narrative can be things such as what is depicted. it can be the collector, the collection that the piece is in, then the story will be communicated better and people will pay more for the arts. sellers haveyears, turned to guarantees or minimum prices when auctioning their art. , suggestingare down renewed confidence in the health of the art market. is why leading indicator

-- wine. doing veryes are well. we look for art and jewelry to do well. wine has done fantastically well. >> how far--? >> we are focused on the season. we are optimistic about the year. .> high hopes for high numbers sotheby's ceo. coming up, a new formula for formula one. how billionaire john malone wants to supercharge the competition. this is bloomberg. ♪

joe: the same teams win formula one races every weekend. that predictability has become a headache for john malone.

malone wants to supercharge the competition. the wealthiest and most powerful teams don't like the idea. here to discuss more is jim ellis. it's a great piece. one islike formula always trying to inject more excitement, but at the end of the day, it is always mercedes, ferrari, red bull. jim: that's one of the problems. for a sports team, you would like there to be some variants. -- variance. the unpredictability is gone. the last nine years, the championship is only got to two teams. the last five years, it is only gone to mercedes. viewers,a lot of younger people, from wanted to get into the sport. joe: what structurally is the cause of this predict ability and how could a check -- pretty debility, and how could it be changed -- predictability, and

how could it be changed? jim: they found the more money you spend on a car and a team, the more likely you are to win. john malone wants to put a cap on teams. that way, the best driver will win the race. a lot of people have been family on -- a lot of people do not want that change to go in, because they like winning. romaine: when i was a kid, it was all about the drivers. now, when you talk about people don't -- why did you watch -- you're talking about engineers and computers, and i guess there is some appeal to that, but you want the drivers to be front and center. why not just reduce the amount of technology or engineering that can go into the cars? jim: it might solve some of it. the issue is more complicated. league, regular sports so much of the business is built

around those car brands. the revenue splitting is done in a strange way for them. they have longevity payments, so , like ferrari, who is bent in 4001 since 1950, they get $100 million a year in longevity bonuses. a lot of the economics in this business is different than a typical sports league in america. malone has to change that, but in a way that doesn't scare away the biggest brands, who don't want to change. they are the ones who continue to get the best benefit out of it. what is your theory? he cane one thing that make his strongest argument on is that tv revenue, which everybody wants-- joe: and it's fallen -- caroline: it has fallen a lot? it has fallen by over 40% in the last five years.

so they have switched over to pay-tv, and that is about everything they need. they just need more teams. lots of teams have gone bankrupt over the last few decades because they cannot win. therefore, sponsorships go away. cant of companies say, you throw $100 million into maintaining a team, why should i do that if i have no chance of winning? yes to figure out a way to do that and keep a track owners happy, who don't share the tv revenue. they are saying, what are we supposed to do? we are selling tickets for $500 right now. it's a sport for a different class of people. it's not a joke sixpack group. caroline: you're not there with a beer. champagne and things. hear more from the magazines and editors of bloomberg businessweek right here. president and the fed vice chair are speaking at an event

on monday. joe: i will be watching economic data. numbers for q1 gdp in the euro area comes out on monday. romaine: u.s. retail sales come out on wednesday. bloomberg technology is next in the u.s.. joe: have a great evening. this is bloomberg. ♪

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